Vipshop Q2 2026 Earnings Report

Vipshop EPS Results

• Actual EPS: N/A
• Consensus EPS: $0.59
• Beat/Miss: N/A
• One Year Ago EPS: N/A

Vipshop Revenue Results

• Actual Revenue: N/A
• Expected Revenue: $3.64 billion
• Beat/Miss: N/A
• YoY Revenue Growth: N/A

Vipshop Announcement Details

• Quarter: Q2 2026
• Date: 8/26/2026
• Time: Before Market Opens
• Conference Call Date: Tuesday, August 25, 2026
• Conference Call Time: 7:30AM ET

Vipshop (NYSE:VIPS) (NYSE:VIPS) is a leading online discount retailer in China, offering high-quality branded products at competitive prices through a time-limited, flash-sales model. The company provides consumers with access to a rotating selection of merchandise, combining the excitement of limited-time offers with curated brand partnerships to drive customer engagement and loyalty.

Vipshop’s platform features a diverse range of product categories, including apparel, footwear, cosmetics, home furnishings, digital electronics and other lifestyle goods. Merchandise is sourced directly from brand owners and authorized distributors, ensuring authenticity and cost savings for consumers. The company serves its members through a user-friendly website and mobile applications, supported by personalized marketing and customer service initiatives.

Founded in Guangzhou in 2008, Vipshop completed its initial public offering on the New York Stock Exchange in March 2012. Since then, it has built a nationwide logistics and distribution network across mainland China, operating multiple warehouses and fulfillment centers to enhance delivery speed and reliability. The company’s investments in technology and supply-chain optimization have been central to its ability to scale and maintain service quality.

Under the leadership of founder and CEO Eric Ya Shen, Vipshop continues to deepen relationships with brand partners and expand its service offerings, including cross-border e-commerce channels. The management team places a strong emphasis on digital marketing, data analytics and operational efficiency as it seeks to sustain growth and adapt to evolving consumer preferences in China’s dynamic retail market.

Vipshop Q2 2026 Earnings Call Transcript

Key Takeaways

• Negative Sentiment: Weak consumer demand weighed on second-quarter results, with revenue declining 4.3% year over year to RMB24.7 billion. Management said shoppers remain highly selective and expects full-year revenue to be slightly below 2025 levels, while third-quarter revenue is forecast to decline approximately 5% to 0%.
• Negative Sentiment: Underlying profitability weakened despite stable gross margins: non-GAAP operating margin fell to 8.1% from 9.3%, and non-GAAP net income dropped to RMB392.2 million from RMB2.1 billion. Higher return rates increased fulfillment costs, while lower revenue created operating deleverage.
• Neutral Sentiment: Reported net income rose sharply to RMB4.3 billion, but this was primarily due to a RMB5.79 billion one-time gain from a commercial REIT listing. A separate RMB1.56 billion withholding-tax adjustment is expected to be settled in the third quarter; management said it was not a penalty and should have minimal impact on future operating margins.
• Positive Sentiment: SVIP membership reached 10 million, with active SVIP customers increasing 8% year over year and contributing 54% of online spending. Management is relying on this higher-intent customer base, curated off-price merchandise, and AI-driven personalization to support retention and profitable growth.
• Positive Sentiment: Shan Shan Outlet GMV grew more than 20% in the first half, and management expects similar growth in the second half, including at least double-digit same-store growth. Vipshop also approved a new $1 billion share-repurchase program and reiterated its goal of returning at least 75% of 2025 non-GAAP net income to shareholders.

Presentation

[Operator]

Ladies and gentlemen, good day, everyone, and welcome to Vipshop Holdings Limited Second Quarter 2026 Earnings Conference Call. At this time, all participants are in the listen only mode. I would now like to turn the call over to Ms. Jessie Zheng, Vipshop's Head of Investor Relations. Please proceed.

[Jessie Zheng, Head of Investor Relations at Vipshop]

Thank you, operator. Hello, everyone, and thank you for joining Vipshop's Second Quarter 2026 Earnings Conference Call. With us today are Eric Shen, our Co-founder, Chairman, and CEO, and Mark Wang, our CFO. Before management begins their prepared remarks, I would like to remind you that the discussion today will contain forward-looking statements made under the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from our current expectations. Potential risks and uncertainties include, but are not limited to, those outlined in our safe harbor statements in our earnings release and public filings with the Securities and Exchange Commission, which also applies to this call to the extent any forward-looking statements may be made.

