Ladies and gentlemen, good day everyone, and welcome to Vipshop Holdings Limited's third quarter 2022 earnings conference call. At this time, I would like to turn the call to Miss Jessie Zheng, Vipshop's Head of Investor Relations. Please proceed. Thank you, operator. Hello, everyone, and thank you for joining Vipshop's third quarter 2022 earnings conference call. With us today are Eric Shen, our Co-founder, Chairman, and CEO, and David Cui, 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, 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 third quarter 2022 earnings conference call. We delivered a strong earnings growth on narrowed revenue decline in the third quarter as we carefully executed on our proven business model. During the quarter, micro and pandemic uncertainty weighed on the top-line recovery, customers' trends improved month by month, overall repeat orders and purchase frequencies hold up well. Through further optimization of operations, we achieved 50% profit growth and meaningful margin expansion year-over-year. As we moved quickly to adapt to external changes, we also pushed ahead with initiatives to reinforce the strength of our platform for the long run. Let me share some of our business progress in the third quarter. First, we continue to enhance our merchandising capabilities. We attract more diverse and high-quality partners to our platform and expanded our product offering, especially in the trendy and high-end segments. We deep divert into different categories to capture the emerging customer trend as people revved up spending on Guochao or Chinese fashion styles, outdoor and athleisure outfits, et cetera. Apparel related GMV booked a positive growth year-over-year during the quarter. We also work more closely with key partners on the Made for Vipshop customized offerings, which become an important line for many brands to achieve the greatest sales efficiency. Most of the products had better conversions than the average level of a certain brand or category. Second, we gained better customer traction. In addition of prudently investing in external channels, we increasingly leverage our upgrade product selection to acquire and return customers. Increasing proportions of customers are Gen Z and male customers who are appealed to more brands that reflect their values. Paid member continue to grow nicely as more high-value customers enjoy the sensible memberships privileges. Active Super VIP customer grew by 21% year-over-year and contributed 40% of online net GMV. Third, we worked hard to unlock technological capabilities throughout our business processes. We made great efforts to further digitalize our merchant platform, adding tools like membership system and customer review for brand partners to better identify opportunities for growth. We also made continuously improvements in personalization, refining search, feed, and scene-based recommendations for customers to discovery their desired selections while typing into their underlying needs. Looking ahead, our business has been consistently based on the premise that customers love value for money, which holds even more true today. We are committed to offering exceptional values on the wide array of branded quality products, and we will continue to win new customers and elevate the trust and the loyalty of existing ones. We are confident in our prospection for quality and sustainable growth in the long term. At this point, let me hand over the call to our CFO, David Cui, who will go over our financial