Annual Report for Fiscal Year Ending December 31, 2024 (Form 20-F)

Operating and Financial Review and Prospects

You should read the following discussion and analysis of our financial condition and results of operations in conjunction with our consolidated financial statements and the related notes included elsewhere in this annual report. This discussion contains forward-looking statements that involve risks and uncertainties about our business and operations. Our actual results and the timing of selected events may differ materially from those anticipated in these forward-looking statements as a result of various factors, including those we describe under "Item 3. Key Information-D. Risk Factors" and elsewhere in this annual report.

A.	Operating Results

Key Factors Affecting Our Results of Operations

Key factors affecting our results of operations include the following:

Our ability to engage consumers on JD NOW

Growth of order volume is key to our revenue growth from JD NOW. Our order volume growth in turn depends on the increase of our number of active consumers and their level of engagement.

The increase in the number of active consumers, and improvement of consumer engagement are mainly driven by our ability to attract, engage and retain consumers on our JD NOW platform. We attract consumers through our marketing and brand promotion activities and convert users from JD.com channels. We engage consumers by offering a wide range of products from trusted retailers and brand owners, and establishing integrated online and offline membership programs. We retain consumers by continually improving consumer experience. For instance, we provide consumers with personalized content and interface that match their purchasing habits and geographic proximity to retailers.

Our ability to empower retailers and brand owners with evolving services

In addition to last-mile and intra-city delivery services and marketplace services, we endeavor to empower retailers and brand owners with evolving services and additional value-added services, which we expect to solidify our relationship with existing retailers and brand owners, allow us to attract new customers to our platform and generate additional income.

We share operational insights with retailers based on our analysis of consumer feedback and behavior across JD NOW platform. We also help retailers establish online membership programs or link their existing offline membership program with online customers to create omni-channel membership programs. Together with our CRM tools, we empower retailers to target and communicate with their members and potential consumers for effective marketing. We help retailers improve sales per square foot and labor efficiency with on-demand delivery infrastructure and digitalized storefront management tools. For instance, we provide self-check-out equipment to offline retail stores and scan-n-go solutions to improve store operation efficiency and consumer experience.

We also help brand owners broaden their consumer reach, penetrate the market in lower-tiered cities and deepen their consumer insights. Many brand owners have successfully built brand awareness and run brand promotions on our platform.

Our ability to enhance customer experience and increase delivery orders

Revenues derived from our local on-demand delivery platform directly relates to the number of orders that customers place on Dada NOW platform, the increase of which is in turn driven by customer experience. Our efforts to that end include expanding the capacity of our delivery network and always endeavoring to deliver reliable and flexible services. In 2023 and 2024, we delivered 2,191.0 million and 2,873.4 million orders, respectively, fulfilling the delivery demand for the participants on our platforms. In 2023 and 2024, our network delivered an average of 6.0 million and 7.9 million orders per day, respectively. As of December 31, 2024, our intra-city delivery service covered around 2,600 cities and counties in China, and our last-mile delivery service covered around 2,700 cities and counties in China.

Building our rider force is the key to expanding the capacity of our delivery network. Leveraging our expanding delivery network and improving delivery service, we are able to increase our delivery order volume. With the growing order volume on our platform, we are able to provide riders with increased order density and more income, which in turn attracts and retains riders.

We have been constantly improving our delivery services to enhance customer experience. In certain scenarios where orders are more time-sensitive or require instant responsiveness, we designate a number of riders to a particular store of a merchant, and our system automatically assigns each order from this store to one of these stationed riders by algorithm. If needed, our crowdsourced riders can also supplement the delivery capacity of the stationed riders. Leveraging our scalable and flexible delivery network, we act as an important delivery force for our customers in peak seasons, such as JD.com's anniversary sales promotional event on June 18 and China's online shopping festival on November 11.

Our ability to continue to enhance delivery efficiency through technology innovation

Rider cost is one of the most important factors affecting our results of operation. We have been constantly endeavoring to improve delivery efficiency through technology and innovation capabilities. We have developed a proprietary smart order recommendation and dispatching system that automatically matches orders with riders on a real-time basis and calculates the optimal delivery route as a recommendation to the rider. Moreover, using deep learning technologies, our automated pricing system sets the delivery fee of each delivery order algorithmically based on an array of factors. We have made, and will continue to make, significant investments to improve our technology infrastructure and optimize the efficiency of our delivery network.

In addition, as our delivery infrastructure evolves and our delivery network keeps expanding, the order volumes and density will increase, which in turn attracts more riders to our platform and drives up our delivery efficiency.

Our ability to control costs and expenses and enhance operational efficiency

Our ability to achieve profitability is dependent on our ability to further control our costs and expenses and improve our operational efficiency. Selling and marketing expenses have historically represented a large portion of our total costs and expenses. Incentives to JD NOW consumers in turn are a major component of our selling and marketing expenses, and advertising and marketing expenses, consisting primarily of online and offline advertisements, are another important component.

We have been always mindful of the balance between rapid business expansion and costs and expenses, particularly selling and marketing expenses. We have been endeavoring to improve selling and marketing efficiency. For example, we leverage our existing network of retailer stores for cost-efficient marketing activities. In addition, we have adopted different promotional activities and marketing strategies for consumers with different purchasing power in different cities. We will continue to make efforts to manage our consumer acquisition cost and improve our consumer retention rate. In addition, as our business grows, we expect to achieve greater operating leverage and increase the productivity of our personnel, allowing us to acquire consumers and senders more cost-effectively and achieve higher operational efficiency.