[Jessie Zheng, Head of Investor Relations at Vipshop]

Please note that certain financial measures used on this call, such as non-GAAP operating income, non-GAAP net income attributable to Vipshop shareholders, and non-GAAP net income per ADS are not presented in accordance with U.S. GAAP. Please refer to our earnings release for details relating to the reconciliation of our non-GAAP measures to GAAP measures. With that, I would now like to turn the call over to Mr. Eric Shen.

[Eric Ya Shen, Co-Founder, Chairman, and CEO at Vipshop]

Good morning and good evening, everyone. Welcome and thank you for joining our second quarter 2026 earnings conference call. The second quarter presents a challenging retail environment defined by a customer who is not just value conscious, but highly selective across the multi-media promotional landscape. Shoppers was intensely focused on clear utility and real value. Prioritize essentially meet great cautions in discretion categories like apparel, weighing on our near-term top-line performance. In this climate, rather than chasing unprofitable-

[Jessie Zheng, Head of Investor Relations at Vipshop]

Unprofitable.

[Eric Ya Shen, Co-Founder, Chairman, and CEO at Vipshop]

Rather than chasing unprofitable value growth, we stayed true to our core value proposition, delivering a highly curated select of high demand, deeply discounted brand products to our loyal customer base. While overall traffic was muted, our SVIP cohort served as a resilient anchor for our business. During the quarter, active SVIP grew by 8% year-over-year, driving 54% of our online spending, showing that as customer budget tighten, high intent shoppers prioritize platforms offering trust, value, quality, and service.

[Eric Ya Shen, Co-Founder, Chairman, and CEO at Vipshop]

At the strategic level, our 1P model gives us a different edge. By leveraging deep category expertise, we built greater trust with brand partners to the point when they actively adjust that merchandise allocations for our platform. For instance, closer collaborations with key partners in fashion apparel has helped buffer against the broader market awareness. This level of brand integration strengthens our moat and protects our core business. On top of this, our merchandising team has been moving quickly to align our product mix with the more selective customers. We have sharpened our curation along the core apparel and lifestyle essentials, matching our assortment to real life occasions to capture immediate demand. This target approach ensures that we always deliver a clear utility, recognized brand, and compelling value. Our opportunities sourcing strategy adds another layers of inventory flexibility.

[Eric Ya Shen, Co-Founder, Chairman, and CEO at Vipshop]

As brand partners manage inventory in a softer market, we serve as a reliable off-price partners, locking in unique, high-demand inventory at deep discounts. This reinforces our differentiated merchandise pipeline and forced deep brand collaborations. At the same time, we continue to advance the repositioning of our exclusive Made-for-Vipshop line to drive stronger customer mindshare and loyalty. By raising product standards and aligning the seasonal launches close with brand partners, we are seeing high-quality halo products emerging, lifting conversion rate, and support overall portfolio stability. As we kick off the upcoming season, we are pleased to see that our SVIP membership has hit the 10 million milestone. To continue the momentum, we are launch an integrated campaigns pair with the four collection and the major upgrade to provide sales.

[Eric Ya Shen, Co-Founder, Chairman, and CEO at Vipshop]

At the core of this push, we are refresh our signature slogan, "Dress the best for 70% less," which has long resonant deep with our loyal base. To ensure we keep evolving alongside the modern Chinese shopper, we are refreshing our campaign reach to both younger and mature demographic while reinforced, enduring true across every market cycle. That shoppers consistently demand great high-quality fashion at unbeatable price. Grounding our mind share in smart value allow us to double down on our off-price advantage, attract high-value shoppers, and drive high-quality growth. Alongside our branding refresh, our customer engagement strategy focused on retention and lifetime value. Real 70% less, saving power our core apparel, delivering pleasant surprise affordability that convince new shoppers. Providing a tailored tiered service model to our SVIP allow us to capture greater wallet share over time.

