京東 (JD) 2021 Q1 法說會逐字稿

Hello, and thank you for standing by for JD.com's First Quarter 2021 Earnings Conference Call. (Operator Instructions) Today's conference is being recorded. If you have any objections, you may disconnect at this time.

您好，感謝您參與京東 2021 年第一季度收益電話會議。 （操作員說明）今天的會議正在錄製中。如果您有任何異議，您可以在此時斷開連接。

I would now like to turn the meeting over to your host for today's conference, Ruiyu Li.

我現在想把會議交給今天會議的主持人李瑞宇。

Thank you, operator, and welcome to our first quarter 2021 earnings conference call. Joining me on the call today are Mr. Lei Xu, CEO of JD Retail; and Sandy Xu, our CFO. For today's agenda, our CEO of JD Retail, Mr. Xu, will share his thoughts on the Q1 performance, followed by our CFO, Sandy, who will discuss the financial highlights for the first quarter 2021. Both Lei and Sandy will join the Q&A session.

謝謝運營商，歡迎參加我們的 2021 年第一季度收益電話會議。今天和我一起參加電話會議的是京東零售首席執行官徐磊先生；和我們的首席財務官 Sandy Xu。對於今天的議程，我們的京東零售首席執行官徐先生將分享他對第一季度業績的看法，隨後我們的首席財務官 Sandy 將討論 2021 年第一季度的財務亮點。雷軍和 Sandy 都將參加問答環節會議。

Before we continue, I refer you to our safe harbor statement in the earnings press release, which applies to this call as we will make forward-looking statements. Also, this call includes discussions of certain non-GAAP financial measures. Please refer to our earnings release, which contains a reconciliation of non-GAAP measures to the most directly comparable GAAP measures. Finally, please note, unless otherwise stated, all figures mentioned during this conference call are in RMB.

在我們繼續之前，我向您推薦我們在收益新聞稿中的安全港聲明，該聲明適用於本次電話會議，因為我們將做出前瞻性聲明。此外，本次電話會議還包括對某些非公認會計原則財務措施的討論。請參閱我們的收益發布，其中包含非 GAAP 措施與最直接可比的 GAAP 措施的對賬。最後請注意，除非另有說明，本次電話會議中提及的所有數字均以人民幣為單位。

Now I would like to turn the call over to our CEO of JD Retail, Mr. Lei.

現在我想把電話轉給我們的京東零售首席執行官雷先生。

(foreign language)

（外語）

[Interpreted] Thank you, Ruiyu. Hello, everyone. This is Lei Xu, CEO of JD Retail. Thank you for joining us on this quarter's earnings call today.

[解釋]謝謝你，瑞宇。大家好。我是京東零售CEO徐磊。感謝您今天參加本季度的財報電話會議。

(foreign language)

（外語）

[Interpreted] This year marks the 18th anniversary of the establishment of JD.com. In the past 18 years, at the heart of the deep integration of China's rail economy and digital economy, we have faced many opportunities and challenges. JD has created a unique business model whose core philosophy for success is about providing the superior customer experience, cost optimization and operational efficiency. These pursuits also constitute our core competitive advantages.

【解讀】今年是京東成立18週年。 18年來，在中國軌道經濟與數字經濟深度融合的核心地帶，我們面臨著諸多機遇和挑戰。京東創造了獨特的商業模式，其成功的核心理念是提供卓越的客戶體驗、成本優化和運營效率。這些追求也構成了我們的核心競爭優勢。

Our long-held business principle of doing the right things and our unique business model have helped us to win greater trust from our users and partners, while enabling us to stay resilient through economic cycles and weather all risks. As you can see, based on this, JD's business, logistics, has become increasingly open. We're enhancing our capacities to empower others, not only rising to the challenges we face, but also seizing opportunities for long-term growth. Here, I would like to share some key progresses that JD Retail achieved in the past quarter from the following 3 aspects.

我們長期以來堅持做正確的事情的商業原則和我們獨特的商業模式幫助我們贏得了用戶和合作夥伴的更大信任，同時使我們能夠在經濟周期中保持彈性並抵御所有風險。可以看到，基於此，京東的業務，物流，變得越來越開放。我們正在增強我們賦予他人權力的能力，不僅要迎接我們面臨的挑戰，還要抓住長期增長的機會。在這裡，我想從以下三個方面分享京東零售在過去一個季度取得的一些關鍵進展。

(foreign language)

（外語）

[Interpreted] First, high-quality growth of business and users. JD Retail's revenues maintained high growth in the first quarter with continued improvement in both operating efficiency and profit margins. Our CFO, Sandy, will elaborate on this later. This lays a solid foundation for our businesses in the following quarters. We are even more encouraged to see that many of our suppliers and partners achieved healthy and sustainable business growth and profitability expansion in the challenging market environment through their partnership with JD.

【解讀】一是業務和用戶的高質量增長。京東零售一季度收入保持高速增長，運營效率和利潤率持續提升。我們的首席財務官 Sandy 稍後將詳細說明這一點。這為我們接下來幾個季度的業務奠定了堅實的基礎。更令我們欣慰的是，我們的眾多供應商和合作夥伴通過與京東的合作，在充滿挑戰的市場環境中實現了健康、可持續的業務增長和盈利能力擴張。

(foreign language)

（外語）

[Interpreted] Coupled with robust operating performance, we are also inspired by the growth of our high-quality active users. By April 1, the number of our annual active users reached the 500 million mark. By the end of Q1, annual active users grew by 29% year-on-year. In the past 12 months, we gained 112 million new active users, with over 80% coming from lower-tier markets. Meanwhile, our unique consumer mind share for quality products and superior shopping experience resonates strongly with our customers as we see higher engagement from them. In the first quarter, we have seen all around improvement in terms of existing and new users retention rates, shopping frequency, purchases on a wider range of product categories as well as average spending per user. This shows that both the number of users and their lifetime value on JD's platform are expanding. We still have much room to grow.

【解讀】加上強勁的運營業績，我們也受到優質活躍用戶增長的鼓舞。到 4 月 1 日，我們的年活躍用戶數達到了 5 億大關。截至一季度末，年活躍用戶同比增長29%。在過去的 12 個月裡，我們新增了 1.12 億活躍用戶，其中超過 80% 來自低端市場。同時，我們對優質產品和卓越購物體驗的獨特消費者心智分享與我們的客戶產生了強烈的共鳴，因為我們看到他們的參與度更高。在第一季度，我們看到現有和新用戶保留率、購物頻率、更廣泛產品類別的購買以及每位用戶的平均支出方面都有所改善。這表明京東平台的用戶數量和生命週期價值都在擴大。我們還有很大的成長空間。

(foreign language)

（外語）

[Interpreted] Second, online marketplace ecosystem. JD Retail's online marketplace business also made meaningful progress during the quarter. The growth rate of our online marketplace business exceeded our 1P business. Our online marketplace ecosystem also becomes increasingly abundant. In particular, the growth rate of apparels and beauty categories reached a 3-year high. Moreover, not only have we made significant progress in long tail categories, but also categories such as home appliances and FMCG that are JD's 1P advantage categories also showed accelerated 3P growth. With the development of our online marketplace ecosystem, its positioning in the consumers' mind share will continue to be enhanced.

