Hello, everyone, and thank you for joining 111's conference call today. On the call from the company are Dr. Gang Yu, Co-Founder and Executive Chairman. Mr. Junling Liu, Co-Founder, Chairman, and CEO. Mr. Luke Chen, CFO of 111's major sub-subsidiary. Mr. Haihui Wang, COO, and Ms. Monica Mu, Investor Relations Director. As a reminder, today's conference call is being broadcast live via webcast. The company's earnings press release was distributed earlier today, together with the earnings presentation, are available on the website at edge.media-server.com/mmc/p/kpnswevm. Before the conference call gets started, let me remind you all that this call may contain forward-looking statements made under the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. Such statements are based upon management's current expectations and current market and operating conditions and relate to the events that involve known and unknown risks, uncertainties, and other factors, all of which would cause actual results to differ materially. For more information about these risks, please refer to the company's filings with the SEC. One One One does not undertake any obligation to update any forward-looking statements as a result of new information, future events, or otherwise, except as required under applicable law. Please note that all numbers are in RMB and all comparisons refer to year-over-year comparisons unless otherwise stated. Please also refer to the earnings press release for detailed information of the comparative financial performance on the year-over-year basis. With that, I will turn the call over to One One One CEO, Mr. Junling Liu. Good morning and good evening. Thank you for joining our Q3 2022 earnings call. What we'll be discussing here is also provided in the slides posted earlier today on the company's website. I encourage you to download the presentation along with the earnings report at ir.111.com.cn. In today's call, I will add some color to some of the latest regulatory development in the healthcare industry and the latest development in COVID-19 policies and how the company rose to the challenges and opportunities. I'll also cover our strategies for building growth momentum, improving operational efficiency, and strengthening supply chain capabilities. Mr. Luke Chen will walk you through our financial results. zero-COVID restriction policies in China continue to create tremendous challenges to our business in Q3. More and more cities are experiencing the rising numbers of infected people, consequently, the number of cities that had to lock down increased significantly. The supply chain, in general, was severely disrupted and the transportation and other logistics were tightly regulated in epidemic-hit areas. Our biggest challenge was to deliver the goods to our customers and replenish stock in time. I'm proud to report that our team truly stood out in dealing with those unprecedented challenges. They literally had to move mountains to fulfill badly needed medicine for our customers and patients. Our online and offline digital platform proved to be highly effective in dealing with the pandemic. We spared no effort in meeting patients' demands in epidemic-hit cities for medical consultation and drugs. We have provided free online consultations for customers in over 370 cities and provided over 3,000 medicinal products covering more than 400 diseases in the last few months. Since the beginning of the COVID-19 pandemic, our online hospital, 1 Clinic, has been offering free online medical consultation services. Recently, we also provided government-approved dedicated delivery fleet for medical products for some provinces hit by the pandemic. Even with the approval, the fleet had to overcome cross-provincial logistic challenges due to different control policies to deliver drugs to patients staying in mobile field hospitals, quarantine hotels, and other facilities. The last few weeks saw the number of infected people in quite a few provinces is rising sharply, and the lockdown followed. A few of our fulfillment centers are under lockdown right now, which is very disruptive to our business. We believe that COVID-19 will continue to create challenges to us in the near future. I have very strong faith in our team and believe we will be able to serve customers with our utmost effort as we have done in the last few quarters. Please allow me to take a moment to brief you the latest regulatory developments. As you know, China just finished its 20th National Congress of the Communist Party in October. One of the very important themes is its focus on construction of a healthy China, which includes enhancing management of major chronic diseases and boosting preliminary disease control capabilities and improving treatment and health management. Opening remarks from the 20th National Party Congress provided us a broad direction on where China's healthcare industry may be heading over the next few years. The following initiatives will create great regulatory tailwinds for the industry. One, encouraging innovation. The government is supportive of domestic innovation with the intention to bring in newer and