Group 1 - Vipshop Holdings Limited has filed its annual report on Form 20-F, which includes audited financial statements for the three years ended December 31, 2024, with the U.S. Securities and Exchange Commission on April 17, 2025 [1] - The annual report is accessible on the Company's website, and holders of the Company's securities can request a free copy [1] - Vipshop is recognized as a leading online discount retailer for brands in China, offering high-quality branded products at significant discounts [2] Group 2 - Since its establishment in August 2008, Vipshop has rapidly developed a large and growing customer base and brand partnerships [2] - The Company provides consumers throughout China with popular branded products at lower prices compared to retail [2]

Financial Performance - For the year ended December 31, 2024, consolidated net revenues were RMB 108.42 billion, a decrease from RMB 112.86 billion in 2023 and RMB 103.15 billion in 2022[55]. - Net income for the year ended December 31, 2024, was RMB 7.84 billion, compared to RMB 8.20 billion in 2023 and RMB 6.31 billion in 2022, indicating a decline in profitability[55]. - The total net revenues for the year ended December 31, 2024, were RMB 108,420,832 thousand, compared to RMB 112,856,020 thousand in 2023, indicating a decrease of approximately 4%[67]. - The gross profit for the year ended December 31, 2024, was RMB 25,469,654 thousand, slightly down from RMB 25,720,892 thousand in 2023, reflecting a decrease of about 1%[67]. - The net income attributable to shareholders for the year ended December 31, 2024, was RMB 7,739,935 thousand, compared to RMB 8,116,624 thousand in 2023, representing a decline of approximately 5%[67]. - The company’s operating expenses for the year ended December 31, 2024, totaled RMB 17,211,609 thousand, a decrease from RMB 17,418,317 thousand in 2023, indicating a reduction of about 1%[67]. - The company’s cash used in financing activities for the year ended December 31, 2024, was RMB 4,969,579 thousand, compared to RMB 6,146,005 thousand in 2023, showing a decrease of approximately 19%[62]. - The company’s product revenues for the year ended December 31, 2024, were RMB 100,734,550 thousand, down from RMB 105,613,485 thousand in 2023, reflecting a decrease of about 5%[67]. - The company’s earnings per share (diluted) for the year ended December 31, 2024, was RMB 71.76, compared to RMB 72.11 in 2023, indicating a slight decline[67]. - The company has achieved net profit since Q4 2012, but future profitability is uncertain due to potential increases in costs and operating expenses[158]. Cash Management and Dividends - The company declared a cash dividend of US$2.15 per ordinary share on February 28, 2024, amounting to net cash dividends of US$233.3 million paid in April 2024[51]. - The company’s ability to pay dividends depends on the dividends from its PRC subsidiaries and service fees from consolidated variable interest entities, which may be restricted by debt instruments[42]. - The company’s board of directors retains discretion over future dividend distributions, which will depend on operational results and cash flow[51]. - The company has established a centralized cash management policy to enhance cash flow efficiency and security, with all cash transfers requiring internal approval[43]. Regulatory Risks - The company faces risks related to regulatory approvals, anti-monopoly actions, and cybersecurity regulations in China, which could materially affect operations and the value of its ADSs[35]. - Under the Holding Foreign Companies Accountable Act, if the SEC determines that the company has filed audit reports from a firm not subject to PCAOB inspections for two consecutive years, trading of its shares may be prohibited[37]. - The company has not been required to obtain permissions from the CSRC for past securities offerings but may need to for future offerings under new regulations[41]. - The PCAOB has not issued new determinations regarding its ability to inspect auditors in mainland China and Hong Kong, which may affect future audit reports[39]. - The approval of the CSRC is required for future overseas offerings, and delays or failures in obtaining such approval could lead to sanctions, fines, and operational restrictions[205]. - The Overseas Offering and Listing Measures, effective March 31, 2023, require PRC domestic companies to complete filing procedures with the CSRC for overseas securities offerings within three business days after closing[206]. - The PRC Foreign Investment Law, effective January 1, 2020, replaced previous laws and aims to unify corporate legal requirements for foreign and domestic investments[185]. - The most recent negative list, effective November 1, 2024, requires PRC domestic enterprises in prohibited industries to obtain consent for overseas listing, impacting foreign investor participation[186]. - The PRC tax authorities may impose adverse tax consequences if contracts with consolidated variable interest entities are deemed not to be on an arm's length basis[189]. - The company is subject to SAFE regulations that limit the use of Renminbi converted from foreign exchange capitals for expenditures beyond approved business scopes[226]. Operational Structure and Risks - Vipshop Holdings Limited is a holding company with no operations of its own, relying on its PRC subsidiaries and consolidated variable interest entities for operational activities[25]. - The consolidated variable interest entities are subject to complex PRC laws and regulations, which may impact their ability to conduct business and accept foreign investments[35]. - The contractual arrangements with the consolidated variable interest entities may not provide the same level of control as direct ownership, posing unique risks to investors[24]. - The company relies on contractual arrangements with consolidated variable interest entities, which may not be as effective as direct ownership, posing risks