results. Thanks, Eric. Hello, everyone. During the third quarter, our revenues came in line with our prior guidance. While the overall consumption was still under pressure, we did see a gradual recovery in spending on apparel-related categories. With strong execution across our business operations, which included preemptively securing supplies for seasonal trends and proactively launching promotional channels, we managed to minimize the negative impact from the pandemic resurgence on the top-line recovery. Once again, we demonstrated a strong profitability with margins hitting their best levels since the beginning of 2021. Gross margin trended upward to 21.7%. Thanks to our continued effort in optimizing cost structure across different categories. Non-GAAP net income increased by 55% to RMB 1.6 billion. Non-GAAP net margin stood above 7% as we remain disciplined in operations. In addition, we continued to preserve shareholder value by steadily executing our share buyback program. During the third quarter, we repurchased approximately $257.6 million of our ADSs. Near term, we remain focused on profitability and we'll work from every aspect to drive operational efficiency. We believe we are financially strong enough to navigate the ongoing uncertainties as well as to reinforce our business fundamentals, which will help us eventually return to growth track. 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 changes are year-over-year changes unless otherwise noted. Total net revenues for the third quarter of 2022 were RMB 21.6 billion as compared with RMB 24.9 billion in the prior year period, primarily attributable to soft consumer needs for discretionary categories amid a challenging macro environment with the COVID-19 resurgence in China. Gross profit was RMB 4.7 billion as compared with RMB 4.8 billion in the prior year period. Gross margin increased to 21.7% from 19.4% in the prior year period. Total operating expenses decreased by 13.9% year-over-year to RMB 3.7 billion from RMB 4.2 billion in the prior year period. As a percentage of total net revenues, total operating expenses decreased to 16.9% from 17.0% in the prior year period. Fulfillment expenses were RMB 1.6 billion, which largely stayed flat as compared with the prior year period. As a percentage of total net revenues, fulfillment expenses was 7.5% as compared with 6.5% in the prior year period. Marketing expenses decreased by 53.9% year-over-year to RMB 572.4 million from RMB 1.2 billion in the prior year period, primarily attributable to more prudent marketing strategy. As a percentage of total net revenues, marketing expenses decreased to 2.6% from 5.0% in the prior year period. Technology and content expenses increased by 7.6% year-over-year to RMB 394.8 million from RMB 366.8 million in the prior year period. As a percentage of total net revenues, technology and content expenses increased to 1.8% from 1.5% in the prior year period. General and administrative expenses increased by 5.0% year-over-year to RMB 1.1 billion from RMB 1.0 billion in the prior year period. As a percentage of total net revenues, general and administrative expenses was 5.0% as compared with 4.1% in the prior year period. Income from operations increased by 47.6% year-over-year to RMB 1.1 billion from RMB 770.8 million in the prior year period. Operating margin increased to 5.3% from 3.1% in the prior year period. Non-GAAP income from operations increased by 47.6% year-over-year to RMB 1.6 billion from RMB 1.1 billion in the prior year period. Non-GAAP