better therapies to China and the world. The initiative will provide a better environment to allow China to act as a global innovation hub in the space of innovation drugs. This will mean that there will be more opportunities for 111, Inc. to launch and commercialize new drugs with its integrated digital platform. Two, strengthening infrastructure for preventative, chronic and infectious diseases. Importance of early diagnosis, early treatment, and early rehabilitation was stressed from the remarks. The government pledged an increase in funding for routine health screening, chronic disease management, infectious disease control, and mental disease treatment. We anticipate that digital technologies can play a key role in the areas of disease prevention, chronic disease management, and the containment of infectious diseases. Three, revitalizing TCM or Traditional Chinese Medicine. In recent years, the government has set TCM as a strategic priority and has issued plenty of supportive policies, including relatively less price cut compared to other types of drugs in the government-run VBP, where many drugs had to drop prices sharply, not to mention encouraging modernization and practicing of TCM. Significant efforts have also been made to promote the standardization of RX TCM granules, which should improve safety and efficacy as market penetration increases. The policy is already having an effect in the market as we have seen a gradual pickup in our sales of TCM. Four, focusing more on youth and elderly care. With the birth rate falling for the fifth year in a row in 2021, the government implemented policies to boost the birth rate, such as the three-child policy, tax deductions, longer maternity leave, enhanced medical insurance, housing subsidies, and additional financial support for the third child. I'm happy to report that some of our private label products are specifically targeting infants and children. As we broaden our portfolio, we should have a range of products for youth and elderly. In addition, the State Council announced 20 prevention and control measures to further optimize the COVID-19 response, under which China will roll out and implement precise, reasonable, and efficient epidemic control measures per public needs. Although it's early days and there have been various implementation approaches in different provinces and cities, and even obvious deviation from the announced control measures are taking place, we see this as a very positive move. In fact, yesterday, we saw media quoting senior officials that with the decreasing toxicity of the Omicron variant, the increasing vaccination rate, and the accumulating experience of outbreak control and prevention, China's pandemic containment faces new stage and mission. This potentially indicates an adjustment of the current COVID measures. One of the major capital cities, Guangzhou, was saying yesterday that the city has adjusted the designation of risk levels and the pandemic containment measures to a varying extent in all its 11 districts. We very much welcome the new development in the fight against COVID-19 and look forward to the time when the pandemic is behind China, where business can operate as usual. Despite the economic downturn and material adverse impact on the offline retail sector in general in the third quarter, we managed moderate growth in revenue and a solid growth in gross margin. Our net revenue for third quarter increased by 0.1% year-over-year to RMB 3.3 billion, while our gross segment profit increased by 22% year-over-year. Our efforts to improve our margin profile continued to deliver positive results during the quarter. Our overall gross segment margin as a percentage of net revenues improved to 6% from 5% in the same quarter of last year. Given the circumstances, this hard-earned margin growth is quite an accomplishment. This achievement came from optimized product assortment and smart pricing, as well as improved team efficiency and technical capabilities. Our B2B business remains the key contributor of our revenue growth, which reached RMB 3.25 billion. Gross profit of our B2B segment rose to RMB 180 million, an increase of 27% year-over-year. B2B segment margin improved to 5.5% from 4.4% in the same quarter of last year. We also improved B2C segment margin to 22.4% from 19.7% in the same quarter last year. We will continue reducing procurement costs as well as optimizing our product assortment and structure. We were able to leverage our digital capabilities to deliver more value-added services to our partners. The market continues to show strong demand for our diverse service offerings. Our value-added services include marketplace vendor services, digital marketing, supply chain management, online medical consultation, e-prescription services, patient education, drug commercialization tools, etc. Even during the pandemic, our service revenue reached RMB 32.57 million, representing a growth of 34% over the same quarter of last year. As our business continues to expand, as we position ourselves as an effective commercialization partner, we will continue to offer value-added services to pharmacies and