Business partnerships

We have established and intend to continue to establish partnerships to grow our business. Since our acquisition of JDDJ in 2016, which was upgraded and rebranded to JD NOW in May 2024, we have successfully integrated JD NOW and Dada NOW and established a leading platform of local on-demand retail and delivery in China. Moreover, we have achieved significant synergies through collaboration with JD Group. We managed to achieve rapid growth after gaining traffic portals on the JD mobile app, JD.com and JD's Weixin mini-program. Moreover, we also act as a local delivery partner for JD Logistics, and our Dada NOW platform has recorded strong growth in order volume arising from cooperation with JD Logistics.

We have also formed strong business partnerships with China's leading supermarket chains, such as Walmart (including Sam's Club), Yonghui and CR Vanguard. We expect to continue to maintain business partnerships to diversify product offerings and enlarge our user base, further enhance delivery efficiency, improve consumer experience, expand and deepen services to retailers and brand owners to improve their operational efficiency and further improve our technology capabilities.

In 2022, 2023 and 2024, 20.3%, 24.5% and 24.6% of our net revenues were derived from services provided to JD Group, respectively. Walmart Group was a related party of ours from August 2018 to September 2024, when JD Group acquired all of the shares held in us by Walmart Group. In 2022, 2023 and 2024, 21.6%, 20.6% and 23.0% of our net revenues were derived from services provided to Walmart Group, respectively.

Key Components of Results of Operations

Net revenues

We generate revenues by providing various services on our JD NOW and Dada NOW platforms. Revenues from JD NOW mainly include revenues from (i) commission fee charged to retailers for using JD NOW platform, (ii) online advertising and marketing services to the customers, such as brand owners or their agents on JD NOW platform, and (iii) fulfillment services to JD NOW retailer customers and other services. Revenues from Dada NOW mainly include revenues from intra-city and last-mile delivery services to logistics companies, various chain merchants, SME merchants and individuals through Dada NOW.

Beginning with the year of 2024, we changed the presentation of disaggregated revenues to better reflect our lines of business. The table below sets forth the disaggregation of revenues for the year ended December 31, 2024 with prior year financial results retrospectively recast to conform to current period presentation.

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

For the Year Ended December 31,

​

​

​

2022

​

2023

​

2024

​

​

RMB

%

RMB

%

RMB

US$

%

​

​

​

(in thousands, except for percentage data)

​

Net revenues

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

JD NOW

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Commission fee

​

1,582,060

​

16.9

​

1,679,218

​

16.0

​

1,423,256

​

194,985

​

14.7

​

Online advertising and marketing services

​

2,249,158

​

24.0

​

2,131,150

​

20.3

​

606,720

​

83,120

​

6.3

​

Fulfillment services and others

​

2,378,807

​

25.4

​

2,681,386

​

25.5

​

1,828,580

​

250,514

​

18.9

​

Subtotal

​

6,210,025

​

66.3

​

6,491,754

​

61.8

​

3,858,556

​

528,619

​

39.9

​

Dada NOW

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Intra-city delivery services

​

2,587,305

​

27.6

​

3,529,214

​

33.6

​

5,077,762

​

695,651

​

52.6

​

Last-mile delivery services

​

306,262

​

3.3

​

347,678

​

3.3

​

524,822

​

71,900

​

5.4

​

Others

​

264,003

​

2.8

​

137,604

​

1.3

​

202,640

​

27,762

​

2.1

​

Subtotal

​

3,157,570

​

33.7

​

4,014,496

​

38.2

​

5,805,224

​

795,313

​

60.1

​

Total

9,367,595

100.0

10,506,250

100.0

9,663,780

1,323,932

100.0

​

Our net revenues from major related parties amounted to RMB3,928.1 million, RMB4,738.1 million, and RMB3,982.9 million (US$545.7 million) for 2022, 2023 and 2024, respectively.

Costs and expenses

Our costs and expenses consist of operations and support costs, selling and marketing expenses, general and administrative expenses, research and development expenses, impairment loss of goodwill and intangible assets and other operating expenses. The following table sets forth the breakdown of our total costs and expenses, in amounts and as percentages of total net revenues for each of the periods presented:

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	For the Year Ended December 31,
​	​	2022			​	2023			​	2024
​		RMB		%		RMB		%		RMB		US$		%
​	​	(in thousands, except for percentage data)
Costs and expenses:
Operations and support		5,743,010		61.3		6,530,343		62.2		7,221,497		989,341		74.7
Selling and marketing		4,747,926		50.7		4,474,087		42.6		2,927,098		401,011		30.3
General and administrative		408,771		4.4		252,802		2.4		233,927		32,048		2.4
Research and development		630,911		6.7		416,346		3.9		362,584		49,674		3.8
Impairment loss of intangible assets	​	-	​	-	​	-	​	-	​	1,058,686	​	145,039	​	11.0
Impairment loss of goodwill	​	-	​	-	​	957,605	​	9.1	​	-	​	-	​	-
Other operating expenses		77,423		0.8		47,456		0.4		50,289		6,890		0.5
Total		11,608,041		123.9		12,678,639		120.6		11,854,081		1,624,003		122.7

​

Operations and support costs. Our operations and support costs primarily consist of (i) riders' and drivers' remuneration and incentives to fulfil our delivery orders and picking orders, (ii) expenses incurred in providing customer and rider care services or the service fee charged by external customer service providers, (iii) expenses charged by outsourced delivery agencies, (iv) expenses incurred in providing online advertising and marketing services, (v) transaction fees charged by third-party payment platform, and (vi) packaging cost as well as other operations and support costs directly attributed to our principal operations.