[Eric Ya Shen, Co-Founder, Chairman, and CEO at Vipshop]

Making SVIP loyalty as a primary engine of operational stability and profitable growth. Turning to our technology roadmap, we are deepening AI integration across our business. On the custom side, our AI product suites is driving tangible results. Virtual try on thickness is steadily up. Integrate customer

[Jessie Zheng, Head of Investor Relations at Vipshop]

Intelligent.

[Eric Ya Shen, Co-Founder, Chairman, and CEO at Vipshop]

intelligent customer service with AI voice interactions and predictive capabilities is lifting conversion rate, and AIGC is enabling faster discovery. Marketing remains our most impactful up case to date. Our upgraded AI marketing agent now enables optimized from placement planning to AIGC creative matching across the right channels. We see clear room for this integrated approach to further drive acquisitions efficiency while improving customer quality. Operationally, we are scaling AI beyond individual tools into a unified, secured intelligence layer across the business. We are already seeing early win in supply chain optimizations, and daily operational workflows. Overall, we remain focused on disciplined execution today while building towards our long-term vision. While we continue to navigate near term macro headwind with caution, I have full confidence in our proven model, solid foundations, and team.

[Eric Ya Shen, Co-Founder, Chairman, and CEO at Vipshop]

As we sharpened our merchandising, elevate the customer experience, and scale technology, we are firmly positioned on the pace back to the sustainable growth. Finally, I would like to brief cover Shan Shan Outlet, a key part of our omni-channel discount retail strategy. Since our acquisitions in 2019, we have driven disciplined expansion across emerging tier 1, tier 2, and key cities. Today, Shan Shan has scaled from 5 to 22 operational outlets mall, becoming China's largest outlet chain by store count, and maintain a top-tier position by total GMV. In the first half, Shan Shan Outlet continue its strong scale momentum with over 20% year-over-year growth, capitalizing on the value-seeking trend and the unique in-person shopping experience of offline retail. Looking ahead, we expect its business contributions to the group to increase steadily.

[Eric Ya Shen, Co-Founder, Chairman, and CEO at Vipshop]

At this point, let me hand over the call to our CFO, Mark Wang, to go over our financial results.

[Mark Wang, CFO at Vipshop]

Thanks, Eric, and hello, everyone. In the second quarter, our top line came in at the lower end of our guided range, reflecting broad-based softening in consumer sentiment. Despite ongoing pressures, we maintain disciplined execution, which provided strong visibility into our operational trajectory, enabling us to preserve core operating profitability and margin health. As noted in our earning release, our non-GAAP net income was temporarily impacted by a one-time withholding tax adjustment. I will elaborate on shortly. Adjusting for this non-recurring item, our underlying non-GAAP net profit remained solid at RMB2.0 billion, with a net margin of 7.9%, demonstrating our underlying profitability and the core cash generation remains fully intact. As Eric mentioned, quality sustainable growth remains our core priority. While micro headwinds persist, we continue to focus on strengthening our competitive moat and strategically reinvesting to fortify our fundamentals for profitable and long-term expansion.

[Mark Wang, CFO at Vipshop]

During the first half, we distributed approximately $400 million to shareholders through a combination of cash dividends and a share repurchase, reflecting the anticipated utilization of our existing authorization. The board of directors has approved a new $1 billion share repurchase program. This underscores our firm commitment to returning no less than 75% of our full year 2025 non-GAAP net income to shareholders, supported by solid business fundamentals and a resilient underlying cash generation. We remain fully confident in our capacity to achieve this capital return target. In addition, to unlock the value of our high-quality assets and optimize capital efficiency, we successfully launched two public REITs backed by three mature Shan Shan Outlet properties, a consumer infrastructure REIT, and a commercial REIT.

[Mark Wang, CFO at Vipshop]

This not only improves the quality of our outlet portfolio and their market valuation, but also creates a capital recycling loop that allow us to reinvest the proceeds from mature assets directly into disciplined expansion. We believe this model maintains our financial flexibility while supporting the sustainable growth of our outlet business, driving asset revaluation, and creating sustainable value for our shareholders. Now, moving to our detailed quarterly financial highlights. Before I get started, I would like to clarify that all financial numbers presented below are in renminbi, and all the percentage change are year-over-year change, unless otherwise noted. Total net revenues for the second quarter of 2026 were RMB24.7 billion, compared with RMB25.8 billion in the prior year period. Gross profit was RMB5.8 billion, compared with RMB6.1 billion in the prior year period. Gross margin was 23.3%, compared with 23.5% in the prior year period.