operating margin increased to 7.2% from 4.2% in the prior year period. Net income attributable to Vipshop's shareholders increased by 168.4% year-over-year to RMB 1.7 billion from RMB 628.4 million in the prior year period. Net margin attributable to Vipshop's shareholders increased to 7.8% from 2.5% in the prior year period. Net income attributable to Vipshop's shareholders per diluted ADS increased to RMB 2.70 from RMB 0.92 in the prior year period. Non-GAAP net income attributable to Vipshop's shareholders increased by 55.0% year-over-year to RMB 1.6 billion from RMB 1.0 billion in the prior year period. Non-GAAP net margin attributable to Vipshop's shareholders increased to 7.4% from 4.1% in the prior year period. Non-GAAP net income attributable to Vipshop's shareholders per diluted ADS increased to RMB 2.56 from RMB 1.50 in the prior year period. Looking forward to the fourth quarter of 2022, we expect our total net revenues to be between RMB 30.7 billion and RMB 32.4 billion, representing a year-over-year decrease rate of approximately 10%-5%. Please note that this forecast reflects our current 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. Thank you. If you would like to ask a question, please press star one one on your telephone and wait for your name to be announced. Once again, that's star one one to ask a question. Please stand by while we compile the Q&A roster. Thank you. We'll now take the first question. First question comes from a line of Thomas Chong from Jefferies. Please go ahead. Hello, Thomas Chong from Jefferies. Your line is open. Please ask your question. 晚 上 好 ， 呃 ， 谢 谢 管 理 层 接 受 我 的 提 问 。 呃 ， 看 到 在 一 个 ， 呃 ， 宏 观 不 明 朗 ， 还 有 疫 情 ， 呃 ， 不 确 定 的 情 况 下 的 ， 我 们 应 该 怎 么 去 考 量 ， 呃 ， 未 来 一 段 时 间 呢 ， 从 这 GMV， 呃 ， 跟 客 户 数 呢 ， 的 一 个 ， 呃 ， 增 长 呢 ？ 呃 ， 另 外 的 话 呢 ， 就 是 ， 呃 ， 我 们 ， 呃 会 预 计 ， 呃 ， 明 年 ， 呃 ， 的 一 个 整 体 的 展 望 ， 呃 ， 大 概 会 是 怎 么 样 的 ？Uh, thanks management, uh, for taking my questions. My question is about the consumer sentiment given the outbreak of pandemic as well as the macro headwinds. Just want to get some color from management about the trend in this, in recent months as well as thoughts in 2023. Thank you. 我 来 回 答 吧 。 第 一 个 就 是 问 那 个 我 们 的 下 半 年 的 生 意 展 望 和 用 户 趋 势 吧 ， 是 吧 ？ 最 近 几 个 月. 最 近 几 个 月 。 嗯 。 最 近 几 个 月 呢 ， 就 是 我 们 看 ， 因 为 疫 情 的 反 复 ， 确 实 那 个 包 括 消 费 ， 那 么 我 们 说 大 家 还 是 持 悲 观 望 也 比 较 多 。 整 体 呢 ， 就 是 因 为 疫 情 的 原 因 ， 影 响 还 比 较 大 。 对 我 们 而 言 呢 ， 就 好 的 方 面 呢 ， 就 是 我 们 看 到 我 们 的 用 户 数 呢 ， 逐 渐 在 回 正 。 我 们 总 体 呢 对 未 来 ， 因 为 其 实 用 户 数 跟 我 们 的 生 意 也 是 呈 正 关 系 嘛 ， 所 以 说 我 们 理 论 上 认 为 说 用 户 数 只 要 回 正 了 ， 那 么 我 们 的 生 意 呢 ， 也 相 对 比 较 稳 定 。 对 明 年 的 展 望 呢 ， 我 们 其 实 觉 得 就 是 说 一 方 面 我 们 自 己 还 牢 牢 把 用 户 那 个 抓 在 手 里 ， 那 么 用 户 实 现 正 增 长 。 另 外 呢 ， 相 信 我 们 说 的 这 个 疫 情 ， 那 么 也 不 会 影 响 太 久 ， 包 括 明 年 我 们 其 实 还 是 对 它 有 些 乐 观 的 。 理 论 上 呢 ， 我 们 相 信 明 年 的 整 体 的 销 售 趋 势 和 用 户 数 ， 我 们 还 是 比 较 乐 观 的 。 Actually, in recent months, our business has been obviously affected by the pandemic challenges, and the consumers are still staying on the sidelines. But on the bright side, we have seen our customer trend has been improving month by month, and has been moving towards close to being flat issue, even having some growth. We are actually on the right track in terms of customer numbers. We expect in the coming months, GMV should stay relatively stable. For the next year, we still will focus on customer growth as long as we have the right customers on our platform. With the pandemic challenges going away over time, we are pretty optimistic about our GMV and customer growth for next year. Thank you. We'll now take our next question. Please stand by. This is from the line of Ronald Keung from Goldman Sachs. Please go ahead. Hello, Ronald Keung from Goldman Sachs. Your line is open. Please ask your question. Oh, thank you. Sorry, I muted my line. David, 想 问 一 下 呢, 第 一 就 我 们 的 Q4 的 guidance 就 是 比 Q3 的 这 个 同 比 下 降 是 有 所 放 缓 的, 或 者 是 环 比 有 一 些 变 好. 