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• Total Net Revenues: RMB3.6 billion, relatively flat compared to the same quarter last year.

• Profit for the Quarter: Grew 10.5% to RMB210.6 million.

• Income from Operations: RMB2.4 million compared to an operating loss of RMB80.4 million in the same quarter last year.

• Non-GAAP Income from Operations: RMB7.1 million compared to a Non-GAAP loss of RMB54 million in Q3 of the prior year.

• Total Operating Expenses: Decreased 23.2% to RMB28.2 million, 5.8% of net revenues down from 7.4% last year.

• Fulfillment Expenses: 2.8% of net revenues, steady from the previous year.

• General and Administrative Expenses: Reduced to 0.4% of net revenues from 1.3% a year ago.

• Selling Expenses: Decreased to 2.1% of net revenues from 2.6% in the prior year.

• Technology Expenses: 0.5% of net revenues, down from 0.7% a year earlier.

• Operating Cash Flow: Positive at RMB110 million for the third consecutive quarter.

• Cash and Cash Equivalents: RMB614.4 million as of September 30, 2024.

• Non-GAAP Net Loss Attributable to Ordinary Shareholders: RMB12.4 million compared to RMB66.9 million in the same quarter last year.

Release Date: November 27, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• 111 Inc (NASDAQ:YI) achieved operational profitability for three consecutive quarters, highlighting effective cost management and operational efficiency.

• The company reported a significant improvement in income from operations, with a shift from a loss of RMB80.4 million in the previous year to a profit of RMB2.4 million in Q3 2024.

• 111 Inc (NASDAQ:YI) has successfully reduced operating expenses as a percentage of net revenues, demonstrating enhanced operational leverage.

• The company has made substantial advancements in digital and AI technologies, improving inventory management and customer conversion rates.

• 111 Inc (NASDAQ:YI) expanded its Kunpeng logistics network, reducing fulfillment costs and enhancing supply chain efficiency.

Negative Points

• The challenging macroeconomic environment in China, including weak consumer sentiment and healthcare reforms, continues to impact the industry.

• Retail pharmacy sales in China decreased by 2.2% in the first nine months of 2024, leading to intensified competition and reduced per store revenues.

• Many large chain pharmacies are experiencing significant declines in net profit, with independent pharmacies facing even greater pressure.

• Despite operational improvements, 111 Inc (NASDAQ:YI)'s total net revenues remained relatively flat year-over-year, indicating limited top-line growth.

• The company faces ongoing challenges in managing redemption requests from investors, which could impact financial flexibility.