pharmaceutical companies. In addition, we continued to enhance our operational efficiency, as a result, total operating expenses as a percentage of net revenues decreased to 8.4% in this quarter from 10.2% in the same quarter last year. Sales and marketing expenses were down to 3.2% from 3.9%. General and administrative expenses were down to 1.4% from 1.6%. Technology expenses were down to 0.9% from 1.7% in the same quarter last year. We expect this momentum to continue as we scale, while we continue to focus on delivering superior services to our customers. Although the current macroeconomic environment has resulted in challenges to our business, we're still committed to executing our strategy to continue to grow our revenue and gross margin. I'm pleased to report that our non-GAAP loss from operations was narrowed to 1.5% of net revenues, as compared to 4.1% in the same quarter last year. We're getting closer and closer to profitability. We're also pleased to see that our operating cash flow and overall cash flow were in the black for the quarter, which is a major milestone of our business. As of Q2 2022, 111's virtual pharmacy network reached approximately 413,000 pharmacies, covering more than 70% of the total number of pharmacies in China. As of September, our cold chain service has deployed in over 270 cities, over 80% of which can complete orders within 48 hours. This capability has provided convenience for rural consumers in particular. In order to continuously improve gross profit, we have carried out a platinum product program. At present, more than 400 pharmaceutical companies and over 1,000 SKUs have become part of this program. The revenue of B2B high margin products in this quarter has increased by 16% year-on-year, and it contributed 0.9% increase to the overall B2B gross profit. I'm pleased to update the progress we have made on our private label initiative. As our network of pharmacies continues to grow and it's time we should introduce some private label products. Not only will this help our pharmacy customers to improve their gross margin, but this helps with our own margin as well. We partnered with some pharmaceutical manufacturers to build a suite of products, which include medicines, health supplements, medical devices, etc. We have already developed three brands, which are Shengwu Kang, Huangjia Rongyao, Guanzhao, and over 990 SKUs launched or already in production schedule, targeting specific market segments. This part of the business is still at its infant stage and no conclusions can be drawn yet, we believe these proprietary products will significantly increase our gross profit and enhance downstream customer stickiness. We depend our relationship with upstream pharmaceutical companies, we were able to help them to improve their digital marketing efficiency and drug commercialization efforts. Let me provide a couple of examples. Since the recent launch in China by AbbVie of its innovative drug upadacitinib, which successfully completed clinical trials in China and abroad, and is China's only approved targeted oral drug for atopic dermatitis for teenagers, we actively participated the launch of the medicine, leveraging our patient management platform. We now offer full lifecycle closed loop services for the drug, covering online plus offline consultation and a post-diagnosis consultation and refill service, which effectively help patients control disease progression. In addition, will help patients improve medication compliance and effectively reduce dropout rates. We also provided full-time caring medical professionals to respond to patients' questions online in a timely manner. Within the span of one month, we have served patients in 16 provinces. In November, Hua Medicine rolled out Dorzagliatin, a first-in-class glucokinase activator in China, providing type 2 diabetes patients with a new treatment option. We're the strategic partner in its national rollout of the drug. Leveraging our advantages in the smart supply chain capabilities and digital platform, we were able to assist Hua Medicine in its launch of the drug across all channels. We have also enhanced the accessibility of the new drug through reservation registration by medical professionals and a full lifecycle patient management, thus providing more patients with convenience to access new therapeutic treatments. The launch was so successful that inventory was depleted so fast that Hua Medicine is scrambling to increase its capacity of manufacturing to cope with the supply shortage. Looking ahead, we will continue to pursue the enormous market opportunities from the digital transformation of the healthcare market in China, which, given the country's vast population, provides us with opportunity to connect millions of people in lower-tier cities via our direct B2B platform and our broad network of pharmacies. In order to bridge the gap in consumer access, we will focus on strengthening every facet of our S2B2C model and advancing our strategic plan to expedite business expansion. On the infrastructure side, we'll keep improving the AI and data processing capability of our technology, upping its power to