想 知 道 这 个 主 要 是 这 个 季 度 我 们 这 个 Singles' Day, 11 月 的 这 个 促 销, 还 有 是 不 是 一 些 去 库 存 或 者 尾 货 的 一 些 带 动 了 我 们 的 环 比 有 所 变 好. 另 外 呢, 我 们 这 一 个 季 度 也 看 到 整 个 净 利 润 率 也 创 了 一 个 新 高, 超 过 7%, 里 边 看 到 销 售 成 本 明 显 就 同 比 下 降 了 50%. 想 知 道 这 个 我 们 觉 得 是 一 个 短 期 的 还 是 以 后 这 个 公 司 的 可 能 未 来 的 净 利 润 率 可 以 上 了 一 个 新 的 台 阶, 这 个 进 入 明 年 的 话, 我 们 打 算 会 不 会 也 增 加 一 些 投 放, 或 者 是 销 售 marketing 这 边 的 一 些 看 法. 我 翻 译 一 下. Thank you management. The first question is on your fourth quarter revenue guidance that implies that the year-over-year decline has a sequential improvement versus the third. Want to hear how have we done in the Singles' Day November events and have our business seen some inventory driven demand, supply driven demand that is driving some sequential improvement. Second is our net margin has reached a new high and within that we've seen that the marketing costs fell around 50% year-over-year. Is this a new normal or into next year, will we actually start to spend a bit more? How should we think about the margin outlook for next year? Thank you. 回 答 第 一 个 问 题 就 是 关 于 那 个 Q4， 就 是 说 整 体 我 们 的 销 售 预 期 会 比 Q3 要 好 啊 ， 那 么 因 为 我 们 其 实 虽 然 说 有 疫 情 的 影 响 ， 那 么 还 是 有 很 多 不 确 定 性 ， 但 是 我 们 刚 刚 说 了 ， 就 是 我 们 自 己 看 到 用 户 的 增 长 慢 慢 趋 向 正 常 ， 那 么 基 本 能 回 来 。 所 以 说 我 们 其 实 对 前 面 ， 就 是 说 对 销 售 业 绩 还 是 有 把 握 ， 但 是 呢 就 是 ， 呃 ， 包 括 我 们 这 次 其 实 发 财 报 的 时 候 ， 我 们 也 在 想 ， 就 是 说 确 实 还 有 很 多 不 确 定 因 素 ， 那 么 尤 其 是 疫 情 的 ， 包 括 我 们 现 在 那 个 ， 比 如 说 我 们 总 部 这 边 ， 其 实 现 在 在 广 州 是 封 控 的 ， 就 大 家 所 有 人 都 居 家 上 班 ， 包 括 我 们 在 外 面 还 有 几 百 万 个 包 裹. 那 么 其 实 是 发 不 出 去 的 ， 就 是 说 比 如 说 是 都 是 在 封 控 区 等 等 地 方 ， 比 如 说 新 疆 啊 ， 哪 里 啊 ， 类 似 这 些 地 方 。 所 以 说 其 实 压 力 还 是 不 小 ， 但 是 我 们 总 体 看 呢 ， 就 是 说 熬 过 去 应 该 问 题 不 大 ， 这 是 第 一 个 的 看 法 。 第 二 个 呢 ， 就 是 说 那 个 关 于 利 润 ， 我 们 说 今 年 的 我 们 的 利 润 有 比 去 年 有 大 的 好 转 ， 主 要 是 上 次 财 报 我 们 也 说 了 ， 一 方 面 呢 ， 就 是 我 们 其 实 也 严 格 审 慎 地 再 去 评 估 我 们 的 新 客 投 放 ， 那 么 我 们 发 现 原 来 有 一 些 不 经 济 啊 ， 那 么 我 们 今 年 呢 做 了 一 些 经 济 的 调 整 ， 但 是 呢 我 们 对 新 客 的 增 长 还 是 比 较 积 极 的 ， 就 是 说 如 果 LTV 算 得 过 来 ， 我 们 还 是 加 大 投 放 的. 第 二 方 面 呢 ， 就 是 说 我 们 自 己 公 司 也 降 本 增 效 ， 那 么 就 是 说 我 们 把 ， 嗯 ， 很 多 也 节 约 了 很 多 钱 ， 那 么 有 原 来 一 些 比 较 浪 费 的 我 们 也 节 约 ， 或 者 说 整 个 在 环 节 中 啊 ， 整 个 购 物 环 节 中 ， 我 们 可 以 再 继 续 精 细 化 运 营 的 ， 我 们 也 做 了 一 些 调 整 。 那 么 第 三 方 面 呢 ， 就 是 说 我 们 自 己 也 忙 ， 不 盲 目 打 折 ， 就 是 说 就 是 是 这 样 ， 就 不 是 盲 目 地 自 己 来 送 优 惠 券 或 者 降 价 ， 就 用 自 己 的 钱 啊 ， 那 么 商 家 那 么 和 我 们 一 起 合 作 ， 我 们 没 问 题 。 但 是 呢 我 们 原 先 有 时 候 在 促 销 的 时 候 ， 经 常 是 自 己 拿 钱 来 贴 补 ， 那 么 我 们 今 年 也 做 了 一 些 调 整 ， 所 以 说 种 种 这 些 方 面 吧 ， 我 们 看 到 这 些 利 润 在 ， 呃 ， 整 体 都 在 好 转 ， 那 么 包 括 我 们 其 实 也 是 有 信 心 啊 ， 就 是 说 我 们 已 经 有 这 种 方 法 ， 而 不 是 说 我 们 这 是 一 个 季 度 的 偶 然 现 象 ， 因 为 我 们 对 整 体 的 利 润 的 把 握 ， 我 们 还 是 很 有 充 分 信 心 的 。 总 体 而 言 呢 ， 我 们 对 明 年 ， 对 未 来 我 们 还 是 充 满 信 心 。 