Remuneration and incentives paid to riders and drivers is the largest component within the operations and support costs. It amounted to RMB4,082.4 million in 2022, RMB4,816.4 million in 2023 and RMB6,547.2 million (US$897.0 million) in 2024, respectively.

We offer various incentive programs to riders, to attract and retain riders. For 2022, 2023 and 2024, incentives to riders recorded as operations and support costs were RMB79.2 million, RMB41.1 million and RMB45.2 million (US$6.2 million), respectively. The total rider incentives as a percentage of our operations and support costs were 1.4%, 0.6% and 0.6% for 2022, 2023 and 2024, respectively. We expect to continue using rider incentives to attract and retain riders. As the amounts of rider incentives largely depend on our business decisions and market conditions, our past practices may not be indicative of near-term trend.

Selling and marketing expenses. Our selling and marketing expenses primarily consist of online and offline promotion and coupon expenses for our platforms, advertising and marketing expenses, payroll and related expenses for employees involved in selling and marketing functions, amortization of intangible assets arising from business cooperation agreement with JD.com, as well as the associated expenses of facilities and equipment, such as depreciation expenses, rental and others.

We offer incentives such as promotion coupons to consumers on JD NOW, and such incentive expenses are recorded as selling and marketing expenses because they serve to promote our JD NOW platform. Such incentive expenses amounted to RMB2,782.6 million, RMB2,548.2 million and RMB1,288.8 million (US$176.6 million) for 2022, 2023 and 2024, respectively. As the amounts of consumer incentives largely depend on our business decisions and market conditions, our past practices may not be indicative of near-term trend.

Advertising and marketing expenses, primarily representing media advertising expenses and expenses for promotional activities, are another important component of our selling and marketing expenses. It amounted to RMB944.5 million, RMB753.5 million and RMB431.2 million (US$59.1 million) for the years ended December 31, 2022, 2023 and 2024, respectively.

The amortization of intangible assets primarily represents amortization of the business cooperation agreements in connection with the share subscription transactions with JD.com in February 2022 and April 2023. It amounted to RMB293.1 million, RMB418.5 million and RMB446.6 million (US$61.2 million) for the years ended December 31, 2022, 2023 and 2024, respectively.

General and administrative expenses. Our general and administrative expenses mainly consist of amortization of intangible assets purchased in the acquisition of JDDJ, payroll and related costs for employees engaging in general corporate functions, share-based compensation, professional fees and other general corporate expenses, as well as expenses associated with the use by these functions of facilities and equipment. The amortization of intangible assets primarily represents amortization of the business cooperation agreement and non-compete commitment arising from our acquisition of JDDJ in 2016, which was almost fully amortized as of December 31, 2023. It amounted to RMB141.6 million and RMB48.1 million for the years ended December 31, 2022 and 2023, respectively.

Research and development expenses. Our research and development expenses mainly consist of technology infrastructure expenses, payroll and related costs for employees involved in researching and developing new products and technologies, share-based compensation, charges for the usage of the server and computer equipment, and editorial content.

Impairment loss of intangible assets. Impairment loss of intangible assets was RMB1,058.7 million (US$145.0 million) for the year ended December 31, 2024. No impairment loss of intangible assets was recorded in 2022 and 2023.

Impairment loss of goodwill. Impairment loss of goodwill was RMB957.6 million for the year ended December 31, 2023. No impairment loss of goodwill was recorded in 2022 and 2024.

Other operating expenses. Our other operating expenses mainly consist of purchase price of merchandise sold on Dada NOW or historically through unmanned retail shelves.

Taxation

Cayman Islands

The Cayman Islands currently levies no taxes on corporations based upon profits, income, gains or appreciation.

Hong Kong

Entities incorporated in Hong Kong are subject to Hong Kong profits tax at a rate of 16.5%. Our operations in Hong Kong have incurred net accumulated operating losses for income tax purposes and no income tax provisions are recorded for the years ended December 31, 2022, 2023 and 2024. Under the current Hong Kong Inland Revenue Ordinance, our subsidiary domiciled in Hong Kong has been introduced to a two-tiered profits tax rate regime which is applicable to any year of assessment commencing on or after April 1, 2018. The profits tax rate for the first HK dollar 2,000,000 of profits of corporations will be lowered to 8.25%, while profits above that amount will continue to be subject to the tax rate of 16.5%.

Chinese Mainland

On March 16, 2007, the National People's Congress introduced a new Enterprise Income Tax Law and most recently amended by the Standing Committee of the National People's Congress on December 29, 2018, under which foreign invested enterprises and domestic companies would be subject to corporate income tax at a uniform rate of 25%. Certain enterprises will benefit from a preferential tax rate of 15% under the Enterprise Income Tax Law if they qualify as high and new technology enterprises, or HNTE. Under such regulation, Dada Glory and Shanghai JDDJ were qualified for HNTE status and are eligible for a reduced income tax rate of 15% for the years ended 2022, 2023 and 2024, Beijing Daguan Information Technology Co., Ltd. is qualified for HNTE status and was eligible for a reduced income tax rate of 15% for the years ended 2023 and 2024.

