Dingdang Health Posts Narrowed Adjusted Loss and Higher Gross Margin in 1H 2026 Despite One-Off Impairment

Dingdang Health (09886) reported first-half 2026 revenue of RMB 2.41 billion, up 3.5 % year on year, as expanded smart-pharmacy coverage and a richer product mix offset intensified industry competition.

Gross profit rose to RMB 0.88 billion, lifting gross margin to 36.5 % from 35.0 % a year earlier. The improvement was driven by better operating efficiency and sales mix optimization.

The statutory net loss widened to RMB 64.90 million (1H 2025: RMB 52.02 million) after booking non-cash impairment charges of RMB 51.48 million on goodwill and RMB 9.39 million on other intangibles linked to under-performing subsidiaries. Excluding impairments, post-IPO amortisation and share-based expenses, adjusted net loss narrowed to RMB 1.01 million versus RMB 5.76 million in the prior-year period.

Cost dynamics were mixed: • Fulfilment expenses fell 3.4 % to RMB 214.49 million, or 8.9 % of revenue. • Selling and marketing costs increased 8.3 % to RMB 569.67 million, representing 23.6 % of revenue. • R&D spend declined 8.0 % to RMB 23.02 million. • G&A expenses dropped 34.6 % to RMB 66.45 million, reflecting lower share-based payment charges (down to RMB 1.01 million from RMB 36.96 million).

Channel performance remained resilient: – Online direct sales grew 3.1 % to RMB 1.74 billion. – Business distribution slipped 0.3 % to RMB 265.90 million. – Offline retail advanced 10.7 % to RMB 337.70 million, supported by expanded pharmacy network. – Other revenue eased 4.0 % to RMB 64.04 million.

Operating cash flow reached RMB 167.99 million (1H 2025: RMB 188.17 million). A RMB 469.16 million inflow from investing activities—mainly net redemption of wealth-management products and time deposits—drove a period-end cash and cash equivalents balance of RMB 939.04 million, more than double the December 2025 level of RMB 429.32 million.

Capital expenditure was contained at RMB 13.78 million, while interest-bearing bank borrowings stood at RMB 4.87 million, leaving gearing at 0.3 %. The company reported no material capital commitments or pledges of assets.

During the half, Dingdang repurchased 68.98 million shares for approximately RMB 61.85 million and cancelled 64.82 million shares. No interim dividend was declared.

Management signalled continued focus on core-city penetration, smart-pharmacy upgrades and AI-enabled health services, while maintaining disciplined cost control to pursue sustainable profitability.