David 可 以 补 充 一 下. Right. Let me first translate Eric's comments. For Q4, we expect revenue to further to narrow to a single digit decline, despite the fact that we have been more or less disrupted by the pandemic, especially actually we were located in Guangzhou and our office headquarters have been in restricted areas and we have to work from home. We still are facing a lot of uncertainties. Also on the logistics side, we have over several millions of parcels pending delivery. That's definitely going to impact our business. We are quite confident that we will navigate this through these uncertainties and achieve a normal business growth. On the profitability side, we have been, we have strong profitability and we is going to demonstrate our efforts in various areas, in terms of cost savings and rational spending initiatives. For example, we have been very prudently investing in external channels as to customer acquisition. We still focus on acquiring new users and we are quite proactive in trying to attract the right kind of new customers to our platform based on the LTV model. We are not going to spending away very freely. That's help us save a lot of, you know, customer acquisition costs. On the other side, we have been streamlining our cost structure from every aspect. We did manage to achieve a lot of cost savings throughout of business processes, and we still have some potential to optimize our cost structure. Lastly, we are not blindly sending away coupons. We would rather work with a lot of brand partners to, you know, share the cost and be quite prudent in delivering coupons. We have seen profitability is solid, and we are confident to manage that kind of profitability. It's not a one time thing. We are going to achieve sustainable profitability. Eric partially answered your questions regarding the pro-profit margin and the marketing expense ratio. I would like to add two more points. One is that our improvement in our pro-profit margin is not just coming from our savings of marketing expenses, but also coming from our improvements in our gross margin as a result of our operational efficiencies and better selections of our inventories that we carry and we pay particular attention to our products margin and rebates and the like. That's one point. The other point is that we do focus our efforts more on our Super VIP growth and that results in much better customer portfolio for us. Our number of our Super VIP grow significantly in this quarter, year-over-year. Thank you, Shen Dong and David. Thank you. We'll now take our next question. Please stand by. This is from the line of Alicia Yap from Citi. Please go ahead. 管 理 层 晚 上 好 。 谢 谢 接 受 我 的 提 问 。 我 是 Vicky Wei 代 Alicia 提 问 。 我 们 有 2 个 小 问 题 。 第 1 个 是 想 跟 进 一 下 刚 才 管 理 层 分 享 的 关 于 物 流 方 面 的 影 响 ， 能 不 能 请 管 理 层 跟 大 家 仔 细 分 享 一 下 您 看 到 物 流 方 面 的 影 响 是 怎 么 样 的 ？ 我 们 有 没 有 看 到 退 货 率 比 往 年 上 升 ？ 我 们 应 该 怎 么 看 待 Q4 ARPU 的 趋 势 ？ 我 的 第 2 个 小 问 题 是 关 于 竞 争 格 局 和 现 在 的 品 牌 商 家 的 策 略 。 能 不 能 请 管 理 层 跟 我 们 分 享 一 下 现 在 您 看 到 最 新 的 竞 争 格 局 。 在 现 在 的 大 环 境 中 ， 品 牌 商 家 的 策 略 是 怎 么 样 的 ？ 我 们 应 该 如 何 看 待 库 存 水 平 ？ 谢 谢 。 Good evening management. Thanks for taking my question. This is Vicky Wei on behalf of Alicia Yap. My first question is, will management provide some details on impact from logistic disruption and the latest return rate trend? How should we think of the fourth quarter ARPU trend? My second question is, will management provide some color on the latest competition and brand's attitude as well as inventory level? Thank you. 我 来 说 一 下 刚 刚 物 流 的 影 响 ， 我 们 现 在 应 该 有 将 近 4 million 订 单 吧 。 就 是 说 我 们 讲 的 客 户 下 了 订 单 ， 我 们 其 实 送 不 过 去 给 顾 客 啊 。 有 些 货 呢 ， 在 我 们 的 仓 库 ， 有 些 货 呢 ， 在 顺丰 的 站 点 。 因 为 比 如 说 像 4 million 里 面 有 1.4 million 是 新 疆 的 ， 因 为 已 经 3 个 月 没 办 法 ， 这 3 个 月 的 货 就 一 直 还 在 那 儿 等 着 新 疆 解 封 ， 包 括 比 如 最 近 的 什 么 武 汉 啊 ， 四 川 啊 ， 包 括 广 东 啊 ， 其 实 最 近 其 实 确 实 压 力 不 小 。 但 是 呢 ， 你 想 像 这 些 长 时 间 送 不 出 去 ， 其 实 未 来 会 有 退 货 率 ， 就 是 说 退 货 率 其 实 会 提 升 啊 。 但 是 我 们 想 的 就 是 说 毕 竟 只 有 目 前 只 有 4 million 单 嘛 ， 但 我 们 总 体 的 订 单 量 的 比 例 还 有 还 能 接 受 。 