handle higher volumes with greater predictive ability. Our technology platform today can access point-of-sales data of over 10,000 pharmacies for those SKUs we're commercializing. We believe this network of pharmacies and the number of SKUs will commercialize, will grow at a fast pace in the near future. With this, we will be able to provide retail pharmacies greater control and cost efficiency to drive their store sales growth and at the same time, further deepen the share of wallet among our existing retail pharmacy customers. The platform's enhanced capability will also allow us to virtually deploy more digital modules and features which will connect more upstream suppliers and result in better sales and margins for our pharmacy customers. On the supply side, the services we provide to pharmaceutical companies in support of their commercialization efforts help deepen our relationships with them, allowing us to source an even wider selection of medications and health-related products for our pharmacy customers and benefit end consumers. These commercialization services also represent a major growth opportunity for us. Globally and in China, medical innovations have been happening at an unprecedented rate. As more and more new medications and devices come onto the market, competition becomes increasingly intense. 111's support during a product launch can improve a company's market position and increase the likelihood of a successful launch. Ultimately, our integrated online and offline platform is a win-win for all. As we help to transform the healthcare system for the better, we believe that there are significant opportunities for us in the age of industrial internet to expedite the digital transformation of healthcare system in China. We will work relentlessly to strengthen this model and pursue growth opportunities post COVID-19. Operationally, our priorities will be delivering revenue and margin growth, strengthening supply network, and a reduced procurement cost, continuing to improve operational efficiency, optimizing fulfillment cost, and broadening our service offerings. We have come a long way since our IPO in 2018. From a new kid in the block four years ago, we have now established ourselves as one of the major players in the digital healthcare service industry. As we continue to expand the coverage of pharmacies and broadening our drug suppliers network, plus our advanced digital capabilities, the supply chain infrastructure, we're uniquely positioned to create value for all our partners in the value chain. 111, Inc. was certified by the Chinese Ministry of Science and Technology as a national high-tech enterprise again. We were also recently awarded the prize of National E-commerce Demonstration Enterprise by the China Ministry of Commerce. Our remote consultation and chronic disease prescription refill service platform has also been selected as a case study in digital solutions for epidemic control and production resumption by the Shanghai Pudong New Area Science and Technology Commission. We're very proud that our efforts have earned us such distinction and are committed to continuous innovation and implementation. Moreover, we have received critical acclaim from local governments, hospital specialists, and patients for our online hospital services and a continuous support for Tibetans living in Ganzhou City, Sichuan Province, for heart disease control. All the ESG efforts carry our core values, and we will firmly fulfill our social responsibilities as we have done in the past. We wish to thank all the investors who have supported us all along. I will now hand the call to Mr. Luke Chen to walk through our financial results. Thank you. Thank you, Junling. Good morning or evening, everyone. Moving to the financials. My prepared remarks will focus on a few key business and financial highlights. You can refer to the details of the third quarter 2022 results from slide 11 to 14 in section two of our presentation. All comparisons are year-over-year and all numbers are in RMB unless otherwise stated. Let's start with the third quarter results. Third quarter had been very challenging for our business due to negative impact from COVID lockdowns in many cities in the province. We have tried our very best to work with local governments as well as logistic companies to fulfill our customer patient orders as these medicines are badly needed. Total net revenues for the quarter grew 0.1% to RMB 3.35 billion. The total gross profit for the quarter grew at 22% to RMB 202 million. The gross margin improved from 5% to 6%. B2B segment was the major contributor for total gross profit and a margin improvement. B2B segment revenue grew at 0.8% to RMB 3.25 billion, while gross segment profit for B2B increased by 27%, with gross segment margin up from 4.4% to 5.5%. This was attributable to our optimization of selection portfolio and competitive pricing. We had also focused ourselves on higher margin products and launched private label product with much better margin. Our B2C segment revenue decreased 20% to $100 million, with gross segment margin improved from 19.7% to 22.4%. Total operating expenses