[Mark Wang, CFO at Vipshop]

Total operating expenses decreased by 2.4% year-over-year to RMB4.5 billion from RMB4.6 billion in the prior year period. As a percentage of total net revenues, total operating expenses were 18.0%, compared with 17.7% in the prior year period. Fulfillment expenses were RMB2.14 billion, compared with RMB2.11 billion in the prior year period. As a percentage of total net revenues, fulfillment expenses were 8.7%, compared with 8.2% in the prior year period. Marketing expenses were RMB760.3 million, compared with RMB715.9 million in the prior year period. As a percentage of total net revenues, marketing expenses were 3.1%, compared with 2.8% in the prior year period. Technology and content expenses were RMB486.2 million, compared with RMB442.0 million in the prior year period. As a percentage of total net revenues, technology and accounting expenses were 2.0%, compared with 1.7% in the prior year period.

[Mark Wang, CFO at Vipshop]

General and administrative expenses decreased by 17.5% year-over-year to RMB 1.1 billion, compared with RMB 1.3 billion in the prior year period, primarily due to higher share-based compensation expenses for Shan Shan Outlet recorded in the prior year period. As a percentage of total net revenues, general and administrative expenses decreased to 4.3% from 5.0% in the prior year period. Income from operations was RMB 1.5 billion, compared with RMB 1.7 billion in the prior year period. Operating margin was 6.2%, compared with 6.6% in the prior year period. Non-GAAP income from operations was RMB 2.0 billion, compared with RMB 2.4 billion in the prior year period. Non-GAAP operating margin was 8.1%, compared with 9.3% in the prior year period. Income tax expenses were RMB 3.3 billion, compared with RMB 407.2 million in the prior year period. The increase was primarily driven by two items.

[Mark Wang, CFO at Vipshop]

The first one is the income tax expense of RMB 1.63 billion relating to the one-off investment gain recognized by Shan Shan Commercial Group, the original holder of the underlying assets on the issuance of a commercial REIT. The second one is an accrued withholding tax expenses of RMB 1.56 billion, reflecting the withholding tax treatments of historical dividend distributions from mainland China to Hong Kong regarding applicable policies on tax treaty benefits. Excluding the tax impact of this discrete and non-operating items, the company's normalized effective tax rate for the second quarter of 2026 remained stable year-over-year. Here, I would like to emphasize that our company has always operated and it continues to operate in full compliance with applicable tax laws and regulatory guidelines. The withholding tax adjustment reflects the adjustment of historical dividend distributions and expected to be settled in the third quarter.

[Mark Wang, CFO at Vipshop]

Going forward, the company will continue to accrue dividend withholding tax at a statutory rate for any onshore earnings allocated for offshore repatriation. While this will increase the cost of direct onshore to offshore equity remittance, we view tax repatriation as step one tool in our broader capital structure toolkit. Net income attributable to Vipshop shareholders increased by 189.1% year-over-year to RMB 4.3 billion from RMB 1.6 billion in the prior year period, primarily due to a one-off investment gain of RMB 5.79 billion from the listing of a commercial REIT. Net margin attributable to Vipshop's shareholders increased to 17.4%, from 5.8% in the prior year period. Net income attributable to Vipshop's shareholders per diluted ADS increased to RMB 8.82 from RMB 2.91 in the prior year period. Non-GAAP net income attributable to Vipshop shareholders was RMB 392.2 million, compared with RMB 2.1 billion in the prior year period.

[Mark Wang, CFO at Vipshop]

Non-GAAP net margin attributable to Vipshop shareholders was 1.6%, compared with 8.0% in the prior year period. Non-GAAP net income attributable to Vipshop shareholders per diluted ADS was RMB 0.80, compared with RMB 4.06 in the prior year period. As of June 30, 2026, the company had cash and cash equivalents and restricted cash of RMB 29.9 billion. Short-term investments of RMB 3.6 billion. Looking forward to the third quarter of 2026, we expect our total net revenues to be between RMB 20.3 billion and RMB 21.4 billion, representing a year-over-year decrease of approximately 5%-0%. Please note that this forecast reflects our current and preliminary view of the market and our operational conditions, which is subject to change. With that, I would now like to open the call to Q&A.