to its operations[180]. - The company faces uncertainties regarding the enforceability of its contractual arrangements with consolidated variable interest entities, which could disrupt its business operations[179]. - If consolidated variable interest entities go bankrupt, the company may lose access to important assets, adversely affecting its financial condition and results of operations[184]. - Foreign ownership of internet-based businesses in China is subject to significant restrictions, impacting the company's operational structure[174]. - The potential for conflict of interest exists among shareholders of the significant consolidated variable interest entity, which may adversely affect the company's business[181]. Market and Competitive Environment - The online discount retail market in China is rapidly evolving, with competition from various online retailers and new e-commerce forms, which may affect the company's market share and operating margins[95][96]. - The company experiences seasonality in its business, with significantly higher sales in the fourth quarter due to promotional campaigns, particularly on November 11 and December 12[172]. - The company has seen an increase in product return rates due to higher sales of apparel products, which typically have a higher return rate compared to standardized products[100]. - Online retail sales of apparel products account for a significant portion of total net revenues, and the company does not expect new product categories to reduce this dependence[102]. Cybersecurity and Data Protection - The company spent RMB222.4 million, RMB233.0 million, and RMB308.0 million (US$42.2 million) on IT and cybersecurity protections for the years ended December 31, 2022, 2023, and 2024, respectively[108]. - The Cybersecurity Law imposes strict obligations on network operators, and violations could result in penalties, including fines and revocation of licenses[214]. - The company has adopted rigorous security policies, including encryption technology, to protect customer information, but faces challenges from evolving hacking techniques[128]. - The company has conducted cybersecurity self-examinations as directed by local authorities, indicating proactive compliance efforts[119]. - The Cybersecurity Review Measures require network platform operators holding personal information of over one million users to undergo a cybersecurity review before any public offering at a foreign stock exchange[119]. Intellectual Property and Compliance - As of the date of the report, the company had been granted 370 patents and submitted 1,054 patent applications in China, highlighting its commitment to intellectual property protection[130]. - The company has 2,264 registered trademarks in China and 103 registered trademarks outside China, emphasizing its focus on brand protection[130]. - The company faces challenges in protecting intellectual property rights in China, with potential costs and resource diversion due to litigation[131]. - The company may incur significant expenses defending against intellectual property infringement claims, which could disrupt operations[132]. Economic and Geopolitical Factors - The global economic downturn, exacerbated by events like COVID-19 and geopolitical tensions, may adversely affect business and financial condition[166]. - Heightened trade and political tensions, particularly between the U.S. and China, could negatively impact economic activities and the company's operations[167]. - The U.S. government has implemented policies that may adversely affect international trade, including tariffs and export controls, which could impact the company's business and financial condition[168]. - The Outbound Investment Rule, effective January 2, 2025, imposes investment prohibitions and notification requirements on U.S. persons for investments in entities associated with "countries of concern," currently only China[169]. Strategic Initiatives - The company plans to enhance brand recognition and customer spending on its online platform to drive sales growth[80]. - The company aims to expand into offline retail, having established a network of 20 Shan Shan Outlets and other retail stores by the end of 2024[83]. - The company plans to expand its brand and product offerings, requiring the establishment of relationships with new brand partners to ensure a steady supply of products on favorable terms[92]. - The company may pursue strategic initiatives in international markets to expand product offerings and improve technology infrastructure[149]. - Future strategic alliances and acquisitions may materially affect the company's business and financial condition[148]. - Strategic acquisitions may require significant managerial and financial resources, potentially diverting resources from existing business operations[150].

Core Insights - The article emphasizes the importance of value investing and highlights specific metrics to identify undervalued stocks, particularly focusing on Vipshop (VIPS) as a strong candidate for value investors [2][8]. Company Overview - Vipshop (VIPS) currently holds a Zacks Rank of 2 (Buy) and an A for Value, indicating strong potential for value investors [4]. - The stock has a Forward P/E ratio of 6.60, significantly lower than its industry's average Forward P/E of 18.54, suggesting it may be undervalued [4]. Valuation Metrics - VIPS has a PEG ratio of 1.46, which is much lower than the industry average PEG of 3.52, indicating favorable growth expectations relative to its price [5]. - The P/S ratio for VIPS is 0.56, compared to the industry's average P/S of 0.81, further supporting the notion of undervaluation [6]. - The P/CF ratio for VIPS stands at 6.69, well below the industry's average P/CF of 21.19, highlighting its attractive cash flow valuation [7]. Investment Outlook - The combination of these metrics suggests that Vipshop is likely undervalued at present, making it an appealing option for value investors [8].