我 们 讲 的 就 希 望 这 种 疫 情 早 点 过 去 吧 ， 就 是 说 那 个 不 要 这 种 大 规 模 的 这 种 封 控 ， 理 论 上 呢 ， 对 货 物 的 顺 畅 ， 顾 客 的 满 意 度 会 提 升 。 第 二 点 是 问 就 是 关 于 在 品 牌 方 面 的 ， 就 是 那 个 不 是 ， 退 货 率 刚 刚 说 了 。 竞 争 格 局. 竞 争 格 局. 品 牌 的 策 略. 那 么 - 过 程 的 情 况. 对 ， 那 么 目 前 看 就 是 说 其 实 我 们 看 在 品 牌 来 讲 ， 那 么 他 们 其 实 很 多 ， 因 为 都 是 线 下 实 体 店 嘛 ， 所 以 说 理 论 上 其 实 大 家 的 日 子 都 不 好 过 ， 尤 其 是 在 Q 三 包 括 Q 四 ， 现 在 疫 情 东 一 个 地 方 ， 西 一 个 地 方 。 所 以 说 其 实 我 们 相 信 其 实 大 家 的 日 子 不 好 过 ， 库 存 也 不 少 ， 而 且 呢 ， 都 赚 不 到 钱 。 那 么 我 们 其 实 在 想 ， 就 是 说 我 们 其 实 作 为 一 个 品 牌 的 那 个 一 个 销 售 通 路 之 一 吧 ， 比 如 说 他 们 也 会 基 本 品 牌 也 会 选 我 们 讲 的 友 商 ， 还 有 包 括 现 在 的 一 些 直 播 平 台 等 等 啊 。 那 么 但 是 呢 ， 我 们 说 我 们 自 己 坚 定 地 做 好 我 们 自 己 的 角 色 ， 那 么 我 们 比 如 说 是 做 特 卖 的 ， 那 么 品 牌 有 深 度 折 扣 的 ， 那 么 我 们 讲 第 一 时 间 我 们 来 帮 他 们 解 决 。 那 么 包 括 比 如 说 有 些 他 们 在 线 上 准 备 要 试 验 的 ， 那 么 发 现 卖 得 不 够 好 ， 那 么 直 接 就 转 给 我 们 ， 或 者 包 括 他 们 能 定 向 地 给 我 们 定 制 商 品 啊 等 等 啊 。 所 以 说 我 们 理 论 上 认 为 我 们 其 实 是 品 牌 的 其 中 一 个 渠 道 之 一 ， 但 是 呢 ， 我 们 是 有 鲜 明 的 特 色 ， 就 是 我 们 一 定 是 要 好 的 商 品 ， 好 的 品 牌 ， 另 外 呢 ， 尽 量 低 的 价 格 满 足 我 们 的 消 费 者 。 所 以 说 我 们 认 为 说 呃 ， 未 来 的 库 存 那 么 有 可 能 会 多 啊 ， 但 是 有 的 时 间 也 不 会 很 多 。 但 是 呢 ， 我 们 想 其 实 对 我 们 来 讲 不 仅 仅 就 是 一 个 库 存 的 问 题 ， 因 为 我 们 有 很 多 是 品 牌 专 门 给 我 们 做 货 ， 分 货 ， 所 以 说 我 们 其 实 也 不 担 心 这 方 面 的 问 题 。 未 来 的 话 大 家 生 意 都 要 做 ， 包 括 品 牌 也 都 要 做 生 意 ， 他 们 也 会 利 用 好 各 个 不 同 的 平 台 ， 那 么 来 做 好 自 己 的 这 生 意 。 First on the logistics side, currently we have roughly four million orders pending delivery. Some of the orders are actually staying in our warehouses or the outlets of SF Express are waiting for the to be delivered. Especially of the four million, actually 1.4 million are going to Xinjiang where which actually has been locked down for over three months. It's, it's really a tough time. Recently, the delay has extended to places like Wuhan, Sichuan, Guangdong. With the delay, we expect to see some pickup in the cancellation or return rates. But four million is just is still a manageable portion of our total orders. We hope that with the pandemic challenges going away over time, we expect delivery and fulfillment efficiencies are returning to normal pace. We can manage to meet customer needs. On the competition side, I think we think our brand partners have quite some channels to choose from. One thing is certain that with the off-offline stores are still struggling, especially with the COVID resurgence in the latest third and fourth quarters, and they have a lot of inventory to clear, and it's very hard for them to make money. I think the we think these brand partners will choose go to the online channels, including us and other channels, including live streaming to clear their inventory. We are one of the of their partners. We know we have a strong value proposition in discount retail, and we managed to secure a lot of supply with deep discounts. Some of the supplies are actually not selling well on other channels and then are transferred to our platform. Many of them are the customized offerings are from for Vipshop. As long as we maintain our strong value proposition in branded quality products with steep discounts. We think we can and we will. We have the competence to meet the growing needs from customers who care value for money, product offerings. There are a lot of inventory out there, and we have a very strong merchandising capabilities, and we are confident that we can secure more supplies from all kinds of brand partners, and secure a growing share of the, of their, inventories to our platform. Thank you. We'll now take the