The Enterprise Income Tax Law also provides that an enterprise established under the laws of a foreign country or region but whose "de facto management body" is located in China be treated as a resident enterprise for PRC tax purposes and consequently be subject to the PRC income tax at the rate of 25% for its global income. The implementing rules of the Enterprise Income Tax Law merely define the location of the "de facto management body" as "the place where the exercising, in substance, of the overall management and control of the production and business operation, personnel, accounting, property, etc., of a non-PRC company is located." Based on a review of surrounding facts and circumstances, we do not believe that it is likely that our operations outside of China should be considered a resident enterprise for PRC tax purposes. If our holding company in the Cayman Islands or any of our subsidiaries outside of China were deemed to be a "resident enterprise" under the Enterprise Income Tax Law, we would be subject to enterprise income tax on our worldwide income at a rate of 25%. See "Item 3. Key Information-D. Risk Factors-Risks Related to Doing Business in China-If we are classified as a PRC resident enterprise for PRC income tax purposes, such classification could result in unfavorable tax consequences to us and our non-PRC shareholders or ADS holders."

The Enterprise Income Tax Law and its implementing rules also impose a withholding income tax of 10% on dividends distributed by a foreign-invested enterprise to its immediate holding company outside of China, if such immediate holding company is considered as a non-resident enterprise without any establishment or place within China or if the received dividends have no connection with the establishment or place of such immediate holding company within China, unless such immediate holding company's jurisdiction of incorporation has a tax treaty with China that provides for a different withholding arrangement. The Cayman Islands, where the Company is incorporated, does not have such a tax treaty with China. According to the arrangement between the Chinese mainland and Hong Kong on the Avoidance of Double Taxation and Prevention of Fiscal Evasion in August 2006, dividends paid by a foreign-invested enterprise in China to its immediate holding company in Hong Kong will be subject to withholding tax at a rate of no more than 5% (if the foreign investor owns directly at least 25% of the shares of the foreign-invested enterprise). We did not record any dividend withholding tax, as it has no retained earnings for the years ended December 31, 2022, 2023 and 2024. See "Item 3. Key Information-D. Risk Factors-Risks Related to Our Corporate Structure-Contractual arrangements in relation to the VIE may be subject to scrutiny by the PRC tax authorities and they may determine that we or the VIE owes additional taxes, which could negatively affect our financial condition and the value of your investment."

Results of Operations

The following table sets forth a summary of our consolidated results of operations for the periods presented, both in absolute amount and as a percentage of our net revenues for the periods presented. Year-to-year comparisons of historical results of operations should not be relied upon as indicative of future performance.

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	For the Year Ended December 31,
​	​	2022			​	2023			​	2024
​		RMB		%		RMB		%		RMB		US$		%
​	​	(in thousands, except for percentage data, share and per share data)
Net revenues		9,367,595		100.0		10,506,250		100.0		9,663,780		1,323,932		100.0
Costs and expenses:		​		​		​		​		​		​		​
Operations and support		(5,743,010)		(61.3)		(6,530,343)		(62.2)		(7,221,497)		(989,341)		(74.7)
Selling and marketing		(4,747,926)		(50.7)		(4,474,087)		(42.6)		(2,927,098)		(401,011)		(30.3)
General and administrative		(408,771)		(4.4)		(252,802)		(2.4)		(233,927)		(32,048)		(2.4)
Research and development		(630,911)		(6.7)		(416,346)		(3.9)		(362,584)		(49,674)		(3.8)
Impairment loss of intangible assets	​	-	​	-	​	-	​	-	​	(1,058,686)	​	(145,039)	​	(11.0)
Impairment loss of goodwill	​	-	​	-	​	(957,605)	​	(9.1)	​	-	​	-	​	-
Other operating expenses		(77,423)		(0.8)		(47,456)		(0.4)		(50,289)		(6,890)		(0.5)
Other operating income		120,921		1.3		63,859		0.6		30,849		4,226		0.4
Loss from operations		(2,119,525)		(22.6)		(2,108,530)		(20.0)		(2,159,452)		(295,845)		(22.3)
Other income/(expenses)		​		​		​		​		​		​		​
Interest expenses	​	(10,946)	​	(0.1)	​	(807)	​	0.0	​	-	​	-	​	-
Others, net		117,625		1.2		146,782		1.4		103,983		14,246		1.0
Total other income, net		106,679		1.1		145,975		1.4		103,983		14,246		1.0
Loss before income tax benefits		(2,012,846)		(21.5)		(1,962,555)		(18.6)		(2,055,469)		(281,599)		(21.3)
Income tax benefits		4,841		0.1		5,012		0.0		16,933		2,319		0.2
Net loss		(2,008,005)		(21.4)		(1,957,543)		(18.6)		(2,038,536)		(279,280)		(21.1)
Net loss per ordinary share:	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Basic and diluted	​	(1.98)	​	-	​	(1.88)	​	-	​	(1.95)	​	(0.27)	​	-
Net loss per ADS(1):	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Basic and diluted	​	(7.91)	​	-	​	(7.52)	​	-	​	(7.80)	​	(1.07)	​	-
Weighted average number of ordinary shares:	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Basic and diluted	​	1,015,265,686	​	​	​	1,040,680,392	​	​	​	1,045,269,866	​	1,045,269,866	​	​

(1)	Each ADS representsfour ordinary shares.