【解讀】二是電商生態。京東零售的在線市場業務在本季度也取得了顯著進展。我們在線市場業務的增長率超過了我們的 1P 業務。我們的在線市場生態系統也變得越來越豐富。尤其是服裝和美妝品類的增速創三年新高。此外，不僅長尾品類取得明顯進展，京東1P優勢品類的家電、快消品等品類也出現3P加速增長。隨著我們在線市場生態系統的發展，其在消費者心智份額中的定位將不斷增強。

(foreign language)

（外語）

[Interpreted] As I mentioned on our last earnings call, the online marketplace ecosystem has always been an area of huge potential for JD. With several years of continued efforts, we have now established a sound foundation. Since the beginning of the year, we have seen meaningful improvement in existing merchants renewable rates and their engagement level as well as significant increased variety of brands and merchants available on our platform. This year, we have welcomed more and more leading brands and merchants from home and abroad to JD's platform, including [Jojitang], Starbucks, Decathlon and a suite of fashion brands under BESTSELLER group and more.

[解讀]正如我在上次財報電話會議上提到的，在線市場生態系統一直是京東潛力巨大的領域。經過幾年的不斷努力，我們現已奠定了良好的基礎。自今年年初以來，我們看到現有商家可續訂率及其參與度顯著提高，並且我們平台上可用的品牌和商家種類顯著增加。今年，京東平台迎來了越來越多的國內外領先品牌和商家，包括【喬吉堂】、星巴克、迪卡儂以及BESTSELLER集團旗下的一系列時尚品牌等等。

(foreign language)

（外語）

[Interpreted] We also continue to collaborate with more brand partners through innovative models. For example, JD and Louis Vuitton launched an innovative collaboration in April with a groundbreaking online luxury shopping model that provide consumers with direct access to the brand's latest collections. It supplements luxury consumption scenarios currently available online, helps to further enhance JD users' luxury shopping experience and promotes further innovation of the luxury industry in China.

【解讀】我們也不斷通過創新模式與更多品牌合作夥伴進行合作。例如，京東和路易威登在 4 月推出了一項創新合作，推出了一種開創性的在線奢侈品購物模式，讓消費者可以直接訪問該品牌的最新系列。它補充了現有線上奢侈品消費場景，有助於進一步提升京東用戶的奢侈品購物體驗，推動中國奢侈品行業的進一步創新。

(foreign language)

（外語）

[Interpreted] All of these successful cases demonstrate JD's ability to provide unique value for our brands and merchants and serve as great examples for more business partners. With China's retail industry continuing to develop in a more beneficial direction, we expect more and more brands and merchants in all categories will come to JD's platform. The upcoming June 18 grand promotion marks the 18th anniversary of JD.com. We plan to help more than 230 brands achieve over RMB 100 million in sales. Looking ahead, we will continue to innovate and explore various models that best suit JD's online marketplace ecosystem.

【解讀】所有這些成功案例都證明了京東能夠為我們的品牌和商家提供獨特的價值，並為更多的商業夥伴樹立了榜樣。隨著中國零售業繼續向更有利的方向發展，我們預計將有越來越多的各個品類的品牌和商家來到京東的平台。即將到來的6月18日盛大促銷是京東成立18週年。我們計劃幫助230多個品牌實現過億元的銷售額。展望未來，我們將繼續創新探索最適合京東電商生態的各種模式。

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（外語）

[Interpreted] Third, omnichannel continues to advance. The challenges coming from the external environment and competitors these days all have validated JD Retail's forward-looking omnichannel strategy. In fact, JD Retail's current business model has already evolved far beyond an online B2C e-commerce model. Therefore, it's uniquely positioned in exploring the omnichannel field, leveraging our state-of-the-art supply chain management, digital operation and integrated marketing capacities. In various consumption scenarios, JD Retail is collaborating with suppliers and partners to build an adaptive model that can efficiently serve various types of consumer demand in any scenarios, anywhere and anytime.

【解讀】第三，全渠道持續推進。這些天來自外部環境和競爭對手的挑戰，都印證了京東零售前瞻性的全渠道戰略。事實上，京東零售目前的商業模式已經遠遠超越了線上B2C電子商務模式。因此，憑藉我們最先進的供應鏈管理、數字化運營和整合營銷能力，它在探索全渠道領域具有獨特的定位。在各種消費場景下，京東零售正與供應商和合作夥伴合作，構建自適應模式，在任何場景、隨時隨地、高效服務各類消費需求。

For instance, we're actively collaborating with leading traffic ecosystems such as Douyin, Kuaishou, [Xigua] and more in diversified online consumption scenarios, and provides our business partners with our strong supply chain middle platform capacities, omnichannel marketing and across the board user asset management solution. In this process, we achieved the unification of products and people in the increasingly diversified retail industry, propelling further optimization of cost efficiency and user experience.

例如，我們積極與抖音、快手、西瓜等領先的流量生態系統在多元化的在線消費場景中進行合作，並為我們的業務合作夥伴提供強大的供應鏈中台能力、全渠道營銷和全渠道用戶。資產管理解決方案。在這個過程中，我們在日益多元化的零售行業中實現了產品和人的統一，推動了成本效率和用戶體驗的進一步優化。

(foreign language)

（外語）

[Interpreted] JD Retail's vision is to sell goods from all over the world and to sell all kinds of goods to the world.

【解讀】京東零售的願景是賣世界各地的商品，把各種商品賣到世界各地。

(foreign language)

（外語）

[Interpreted] To conclude, despite all the challenges facing us right now, the accelerated growth we achieved last year and the long-term investments we are making to expand the total addressable market, JD Retail, as the core business of JD.com, will continue to strive for high and healthy growth in 2021 and serve as the cornerstone for JD.com's overall development.

[解釋] 總而言之，儘管我們現在面臨著所有挑戰，但我們去年實現的加速增長以及我們為擴大總潛在市場京東零售作為京東核心業務所做的長期投資， 2021年將繼續努力實現高速健康增長，作為京東整體發展的基石。

(foreign language)

（外語）

[Interpreted] This concludes my remarks. I will now give the floor to our CFO, Sandy.

[解釋] 我的發言到此結束。我現在請我們的首席財務官桑迪發言。

Thank you, Lei. Hello, everyone. We are excited to get off to a flying start in 2021 with robust operating and financial performance in the first quarter. As Lei pointed out, our unique business philosophy and model allow us to embrace innovation and take advantage of structural changes that are taking place in China.

謝謝你，雷。大家好。我們很高興能夠在 2021 年以強勁的運營和財務表現在第一季度取得良好的開端。正如雷軍指出的那樣，我們獨特的經營理念和模式使我們能夠擁抱創新，並利用中國正在發生的結構性變化。

Before going through the financial results, I will touch upon a few highlights from the first quarter. This year marks the 18th year since the launch of JD.com. Along the way, we have been able to build a comprehensive set of supply chain, fulfillment and technology capabilities to serve customers and business partners. Our business model has evolved from being the largest retail company in China by revenue to a supply-chain-based technology and service provider. We are rolling a snowball on a very long slope and continue to gain momentum.