next question. Please stand by. This is from the line of Andre Chang from JPMorgan. Please go ahead. Shen Dong, David Dong, Jessie. Thank you, management, for taking my question. My question is about the, you know, future upside of our gross margin. Now, we noticed the, you know, efficiency gain, the, you know, product strategy has helped the company to improve the gross margin over the past two years. But there's still a significant gap against the, you know, gross margin that company achieved probably back five years ago. I wonder whether, you know, the management still see a good room to, you know, improve the gross margin toward the historical level, you know, through the current strategy or other things. That we've already see the, you know, near-term benefits being released and that the margin should be, rather stable here. 对 ， 我 们 现 在 那 个 毛 利 率 的 ， 其 实 我 们 最 终 我 们 是 看 净 利 率 嘛 ， 但 是 呢 ， 净 利 率 的 话 ， 看 的 话 ， 其 实 从 前 面 第 一 个 从 毛 利 率 看 ， 看 起 啊 ， 那 么 我 们 毛 利 率 呢 ， 刚 刚 讲 的 ， 如 果 影 响 毛 利 率 的 ， 刚 刚 提 的 这 几 点 的 ， 最 重 要 的 就 是 那 个 ， 就 是 我 们 说 的 ， 如 果 自 己 不 用 促 销 ， 自 己 不 用 这 种 优 惠 券 来 大 打 折 扣 ， 那 么 我 们 其 实 就 能 节 约 很 多 钱 。 比 如 说 我 们 随 便 说 啊 ， 比 如 说 现 在 是 二 十 一 啊 ， 假 设 这 个 月 是 二 十 一 ， 如 果 这 个 月 我 们 自 己 要 贴 代 金 券 ， 要 给 用 户 送 礼 ， 送 代 金 券 ， 直 接 我 们 的 毛 利 就 变 成 十 九 了 。 所 以 说 我 们 其 实 最 近 就 是 在 这 些 方 面 呢 ， 我 们 就 做 得 比 较 克 制 ， 但 是 呢 ， 其 实 生 意 上 面 我 们 也 是 照 ， 照 正 常 ， 所 以 说 我 们 觉 得 就 没 有 太 大 必 要 说 自 己 要 花 很 多 钱 去 做 这 种 促 销 ， 那 么 这 是 一 方 面 。 那 么 另 外 的 话 就 是 刚 刚 看 的 ， 就 是 说 那 个 我 们 其 实 现 在 跟 当 年 的 不 一 样 ， 因 为 我 们 当 年 比 如 说 可 能 有 二 十 五 ， 但 是 现 在 这 个 整 个 毛 利 的 趋 势 ， 我 们 相 信 大 概 在 这 个 水 平 吧 ， 可 能 通 过 我 们 的 ， 呃 ， 那 个 通 过 我 们 的 调 整 ， 可 能 会 适 当 高 一 些 ， 但 不 会 高 到 当 年 那 个 水 平 。 另 外 呢 ， 因 为 毛 利 率 等 于 是 我 们 其 实 跟 品 牌 要 的 扣 点 啊 ， 那 么 现 在 大 家 日 子 都 不 好 过 ， 我 们 也 不 好 意 思 去 再 去 讲 扣 点 。 所 以 说 整 体 而 言 呢 ， 我 们 相 信 接 下 去 的 毛 利 率 大 概 在 这 个 水 平 ， 是 我 们 现 在 这 个 ， 比 如 说 我 们 Q 三 、Q 四 反 映 的 大 概 就 是 未 来 的 毛 利 率 水 平 。 那 么 但 是 净 利 率 呢 ， 我 们 其 实 后 续 随 着 我 们 继 续 精 细 化 运 营 ， 那 么 随 着 订 单 的 收 -- 订 单 的 增 加 ， 物 流 费 用 的 降 低 ， 整 个 什 么 ， 那 个 我 们 讲 的 行 政 费 用 的 降 低 ， 那 个 等 等 啊 ， 包 括 我 们 的 SVIP， 包 括 我 们 的 货 客 ， 那 个 成 本 更 低 ， 呃 ， 市 场 做 得 更 好 ， 那 么 理 论 上 净 利 率 还 是 能 提 升 的 。 Okay. On GP margin, one thing you should bear in mind that we always focus on achieving a solid and a sustainable net profit margin. Turning to GP margin, one of the biggest factor is actually the cost savings from the customer rebates or coupons. We are not, we are currently quite prudent on this side. For example, this month, we probably achieve 21% of GP margin. And if we are investing a lot of rebate or coupons that could go down to 19%. That's one of the biggest savings. Second, on the take rate, we have said for many times that we're not going to increase the take rate from brand partners because they are struggling with their business. That line should remain stable. This means that the gross margin will not go back to the level of five years ago, say 25%. It should largely remain stable at the current level, at the level we have seen for Q3 and Q4, 20%-21% something, that's for gross margin. On the net profit margin, we still have a lot of potential to grow through further optimization of our operations. We can still achieve certain operating leverage on the fulfillment, customer acquisition and other G&A expenses. For the net profit margin, we still have room to grow. Thank you. We'll now take our next question. Please stand by. This is from the line of Eddy Wang from Morgan Stanley. Please go ahead. Hey, Shen Dong, David Dong, thank you, thank you accepting my