Thank you, operator. Hello, everyone, and thank you for joining Vipshop's First Quarter 2026 Earnings Conference Call.

With us today are Eric Shen, our Co-Founder, Chairman and CEO; and Mark Wang, our CFO. Before management begins their prepared remarks, I would like to remind you that the discussion today will contain forward-looking statements made under the safe harbor provisions of the U.S.

Private Securities Litigation Reform Act of 1995. Forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from our current expectations.

Potential risks and uncertainties include, but are not limited to, those outlined in our safe harbor statements in our earnings release and public filings with the Securities and Exchange Commission, which also applies to this call to the extent any forward-looking statements may be made. Please note that certain financial measures used on this call, such as non-GAAP operating income, non-GAAP net income attributable to Vipshop's shareholders, and non-GAAP net income per ADS, are not presented in accordance with U.S.

GAAP. Please refer to our earnings release for details relating to the reconciliations of our non-GAAP measures to GAAP measures.

With that, I would now like to turn the call over to Mr. Eric Shen.

Good morning and good evening, everyone. Welcome, and thank you for joining our First Quarter 2026 Earnings Conference Call.

Our first-quarter performance reflected a significant calendar-driven shift caused by the later Chinese New Year. This led to a successful holiday surge in active that effectively pulled forward demand, resulting in a softer March.

What is important to highlight is the sustained health of our customer base. Our holiday results was outstanding, driven by customer who actively sought out our seasonal collection and value promotions.

This strength of that demand, especially in apparel, confirms that we remain a top priority for their spending and gives us real confidence in their long-term resilience. Our customer metrics this quarters further prove that resilience.

Total active customers showed a positive momentum, lead by our SVIP members, who grew by 9% year-over-year. They are paid members accounting for 50% 55% of our online spending.

We remain focus on the quality of our growth. As we move further into the year, we are making steadily progress in how we optimize merchandising portfolio, engaged with customers, and integrate AI to reshape our off-price retail model.

Since realigning our team last year, we are seeing the benefits of the faster, more fluid approach to merchandising. By staying focused on customer relevance and deepening categories expertise, we've been able to move from market insight to product on shelf more quickly, ensure our deep-discount brand inventory hits when demand peaks.

We are also driven better cross-category engagement, as we curate our selection around the broader needs of our customer and developed more effective analytics and marketing tools for brand partners. We are helping shoppers easily discover products across apparel, child care, and home category.

Following our last update, we have transitioned our Made for VIP line into the new phase of growth by raising the bar for quality, style, and value. At the same time, we are tightened our planning with brand partners' seasonal calendars to stay in sync with real-time fashion trends.

This approach ensure our line-up is always curated and on-trend. Looking ahead, we will continue to involve the exclusive offering into the primary driver of customer mindshare and brand loyalty.

Building on our optimistic buying strategy, we were successfully speed up our buying cycle. Over the past few months, our teams have locked in a high value of exclusive, low-priced inventory that is now flow through the platform.

This has enhanced the treasure hunt experience for our customer. We are seeing strong daily habits from our high-value shoppers, who return more frequency to discover our latest arrivals.

This differentiate merchandising approach directly feeds in the strength of our SVIP program. By offering exclusive access to private sales and unique inventory, we are driving both member acquisitions and loyalty.

A great example is our recent event with a global athletic brands, where curated selection deliver a surge in new SVIP sign-ups, particular among young male shoppers, and sales volume many time above the baseline. In line with the push of high-value engagement, we have shift towards a more target acquisitions model, using refined algorithms that identify members with the highest long-term value.

By replacing generic benefits with a tiered service system, we are directly rewarding higher spending with exclusive product access, deeper discounts, one-stop customer support, and value-added benefits. This will further optimize conversions and individual spend.

This integrate efforts ensure the SVIP program remains our primary engines for sustainable revenues and earnings growth. As the pace of the change in retail accelerate, we were excited to embrace the broad opportunities AI offers.

Our initial journey focused on putting the customer first, enhancing experiences through virtual try-ons, smarter search and recommendations, and automate customer support. We are also leveraged AIGC to reach potential customer more effectively with automate contents.

Having proven this use case, we are now shifting our focus towards scaling that capabilities for greater operational impact. For example, we are using generative AI to scale personalized marketing.

By combine our operational expertise with real-time customer feedback, our AI marketing agent effectively generate tailored creative across video, photo, and text forms. This has already driven a clear lift in our customer acquisition efficiency.