[Operator]

Thank you. We will now begin the question and answer session. To ask a question, please press star 1 1 and wait for your name to be announced. If you wish to ask the management your questions in English, kindly translate them in Chinese. One moment for our first question. The first questions will come from the line of Thomas Chong of Jefferies. Please go ahead.

[Thomas Chong, Analyst at Jefferies]

Hi. Good evening. Thanks management for taking my question. My question is about the consumer sentiment. Can management comment about how we are seeing the sentiment so far? On that front, can we comment about the monthly revenue trend that we are seeing since April till now? Given that we are already 2 months in the quarter, are we actually seeing our revenue hitting the low end or the high end of the guidance? Finally, can management comment about the second half outlook? Thank you.

[Eric Ya Shen, Co-Founder, Chairman, and CEO at Vipshop]

[Non-English content]

[Jessie Zheng, Head of Investor Relations at Vipshop]

Okay, in terms of the general consumer sentiment, we find consumers are not particularly enthusiastic. They are actually not buying into everything. They are very value seeking and they are very budget conscious, and they are very selective. As we enter into Q3, across our sector, we continue to observe pressure quarter to date from July to August. We do see some recovery in terms of sales momentum, but it is only slightly better. It is far from being good. That is why we think that for the second half and for the full year, we may see a similar consumer sentiment as we have seen in the first half. That will bring our total revenue for the full year to be slightly negative from last year.

[Thomas Chong, Analyst at Jefferies]

[Non-English content]

[Operator]

Please hold for our next question. Our next questions will come from the line of Alicia Yap of Citigroup. Please go ahead.

[Alicia Yap, Analyst at Citigroup]

Hello, thank you. [Non-English content] Thanks management for taking my questions. Have a questions on the operating income. We notice that it seems that there is, you know, the operating margin seems to be declining on a year-over-year trend. How should we be thinking about the gross margins, operating expenses, and also operating margin trend for the third quarter and the fourth quarter? Thank you.

[Eric Ya Shen, Co-Founder, Chairman, and CEO at Vipshop]

[Non-English content]

[Jessie Zheng, Head of Investor Relations at Vipshop]

On margin, in terms of operating margin, we do see a slight decline year-over-year for Q2. That is primarily because we see a certain level of deleverage from fulfillment expenses, which is increasing proportionally as return rate are still going up. Actually, when we look at our GP margin, it is flattish and it is even growing, which implies that we have strong management on managing the gross margin and the gross profit. In addition, we do see a certain operating leverage from fixed cost and expenses as the revenue scale becomes smaller due to macro pressure. But overall, we expect operating margin will continue to be quite resilient given our structural cost and expense discipline. For the second half, for Q3 and Q4, we are pretty confident in managing the structural health of our business.

[Jessie Zheng, Head of Investor Relations at Vipshop]

As you look externally, you see a lot of industry players actually investing in unprofitable subsidies. That is not what we are going to do. Our focus remains steadfastly on maintaining a healthy level of profitability and margin. So we do expect our margins, especially the NP margins, will remain relatively stable for the second half. Thank you.

[Operator]

Please hold for our next question. The next question will come from the line of Vicky Wu of CICC. Your line is open.

[Vicky Wu, Analyst at CICC]

[Non-English content] We've noticed an adjustment regarding the withholding tax this quarter. Could management elaborate more on the reasons for this, and is this a result of a penalty imposed by the tax authority? Looking ahead, will this affect your plans for share buybacks and dividend payouts? Thank you.

[Mark Wang, CFO at Vipshop]

Okay, thanks for your question. Mark, first of all, this is absolutely not a penalty. The company is, and has always been in full compliance with applicable tax laws and regulatory guidelines. This adjustment represents a prudent step in the company's continuous enhancement of its compliance framework. Through a proactive reassessment aligned with prevailing best practice, we are mitigating compliance risk and providing greater tax certainty. This is not a compliance finding or penalty. Withholding tax on dividend is a transaction cost associated with capital mobility, not an operational expense. Our operating margin and the pre-tax cash flows remain fully intact. The company maintains multiple avenues to optimize offshore liquidity, and cash repatriation is just one of them. Accordingly, we anticipate an impact on our future net margin to be minimal. The company remains fully committed to our long-term shareholder return promise. Thank you.