在介紹財務業績之前，我將談談第一季度的一些亮點。今年是京東上線的第18個年頭。在此過程中，我們已經能夠建立一套全面的供應鏈、履行和技術能力，為客戶和業務合作夥伴提供服務。我們的商業模式已經從中國收入最大的零售公司發展為基於供應鏈的技術和服務提供商。我們在一個很長的斜坡上滾雪球，並繼續獲得動力。

Some of these capacities that we have been building for years are turning into promising growth opportunities and achieving important milestones. And a number of our younger businesses are seeing exciting developments and rapid iteration. At this stage, the most notable among them include: first, JD Logistics, which has published its prospectus on May 17 and expects to list on the Hong Kong Stock Exchange on May 28, 2021; second, JD Property, which completed its Series A preferred share financing by end of Q1; third, our international businesses that grew triple digits in Q1; and fourth, our Jingxi business, which aims to synchronize our efforts and resources in lower-tier markets.

我們多年來一直在建設的其中一些能力正在轉化為充滿希望的增長機會並實現重要的里程碑。我們的一些年輕企業正在看到令人興奮的發展和快速迭代。現階段，其中最引人注目的包括：一是京東物流，已於5月17日發布招股書，預計將於2021年5月28日在港交所上市；二是京東地產，一季度末完成A輪優先股融資；第三，我們的國際業務在第一季度增長了三位數；第四，我們的京西業務，旨在同步我們在低線市場的努力和資源。

To help the investors better understand the different growth trajectories of our expanding business lines and how they are evaluating from the management's perspective, starting from Q1 2021, we restructured our segment presentation. The changes in segment reporting mainly include. First, JD Logistics is presented as a stand-alone segment. Its revenues include revenues generated from both JD Retail and external customers from JD Group's perspective. The eliminations at the group level are presented in the line of net revenue intersegment.

為了幫助投資者更好地了解我們不斷擴大的業務線的不同增長軌跡以及他們如何從管理層的角度進行評估，從 2021 年第一季度開始，我們重組了我們的分部展示。分部報告的變化主要包括。首先，京東物流作為一個獨立的部分呈現。從京東集團的角度來看，其收入包括來自京東零售和外部客戶的收入。集團層面的抵銷在淨收入分部間列示。

Second, operating results of JD Property and Jingxi business, which includes our social e-commerce platform, Jingxi, convenience store business, Jingxitong, and community group purchase business, Jingxi Pinpin, have been carved out from the JD Retail segment and are reported enter the New businesses segment. As a result of these changes, we now report 3 main segments: namely JD Retail, JD Logistics and New businesses. New businesses segment primarily include JD Property, Jingxi business, international business, JD Cloud and AI business. The prior period segment information has been retrospectively revised to conform to the current period presentation, and these changes have no impact on our consolidated results.

二是京東地產和京西業務的經營成果，包括我們的社交電商平台京西、便利店業務京西通和社區團購業務京西拼品，已從京東零售板塊中剝離出來，並據報進入新業務部門。由於這些變化，我們現在報告三個主要部分：京東零售、京東物流和新業務。新業務板塊主要包括京東地產、京西業務、國際業務、京東雲和人工智能業務。前期分部信息已追溯修訂以符合本期列報，這些變化對我們的合併業績沒有影響。

On another note, as the transaction with JD Technology, formerly known as JD Digits, was completed on March 31, 2021, we deconsolidated the cloud and AI business starting from March 31, 2021. The updated segment presentation reflects not only our current organization structure, but also the different development stages of various business lines. JD Retail's revenues grew 35% year-on-year to RMB 186 billion in Q1. This is a robust growth on top of our relatively higher base compared to the industry in Q1 2020 as we largely maintained operations during the COVID outbreak. That said, internally, we evaluate our retail business performance by looking at the 2-year CAGR, i.e., the compound growth rate of our businesses in Q1 2021 over Q1 2019, which smooths out the disruption caused by the pandemic, therefore, better depicts the underlying growth momentum of our businesses.

另一方面，由於與京東科技（前身為京東數科）的交易於 2021 年 3 月 31 日完成，我們從 2021 年 3 月 31 日開始拆分雲和人工智能業務。更新的分部展示不僅反映了我們當前的組織結構，也是各個業務線的不同發展階段。京東零售第一季度營收同比增長35%至人民幣1860億元。由於我們在 COVID 爆發期間基本維持運營，因此與 2020 年第一季度的行業相比，我們的基數相對較高，這是一個強勁的增長。也就是說，在內部，我們通過查看 2 年復合年增長率（即 2021 年第一季度我們的業務相對於 2019 年第一季度的複合增長率）來評估我們的零售業務表現，這消除了大流行造成的破壞，因此，更好地描述我們業務的潛在增長動力。

Our core JD Retail business clearly remains in a buoyant growth trajectory after 18 years of operation, with a 27% 2-year CAGR of revenues in Q1, nearly doubled the growth rate of China's total online retail sales of goods over the same period. We continue to see successful category expansion. General merchandise revenues reported 36% year-on-year growth and a 2-year CAGR of 37% in Q1 2021, continuing the strong momentum on top of the high growth in Q1 last year, boosted by the structural pickup in demand and enhanced consumer mind share of JD general merchandise categories. This was led by our supermarket, health care, home product and cosmetics categories. Our electronics and home appliance revenues increased 34% year-on-year and a 2-year CAGR of 21% during Q1, a clear recovery from last year and continuing to significantly outperform the industry.

我們的核心京東零售業務經過 18 年的運營，顯然仍處於強勁的增長軌道，第一季度收入的 2 年復合年增長率為 27%，幾乎是同期中國在線商品零售總額增長率的兩倍。我們繼續看到成功的品類擴張。 2021 年第一季度，雜貨收入同比增長 36%，兩年復合年增長率為 37%，在需求結構性回升和消費者增強的推動下，繼續保持去年第一季度高增長的強勁勢頭京東百貨類目中的份額。這以我們的超市、保健品、家居用品和化妝品類別為主導。我們的電子和家電收入在第一季度同比增長 34%，兩年復合年增長率為 21%，較去年明顯回升，並繼續顯著優於行業。

More notably, the fast revenue growth of our core retail business was accompanied by even faster profit growth. The operating profit of JD Retail grew 45% year-on-year and a 2-year CAGR of 46% in Q1, considerably outpacing its revenue growth during the same period in spite of intense competition. Operating margin of JD Retail improved by 27 basis points year-on-year and reached 4.0% in Q1, driven by increased fulfilled gross margin and technology-led operating leverage. This was the second highest operating margin level of JD Retail in our history, only slightly below 4.2% achieved in Q3 2020 with the social security benefit.

更值得注意的是，我們核心零售業務收入的快速增長伴隨著更快的利潤增長。京東零售第一季度營業利潤同比增長 45%，兩年復合年增長率為 46%，儘管競爭激烈，但仍遠超同期收入增長。京東零售的營業利潤率同比提升 27 個基點，在第一季度達到 4.0%，這主要得益於已實現的毛利率和技術主導的經營槓桿。這是京東零售歷史上第二高的營業利潤率水平，僅略低於 2020 年第三季度在社會保障福利下實現的 4.2%。

Once again, we continue to maintain margin improvement, even as our product mix shift towards the high-frequency but small, medium-sized consumer staple categories that are yet to fully realize earnings potential. All in all, while maintaining healthy growth, our core retail business is well on track to expand margins over the long term. Our JD Logistics business, JDL, is at a high secular growth stage while it continues to invest in infrastructure and capacities to expand its total addressable market and drive future growth.