for the quarter were down 17% to $283 million. As a percentage of net revenue, total operating expenses for the quarter were down to 8.4% from 10.2%, which reflected continuous improvement in our operation efficiency. Fulfillment expenses as a percentage of net revenue for the quarter was around 3%, comparable to the same quarter last year. Sales and marketing expenses were $108 million, representing a decrease of 18% year-over-year. As a percentage of net revenue, sales and marketing expenses for the quarter was 3.2%, down from 3.9% in the same quarter of last year. We believe this trend will continue as we further build up our scale and improve our sales team efficiency. General and administrative expenses were $46 million, representing a decrease of 13% year-over-year. As a percentage of net revenues, G&A expenses accounted for 1.4%, down from 1.6% in the same quarter of last year, which was attributable to our continuous optimization of our supporting functions. Technology expenses accounted for 0.9% of net revenue, down from 1.7% in the same quarter of last year. We completed major tech development programs, we believe that current standing reflect appropriate amount of our investment in technology. As a result, the GAAP loss from operations narrowed to $48.7 million, compared to $135.9 million in the same quarter of last year. As a percentage of net revenues, the GAAP loss from operations decreased to 1.5% in the quarter from 4.1% in the same quarter of last year. The GAAP net loss attributable to ordinary shareholders was $64.9 million, compared to $213 million in the same quarter of last year. As a percentage of net revenues, the GAAP net loss attributable to ordinary shareholders decreased to 1.9% in the quarter from 6.4% in the same quarter of last year. As you can see, we are improving our financial performance quarter by quarter and we're getting very closer to profitability. We are also very pleased to report that we have achieved positive operating cash flow and overall cash flow for the quarter. Please refer to slide 15 to 19 of the appendix section for selected financial statements. In a quick note on our cash position as of September 30th, 2022, we had cash and cash equivalents, received cash and shorter investment of RMB 866 million. This concludes our prepared remarks. Thank you. Operator, we are now ready to begin the Q&A session. Thank you. If you wish to ask a question, please press star one on your telephone keypad and wait for your name to be announced. If you wish to cancel your request. Please press star two. If you're on a speakerphone, please pick up the handset to ask your question. Your first question comes from Cathy Chen with CICC. Please go ahead. Hi, this is Cathy from CICC. Thank you for taking my question, and congratulations on your progress. I have two questions in total. The first is that looking forward, I'm wondering what will be the company's operational focus. The second one is that as from the gross margin of the B2B business continuously increased, and I'd very appreciate it if you can share with us the key factors behind the rising and how you evaluate its sustainability. I think we need- Yeah, yeah. Junling, are you going to take the first question? Sorry, I was on mute. Apologize, Cathy. Thank you for your question. I'll answer the first question. Looking ahead, you know, if we look at our operational, priorities, I would say the following. We're gonna focus on the top line and the bottom line growth. We're gonna the supply network. We're gonna reduce procurement cost, and, we will focus on improving operational efficiency and, in terms of the sales and marketing, the logistics, the GMA, et cetera. We also want to grow the services. The, the last point I wanna make is that, we're gonna continue to, really invest in innovation. There is a lot we can do with the asset we have built so far, and we're gonna continue to exploit our technology capabilities to deliver value, you know, for both the upstream and downstream customers. Thank you. Yeah. Cathy, this is Haihui. I will take your second question regarding the B2B margin. Yes, you are right. Our B2B gross profit increased 27% year-over-year. This improvement came from our continuous effort to reduce our procurement cost, as Junling just mentioned. Through either our direct sourcing from pharmaceutical companies, et cetera, and also, our efforts to optimize our product assortment and our cost structure. Regarding your question of this sustainability, as we can expect the overall economy and environment get better, we will further tighten our partnership with pharmaceutical companies, and we will go get more rooms to promote our digital marketing capability. I believe the B2B profit, the gross profit improvement trend will continue. Thank you, Cathy. You're very- Thank you. Your next question comes from Lauren Cai with HSBC. Please go ahead. Hi. Thanks, management for taking my question. Congratulations on your solid results, especially your positive operating cash flow this quarter. This brings me to my first question about cost control. Can management share more details on what's been done to