question. My question is about My question is about maybe just the overall situation, which is because I see, if we look at each user, the orders for each user this quarter, it's still relatively stable. GMV per customer or GMV per order is also relatively stable. This net sales per customer or sales per order this quarter is still, you know, a certain degree of year-on-year decline. I don't know if this is because of the promotion we a certain degree of year-on-year decline. I don't know if this is because of the promotion we did or because of the impact of the epidemic, which led to everyone's consumption, this so-called downgrade in consumption, which led to the decline in the amount of each order, or is there some other reason? I just want to ask what you think the trend will be in the future. Yeah. I'll also translate it quickly. Thank you for taking my question. My question is about the user behavior change. We noticed that the net sales per customer and the net sales per order actually declined year-over-year in this quarter. On the other hand, if you look at GMV per customer, GMV per order are actually quite stable. I'm not sure this is because of the COVID impact or it is because that we have the, you know, the 3P GMV actually increased, which has, you know, result this decline. What are your thoughts about, you know, the further trend of this matrix? Thank you. Okay. 我 来 简 单 说 一 下, David 再 补 充. 我 们 其 实 Q3 的 话, 我 们 因 为 穿 戴 类 做 的 是 不 错, 那 么 穿 戴 类 比 去 年 的 Q3 有 增 长. 理 论 上 呢, 因 为 穿 戴 类 的 退 货 率 会 高 嘛, 大 家 会 看 到, 如 果 从 财 报 里 看 的 话, 这 个 UP 值 会 稍 微 跌 一 些. 整 体 呢 不 用 担 心, 整 体 我 们 自 己 运 营 的 UP 值 差 不 了 太 多 的. 我 们, 对 我 们 来 讲 呢, 总 体 来 讲 就, 包 括 退 货 率 高, 就 是 说 如 果 是 穿 戴 的 退 货 率 高, 对 我 们 来 讲 成 本 费 用 也 比 较 可 控, 对 我 们 来 讲 不 用 太 担 心 这 种. Yeah. David 再 补 充. Actually the difference between GMV per order and revenue per order is primarily attributable to higher contribution from apparel categories. Actually, we did quite well in Q3 for apparel categories, which booked a positive year-over-year growth at 3.5% growth. Normally apparel categories carry relatively higher return rejection rates. That's why you would see ARPU had declined a bit during the quarter. If you look at the GMV per order, that's quite stable. The other thing is that returns and exchanges are totally manageable. It has been consistently reflected in our income statement, it has very little impact on the profit, on the profit level. David. Yeah. I think Eric answered the key points on this question. Just to clarify that the drop on ARPU is not because of the standardized item. It's purely because of the revenue mix. The apparel, clothes and shoes categories increased. We did pretty well on that part. Apparels have higher return rates. We believe that the return rates in future will remain relatively stable and that will not worsen the situation on ARPU. The other reason that you rightly pointed out is that because of the softer consumers demand and people spend less, and also it's in the summer season, so the consumption is soft. That contributed another reason for that. Thank you. 谢 谢. Thank you. Due to time constraints, that concludes today's question and answer session. At this time, I will turn the conference back to Jessie for any closing remarks. Thank you for taking the time to join us today. If you have any questions or follow ups, please don't hesitate to contact us. We look forward to speaking with you next quarter. Thank you. This does conclude the conference for today. Thank you for participating, and you may now disconnect.