再一次，我們繼續保持利潤率改善，即使我們的產品組合轉向尚未完全實現盈利潛力的高頻但中小型消費必需品類別。總而言之，在保持健康增長的同時，我們的核心零售業務有望長期擴大利潤率。我們的京東物流業務 JDL 處於長期高速增長階段，同時繼續投資於基礎設施和產能，以擴大其潛在市場並推動未來增長。

JDL's revenues reached RMB 22 billion in Q1 with year-on-year growth accelerated to a historical high of 64% from 34% in Q1 2020 and the 2-year CAGR was 48%. Starting second half of 2020, JDL started to reinvest the benefit from social security reduction and other supportive measures by the government it received in logistics, infrastructure and technologies to expand market potential. As a result, its operating loss ratio widened to 6.6% in Q1 from 3.1% in the same quarter last year. JD Logistics currently operates over 1,000 warehouses with an aggregate gross floor area of over 21 million square meters.

JDL第一季度營收達到220億元人民幣，同比增長從2020年第一季度的34%加速至64%的歷史高位，2年復合年增長率為48%。從 2020 年下半年開始，JDL 開始將其從政府降低社會保障和其他支持措施中獲得的收益再投資於物流、基礎設施和技術，以擴大市場潛力。因此，其第一季度的經營虧損率從去年同期的 3.1% 擴大至 6.6%。京東物流目前經營著1000多個倉庫，總建築面積超過2100萬平方米。

Enter the New businesses segment. We recorded fast growth across the board from all sub-business lines during the quarter. Total revenues of New businesses grew 56% year-on-year to RMB 5 billion in Q1 on an apple-to-apple comparable basis with a 2-year CAGR of 42%. As we are seeing many exciting developments, our New businesses are in very early stage of incubating that require investments. In Q1, we invested and incurred RMB 2.3 billion operating loss in New businesses compared to an operating loss of RMB 1.4 billion in the same period last year, mainly due to our investments in the newly formed Jingxi business group.

進入新業務部分。本季度，我們所有子業務線均實現了快速增長。第一季度新業務總收入同比增長 56%，達到 50 億元人民幣，2 年復合年增長率為 42%。由於我們看到了許多令人興奮的發展，我們的新業務正處於孵化的早期階段，需要投資。第一季度，我們在新業務上的投資和經營虧損為人民幣 23 億元，而去年同期的經營虧損為人民幣 14 億元，主要是由於我們對新成立的京西事業群的投資。

Jingxi business' day 1 mission is to serve price-sensitive consumers and business partners in lower-tier markets and create value to the society through leveraging JD's technology and supply chain capacity as well as fulfillment infrastructure. That said, in the first quarter of operation, Jingxi Pinpin services have covered 17 provinces, recording record order volume growth by offering differentiated user experiences. We are committed to driving forward our strategies to serve the lower-tier markets under Jingxi brand.

京西商務第一天的使命是利用京東的技術和供應鏈能力以及履行基礎設施，服務於對價格敏感的消費者和下層市場的商業夥伴，為社會創造價值。儘管如此，在第一季度的運營中，京西拼品服務已覆蓋17個省份，通過提供差異化的用戶體驗，訂單量增長創歷史新高。我們致力於推進我們的戰略，以京西品牌服務於低線市場。

Now turning to our traditional review of our financial performance. Total net revenues grew 39% year-on-year and 29.5% 2-year CAGR to RMB 203 billion in Q1. It is worth highlighting that our net service revenues growth reached 73% year-on-year, highest growth rate in the last 5 years. The 2-year CAGR of net service revenues in Q1 was 50%, significantly outpacing the 27% 2-year CAGR of net product revenues during the same period. This is mainly driven by the triple-digit year-on-year growth of JD Logistics external revenue and over 60% year-on-year growth of our advertising revenue in Q1. As a result, net service revenues contributed 13.7% of our total revenues in Q1, up from 11% a year ago and 10.3% in Q1 2019, boding well for our diversifying revenue growth potential.

現在轉向我們對財務業績的傳統審查。第一季度總淨收入同比增長 39%，2 年復合年增長率為 29.5%，達到 2030 億元人民幣。值得一提的是，我們的淨服務收入同比增長達到 73%，是過去 5 年的最高增長率。第一季度淨服務收入的 2 年復合年增長率為 50%，大大超過同期淨產品收入的 27% 的 2 年復合年增長率。這主要是受京東物流對外收入同比三位數增長和第一季度廣告收入同比增長超過 60% 的推動。因此，淨服務收入占我們第一季度總收入的 13.7%，高於一年前的 11% 和 2019 年第一季度的 10.3%，這對我們多元化的收入增長潛力來說是個好兆頭。

Our non-GAAP operating margin was 1.7% in Q1, 50 basis points lower year-on-year. This was largely a result of our continued investments in new capacities of JD Logistics and to a lesser extent our investment in new businesses, namely Jingxi, Cloud and AI. Non-GAAP net income attributable to ordinary shareholders was RMB 4.0 billion, with non-GAAP net margin remained stable year-over-year at 2.0%, even as we resumed marketing efforts and increased investments in our logistics and new businesses opportunities to position for the long term. It's worth highlighting that we continue to generate operating efficiency and further shortened our inventory turnover days to 31.2 days in the last 12 months, while we expand the total number of SKUs directly managed by us under the 1P model, which exceeded 8 million in Q1 2021.

我們第一季度的非公認會計原則營業利潤率為 1.7%，同比下降 50 個基點。這主要是由於我們對京東物流新能力的持續投資，以及在較小程度上我們對京西、雲和人工智能等新業務的投資。歸屬於普通股股東的非美國通用會計準則淨利潤為人民幣 40 億元，非美國通用會計準則淨利潤率同比保持穩定在 2.0%，儘管我們恢復了營銷工作並增加了對物流和新業務機會的投資以定位長期。值得強調的是，在過去的 12 個月中，我們不斷提高運營效率，進一步將庫存周轉天數縮短至 31.2 天，同時我們擴大了我們在 1P 模式下直接管理的 SKU 總數，2021 年第一季度超過 800 萬.

As of March 31, cash, cash equivalents, restricted cash and short-term investments added up to a total of RMB 139 billion. Our free cash flow for Q1 was an outflow of RMB 9.7 billion as compared to an outflow of RMB 3.0 billion a year ago. Besides the seasonality factor, decreased quarterly free cash flow was also due to our early payments or prepayments to certain suppliers to secure some sought after merchandises, especially amid a global shortage of supply of consumer electronics components and increase of CapEx in the quarter. And free cash flow for trailing-12-months was RMB 28 billion, up from RMB 15 billion a year ago.

截至3月31日，現金、現金等價物、限制性現金及短期投資合計1390億元。我們第一季度的自由現金流流出人民幣 97 億元，而一年前流出人民幣 30 億元。除了季節性因素外，季度自由現金流減少也是由於我們提前向某些供應商付款或預付款以獲取一些搶手的商品，特別是在全球消費電子元件供應短缺和本季度資本支出增加的情況下。過去 12 個月的自由現金流為人民幣 280 億元，高於一年前的人民幣 150 億元。

Lastly, we repurchased approximately 10 million ADS for approximately USD 800 million year-to-date under the USD 2 billion share repurchase program approved by the Board in March 2020. In summary, we managed to continue our strong user and top line growth momentum with diversified growth drivers, maintained solid bottom line performance while continuing to invest for the long term. Once again, we demonstrated the resilience of our unique business model. With the robust performance of our core business and our long-term approach of building core competence with new businesses, JD is at a position of strength.