Core Viewpoint - The article emphasizes the effectiveness of value investing as a strategy to identify undervalued stocks, highlighting Vipshop (VIPS) as a strong candidate based on various financial metrics [2][3][7]. Company Metrics - Vipshop (VIPS) has a Zacks Rank of 2 (Buy) and a Value grade of A, indicating it is considered a high-quality value stock [3]. - The company has a PEG ratio of 1.32, significantly lower than the industry average of 3.01, suggesting it is undervalued relative to its expected earnings growth [4]. - Vipshop's P/S ratio stands at 0.49, compared to the industry average of 0.85, indicating a potentially better performance indicator due to less manipulation of sales figures [5]. - The P/CF ratio for VIPS is 5.98, which is substantially lower than the industry average of 19.09, further supporting the notion that the stock is undervalued based on cash flow strength [6]. - Overall, these metrics suggest that Vipshop is likely undervalued at present, making it an attractive option for value investors [7].

Group 1 - Vipshop (NYSE: VIPS) reported 4Q24 results with revenue exceeding consensus expectations due to better-than-expected GMV performance [1] - The company achieved non-GAAP operating profit and net income that were also ahead of consensus estimates [1] - Management provided slightly optimistic guidance for 1Q25, indicating continued positive momentum [1]

Investment Rating - The investment rating for the company is "Outperform" [5][10]. Core Views - The report indicates that consumer sentiment is gradually improving, and the company is increasing shareholder returns. The revenue for Q4 2024 was 33.2 billion yuan, a year-over-year decrease of 4.2%, primarily due to weak demand and intensified competition. However, the clothing category showed positive growth, and other income increased by 4% year-over-year, driven by the Shanshan Outlet stores [1][7]. - For Q1 2025, the management expects revenue growth to be in the range of -5% to 0%, with a goal to achieve positive growth in GMV and revenue for the year [3][10]. - The company reported a GMV of 66.2 billion yuan, with a year-over-year growth of 0%. The number of active buyers decreased by 6% year-over-year to 45.7 million [1][7]. Revenue and Profitability - The company's Non-GAAP net profit for the quarter was 3 billion yuan, a year-over-year decrease of 7%, with a stable net profit margin. Adjusted operating profit decreased by 14% year-over-year, and the adjusted operating profit margin fell by 1.2 percentage points to 10.2% due to reduced revenue [2][8]. - The overall shareholder return rate for 2024 was 9.5%, and the company plans to allocate 75% of the adjusted net profit for 2025 to shareholder returns, expecting a return rate of 12.5% [2][8]. Financial Forecasts - The revenue forecasts for 2025 and 2026 have been adjusted to 110.8 billion yuan and 114.6 billion yuan, respectively, with a compound annual growth rate of 5% expected for adjusted net profit from 2025 to 2027 [3][10]. - The target price for the company has been adjusted to between $16 and $18, reflecting an increase potential of 9% to 22% [3][10].