contain costs, and can these measures or this trend sustain going forward when macro environment turns better and we may need to increase investment to gain more growth? For my second question, I want to ask about your outlook for next year. With China gradually easing COVID control measures, how would it impact our business? Thank you. Yes, Lauren. I'll take your first question regarding the cost control. Yeah, it is very encouraging to see that as a result of our continuous efforts, we are seeing we enhance our operational efficiency and our total operating expenses have decreased to 8.4% from 10.2% of Q3 last year. This is actually from every single elements we are doing our best. Our sales and marketing expenses decreased from 3.9% to 3.2%. Our technology expenses and also our GMA decreased from 1.7% and 1.6% to 0.9% and 1.4% respectively. When the overall environment is getting better, definitely that would be even better news for us. When the overall economy and environments are getting better, we definitely expect This momentum to continue. As at that time, the demand of our customers will be released and increased. With our volume growth, we will definitely see scale. Thank you. Yeah, Lauren, let me just answer your second question about it. You know, we're all anticipating that the COVID zero policies will be behind us or relax. We saw some encouraging developments recently. That's still, you know, unknown because different provinces have different implementation approaches. You know, as we speak, some of our warehouses are still under lockdown, and we cannot ship goods out, we cannot replenish inventory. You know, there is also, you know, the latest developments and, you know, starting from today, that, you know, a lot of those drugs were not allowed to sell online anymore, especially those, you know, RX drugs. Also, you know, every customer has to register its real name, and there is gonna be a verification process. You know, fortunately for us that, you know, we more focused on the B2B, and that's the majority of our business. The impact to us is a lot smaller than the rest of the other guys in the industry. You know, we all hope that, you know, this is the first step to a, you know, post COVID restriction kind of containment measure. You know, of course, if we look at a broad picture, we are in a multitrillion-dollar market. You know, to quote some numbers in 2021, last year, the market is 8 trillion RMB. You know, it is widely anticipated that by 2030, this market is gonna hit $16 trillion. That is more than $2 trillion. There's, you know, I said a few, you know, things early on in my speech that there is a lot of tailwinds for us as well. I think, you know, the biggest, you know, tailwind is really the transformation, you know, of digital digitization in the industry. We are already playing a major role, and we'll continue to play an more important role in the future. In terms of expectation, I'm gonna expect very good quality growth for the company, both, the top line, you know. You know, in the past few years, we focused more on the revenue growth and, you know, obviously, we needed that. We needed that scale. We needed the customer to know us, to, you know, experience the services we deliver to them. In the future, I would like to see, in addition to a top-line growth, we also want to see a better margin growth and also the improvement in the bottom line. I hope that answers your question, Laura. Yeah, thanks. That's very helpful. Thank you. Thank you. Your next question comes from Zoe Bian with Citi. Please go ahead. Good evening, management. This is Zoe from... I have one question here. May I ask what's the update of your potential privatization? Sorry, the potential? Privatization. Yeah. It's Junling. Maybe let me answer Zoe's question on this one. No, the process is still ongoing. As we disclosed, we the company has formed a special committee to work on the proposal, and the special committee has recruited the legal and financial advisors. The company will make public the relevant information regarding the privatization as advised by special committee. Now it's within the hands of the special committee, and we will disclose when we advised by them according to SEC rules. That's the latest. Right. Okay. Sure. Thank you very much. Thank you. Thank you. Your next question comes from Gerald Hasting, who is a Private Investor. Please go ahead. Hello. Congratulations on your performance this quarter. I'm gratified to see that the operating cash flow and overall cash flow were in the black for the quarter, which I believe is a major milestone for your company. How do you plan to continue this trend going forward? Yeah. We are pleased to see the positive operating cash flow and overall cash flow for the quarter. It mainly attributed to our efforts to continuously reduce the operation loss, as well as we improve, continue to improve our working capital, the efficiency. Our average accounts payable is about like 40-45 days, and our inventory average turnover is like 25 days. That give us a good operating cash flow. We have very strong confidence. When we've continued to leverage