最後，根據董事會於 2020 年 3 月批准的 20 億美元股票回購計劃，我們今年迄今以約 8 億美元的價格回購了約 1,000 萬股美國存託憑證。總而言之，我們設法繼續保持強勁的用戶和收入增長勢頭，多元化的增長動力，保持穩健的底線表現，同時繼續長期投資。我們再次展示了我們獨特商業模式的彈性。憑藉我們核心業務的強勁表現以及我們通過新業務建立核心競爭力的長期方法，京東處於優勢地位。

That concludes my prepared remarks. Let's now move on to Q&A. Thank you.

我準備好的發言到此結束。現在讓我們繼續進行問答。謝謝你。

(Operator Instructions) Your first question comes from Eddie Leung from Bank of America Merrill Lynch.

（操作員說明）您的第一個問題來自美銀美林的 Eddie Leung。

(foreign language) So I have 2 questions. The first one is about omnichannel threat. So we'd like to hear from the management team about their thoughts on the competitive environment as well as the differentiation of JD in community group and new retail. And then secondly, just want to get a sense on the average order size because we know that in the first quarter the growth of large ticket items such as home appliances had very strong growth. But on the other hand, we continue to see the growth of small ticket items, like JD supermarket and grocery. So these are my 2 questions.

（外語）所以我有兩個問題。第一個是關於全渠道威脅。所以我們想听聽管理層對競爭環境的看法，以及京東在社區集團和新零售方面的差異化。其次，只是想了解一下平均訂單規模，因為我們知道一季度家電等大件商品的增長非常強勁。但另一方面，我們繼續看到京東超市和雜貨店等小額商品的增長。所以這是我的兩個問題。

Thanks, Eddie. This is Sandy. Maybe let me take the Jingxi-related question first, and Xu Lei can comment on the omnichannel strategy. So on Jingxi strategy, first of all, we believe this social book purchase model is definitely a long-term initiative. There is a structural opportunity for JD to further penetrate down to the lower-tier market to provide the price-sensitive consumers with more product selections and services, in particular, the products within the relatively low price range. And we have strong commitment and desire to explore the future addressable market opportunity with our Jingxi brands, as I just mentioned.

謝謝，埃迪。這是桑迪。或許讓我先提一下京西相關的問題，徐磊可以評論一下全渠道策略。所以在京西策略上，首先，我們認為這種社交購書模式絕對是一個長期的舉措。京東有結構性機會進一步向低端市場滲透，為價格敏感的消費者提供更多的產品選擇和服務，特別是價格相對較低的產品。正如我剛才提到的，我們有堅定的承諾和願望，用我們的京西品牌探索未來的潛在市場機會。

Even though the existing players in the market focus more on traffic operation at this stage, we believe, by end of the day, the key to win the game would be the supply chain capability and logistic infrastructure driven by technology. Because only these core -- with these core capabilities, we can provide our users with better shopping experience and quality products with better pricing. These are the areas where we have unique advantages and experiences through our 1P business and our logistics business. On one hand, we could leverage our existing supply chain network through our B2C e-commerce business, our long-term relationship with the brands to provide our users with more SKU selection.

儘管現階段市場上的現有玩家更關注交通運營，但我們認為，最終贏得這場比賽的關鍵將是技術驅動的供應鏈能力和物流基礎設施。因為只有這些核心——有了這些核心能力，我們才能為我們的用戶提供更好的購物體驗和價格更優的優質產品。這些是我們通過1P業務和物流業務具有獨特優勢和經驗的領域。一方面，我們可以通過我們的 B2C 電子商務業務、我們與品牌的長期合作關係，利用我們現有的供應鍊網絡，為我們的用戶提供更多的 SKU 選擇。

On another hand, we see this is a business heavily relied on local supply chain, especially for the fresh produce products. It is possible that a platform can quickly build up a nationwide service network, but if it cannot provide the users with competitive pricing and good shopping experience, it can easily be replaced by other platforms as well. So as a supply chain-driven platform, we would not compete on speed with other platforms, but taking a long-term approach through investing in infrastructure, focusing on building our own teams and supply chain. Only the traffic-driven platforms would compete on speed through heavy subsidy. So we will enhance our collaborations with JD's -- within JD's various business lines to satisfy our users' different shopping demands and different scenarios, leveraging our existing technology and infrastructure as much as possible.

另一方面，我們看到這是一個嚴重依賴本地供應鏈的業務，尤其是新鮮農產品。一個平台有可能快速建立起覆蓋全國的服務網絡，但如果不能為用戶提供有競爭力的價格和良好的購物體驗，也很容易被其他平台取代。所以作為一個供應鏈驅動的平台，我們不會與其他平台競爭速度，而是通過投資基礎設施，專注於建立自己的團隊和供應鏈來採取長期的方法。只有流量驅動的平台才會通過高額補貼來競爭速度。因此，我們將加強與京東的合作——在京東的各個業務線內，盡可能利用我們現有的技術和基礎設施，滿足用戶不同的購物需求和不同的場景。

(foreign language)

（外語）

[Interpreted] This is Xu Lei. I will comment on the omnichannel business and our FMCG and some high-value products.

[解釋]這是徐磊。我將評論全渠道業務以及我們的快速消費品和一些高價值產品。

(foreign language)

（外語）

[Interpreted] As you can see from the government release that the online retailing will take a greater part of the overall social retail.

【解讀】從政府發布的公告中可以看出，網絡零售將在整個社交零售中佔據更大的比重。

(foreign language)

（外語）

[Interpreted] And we have always seen that the decentralized trend continue to grow online and more and more traffic platforms are being more active online. And also, we see the digital transformation is happening quickly for our -- for the offline businesses.

【解讀】而且我們一直看到，去中心化的趨勢在線上持續增長，越來越多的流量平台在線上更加活躍。而且，我們看到我們的線下業務正在迅速發生數字化轉型。

(foreign language)

（外語）

[Interpreted] For the goal of JD Retail is to integrate in these trends and continue to promote the overall development of China's retail industry.

【解讀】京東零售的目標就是融入這些趨勢，持續推動中國零售業的整體發展。

(foreign language)

（外語）

[Interpreted] And in terms of our omnichannel businesses, by leveraging our strong capacities in supply chain, our digitalization capacities and our integrated marketing capacities, we will put all of these capacities in the use of different consumption scenarios to give support to our merchants and partners to help them to adapt to the changing market environment and to help them to achieve all kinds of shopping scenarios to satisfy the needs of the customers anytime and anywhere.

【解讀】在全渠道業務方面，我們將利用我們強大的供應鏈能力、數字化能力和整合營銷能力，將這些能力運用到不同的消費場景中，為我們的商家和商家提供支持。合作夥伴幫助他們適應不斷變化的市場環境，幫助他們實現各種購物場景，隨時隨地滿足客戶的需求。

(foreign language)

（外語）

[Interpreted] And based on our unparalleled capacities in supply chain and fulfillment, we can better serve our partners in this very complicated industry environment to help them to enter more emerging new traffic platforms. So these have already been welcomed by more and more of our partners.

