Dingdong (Cayman) Limited (DDL.US) Q2 Results: Achieves 6.5 Billion Yuan GMV; Non-GAAP Net Profit 130 Million Yuan, Up 23.9% YoY

Stock News
Aug 21

On the evening of August 21, 2025, Dingdong (Cayman) Limited (DDL.US) released its second quarter 2025 financial results, marking the first quarterly report since officially announcing its "4G" strategy. Overall, Dingdong achieved dual growth in both scale and profitability during the quarter, demonstrating steady progress, while initial results from product structure and customer base adjustments driven by the new strategy are becoming evident.

**Stable Growth with Sustained Self-Sufficiency**

Financial results show that Dingdong achieved GMV of 6.5 billion yuan in Q2, up 4.5% year-over-year, with revenue reaching 5.98 billion yuan, up 6.7% year-over-year. In terms of profitability, Non-GAAP net profit reached 130 million yuan, representing a 23.9% increase compared to the same period last year, while GAAP net profit also achieved 110 million yuan, up 59.7% year-over-year.

With this performance, having achieved 11 consecutive quarters of Non-GAAP profitability and 6 consecutive quarters of GAAP profitability, Dingdong has undoubtedly demonstrated complete self-sufficiency capabilities.

Within the company's sustained stable growth, Dingdong's competitive advantages in the Yangtze River Delta region remain highly evident. In Shanghai, despite already high consumer penetration rates, Dingdong still achieved 3.5% year-over-year GMV growth during the quarter. The Jiangsu-Zhejiang region achieved 11% year-over-year growth, with 10 cities recording growth rates exceeding 20%.

In an environment of rapid external changes and intense competition, Dingdong's steady progress and sustained profitability further validate the stability of the company's core operations and the correctness of its strategic decisions.

**"4G" Strategy Transformation: Rapid Growth in Quality Products and Premium Users**

While Dingdong remains anchored in the vertical fresh food segment and continues to focus on the challenging task of supply chain management, its growth potential has not been constrained. The company continues to pursue deeper and broader strategic planning to continuously break development boundaries.

Recently, Dingdong officially announced its "4G" strategy (Good Users, Good Products, Good Service, Good Brand Perception) and a focus on "one inch narrow, one kilometer deep" approach, implementing a series of adjustments including APP "Quality Love" upgrades, product development division restructuring, and performance evaluation system optimization, with increased focus on creating "good products."

Although strategic reform is a long-term process requiring navigation through transformation challenges, after nearly six months of adjustments, the platform has begun showing preliminary data changes this quarter.

Company executives indicated during the earnings call that a significant portion of overall growth came from these new initiatives. For instance, the platform's monthly average order frequency per user reached 4.4 times during the quarter, maintaining year-over-year growth, while "good users" who focus more on product freshness, quality, and uniqueness achieved a monthly order frequency of 8.1 times.

In June, "good users" accounted for nearly 30% of Dingdong's user base, contributing 68.5% of GMV, while new customers classified as "good users" represented 80%. This clearly indicates the company's accurate assessment of current market trends and the effectiveness of its strategy to attract premium users through quality products.

To create "good products," Dingdong has cumulatively replaced over 4,000 product SKUs. By June, quality products with attributes such as popular acclaim, unique offerings, superior quality, and distinctive features accounted for 40% of platform SKUs, with GMV contribution increasing by approximately 30 percentage points compared to early this year.

In pursuing the "4G" strategy, Dingdong has developed its own methodology. For common mainstream fresh food categories, Dingdong chooses to go deeper into sourcing, achieving greater safety and transparency while implementing differentiated innovation to rapidly increase the proportion of quality products in these categories.

In June, quality products in the meat, poultry, and egg category accounted for 55% of GMV, with black pork representing 35% of the pork series. Additionally, organic vegetables in the vegetable category increased to 12% in June, with GMV up approximately 38% year-over-year. Looking at the entire Q2, overall organic product GMV grew approximately 40% year-over-year.

Dingdong's underlying digital capabilities and deep AI technology applications cannot be overlooked. Under the new strategy, Dingdong's "Digital Intelligence Brain" system has evolved from its initial positioning as a "supply chain efficiency improvement tool" to become a key engine driving business model innovation and user experience optimization, applied across all core business segments. It assists efficient operations across the entire value chain, helps product development personnel make development decisions, and significantly enhances consumer experience through front-end and back-end AI technology applications.

**Supply Chain Foundation Driving Diversified Growth Potential**

With deep supply chain resources, differentiated product development capabilities, and AI-enhanced digital foundation, Dingdong is better positioned to drive growth in incremental businesses such as B2B supply chain services and international expansion.

In Dingdong's future business planning, the company will focus on product and supply chain capabilities, ensuring "product availability" and stable supply through fresh food direct sourcing, proprietary farms and factories, and extensive product development teams. Through the Dingdong app and multiple quality domestic and international sales channels, the company aims to enhance omnichannel sales scale and efficiency to "sell well." Building on this foundation, the company will continuously expand reach through products and supply chain, bringing Dingdong products to more countries and regions.

From supply chain to channels to regional expansion, these elements can collectively build Dingdong's long-term, unique systematic capabilities and growth potential.

Financial results also show that B2B business revenue grew 69.4% year-over-year during the quarter, with revenue contribution increasing by 1.6 percentage points year-over-year.

With the advancement of the "4G" strategy and "one inch narrow, one kilometer deep" approach, along with the emergence of the new "Quality Love" positioning, Dingdong has developed unique business models and competitive advantages, potentially leveraging greater growth momentum based on its strongest business capabilities.

"Of course, our transformation will require a long time, but we believe the effects will become increasingly evident. We will be friends with time and create long-term value for investors," said Dingdong founder and CEO Liang Changlin during the earnings call.

Regarding future performance expectations, amid intensely competitive retail industry conditions, Dingdong management expressed confidence in maintaining current scale while continuing profitability.

Additionally, as of the end of Q2, the company's balance including cash and cash equivalents, short-term restricted funds, short-term investments, and long-term wealth management totaled 4.01 billion yuan. This solid cash flow will continue to support future business development.

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