Financial Data and Key Metrics Changes - Total net revenues for Q4 2024 were RMB33.2 billion, down from RMB34.7 billion in the prior year period, reflecting a year-over-year decrease [35] - Gross profit decreased to RMB7.6 billion from RMB8.2 billion, with a gross margin of 23.0%, down from 23.7% in the prior year [35] - Full year 2024 net income attributable to shareholders was RMB7.7 billion, compared to RMB8.1 billion in the prior year, with a net margin of 7.1% [44] Business Line Data and Key Metrics Changes - Apparel categories saw a 2% increase year-over-year, accounting for 75% of total GMV, the highest level in the company's history [8][17] - Non-apparel business narrowed its loss of sales in Q4, driven by home appliances and digital products [17] - Active Super VIP membership increased by 50% year-over-year, contributing 51% of online spending in Q4 [18] Market Data and Key Metrics Changes - Consumer sentiment showed slight improvement, with consumers becoming more active towards the end of Q4 [57] - The trade-in program contributed approximately RMB300 million to RMB400 million in incremental GMV from home appliances and digital products in Q4 [59] Company Strategy and Development Direction - The company remains committed to its long-term strategy focused on retail for brands, emphasizing quality growth and a differentiated business model [20][28] - Continued investment in merchandising capabilities, with over 1,500 new brands added last year [22] - The company aims to leverage AI to improve productivity and customer experience, focusing on applications like product recommendations and customer service [71][73] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in returning to sustainable and profitable growth, despite ongoing uncertainties [28] - For Q1 2025, the company expects total net revenues to be between RMB26.3 billion and RMB27.6 billion, reflecting a year-over-year decrease of approximately 5% to 0% [46] - Management anticipates a positive trajectory for the full year of 2025, aiming for growth in GMV and revenue [52] Other Important Information - The company returned approximately $770 million to shareholders through dividends and buybacks in 2024 [33] - Non-GAAP net income attributable to shareholders for Q4 was RMB3.0 billion, compared to RMB3.2 billion in the prior year [40] Q&A Session Summary Question: Q1 revenue guidance and consumer sentiment - Management indicated that business is on track within guidance, with consumer sentiment slightly better than expected [50][51] Question: Drivers of Q4 outperformance - Management attributed Q4 outperformance to improved consumer activity, effective merchandising, and targeted promotions [57][58] Question: Gross margin trend in 2025 - Management believes there is room for improvement in gross margin, aiming to maintain a balance between profitability and growth [62][66] Question: AI applications in business - Management is investing in AI to enhance productivity and efficiency, focusing on customer service and merchandising optimization [71][73] Question: ARPU and shopping frequency of Super VIP members - Management noted a slight decline in ARPU due to an increase in active Super VIP members, but overall health of the SVIP customer base remains strong [75][77]

Financial Performance - Total net revenues for Q4 2024 were RMB33.2 billion (US$4.6 billion), a decrease of 4.3% from RMB34.7 billion in the prior year[3]. - Gross profit for Q4 2024 was RMB7.6 billion (US$1.0 billion), down from RMB8.2 billion in the prior year, with a gross margin of 23.0%[6]. - Net income attributable to shareholders for Q4 2024 was RMB2.4 billion (US$335.2 million), a decline of 20% from RMB3.0 billion in the prior year[11]. - Total net revenues for the three months ended December 31, 2024, were RMB 33,223,842, a decrease of 4.2% compared to RMB 34,674,476 for the same period in 2023[40]. - Product revenues for the twelve months ended December 31, 2024, were RMB 100,734,550, down from RMB 105,613,485 in 2023, representing a decline of 4.1%[40]. - Non-GAAP net income attributable to Vipshop's shareholders for the twelve months ended December 31, 2024, was RMB 9.03 billion, a decrease of 5% from RMB 9.51 billion in 2023[46]. - The company reported a net income of RMB 2.45 billion for the three months ended December 31, 2024, down from RMB 2.95 billion in the same period of 2023, a decline of 16.9%[46]. Customer and Order Metrics - The number of active customers for Q4 2024 was 45.7 million, down from 48.5 million in the prior year[3]. - Total orders for Q4 2024 were 217.5 million, compared to 234.3 million in the prior year, reflecting a decrease of 7.1%[4]. Cash Flow and Shareholder Returns - The company generated net cash from operating activities of RMB8.9 billion (US$1.2 billion) for Q4 2024[16]. - For the full year of 2024, net cash generated from operating activities was RMB9.1 billion (US$1.3 billion), with free cash inflow of RMB5.6 billion (US$770.2 million)[23]. - The Company repurchased US$43.3 million of its ADSs during the quarter ended December 31, 2024, under its US$1.0 billion share repurchase program[24]. - The board of directors declared an annual cash dividend of US$2.40 per ordinary share, or US$0.48 per ADS, for fiscal year 2024[25]. - The Company has fully utilized the remaining authorized amount of its initial share repurchase program and plans to continue repurchases under a new US$1.0 billion program effective until February 2027[24]. Operating Expenses - Operating expenses for the twelve months ended December 31, 2024, totaled RMB 17,211,609, a slight decrease from RMB 17,418,317 in 2023[40]. - Fulfillment expenses for the three months ended December 31, 2024, were RMB 2,460,984, compared to RMB 2,525,204 in the same period of 2023, reflecting a decrease of 2.6%[41]. - Marketing expenses for the twelve months ended December 31, 2024, were RMB 2,979,654, down from RMB 3,242,215 in 2023, indicating a decline of 8.1%[40]. Shareholder Equity and Assets - Total assets increased from RMB 72.32 billion in 2023 to RMB 74.94 billion in 2024, representing a growth of 3.6%[44]. - Total shareholders' equity grew from RMB 38.56 billion in 2023 to RMB 41.55 billion in 2024, an increase of 7.8%[44]. - Total current liabilities decreased from RMB 30.62 billion in 2023 to RMB 29.93 billion in 2024, a reduction of 2.3%[44]. Earnings Per Share - Net earnings per Class A and Class B ordinary share (diluted) for the three months ended December 31, 2024, were RMB 23.46, down from RMB 26.75 in 2023[40]. - Non-GAAP net income per Class A and Class B ordinary share (diluted) was RMB 28.51 for the twelve months ended December 31, 2024, compared to RMB 28.97 in 2023, a decrease of 1.6%[47]. Future Outlook - For Q1 2025, the Company expects total net revenues to be between RMB26.3 billion and RMB27.6 billion, representing a year-over-year decrease of approximately 5% to 0%[27]. - The Company will hold a conference call on February 21, 2025, to discuss the financial results[29]. Other Financial Metrics - Free cash flow for the trailing twelve months ended December 31, 2024, was RMB5.6 billion (US$770.2 million) after accounting for capital expenditures of RMB3.6 billion (US$488.1 million)[23]. - The weighted average number of ADSs used in computing diluted earnings per ADS for the full year of 2024 was 539,279,030[23]. - The weighted average number of diluted shares decreased from 110.38 million in 2023 to 104.30 million in 2024, a decline of 5.5%[47]. - Share-based compensation expenses increased from RMB 284.67 million in Q4 2023 to RMB 539.09 million in Q4 2024, a rise of 89.5%[46]. - The Company emphasizes the use of non-GAAP financial measures to provide clarity on its operating performance[35].