【解讀】並且基於我們無與倫比的供應鍊和履約能力，我們可以在這個非常複雜的行業環境中更好地服務我們的合作夥伴，幫助他們進入更多新興的新流量平台。因此，這些已經受到我們越來越多的合作夥伴的歡迎。

(foreign language)

（外語）

[Interpreted] And for our offline partners, they have also very welcomed our methods to empower them with our capacities and resources rather than just taking advantage of the traffic. So in this way, we can better serve our business partners and also our consumers in more diversified shopping scenarios.

【解讀】對於我們線下的合作夥伴，他們也非常歡迎我們用我們的能力和資源來賦能他們的方式，而不是僅僅利用流量。所以這樣，我們可以在更多元化的購物場景中更好地服務於我們的商業夥伴以及我們的消費者。

(foreign language)

（外語）

[Interpreted] And a comment on the FMCG categories. We can see that this category achieved accelerated, faster growth last year due to the pandemic, thanks to the strong supply chain of JD.com. And this year, it continued a steady growth, especially during the Chinese New Year grand promotion.

[解釋] 以及對快速消費品類別的評論。我們可以看到，由於京東強大的供應鏈，去年這一品類由於疫情而實現了加速、更快的增長。而今年，它繼續穩步增長，尤其是在春節大促期間。

(foreign language)

（外語）

[Interpreted] And in this category, FMCG and the supermarket-related categories, JD.com has become the go-to or the #1 image and branding in consumers' mind share.

【解讀】在這個品類，快消品和超市相關品類中，京東已經成為消費者心目中的首選或第一形象和品牌。

(foreign language)

（外語）

[Interpreted] At the same time, we also realize the trend of consumption upgrade and the penetration of the sales channels, especially for categories like baby and maternal product.

【解讀】同時，我們也意識到消費升級的趨勢和銷售渠道的滲透，尤其是母嬰等品類。

(foreign language)

（外語）

[Interpreted] And for this quarter, due to the Chinese New Year Shopping Festival, the alcohol products -- the sales performance of alcohol products has been very outstanding. And based on our very close collaboration with our brand partners and reputations of trustworthy and authentic products we have been built in consumers' mind share, JD has become one of the largest sales channel for most of the alcohol brands on the Chinese market.

【解讀】而本季度，由於春節購物節，酒類產品——酒類產品的銷售表現非常突出。基於我們與品牌合作夥伴的密切合作以及在消費者心目中建立的值得信賴和正宗產品的聲譽，京東已成為中國市場上大多數酒類品牌最大的銷售渠道之一。

(foreign language)

（外語）

[Interpreted] And also this year, we will pay attention to help the development of new emerging brands and high-quality Chinese brands and to recruit more new brands on our platform to meet the needs of more and more young consumers.

【解讀】而且今年我們也會注重助力新興品牌和中國優質品牌的發展，在我們的平台上招募更多的新品牌，以滿足越來越多年輕消費者的需求。

(foreign language)

（外語）

[Interpreted] And in the electronics and digital products, this is our advantaged categories, it has kept a very steady growth in Q1.

【解讀】在電子和數碼產品中，這是我們的優勢品類，在第一季度保持了非常穩定的增長。

(foreign language)

（外語）

[Interpreted] And for the electronics product categories, the key strategies for us this year is to help the industry and more partners to embrace the omnichannel expansion, to improve the consumer shopping experience and also to support our offline partners in their digital transformation through our premier services and our upgrades and towards some transformation of our sales channels.

【解讀】對於電子產品品類，我們今年的重點戰略是幫助行業和更多的合作夥伴擁抱全渠道擴張，改善消費者的購物體驗，同時通過我們的支持線下合作夥伴的數字化轉型。一流的服務和我們的升級以及我們的銷售渠道的一些轉變。

(foreign language)

（外語）

[Interpreted] Also, I just want to raise this observation that the personal computers and mobile phones, these industries, it might be affected by the shortage of chip supplies this year. This might be a bottleneck for the supply chain for these categories.

【解讀】另外，我只是想提出一個觀察，個人電腦和手機這些行業，今年可能會受到芯片供應短缺的影響。這可能是這些類別供應鏈的瓶頸。

(foreign language)

（外語）

[Interpreted] So I want to share 3 points upon that. First is that based on our close collaboration with our suppliers and our outstanding supply chain management capacities, JD will be a less affected platform because of the supply chain bottleneck this year.

[解釋] 所以我想分享 3 點。首先是基於我們與供應商的密切合作以及我們出色的供應鏈管理能力，京東今年將是一個受供應鏈瓶頸影響較小的平台。

(foreign language)

（外語）

[Interpreted] And second, we will have made very precise predictions on the supply chain projections, so we can join hands with our partners to address this supply tension together. And in this process, we'll even strengthen our collaborations on the supply chain with all our partners.

【解讀】第二，我們將對供應鏈的預測做出非常精確的預測，這樣我們就可以與我們的合作夥伴攜手，共同應對這種供應緊張。在這個過程中，我們甚至會加強與所有合作夥伴在供應鏈上的合作。

(foreign language)

（外語）

[Interpreted] And thirdly, we also see the consumption is on the upward trend for those consumer electronics and home appliances categories.

【解讀】第三，我們也看到消費電子和家電品類的消費呈上升趨勢。

(foreign language)

（外語）

[Interpreted] Yes. Thank you.

[解釋] 是的。謝謝你。

Yes. And Eddie, to respond to your question regarding the average order value, this is not a key operating metric that we manage on a daily basis. But in Q1, our total order number actually increased slightly faster than our top line -- than our GMV growth. So that means the average order value remained largely stable compared to same period last year.

是的。 Eddie，回答您關於平均訂單價值的問題，這不是我們每天管理的關鍵運營指標。但在第一季度，我們的總訂單數實際上比我們的收入增長略快——比我們的 GMV 增長要快。這意味著與去年同期相比，平均訂單價值基本保持穩定。

Your next question comes from Ronald Keung from Goldman Sachs.

您的下一個問題來自高盛的 Ronald Keung。

My question is mostly on our investments and how we see the balancing between kind of growth, our core profitability and investments given quite a lot of our peers have been saying reinvesting a lot of their profits or all of their profits -- incremental profit. So in our case, we've seen a very good balance in the first quarter, that we have delivered basically still growth in EBIT, but quite big investments into logistics and new businesses that you have now disclosed separately. So how should we think about that trend, say, into the next few quarters? And should we -- how do we think about that balance and -- maybe for logistics and new businesses and the Jingxi business unit? If management could share some of those strategies and likely the trends in investment. And how do we think about that?

我的問題主要是關於我們的投資，以及我們如何看待增長、核心盈利能力和投資之間的平衡，因為我們的很多同行一直在說將他們的大部分利潤或全部利潤再投資——增量利潤。因此，在我們的案例中，我們在第一季度看到了非常好的平衡，我們的息稅前利潤基本保持增長，但對物流和新業務進行了相當大的投資，您現在已經單獨披露了這些投資。那麼我們應該如何看待這種趨勢，比如說，在接下來的幾個季度？我們是否應該——我們如何看待這種平衡——也許對於物流和新業務以及京西業務部門？如果管理層可以分享其中一些策略以及可能的投資趨勢。我們如何看待這一點？

Thanks, Ronald. Let me take this question first. I think, first of all, we prioritize growth above the importance of profitability because across all of our business lines, we are still in high-growth stage. But each segment or each business line is actually in different development stage. So we have kind of a differentiated investment strategy. So for JD Retail, we still -- you can see that for the first quarter and in the past few quarters, they continue to maintain a high-growth rate. And we -- as I mentioned at the call last quarter, we expect that, in 2021, our retail business will largely maintain the strong growth momentum from 2020.