Year ended December 31, 2024 compared to year ended December 31, 2023

Net revenues

Our net revenues were RMB9,663.8 million (US$1,323.9 million) in 2024 as compared to RMB10,506.3 million in 2023. The change was due to the RMB1,790.7 million (US$245.3 million) increase in the net revenues from Dada NOW platform and RMB2,663.2 million (US$360.7 million) decrease in the net revenues from JD NOW platform.

The net revenues generated from Dada NOW increased by 44.6% from RMB4,014.5 million in 2023 to RMB5,805.2 million (US$795.3 million) in 2024, mainly due to the increase in order volume of intra-city delivery services provided to chain merchants in 2024 as compared to 2023.

The net revenues generated from JD NOW decreased by 40.6% from RMB6,491.8 million in 2023 to RMB3,858.6 million (US$528.6 million) in 2024, mainly due to a decrease in online advertising and marketing services revenues and a decrease in fulfillment services and other revenues.

Operations and support costs

Our operations and support costs increased by 10.6% from RMB6,530.3 million in 2023 to RMB7,221.5 million (US$989.3 million) in 2024, primarily due to an increase in rider cost as a result of the increasing order volume of intra-city delivery services provided to various chain merchants, offset by a decrease in online advertising and marketing services costs.

Selling and marketing expenses

Our selling and marketing expenses decreased by 34.6% from RMB4,474.1 million in 2023 to RMB2,927.1 million (US$401.0 million) in 2024, primarily due to a decrease in promotional activities initiated by us on the JD NOW platform.

General and administrative expenses

Our general and administrative expenses were RMB233.9 million (US$32.0 million) in 2024, compared with RMB252.8 million in 2023.

Research and development expenses

Our research and development expenses decreased by 12.9% from RMB416.3 million in 2023 to RMB362.6 million (US$49.7 million) in 2024, primarily due to a decrease in research and development personnel costs.

Impairment loss of intangible assets

Impairment loss of intangible assets was RMB1,058.7 million (US$145.0 million) for the year ended December 31, 2024. No impairment loss of intangible assets was recorded in 2023.

Impairment loss of goodwill

Impairment loss of goodwill was RMB957.6 million for the year ended December 31, 2023. No impairment loss of goodwill was recorded in 2024.

Other operating expenses

Our other operating expenses were RMB50.3 million (US$6.9 million) in 2024, compared with RMB47.5 million in 2023.

Interest expenses

Our interest expenses were nil in 2024, compared with RMB0.8 million in 2023.

Others, net

Our others, net primarily represents for interest income and foreign exchange gain/(loss). The decrease from RMB146.8 million in 2023 to RMB104.0 million (US$14.2 million) in 2024 was mainly attributable to a reduction in interest income generated from deposits.

Income tax benefits

Our income tax benefits are RMB16.9 million (US$2.3 million) in 2024 as compared to RMB5.0 million in 2023, primarily due to a reversal of deferred tax liabilities as a result of intangible assets impairment.

Net loss

As a result of the foregoing, our net loss increased by 4.1% from RMB1,957.5 million in 2023 to RMB2,038.5 million (US$279.3 million) in 2024.

Year ended December 31, 2023 compared to year ended December 31, 2022

Net revenues

Our net revenues were RMB10,506.3 million in 2023 as compared to RMB9,367.6 million in 2022. The change was due to the RMB856.9 million increase in the net revenues from Dada NOW platform and RMB281.8 million increase in the net revenues from JD NOW platform.

The net revenues generated from Dada NOW increased by 27.1% from RMB3,157.6 million in 2022 to RMB4,014.5 million in 2023, due to the increase in order volume of intra-city delivery services to chain merchants in 2023 as compared to 2022.

The net revenues generated from JD NOW increased by 4.5% from RMB6,210.0 million in 2022 to RMB6,491.8 million in 2023, due to the increase in fulfillment services and commission fee, partially offset by the decrease in online advertising and marketing services.

Operations and support costs

Our operations and support costs increased by 13.7% from RMB5,743.0 million in 2022 to RMB6,530.3 million in 2023, due to increases in rider cost from RMB3,986.2 million in 2022 to RMB4,679.6 million in 2023 as a result of the increase in the volume of orders for our intra-city delivery services. The increase in delivery order volume was primarily because we developed more chain merchants.

Selling and marketing expenses

Our selling and marketing expenses decreased by 5.8% from RMB4,747.9 million in 2022 to RMB4,474.1 million in 2023, primarily due to (i) RMB234.4 million decrease in promotional activities conducted on JD NOW platform, (ii) RMB191.0 million decrease in advertising and marketing expenses, partially offset by RMB125.4 million increase in amortization of the business cooperation agreements in connection with the share subscription transactions with JD.com in February 2022 and April 2023.

General and administrative expenses

Our general and administrative expenses decreased by 38.2% from RMB408.8 million in 2022 to RMB252.8 million in 2023, primarily due to (i) a decrease in amortization of intangible assets arising from the acquisition of JDDJ in 2016, and (ii) a decrease in share-based compensation expenses.

Research and development expenses

Our research and development expenses decreased by 34.0% from RMB630.9 million in 2022 to RMB416.3 million in 2023. The decrease was attributable to the RMB155.6 million decrease in research and development personnel cost.

Impairment loss of goodwill

We had impairment loss of goodwill of RMB957.6 million in 2023 based on a quantitative impairment test of the fair value of our company, considering the duration and severity of the decline in our market capitalization. No impairment loss of goodwill was recorded in 2022.

Other operating expenses

Our other operating expenses decreased by RMB30.0 million from RMB77.4 million in 2022 to RMB47.5 million in 2023, mainly due to the decrease in purchase price of merchandise sold on Dada NOW.