Beyond the marketings, AI is increasingly empowering our brand partners with advanced business analyst, deeper customer cohort insights, and optimized merchandising strategy. By anchoring our strategy in the off-price model and leveraging best-in-class technology, we are identified more effective ways to serve our customer, from dynamic merchandising to the smart supply chain.

This allow us to continue earnings customer loyalty through every interaction. We remain committed to investing in our people and our platform.

We are confident that by continuously optimized our operational strategies, we will driven steadily profitable growth for the long term. At this point, let me hand over the call to our CFO, Mark Wang, to go over our financial results.

Thanks, Eric, and hello, everyone. Our latest results landed within our guided range, reflecting a dynamic quarter that was heavily influenced by late Chinese New Year.

The holiday period triggered a concentrated surge in demand for winter and early spring apparel categories, where our merchandise strengths resonate well with a broader base of consumers. By successfully capturing this peak season opportunities, we proved that the effectiveness of our coordinate efforts across merchandising, customer engagement, and operations.

This operation synergy directly fed into our bottom line. Margins remained healthy and stable, underpinned by highly favorable category mix and our continued operational discipline.

As Eric outlined, we maintained focus strategic investments in our key growth drivers: expanding differentiated merchandise offerings, deepening SVIPs engagement, and scaling AI integration across our operations. At the same time, we continued to manage our broader resource pool with strict prudence, dynamically shifting spend to our most productive activities.

This balanced approach ensure we sustain solid baseline profitability by prioritizing high-quality, profitable revenue today. Simultaneously, it allows us to systematically strengthening our foundations for the long term, even as we navigate an uncertain macroeconomic backdrop.

Turning to shareholder returns, we remain firmly on track to deliver on our 2026 commitment of returning no less than 75% of full-year 2025 non-GAAP net income to shareholders. In April, we completed our annual dividend, distributing approximately $300 million US dollar.

For the quarters ahead, we look forward to executing the remaining balance of our shareholder return program. Our free cash flow outlook is robust, and we have the full financial capacity to meet our full-year allocation target.

Now moving to our detailed quarterly financial highlights. Before I get started, I would like to clarify that all financial numbers presented below are in RMB, and all the percentage change are year-over-year changes, unless otherwise noted.

Total net revenues for the first quarter of 2026 increased by 1.2% year-over-year to RMB26.6 billion from RMB26.3 billion in the prior-year period. Gross profit increased by 6.8% year-over-year to RMB6.5 billion from RMB6.1 billion in the prior-year period.

Gross margin increased to 24.4% from 23.2% in the prior-year period. Total operating expenses were RMB4.2 billion, compared with RMB4.0 billion in the prior-year period.

As a percentage of total net revenues, total operating expenses was 15.7%, compared with 15.3% in the prior-year period. Fulfillment expenses were RMB2.0 billion, compared with RMB1.9 billion in the prior-year period.

As a percentage of total net revenues, fulfillment expenses were 7.7%, compared with 7.2% in the prior-year period. Marketing expenses decreased by 1.8% year-over-year to RMB719.3 million from RMB732.1 million in the prior-year period.

As a percentage of total net revenues, marketing expenses decreased to 2.7% from 2.8% in the prior-year period. Technology and content expenses decreased by 0.2% year-over-year to RMB448.2 million from RMB449.1 million in the prior-year period.

As a percentage of total net revenues, technology and content expenses was 1.7%, which stayed flat as compared with that in the prior-year period. General and administrative expenses were RMB950.5 million, compared with RMB950.8 million in the prior-year period.

As a percentage of total net revenues, general and administrative expenses was 3.6%, which stayed flat as compared with that in the prior-year period. Income from operations increased by 9.7% year-over-year to RMB2.5 billion from RMB2.3 billion in the prior-year period.

Operating margin increased to 9.4% from 8.7% in the prior-year period. Non-GAAP income from operations increased by 3.5% year-over-year to RMB2.7 billion from RMB2.6 billion in the prior-year period.

Non-GAAP operating margin increased to 10.2% from 10.0% in the prior-year period. Net income attributable to Vipshop's shareholders increased by 13.6% year-over-year to RMB2.2 billion from RMB1.9 billion in the prior-year period.

Net margin attributable to Vipshop's shareholders increased to 8.3% from 7.4% in the prior-year period. Net income attributable to Vipshop's shareholders per diluted ADS increased to RMB4.48 from RMB3.72 in the prior-year period.

Non-GAAP net income attributable to Vipshop's shareholders was RMB2.31 billion, compared with RMB2.31 billion in the prior-year period. Non-GAAP net margin attributable to Vipshop's shareholders was 8.7%, compared with 8.8% in the prior-year period.