謝謝，羅納德。讓我先回答這個問題。我認為，首先，我們將增長置於盈利的重要性之上，因為在我們所有的業務線中，我們仍處於高增長階段。但每個細分市場或每個業務線實際上處於不同的發展階段。所以我們有一種差異化的投資策略。所以對於京東零售，我們仍然——你可以看到第一季度和過去幾個季度，他們繼續保持高增長率。而且我們——正如我在上個季度的電話會議上提到的，我們預計，到 2021 年，我們的零售業務將在很大程度上保持 2020 年以來的強勁增長勢頭。

But with that, because of the scale benefit and operating leverage that we are gradually realizing from our core retail business, we -- our expectation for the longer-term margin expectation for retail remain unchanged. So that means we still expect over a longer-term period our JD Retail's net margin will maintain a steady growth trend. So really, the underlying margin drivers for JD Retail are the scale economy as well as the improvement of our 3P ecosystems.

但是，由於我們從核心零售業務逐漸實現的規模效益和經營槓桿，我們對零售業長期利潤率的預期保持不變。因此，這意味著我們仍預計京東零售的淨利潤在較長時期內將保持穩定增長趨勢。所以說真的，京東零售的潛在利潤驅動因素是規模經濟以及我們 3P 生態系統的改進。

I remember I discussed this before. Our procurement cost for many products within the supermarket category is still 3% to 5% higher than the offline retailers. So there is great potential for margin improvement as we grow our scale for this particular category. And we actually have similar situation in many other categories. And our 3P business, as everyone knows, our apparel category was under abnormal competitive pressure in the past few years. So if the marketplace business performs better, that will definitely be a driver for margin improvement.

我記得我之前討論過這個。我們在超市品類中的許多產品的採購成本仍然比線下零售商高 3% 到 5%。因此，隨著我們擴大這一特定類別的規模，利潤率有很大的提高潛力。我們實際上在許多其他類別中也有類似的情況。而我們的3P業務，眾所周知，我們的服裝品類在過去的幾年裡承受著異常的競爭壓力。因此，如果市場業務表現更好，那肯定會成為利潤率提高的驅動力。

But having said that, the longer-term profitability will be affected by the category mix and service revenue contribution. And when you build your financial model for the 2021 retail margin, you should also take into consideration that the disrupting factors last year, including the social security benefit, right, as well as the lack of marketing and promotion activities in the first half of 2020. So this is for JD Retail.

但話雖如此，長期盈利能力將受到品類組合和服務收入貢獻的影響。而當你為 2021 年零售利潤率建立財務模型時，你還應該考慮到去年的破壞因素，包括社會保障福利，對，以及 2020 年上半年缺乏營銷和促銷活動。 .所以這是給京東零售的。

And then for JD Logistics, as you can see that JD Logistics is still in a hyper-growth stage, and we continue to invest in infrastructure and network to expand their service offerings and growth potential. So similar to the largest e-commerce platform in the U.S. and other industry peers, the logistics capacity needs to be expanded periodically to support the growth of transaction volume. And our JD Logistics is not only building infrastructure to support our 1P businesses, but also expanding their service scope and capabilities for external customers where the external revenues actually grew much faster compared to internal revenue. So the -- but if you look at the margin trend, you should also consider that the logistic industry has relatively higher fixed cost compared to our other business lines. So their profitability would present stronger seasonality due to the promotion of our 1P and their other retail customers.

然後對於京東物流，您可以看到京東物流仍處於高速增長階段，我們將繼續投資於基礎設施和網絡，以擴大其服務範圍和增長潛力。因此，與美國最大的電子商務平台和其他行業同行類似，物流能力需要定期擴大以支持交易量的增長。我們的京東物流不僅在建設基礎設施來支持我們的 1P 業務，還擴大了他們對外部客戶的服務範圍和能力，外部收入實際上比內部收入增長得更快。所以 - 但如果你看一下利潤率趨勢，你還應該考慮到與我們的其他業務線相比，物流行業的固定成本相對較高。因此，由於我們的 1P 和他們的其他零售客戶的推廣，他們的盈利能力將呈現出更強的季節性。

And then last, on the new businesses. As Jingxi Pinpin is still in early development stage, it's quite difficult to depict accurate investment expectation. But we focus on building core capabilities and infrastructure rather than gaining short-term traffic through subsidy. Based on our existing supply chain and logistic infrastructure, we require our business teams to deliver a better financial model than the competitors when they were in the similar scale or development stage. So far, our Jingxi Pinpin business has been growing as planned with footprint in over 17 provinces, and we are satisfied with the overall ROI.

最後，關於新業務。由於京喜品品仍處於早期發展階段，很難描繪出準確的投資預期。但我們專注於構建核心能力和基礎設施，而不是通過補貼獲得短期流量。基於我們現有的供應鍊和物流基礎設施，我們要求我們的業務團隊在類似規模或發展階段時提供比競爭對手更好的財務模型。到目前為止，我們的京西品品業務按計劃發展，足跡遍布超過17個省份，我們對整體投資回報率感到滿意。

The future investment will depend on the progress of building the capabilities we need for this business and whether we can provide our users with adequate level of customer experience. So for the reasons that we can deliver good customer experience, we will invest more resources and further expand the scale. And for the regions where the customer experience cannot meet our minimum requirement, we will be more focused on improving the product and service quality before we invest additional resources. So it's very dynamic, and we actually assess the budget for spending on a monthly basis because this is such a new business model, and it's very different from the matured business lines where we can relatively manage the profitability on a longer-term period.

未來的投資將取決於我們為這項業務構建所需能力的進度，以及我們能否為用戶提供足夠水平的客戶體驗。因此，為了能夠提供良好的客戶體驗，我們將投入更多資源，進一步擴大規模。而對於客戶體驗達不到我們最低要求的地區，我們會在投入額外資源之前，更加專注於提升產品和服務質量。所以它是非常動態的，我們實際上是按月評估支出預算，因為這是一種新的商業模式，它與成熟的業務線有很大的不同，我們可以相對地管理長期的盈利能力。

Your next question comes from Thomas Chong from Jefferies.

您的下一個問題來自 Jefferies 的 Thomas Chong。

My question is more about user growth as well as penetration to lower-tier cities. Can management share about our strategies on how to further grow our users for this year after reaching the 500 million milestone? And on that front, can you also comment our strategies in lower-tier cities penetration this year?

我的問題更多是關於用戶增長以及對低線城市的滲透。管理層能否分享我們在達到 5 億里程碑後如何在今年進一步增加用戶的策略？在這方面，您能否評論一下我們今年在低線城市的滲透策略？

(foreign language)

（外語）

[Interpreted] This is Xu Lei. To answer your questions on the users, we'll adopt a more flexible approach this year from 2 aspects. First, we will increase -- we will diversify the channels and the approaches for our new user acquisition. At the same time, we will manage more high quality -- we will manage our cost and the quality of the cost in the new users acquisition.