our scale, to build up scale and improve our margin, and getting closer to operating profitability, so the overall cash flow will be continued to be positive. And we're quite confident on that. If you don't mind, if you, may I ask a second question? How. Sure. -your company achieve, double-digit revenue and gross profit growth, especially in light of the COVID-19 situation and possibly third quarter economic uncertainties? Yeah. Maybe let me try to answer that question. You know, first of all, you mentioned about, you know, this, you know, overall environment. It is, it is the COVID-19... the COVID zero policy, you know, does cause a lot of disruption to our business. You know, our fulfillment centers cannot operate as usual and, you know, we couldn't really replenish inventory and some of the fulfillment centers were locked down, and we were not able to deliver orders out. There are many orders get stuck in transit because you don't know which city was locked down, and some of the cities actually are logistical hubs. I think, you know, under such circumstances, it really proves the quality of our team, and it's extraordinary. You know, first of all, we established the emergency response committee and, you know, this committee, you know, reports to the management of the logistic problems and all the necessary measures that need to be taken. You know, if there are decisions that need to be made in the daily meeting with the management. You know, for instance, you know, some of the majority of the workers stay in a dormitory near the warehouse, and the some of the dormitories get locked down. You know, under such situations, you know, we need to quickly figure out how we can, you know, do our best to keep the operation going. You know, in the end, we made a decision that, you know, all our office people, you know, went to the warehouse to help with, you know, the sorting, to help with packaging and really try to deliver the orders out. Also, you know, our GR team is excellent. You know, they managed to, you know, work with various governments to, you know, get a special delivery fleet permit. You know, we'll have to work with different provincial governments to make sure that the goods can really cross provinces. You know, under the extraordinary circumstances, we still delivered 22% margin growth. This is also related to our strategy. You know, like what we did was we optimized our assortment, we optimized our pricing, and we reduced the procurement cost, and we also used our technology to really provide a whole selection, a whole rich selection of products at a very competitive pricing. You know, the pandemic is still pretty serious right now. We still anticipate, you know, a lot of negative impact is going to be, you know, assumed. You know, we have every confidence that we will overcome all those challenges and that we'll continue to deliver growth in the future. Thank you, Gerald. Thank you for your answer. I do look forward to your report next quarter with great anticipation. Good luck going forward. Thank you. Thank you. Your next question comes from Felix Yang, who is a private investor. Please go ahead. Thank you for the chance to raise questions. First of all, congratulations to you all for the 17th continuous gross quarterly. I have two questions regarding the technology R&D progress and also the private label products. First, I would like to know, is there any progress in technology R&D in the past season, and what future advances will there be? Second is about private label products. I know it's a good way to raise the margin and what will there be for the next quarter and the coming year? Thanks, Felix. Let me take the first question regarding our technology. We are continuously making very significant resource investment in technology and in innovation. As you know that we set our mission as applying digital technology to seamlessly connect patients with medical services. You can see that, you know, everything through digital technology. Jimmy also mentioned that we build various systems to, you know, for example, build a smart sourcing system to manage our assortment. We build a Hawkeye system to improve efficiency of our field teams, and also build very sophisticated supply chain management systems based on, you know, optimization models and algorithms. You know, all those help us to speed up our inventory turn. Improve our supply chain efficiency and reduce our fulfillment cost. As you can see, that results are illustrated through our margin improvement. This has also been exemplified by the, well, various recognitions, you know, some nationally, some locally. Okay, Jenny mentioned that we are certified by the Chinese Ministry of Science and Technology as a National High-Tech Enterprise. We were awarded the prize of National E-commerce Demonstration Enterprise by China Ministry of Commerce. These are national recognitions, which are very significant. We have some recognitions or distinctions by the local government, Shanghai government and Pudong government. We feel very proud of all those recognitions and the effort we have put in. Thanks. Regarding your second question