Non-GAAP net income attributable to Vipshop's shareholders per diluted ADS increased to RMB4.68 from RMB4.43 in the prior-year period. As of March 31st, 2026, we had cash and cash equivalents and restricted cash of RMB28.3 billion and short-term investments of RMB2.7 billion.

Looking forward to the second quarter of 2026, we expect our total net revenues to be between RMB24.5 billion and RMB25.8 billion, representing a year-over-year decrease of approximately 5% to 10% to 0%. Please note that this forecast reflects our current and preliminary view of the market and operational conditions, which is subject to change.

With that, I would now like to open the call to Q&A.

晚上好，谢谢管理层接受我的提问。我这边题是，第一个是关于我们现在看到4月份，还有5月份，现在我们看到GMV的趋势可以分享一下吗？因为我们也看到了在物流行业那边，也看到行业的单量就是都在放缓，所以想看一下我们GMV未来一段的趋势。第二的话呢，是关于618的，想问一下我们对今年的618跟去年的话呢，觉得会有什么的不一样？另外的话就是如果是现在看消费情绪的话，我们应该怎么看下半年的一个展望？谢谢。Let me translate into English. Thanks management for taking my question.

My first question is about the monthly GMV trend, given that we have seen some softness in industry parcel volume in the past few weeks or even last month. How is our monthly GMV so far?

My second question is relating to June 18th. How should we think about the events this year versus last year?

On top of that, how is the consumer sentiment these days that we should think about the outlook for the second half? Thank you.

好，我来回答。就是我们其实整个Q1是表现不错的，那么尤其是1、2月份啊。那么中国因为放放假的时候，那个春节是有错位，所以我们一般都把1、2分 1、2月份放在一起看。那么1、2月份其实长得非常好的。那么这里面的其实也有像比如我们去年因为暖冬嘛，导致很多用户其实没买东西，所以放到1、2月份买了。那么1、2月份非常好，但是3月份呢我们看到其实3月份其实有下跌。那么我们觉得我们也问了各个行业，那么其实大家都差不多，3月份觉得特别差。那么另外呢从4月份开始以来，但是我们的Q1还不错，因为1、2月份长得非常好，哪怕3月份跌一点，其实整体的表现还可以。但是4月份呢我们就看到其实4月份的生意也不好，就4月份其实那个跌幅比3月份还大一点，但不是很多吓人的大啊。那么就是说我们觉得整体情况没有我们想象这么好。到5月我们目前为止，我们觉得其实也是负增长，那么但是也不是负得很多，会比4月份好一些。所以说我们这次对Q2我们觉得，那么因为4月、5月已经过了一半了，一半时间了，所以我们觉得其实没有这么乐观，所以说我们觉得我们报guidance还是报一个0到-5啊。那么对未来的618，我们自己觉得总体来讲也不会有太大的很好，也不会有太差，因为反正基本差不多。因为还有个呢因为现在618大家时间比较拖得长，其实从5月份就开始了，所以说我们认为618相对平稳吧，所以说我们对Q2是做了一个保守的预估。那么另外呢就是我们对全年其实呢Q1还可以，Q2跌了一些，那么我们自己想在Q3、Q4争取要把那个要保证相对平稳吧，所以说我们总体对下半年的展望，我们认为希望就是尤其是消费啊，包括对衣服的消费，我们希望大家还是在下半年会有一些好的好的情况吧，所以但是我们对总体的全年的展望我们应认为也相对稳稳稳健吧。

Okay. We actually started the year on a very strong note.

We have seen a holiday search during the January to February period when consumers actually concentrate their buying activities and that impact effectively pulled forward demand. Following the holiday period, we saw a very apparent moderation of sales in March.

As we enter the second quarter, the April data does not turn out very well. It's not improving from March.

Into May to date, still very challenging, but actually we saw a slight pick up in consumer activity. As we have been through half of the quarter, it seems that we have relatively low visibility on consumer sentiment and activity.

How the rest of the quarter will turn out still depends on the month-long industry promotion, which we also don't have a big expectations. We think it's more prudent for us to give a conservative guidance and reset our second quarter expectations.

Turning to our outlook for the full year, we think we still have opportunities in the second half, and we believe as consumer sentiment maybe improving marginally, we should be able to capture opportunities in discretionary spending, especially apparel. We look forward to making the best effort to maintain a steady operational performance for the second half.

For the full year, we continue to believe that we will maintain steady outlook.

Thank you.