Other operating income

Our other operating income decreased by RMB57.1 million from RMB120.9 million in 2022 to RMB63.9 million in 2023, mainly because of the decrease in government subsidies related to VAT taxes due to less VAT taxes paid in 2023.

Interest expenses

Our interest expenses decreased from RMB10.9 million in 2022 to RMB0.8 million in 2023. The decrease of interest expenses was due to repayment of short-term loans in June 2023.

Others, net

Our others, net represents for interest income and foreign exchange gain (loss). The increase from RMB117.6 million in 2022 to RMB146.8 million in 2023 was mainly attributable to RMB36.5 million increase in interest income.

Income tax benefits

Our income tax benefits are RMB5.0 million in 2023 as compared to RMB4.8 million in 2022, primarily due to taxable temporary differences recovered as a result of the amortization of the intangible assets arising from the acquisition of JDDJ in 2016.

Net loss

As a result of the foregoing, our net loss decreased by 2.5% from RMB2,008.0 million in 2022 to RMB1,957.5 million in 2023.

Critical Accounting Estimates

We prepare our financial statements in conformity with U.S. GAAP, which requires us to make judgments, estimates and assumptions. We continually evaluate these estimates and assumptions based on the most recently available information, our own historical experience and various other assumptions that we believe to be reasonable under the circumstances. Since the use of estimates is an integral component of the financial reporting process, actual results could differ from our expectations as a result of changes in our estimates.

The following descriptions of critical accounting estimates should be read in conjunction with our consolidated financial statements and accompanying notes and other disclosures included in this annual report.

Impairment of intangible assets

As of December 31, 2024, we noted events and changes in circumstances existed as of December 31, 2024 that may indicate that the carrying amounts of intangible assets were no long recoverable.

We determined the entire group as one asset group for the purpose of the impairment testing as intangible assets do not have identifiable independent cash flows. Fair value of the asset group was estimated using an income approach of discounted cash flow model based on 1) internal cash flows forecasts; 2) an estimated terminal value and 3) a discount rate. All estimates used and assumptions made were in accordance with the Group's historical and industrial experience of the local on-demand retail and delivery industries. We recognized impairment loss of RMB1,058.7 million (US$145.0 million) in 2024.

Recent Accounting Pronouncements

A list of recently issued accounting pronouncements that are relevant to us is included in Note 2.27 "Recent accounting pronouncements" to our audited consolidated financial statements included elsewhere in this annual report.

B.	Liquidity and Capital Resources

We had net cash used in operating activities of RMB945.4 million in 2022, RMB380.8 million in 2023 and RMB1,056.4 million (US$144.7 million) in 2024, respectively. Our primary sources of liquidity have been proceeds from short-term bank borrowings, our initial public offering in June 2020, proceeds from our follow-on public offering in December 2020, and investment from JD.com in February 2022. As of December 31, 2024, we had RMB3,003.2 million (US$411.4 million) in cash and cash equivalents, of which approximately 53.5% were held in Renminbi and the remainder was primarily held in U.S. dollars.

We believe our cash will be sufficient to meet our current and anticipated needs for general corporate purposes for at least the next 12 months. We may, however, need additional cash resources in the future if we experience changes in business conditions or other developments. We may also need additional cash resources in the future if we find and wish to pursue opportunities for investment, acquisition, capital expenditure or similar actions. If we determine that our cash requirements exceed the amount of cash we have on hand, we may seek to issue equity or equity linked securities or obtain debt financing. The issuance and sale of additional equity would result in further dilution to our shareholders. The incurrence of indebtedness would result in increased fixed obligations and could result in operating covenants that would restrict our operations. We cannot assure you that financing will be available in amounts or on terms acceptable to us, if at all.

Our accounts receivable represents primarily the amount receivable from chain merchants for our delivery services, and advertising customers for our online advertising and marketing services. We receive payment before or concurrently with our provision of services in most cases, except for a limited number of customers for delivery services where we generally allow one month for them to settle after issuance of invoices. As of December 31, 2023 and 2024, our accounts receivable, net of allowance for doubtful accounts, were RMB386.8 million and RMB1,163.5 million (US$159.4 million), respectively.

Riders and drivers are entitled to withdraw their delivery remuneration after completion of services. Payable to riders and drivers represents the amount that riders and drivers have not withdrawn from their accounts. As of December 31, 2023 and 2024, our payable to riders and drivers, were RMB867.3 million and RMB1,009.2 million (US$138.3 million), respectively.

Our amount due from related parties represents primarily the amount due from JD Group and Walmart Group arising from our services to them. As of December 31, 2023 and 2024, our amount due from related parties were RMB1,287.1 million and RMB626.0 million (US$85.8 million), respectively. The decrease was primarily due to Walmart Group ceasing to be a related party of ours in September 2024. See also "Item 7. Major Shareholders and Related Party Transactions-B. Related Party Transactions-Other Related Party Transactions."

Although we consolidate the results of the VIE, we only have access to the assets or earnings of the VIE through our contractual arrangements with the VIE and Jingdong Bangneng. See "Item 4. Information on the Company-C. Organizational Structure." For restrictions and limitations on liquidity and capital resources as a result of our corporate structure, see "-Holding Company Structure."