[Operator]

Thank you for the questions. Please hold for our next question. The next questions will come from the line of Sedona Fung from UBS. Your line is open. Please go ahead.

[Sardonna Fong, Analyst at UBS]

Thank you, management, for taking my question. [Non-English content] I'll translate myself. Congrats on the strong Shan Shan 2Q GMV growth performance of over 20%. What is management outlook for the second half? Now that the two REITs have already completed their listing, what would be the pace of progress on the securitization of the remaining outlet projects that management can share? Lastly, on shareholder return, noted that the company resumed buybacks in second quarter, and management also announced a new buyback program in August of $1 billion. How should we think about the level and pace of shareholder return for the second half? Thank you.

[Eric Ya Shen, Co-Founder, Chairman, and CEO at Vipshop]

[Non-English content]

[Jessie Zheng, Head of Investor Relations at Vipshop]

We are quite optimistic about Shan Shan Outlet growth momentum in the first half. Shan Shan Outlet grew by over 20% in terms of GMV. Actually, the first quarter turned out to be much better and followed by a very decent second quarter, given the general soft consumer sentiment today. We continue to expect a similar growth momentum for the second half, and we do believe that over 20% GMV growth is completely achievable. Actually, we have higher standards for comparable same-store sales for the existing Shan Shan Outlets, which we believe will grow at least double digits.

[Mark Wang, CFO at Vipshop]

Okay, Mark. Let me answer your second and third questions. Your second question is regarding the REIT status and planning. On June 18, 2026, we successfully listed our commercial REIT on the Shanghai Stock Exchange. The listing makes a significant strategic milestone for Vipshop, expanding our presence from consumer infrastructure REITs into the broader commercial REIT arena. The REIT with a total of RMB 7.7 billion, making it the largest commercial REIT in terms of the fund raising scale among the first batch of commercial REITs listed on China's capital market. There are two underlying assets, Shan Shan Outlets in Zhengzhou and Harbin in the commercial REIT. Both are mature outlets operate for around 10 years. Both outlets hold leading position in their regional markets. The Zhengzhou outlets is the highest grossing outlets in Henan province, while the Harbin outlets ranks first in Heilongjiang province.

[Mark Wang, CFO at Vipshop]

In addition to the three outlets already used as underlying assets for the REIT issuance, we also hold another 18 outlets projects, demonstrating strong potential for future expansion. We will conduct future evaluation based on our strategy and the market conditions. Your third question is regarding the buyback. During the 2021 to 2025, we have already returned $3.7 billion to shareholders. Our long-term returns to shareholder is built on our strong business model and health cash flow. External factors may cause short-term volatility in our business. Our corporation are managed to deliver stable and robust profitability across economic cycles. This strength let us keep providing sustainable returns to our shareholders over time. For 2026, we remain fully committed to our full year shareholder return policy, which targets total payout ratio of no less than 75% of our 2025 non-GAAP net income.

[Mark Wang, CFO at Vipshop]

In first half, we have distributed approximately $400 million U.S. through dividend and buyback. Reflecting the anticipated utilization of our existing authorization, the board of directors have approved a new $1 billion U.S. share repurchase program. We will continue the buyback opportunistically in the quarters ahead. Thanks.

[Sardonna Fong, Analyst at UBS]

Thank you.

[Operator]

Thank you for the questions. Due to time constraint, that concludes today's Q&A session. At this time, I will turn the conference back to Jessie for any closing remarks.

[Jessie Zheng, Head of Investor Relations at Vipshop]

Thank you for taking the time to join us today. If you have any questions, please don't hesitate to contact our IR team. We look forward to speaking with you next quarter.

[Operator]

That concludes today's conference call. Thank you for your participation. You may now disconnect your line.

Participants

Executives

• Jessie Zheng, Head of Investor Relations
• Eric Ya Shen, Co-Founder, Chairman, and CEO
• Mark Wang, CFO

Analysts

• Thomas Chong, Analyst at Jefferies
• Alicia Yap, Analyst at Citigroup
• Vicky Wu, Analyst at CICC
• Sardonna Fong, Analyst at UBS