[解釋]這是徐磊。針對各位用戶的疑問，今年我們將從兩個方面採取更加靈活的方式。首先，我們將增加——我們將多樣化獲取新用戶的渠道和方法。同時，我們將管理更高的質量——我們將在新用戶獲取中管理我們的成本和成本的質量。

(foreign language)

（外語）

[Interpreted] And in overall, both the numbers of users and the users' operating efficiency continue to grow. And users' conversion rate is also better compared with the performance in 2019 and 2020.

【解讀】從總體上看，無論是用戶數量還是用戶運營效率都在持續增長。並且用戶的轉化率也比 2019 年和 2020 年的表現更好。

(foreign language)

（外語）

[Interpreted] And on the new users, we see the qualities of the new user continues to be improved in terms of their repurchase rates and retention rates as well as their average spending on our platform.

【解讀】在新用戶方面，我們看到新用戶的質量在他們的複購率和留存率以及他們在我們平台上的平均支出方面不斷提高。

(foreign language)

（外語）

[Interpreted] And for our existing old users, their performance is on the right track. And with across the board good performance in terms of their shopping frequencies, the variety of products, they choose our platform, their average spending and retention rates. We will continue to improve their shopping experience on JD.com to improve their further engagement with us.

【解讀】而對於我們現有的老用戶來說，他們的表現走上了正軌。他們在購物頻率、產品種類、選擇我們的平台、平均消費和保留率方面都表現出色。我們將繼續改善他們在京東的購物體驗，以改善他們與我們的進一步互動。

(foreign language)

（外語）

[Interpreted] And in terms of the category's contribution to new customers acquisition, our consumer goods such as food, FMCGs, they make the biggest contribution to new user acquisition. And for mobile and home appliances, also attracting more new users this quarter. And for our makeup, beauty and clothing categories, which has a weaker appeal in the past, they also did a better job in acquiring new users this quarter.

【解讀】從品類對新用戶獲取的貢獻來看，我們的食品、快消品等消費品對新用戶獲取的貢獻最大。而對於手機和家電，本季度也吸引了更多的新用戶。而對於我們過去吸引力較弱的彩妝、美妝和服裝品類，他們在本季度的新用戶獲取方面也做得更好。

(foreign language)

（外語）

[Interpreted] For the lower-tier market, it continue to be the main source of our new users. In this quarter, the new users coming from the lower-tier markets for the first time reached 81%.

【解讀】對於低端市場，它仍然是我們新用戶的主要來源。本季度，來自低線市場的新用戶首次達到81%。

(foreign language)

（外語）

[Interpreted] We will continue to expand our touch points with the customers in the lower-tier markets by leveraging various sales channels and interfaces with our customers to reach the new users and also to providing more tailored supply chains and product mix to offer more precise matching of products to the lower-tier market users.

【解讀】我們將繼續擴大與下層市場客戶的接觸點，利用各種銷售渠道和與客戶的接口來接觸新用戶，同時提供更量身定制的供應鍊和產品組合，以提供更精準的服務。產品與低端市場用戶的匹配。

(foreign language)

（外語）

[Interpreted] And we estimate that the new users growth trends will continue in the following time of 2021. Thank you.

【解讀】我們估計新用戶增長趨勢將在接下來的 2021 年繼續。謝謝。

Your next question comes from Alicia Yap from Citigroup.

您的下一個問題來自花旗集團的 Alicia Yap。

Congrats on the strong results. I have a question regarding how should we be thinking about for the second quarter trend. I believe -- I think, Sandy, you previously mentioned we should look at on the first half growth rate as comparable to the first half last year. So given such a strong performance in first quarter, are we still implying the first half this year will be similar to last year? If that's the case, then it will be implying second quarter only growing at 20% year-over-year. But then given your upcoming 18 years anniversary of this June 18 promotion, it also doesn't sound reasonable. So any color you can give us in terms of the second quarter trend that we should be thinking about.

恭喜取得了不錯的成績。我有一個關於我們應該如何考慮第二季度趨勢的問題。我相信 - 我認為，桑迪，你之前提到我們應該將上半年的增長率與去年上半年相當。那麼，鑑於第一季度的強勁表現，我們是否還在暗示今年上半年將與去年相似？如果是這種情況，那麼這將意味著第二季度僅同比增長 20%。但是考慮到您即將在 6 月 18 日促銷活動的 18 週年紀念日，這聽起來也不合理。因此，根據我們應該考慮的第二季度趨勢，您可以給我們任何顏色。

Thanks, Alicia. During -- the COVID outbreak had very significant and very different impact on the performance of our various categories last year. For example, if you remember that the home appliance category was extremely weak in Q1 last year, but was extremely strong in Q2 when the pent-up demand were released in April and May. So when we manage our business internally or think about the trend of our retail business, as I just mentioned, we would either look at the 2-year CAGR or look at the year-over-year growth for the entire first half. Of course, there was also impact from the nonrecurring sales of the COVID-related protection products, such as face masks and thermometers last year. So I think your understanding is largely correct.

謝謝，艾麗西亞。在此期間，COVID 爆發對我們去年各個類別的表現產生了非常顯著和非常不同的影響。例如，如果您還記得去年第一季度家電品類非常疲軟，但在四五月份被壓抑的需求釋放時，第二季度卻異常強勁。因此，當我們在內部管理業務或考慮零售業務的趨勢時，正如我剛才提到的，我們要么看 2 年的 CAGR，要么看整個上半年的同比增長。當然，去年口罩和體溫計等與 COVID 相關的防護產品的非經常性銷售也產生了影響。所以我認為你的理解在很大程度上是正確的。

We expect the whole year for retail business to largely maintain the growth momentum from 2020. So this includes while we both look at from the 2-year CAGR perspective and look at it from the first half year perspective. We expect to see that the category shift -- category mix shift will continue, general merchandise category to grow faster than the electronics and home appliance, and, in particular, the supermarket and health care categories. Advertising revenue will also grow faster than product sales. And -- but this is only for the retail business. If you look at our group as a whole, the other business lines are less affected by the COVID impact last year. So you should also consider the growth of services revenues, in particular, the logistic services now contribute quite significant portion of our total revenue.

我們預計從 2020 年起全年零售業務將基本保持增長勢頭。所以這包括我們既從 2 年 CAGR 的角度來看，也從上半年的角度來看。我們預計品類的轉變——品類組合的轉變將繼續，日用百貨品類的增長速度將超過電子和家電，尤其是超市和保健品品類。廣告收入的增長也將快於產品銷售。而且 - 但這僅適用於零售業務。如果您將我們集團視為一個整體，去年其他業務線受 COVID 影響的影響較小。因此，您還應該考慮服務收入的增長，特別是物流服務現在占我們總收入的很大一部分。

We are now approaching the end of the conference call. I will now turn the call over to JD.com, Ruiyu Li, for closing remarks.

我們現在接近電話會議的尾聲。我現在將把電話轉給京東李瑞宇，作為結束語。

Thank you, operator, and thank you for joining us on today's conference call. Please feel free to contact us if you have any further questions.

謝謝你，接線員，謝謝你加入我們今天的電話會議。如果您有任何其他問題，請隨時與我們聯繫。

Thank you for your participation in today's conference. This concludes the presentation. You may now disconnect. Good day.

感謝您參加今天的會議。介紹到此結束。您現在可以斷開連接。再會。

[Portions of this transcript that are marked [Interpreted] were spoken by an interpreter present on the live call.]

[此成績單中標記為 [已翻譯] 的部分由現場通話中的口譯員朗讀。]