All of our net revenues have been, and we expect they are likely to continue to be, in the form of Renminbi. Under existing PRC foreign exchange regulations, payments of current account items, including profit distributions, interest payments and trade and service-related foreign exchange transactions, can be made in foreign currencies without prior SAFE approval as long as certain routine procedural requirements are fulfilled. Specially, under the existing exchange restrictions, without prior approval of SAFE, cash generated from the operations of our PRC subsidiaries in the Chinese mainland may be used to pay dividends to us. However, current PRC regulations permit our PRC subsidiaries to pay dividends to us only out of their accumulated profits, if any, determined in accordance with Chinese accounting standards and regulations. Our PRC subsidiaries are required to set aside at least 10% of its after-tax profits after making up previous years' accumulated losses each year, if any, to fund certain statutory reserve funds until the total amount set aside reaches 50% of their registered capital. These reserves are not distributable as cash dividends. Historically, our PRC subsidiaries have not paid dividends to us, and they will not be able to pay dividends until they generate accumulated profits. Furthermore, capital account transactions, which include foreign direct investment and loans, must be approved by and/or registered with SAFE, its local branches and certain local banks.

As a Cayman Islands exempted company and offshore holding company, we are permitted under PRC laws and regulations to provide funding to our PRC subsidiaries only through loans or capital contributions, subject to the approval of government authorities and limits on the amount of capital contributions and loans. This may delay us from using the proceeds from our securities offerings to make loans or capital contributions to our PRC subsidiaries. We expect to invest substantially all of the proceeds from our initial public offering and follow-on offering into our PRC operations within the business scopes of our PRC subsidiaries and the VIE. See "Item 3. Key Information-D. Risk Factors-Risks Relating to Doing Business in China-PRC regulation of loans to and direct investment in entities in the Chinese mainland by offshore holding companies and governmental control of currency conversion may delay or prevent us from using the proceeds of financing activities to make loans to our PRC subsidiaries and the VIE in the Chinese mainland, which could materially and adversely affect our liquidity and our ability to fund and expand our business."

The following table sets forth the movements of our cash flows for the periods presented:

​	​	​	​	​	​	​	​	​
​	​	For the Year Ended December 31,
​	​	2022	​	2023	​	2024
​		RMB		RMB		RMB		US$
​	​	(in thousands)
Net cash used in operating activities		(945,440)		(380,838)		(1,056,423)		(144,728)
Net cash (used in)/provided by investing activities		(1,026,393)		1,214,856		1,782,615		244,217
Net cash provided by/ (used in) financing activities		3,054,854		(85,198)		(81,067)		(11,106)
Effect of foreign exchange rate changes on cash, cash equivalents and restricted cash		13,998		(4,450)		23,231		3,181
Net increase in cash, cash equivalents and restricted cash		1,097,019		744,370		668,356		91,564
Cash and cash equivalents and restricted cash, beginning of the year		570,850		1,667,869		2,412,239		330,475
Cash and cash equivalents and restricted cash, end of the year		1,667,869		2,412,239		3,080,595		422,039

​

Operating activities

Net cash used in operating activities in 2024 was RMB1,056.4 million (US$144.7 million). The principal items accounting for the difference between the net loss of RMB2,038.5 million (US$279.3 million) and operating cash outflow of RMB1,056.4 million (US$144.7 million) were certain non-cash expenses, primarily impairment loss of intangible assets of 1,058.7 million (US$145.0 million), depreciation and amortization of RMB489.3 million (US$67.0 million), share-based compensation of RMB90.7 million (US$12.4 million), and changes in working capital accounts of RMB692.9 million (US$94.9 million). The changes in working capital accounts mainly include (i) RMB377.8 million (US$51.8 million) decrease in accrued expenses and other current liabilities, (ii) RMB186.0 million (US$25.5 million) decrease in the amount due to related parties, and (ⅲ) RMB108.7 million (US$14.9 million) increase in prepayments and other current assets.

Net cash used in operating activities in 2023 was RMB380.8 million. The principal items accounting for the difference between the net loss of RMB1,957.5 million and operating cash outflow RMB380.8 million were certain non-cash expenses, primarily impairment loss of goodwill of 957.6 million, depreciation and amortization of RMB515.7 million, share-based compensation of RMB163.2 million, and changes in working capital accounts of RMB100.0 million. Depreciation and amortization mainly relates to the amortization of the business cooperation agreement and non-compete commitment arising from our acquisition of JDDJ in 2016 and business cooperation agreements in connection with the share subscription transactions with JD.com in February 2022 and April 2023. The changes in working capital accounts mainly include (i) RMB226.1 million increase in amount due from related parties, (ii) RMB143.9 million decrease in prepayments and other current assets. The increase amount due from related parties was mainly due to the growth of services provided to JD Group. The decrease in prepayments and other current assets was primarily due to increases in VAT receivable and interest receivable.

Net cash used in operating activities in 2022 was RMB945.4 million. The principal items accounting for the difference between the net loss of RMB2,008.0 million and operating cash outflow RMB945.4 million were certain non-cash expenses, primarily depreciation and amortization of RMB497.0 million, share-based compensation of RMB218.7 million, and changes in working capital accounts of RMB345.0 million. Depreciation and amortization mainly relates to the amortization of the business cooperation agreement and non-compete commitment arising from our acquisition of JDDJ in 2016 and business cooperation agreement in connection with the share subscription transaction with JD.com in February 2022. The changes in working capital accounts mainly include RMB315.8 million increase in accrued expenses and other current liabilities.The increase in accrued expenses and other current liabilities was due to (i) the increase in payables to retailers on JD NOW as a result of the increase in GMV and extended settlement cycles with retailers, (ii) the increase in advance from customers as a result of the increasing promotional activities and intra-city delivery services launched by brand owners and retailers, and (iii) the increase in payable for advertising and marketing expenses, which was primarily attributable to the increase in referral fees paid to staff at retailer stores and third-party promotion service providers for their efforts to attract new consumers to the JD NOW platform.