感谢管理层接受我的提问哈。我想请教一下关于杉杉奥莱的一些进展。一个呢是想能不能帮我们拆一下这个杉杉一季度的一些表现。然后另外一个的话，我们也是关注到这个唯品会商业REIT也即将发售了，你想了解一下这个REIT在发行批后的话会怎样去影响一下这个报报表端？I will translate by myself. Thanks management for taking my question.

I would like to ask for some updates regarding Shanshan Outlets. First, could you walk us through Shanshan's first-quarter performance?

Second, we've noticed that the Vipshop commercial REIT is about to be launched, and how should we assess its subsequent impact on the financial statements? Thank you.

Thanks for your question. Actually, Shanshan Outlets business is quite strong in the first quarter, and the GMV gross around 30% year-over-year.

Thanks for your question regarding the REITs. I think some of the investors may be aware that Vipshop commercial REIT obtained official approval from the CSRC and the Shanghai Stock Exchange in late April, and completed the pricing process on May 19th.

There are two underlying assets: Shanshan Outlets in Zhengzhou and Harbin. Both are mature outlets operate for around 10 years, and both outlets hold leading position in their regional markets.

Zhengzhou Outlets is the highest grossing outlets in Henan Province, where the Harbin Outlets ranks first in Heilongjiang Province. The commercial REIT issue feature more flexible policy regarding the fund usage and expansion mechanism.

Actually, in addition to this real estate already used as underlying assets for the REITs, we also hold another 18 outlets projects, demonstrating strong potential for future expansion. We will conduct further evaluation based on our strategy and the market conditions.

For the accounting treatment, for this Zhengzhou and Harbin, we subscribed for 49% of the total shares in the commercial REITs. In simple terms, we will lose control and we will deconsolidate the investment from our financials, and recognize the related investment gain accordingly.

More specifically, on GAAP basis, we will book a one-time investment gain of around 5.3 billion RMB in the third in the second quarter, an increase of 1.7 billion income tax expenses. Cash-flow-wise, we will see a significant increase in net cash inflow of RMB1.7 billion in the second quarter.

Thanks.

Hi, 管理层晚上好，谢谢接受我的提问。我有两个问题。第一个问题是，刚刚我们管理层说到那个4月份其实我们看到的是一个负增长，然后5月份到此为止可能也也应该是一个负增长。然后上周的这个社零，看到4月份社零的这个总额在服饰其实是增长3.6%，然后想管理层就是大概说一下这个是不是有大部分的这个销售转到了线下？然后另外就说如果如果不是的话，或者是其他线上的平台是不是从我们这走我们这里抢走了一些市场份额？这个是第一个问题。然后第二个问题其实也是跟第一个问题有关的，就是这个杉杉奥莱，我们刚说到这个quarter是涨了这个30%几嘛，然后管理层是不是看到从消费者的这个行为是比较往线下去购物呢？还是说是因为杉杉提供了一些那个品类，或者是一些商品在我们唯品会线上是没有的，所以就导致了更多的消费者转移到去线下去购物？我自已翻译一下。So

thanks management for taking my questions. I wanted to follow up.

I think management earlier mentioned that since like you guys saw April is a negative growth for your platform, and then maybe May that's also so far month-to-date is also seems to be negative. Then I think last week we have the you know China retail sales data is the total apparel sales is actually grew 3.6% in April.

Just wanted to see where is the disconnect? Is it a lot of these spending being shifting to offline?

Or is it there are some of the you know the the market share you know our market shares are losing to other online platform? Then related to that is also on the Shanshan Outlet.

Also, I think management mentioned the platform grew like 30+%. Also wanted to know if this because of the consumer behavior that you observe started to shift more to the offline shopping, or is it because Shanshan actually have certain merchandise that VIP Online doesn't have?

Thank you.

那个我来回答一下。就是我们也看到就统计局的数字是3.6%，那么社零，那么服饰类啊，那么我们看到去年全年也是3.6%。但是呢如果拆开看的话，就是线下其实会跌的。那个就是说他增长，不是，就是线上会跌的，反而是线下那个就是说比线上的趋势会好，所以说我们最近也在看这个问题。那么包括那个就是我们在想是不是因为可能现在的线上的退货率高，那么包括很多用户也回到线下，包括商家也在线下投入。那么但是我们估计像这种我们是估计啊，就是可能是这么一段时间，但是我们希望也会有好转啊。那么另外呢就是像我们这块的话，比如说杉杉它增长得蛮快，那么因为杉杉的体用，那么那个它的占比还是蛮高的，所以说尤其是体用占比，体用户外的占比蛮高的话呢，它的增长更明显。像我们，比如说我们4月份跌的时候，但是我们的体用品类也没跌，是增长的，只是我们说的在尤其我们的核心的男女服装，男女性的男装、女装啊、童装啊这些跌，所以说我们自己看到其实消费者需求还是有，那可能在品类方面啊转做一些转移啊，所以说我们那个可能像整体的这个就是这个我们说的线上服装的生意，可能我们要过再过一些时间我们才能看到一些趋势。 Okay.