of OEM. Yes, this actually, this is really exciting. Today, we have launched about 9 SKUs of our private label products. All of these 9 SKUs have been well accepted by our customers, especially those small and medium chains or individual B2B stores. Actually, in China, in those big chain stores, private label products have contributed about 10%-20% of their GMV and about 30%-40% of their margin. Well, our B2B customers, those individual stores, those small chains, they are not able to have their own brand, as you know, their volume is there. There are also many, many opportunities for this market that when we launch our offer, our private label to help them compete with those big ones in the market. There are already about 100 private label SKUs in our pipeline, some are in production, et cetera. We expect to see a fast increasing volume in this project in the coming quarters. Felix, I hope I answered your question. Thank you. Thank you. Thank you. Your next question comes from Tom Craig with PatientStone Investments. Please go ahead. Thank you. This is Tom Craig from PatientStone. Congratulations on your performance in the third quarter. I have three questions. The first one is, what services did the company provide to patients in COVID-hit regions? Second one is, what are the reasons behind contracting non-GAAP net goals from operation as% of net revenue? Can this be sustained? Third one is, what is the status of the company's cash reserves? Thank you. Hi, Tom. Let me answer your first question. You know, it's hard. It's very hard to provide services for the COVID impacted regions. We have made a tremendous effort in conquering all those difficulties. As we speak now, you know, five of our seven fulfillment centers are under severe impact, lockdowns or other impact right now. You know, our offices, headquarter office here locked down for almost 80 days, it was hard. Even every single day, we have 1,000 orders blocked somewhere in through, en route to customers. Every single day. What we did that, you know, since the first day of the pandemic, we formed a emergency response center, we have daily calls to resolve from on the fly. We, we launched a free consultation, online consultation for the patients in those pandemic impacted regions. Jenny mentioned that we cover customers for more than 370 cities and, you know, handling more than 400 different type of diseases. We, we work with the government to get special licenses. For example, we get for some local government to give us dedicated delivery fleet for medical products for some provinces. We also built a very robust and dedicated transportation networks to deal with the daily disruptions caused by the COVID pandemic. You know, the network consists of all the, you know, hubs, spokes, you know, partnering with our platform vendors. You know, our marketplace vendors. You know, every link will have multiple options to, you know, so that if one link is broken due to some reason and we can immediately, you know, transfer to the second. Through all those ways, we're able to, you know, certainly it's not at, you know, 100% as we, you know, we, we hope so, hope to, but we can handle a large volume, a large percentage of our business through the pandemic. Tom, regarding second question about the net loss. Yes, we are seeing a contracting of our net loss from operations as a percentage of our net revenue. This is, of course, the both part. One is the improvement of our gross profit. As I just mentioned, about 27% improvement on our gross profit year-over-year. This is one hand. On the other hand. Also we reduced our operating expenses, which is 8.4% from 10.2% of the same quarter last year. The improvement came from the procurement source upgrade and our product assortment, the optimization of our product assortment, and also, we launched various tools. For example, our new PIS, our smart pricing tools. All of this has contribute to the reduction of expenditure. Moving forward, of course, we will sustain the trend. We will continue our efforts on both sides. We expect to see a further improvement in the near future quarters on our net loss and our profitability. Thank you. Yeah. On the cash position, we have just closed at our earnings release that as of September end, we have total cash, including restricted cash and short-term investment, amounting to RMB 860 million. As we just shared with you that, we have reported a positive operating and overall cash flow for the quarter, and we believe the trend will continue. We have strong confidence that this position, cash position, is sufficient to support our future operation, as well as our growth. Tom, yeah, I hope we answered all your questions. Thank you for the answer. I hope you have a great fourth quarter. Thank you. Thank you. Thank you. There are no further questions at this time. In closing, on behalf of the entire 111 management team, we'd like to thank you for your interest and participation in today's call. If you require any further information or have any interest in visiting 111 in Shanghai, China, please let the company know. Thank you for joining us today. The call has concluded.