Core Viewpoint - Vipshop Holdings Limited reported financial results for Q4 and full year 2024, showing a challenging year but exceeding expectations in the fourth quarter, with a focus on apparel categories and a strong performance from Super VIP customers [3][13]. Financial Performance - Total net revenues for Q4 2024 were RMB 33.2 billion (US$ 4.6 billion), a decrease from RMB 34.7 billion in the prior year [4][13]. - Gross profit for Q4 2024 was RMB 7.6 billion (US$ 1.0 billion), down from RMB 8.2 billion in the prior year, with a gross margin of 23.0% compared to 23.7% [5][13]. - Income from operations for Q4 2024 was RMB 2.9 billion (US$ 390.6 million), down from RMB 3.7 billion in the prior year, resulting in an operating margin of 8.6% compared to 10.6% [7][13]. - Net income attributable to shareholders for Q4 2024 was RMB 2.4 billion (US$ 335.2 million), down from RMB 3.0 billion in the prior year, with a net margin of 7.4% compared to 8.5% [9][13]. - For the full year 2024, total net revenues were RMB 108.4 billion (US$ 14.9 billion), down from RMB 112.9 billion in the prior year [16][19]. Customer Metrics - The number of active customers for Q4 2024 was 45.7 million, down from 48.5 million in the prior year [13]. - Total orders for Q4 2024 were 217.5 million, compared to 234.3 million in the prior year [13]. Cash Flow and Shareholder Returns - Net cash generated from operating activities for Q4 2024 was RMB 8.9 billion (US$ 1.2 billion) [15]. - The company repurchased US$ 43.3 million of its ADSs under its US$ 1.0 billion share repurchase program [23]. - An annual cash dividend of US$ 2.40 per ordinary share was declared for fiscal year 2024, with a payment date expected on April 25, 2025 [24]. Business Outlook - For Q1 2025, the company expects total net revenues to be between RMB 26.3 billion and RMB 27.6 billion, reflecting a year-over-year decrease of approximately 5% to 0% [25].

Core Viewpoint - Vipshop Holdings Limited is expected to report a decline in both earnings and revenue for the fourth quarter of 2025 compared to the previous year [1] Financial Performance - The company is projected to report quarterly earnings of $5.39 per share, down from $5.79 per share in the same period last year [1] - Vipshop anticipates quarterly revenue of $32.07 billion, a decrease from $34.67 billion a year earlier [1] - In the third quarter, Vipshop reported sales of $2.95 billion, which is a 9.2% year-on-year decline, but exceeded Wall Street's expectation of $2.91 billion [2] Stock Performance - Vipshop shares fell by 0.3% to close at $14.53 on the day of the third-quarter report [2] Analyst Ratings - Citigroup analyst Alicia Yap maintained a Buy rating but reduced the price target from $18 to $17 [3] - Benchmark analyst Fawne Jiang reiterated a Hold rating [3] - Barclays analyst Jiong Shao initiated coverage with an Overweight rating and a price target of $19 [3]