The NBS data, the apparel sales the growth of 3.6% you have mentioned actually refers to both online and offline. Based on our observation, actually online, we have seen a very notable decline, and we are actually quite in line with the industry trend.

Offline, we do see very strong growth. We believe it could be the difference of consumer activity with online and offline shopping.

When they do online shopping, they tend to return a lot, so that would make the sales and after revenue data more compressed. With offline, consumers do shift part of their spending increasingly to outlet channels, and it's actually the same with merchants.

With brand partners, they have been shifting a little bit more resources to offline outlets channels as well. We think it's still a partially holiday-driven, and going forward, we have to see whether the momentum can be sustained.

In addition, the outperformance is actually benefiting from a higher concentration of certain categories, especially sportswear and outdoor products. That makes their sales performance exceptionally strong, because consumers tend to shop into these categories.

It's just been fitting in with their lifestyle. It's actually the same thing with the online category performance.

Even in April and May, while we do see a broader weakness in apparel categories, sportswear and outdoor products continue to outperform. The real weakness is actually going into more discretionary apparel categories like women's wear and men's wear, which are pretty much fashion-driven.

I think we still need some time to see whether the discretionary spending will turn out better than expected going forward.

Thank you.

谢谢沈总、Mark、Jessie。那想问两个提问吧。第一个就是我们看到这个GMV和收入这个gap这个季度比较大，那想知道是杉杉这个online、offline的这个比例accounting原因呢？还是是这个return，就这个退货率又有又有一些提高？第二就想看这个，因为现在3月、4月、5月都比较弱呢，那到底这个是一个技术原因，是个high base，还是这个会不会变成我们下半年也是这样的一个trend？因为我看去年三季度其实增速还是比较健康，所以base也也不低。那所以想听一下这个最近几个月会不会对我们整年或者下半年这个增长的判断会有一些变化？那我翻译一下。Thank you management for taking my question. First, want to ask about the GMV gap with revenue.

Is that due to Shanshan or maybe the return rates have changed? Second is given that the March, April, May trends have been quite soft, should we take this or read this into the second half given the base in in the third quarter last year is not a a low one, which therefore the the base is normal.

How how should we think of the recent trends and translating to our expectations into the second half? Thank you.

Thanks for your question. Let me answer the first question.

Actually, the year-over-year growth gap between revenue and GMV in the first quarter increased due to the following two reasons: The first one is the return change rate slightly increased year-over-year due to higher contribution from apparel categories and SVIP members. Secondly, as you mentioned, the increased GMV contribution from Shanshan Outlets.

Given that Shanshan operates on a commission-based model, from accounting-wise, we recognize revenue based on net method, which resulting revenue to GMV gap become wider. 那我来回答第二个问题。就是关于那个就是是不是我们说的很危险，我们觉得倒不至于。因为我们其实跌的那个数字啊，就假设4月最多跌的数字也就是在0到-5之间，但是呢其实跟我们原来预估的数字，因为我们原来预估长嘛，所以说其实是有一些差距的。那么我们觉得可以再过些时间再看看整体的趋势。那么3、4、5不好跟我们说的这个天气也有关系，就是换季的话不明显啊，所以说我们觉得那个就近段时间是有一些这个消费趋势的问题。那我现不敢打包票，可能过一些时间我们再看，那么看大家尤其对服饰类的这种购买需求，是不是有慢慢旺盛起来。

In terms of our full-year outlook, even when we face near-term pressure from March to May to date, we think is still within our control. It's just from -5% to 0%.

That's the range we are confident to maintain. Also, the recent softness is related to a number of factors: weather condition, seasonal transition to spring and summer apparel.

Of course, there is a bit of uncertainties on consumer sentiment and behavior, etc. We may need more time to see whether the trend will be improving going forward.

For the full year, we think our full-year target is still achievable. By continuously optimizing our operational strategies, we should be able to maintain at least a steady business performance.

理解。 Thank you.

Thank you for taking the time to join us today. If you have any questions, please don't hesitate to contact our IR team.

We look forward to speaking with you next quarter.