Investing activities

Net cash provided by investing activities in 2024 was RMB1,782.6 million (US$244.2 million), consisting primarily of net cash provided by purchase and disposal of wealth management products.

Net cash provided by investing activities in 2023 was RMB1,214.9 million, consisting primarily of net cash provided by purchase and disposal of wealth management products, net proceeds from the repayment of loan by certain third party companies in connection with our last-mile delivery services.

Net cash used in investing activities in 2022 was RMB1,026.4 million, consisting primarily of net cash used in purchase of wealth management product, net cash lent to certain third party company in connection with our last-mile delivery services to our major last-mile delivery service customer, and cash paid for purchase of property, equipment and intangible assets.

Financing activities

Net cash used in financing activities in 2024 was RMB81.1 million (US$11.1 million), consisting primarily of repurchase of ordinary shares.

Net cash used in financing activities in 2023 was RMB85.2 million, consisting primarily of repayment of short-term bank borrowings.

Net cash provided by financing activities in 2022 was RMB3,054.9 million, consisting primarily of proceeds from investment from JD.com in February 2022, partially offset by payment for share repurchases.

Material cash requirements

Other than the cash requirements for our regular operations, our material cash requirements as of December 31, 2024 and any subsequent interim period primarily include our capital expenditures and operating lease commitments.

Our capital expenditures are primarily incurred for purchases of property, equipment and intangible assets. Our capital expenditures were RMB3.7 million in 2022, RMB7.2 million in 2023, and RMB6.0 million (US$0.8 million) in 2024.

Our operating lease commitments consist of the commitments under the lease agreements for our office premises and other facilities. Payment due by December 31, 2024 for our operating lease commitments amounted to RMB42.2 million (US$5.8 million).

We intend to fund our existing and future material cash requirements with our existing cash balance and other financing alternatives. We will continue to make cash commitments, including capital expenditures, to support the growth of our business.

In December 2024, we entered into a one-year unsecured revolving credit of RMB500 million with a reputable commercial bank in China, which can be used for borrowings, banks' acceptances, bank guarantees and other purposes in accordance with the relevant agreements. As of December 31, 2024, the facility was unused.

We do not have any financial guarantees or other commitments to guarantee the payment obligations of any third parties that is reasonably likely to have a material current or future effect on our financial condition. We do not have retained or contingent interests in assets transferred. We have not entered into contractual arrangements that support the credit, liquidity or market risk for transferred assets. We do not have obligations that arise or could arise from variable interests held in an unconsolidated entity, or obligations related to derivative instruments that are both indexed to and classified in our own equity, or not reflected in the statement of financial position.

Other than as discussed above, we did not have any significant capital and other commitments, long-term obligations or guarantees as of December 31, 2024.

Holding Company Structure

Our Company, Dada Nexus Limited, is a holding company with no material operations of its own. We conduct our operations primarily through our PRC subsidiaries, the VIE and its subsidiaries. As a result, Dada Nexus Limited's ability to pay dividends depends upon dividends paid by our PRC subsidiaries.

If our existing PRC subsidiaries or any newly formed PRC subsidiaries incur debt on their own behalf in the future, the instruments governing their debt may restrict their ability to pay dividends to us. In addition, our wholly foreign-owned subsidiaries in the Chinese mainland are permitted to pay dividends to us only out of their retained earnings, if any, as determined in accordance with PRC accounting standards and regulations. Under PRC law, each of our PRC subsidiaries and the VIE is required to set aside at least 10% of its after-tax profits each year, if any, to fund certain statutory reserve funds until such reserve funds reach 50% of its registered capital. In addition, our PRC subsidiaries and the VIE may allocate a portion of its after-tax profits based on PRC accounting standards to a discretionary surplus fund at its discretion. The statutory reserve funds and the discretionary funds are not distributable as cash dividends. Remittance of dividends by a wholly foreign-owned company out of the Chinese mainland is subject to examination by the banks designated by SAFE. As of December 31, 2024, as our PRC subsidiaries, the VIE and the subsidiaries of the VIE are all in an accumulated loss position, no statutory reserve was appropriated. Our PRC subsidiaries have not paid dividends and will not be able to pay dividends until it generates accumulated profits and meets the requirements for statutory reserve funds.

C.	Research and Development

See "Item 4. Information on the Company-B. Business Overview-Our Technology Capabilities and Empowerment," "Item 4. Information on the Company-B. Business Overview-Our Technology Infrastructure and Team" and "Item 4. Information on the Company-B. Business Overview-Intellectual Property."

D.	Trend Information

Other than as disclosed elsewhere in this annual report, we are not aware of any trends, uncertainties, demands, commitments or events for the period since January 1, 2025 that are reasonably likely to have a material and adverse effect on our net revenues, income, profitability, liquidity or capital resources, or that would cause the disclosed financial information to be not necessarily indicative of future results of operations or financial conditions.

E.	Critical Accounting Estimates

For our critical accounting estimates, see "Item 5. Operating And Financial Review and Prospects-Critical Accounting Estimates."