Full Press Release Details
111, Inc. Announces Third Quarter 2025 Unaudited
SHANGHAI, December 17, 2025 /PRNewswire/ -
111, Inc. ("111" or the "Company") (NASDAQ: YI), a leading tech-enabled healthcare platform company committed
to reshaping the value chain of healthcare industry by digitally empowering the upstream and downstream in China, today announced its
unaudited financial results for the third quarter ended September 30, 2025.
Quarter 2025 Highlights
(1) Non-GAAP income from operations represents income from operations excluding share-based compensation expenses.
(2) Non-GAAP net income represents net income excluding share-based compensation expenses, net of tax. Considering the impact of
accretion of redeemable non-controlling interest for the third quarter 2025, non-GAAP net income is used as a meaningful measurement
of the operation performance of the Company.
Mr. Junling Liu, Co-Founder, Chairman, and Chief Executive Officer of
111, commented, "In the third quarter of 2025, we once again demonstrated resilience despite a challenging macroeconomic landscape.
I am pleased to report that we have achieved non-GAAP operational profitability for the third consecutive quarter and generated positive
operating cash flow both in the quarter and on a year-to-date basis."
"We are decisively executing a strategic shift towards an asset-light
business model. During and subsequent to the quarter, we completed the divestiture of three self-operated subsidiaries. Crucially, this
represents a change in ownership structure, not a reduction in service capability. These facilities have now joined our ecosystem as fulfillment
partners and will be dedicated to service our customers exclusively. While this structural optimization may create a temporary headwind
for our top-line revenue, it meaningfully strengthens our liquidity and profitability. It allows us to maintain a robust logistics network
without the associated capital burden, accelerating our transition from an asset-heavy model to a high-margin, technology-enabled service
"Our strategic initiatives are delivering strong results. We
have made substantial progress in enhancing our supply chain capabilities through the ongoing "MANTIANXING" initiative.
The nationwide network of fulfillment centers continues to grow. As of the end of the quarter, the initiative has generated
inventory value of RMB498 million, driving growth of 20.5% in GMV and 31.0% in customer count compared to Q2. In optimizing our
supply chain, we have systematically enhanced overall competitiveness through initiatives such as traceability code scanning, relay
picking by warehouse personnel, and optimal carrier matching. These measures have significantly improved operational
efficiency, reduced total fulfillment costs, and provided a solid, reliable foundation for our business growth."
"Looking ahead, our vision is to build the industry's AI-powered
transaction platform for pharmaceutical procurement. We are actively leveraging AI capabilities to create a unified, intelligent platform
that optimizes decision-making for pharmacies and maximizes reach for suppliers. By aggregating industry information and streamlining
transactions on a single interface, we are committed to providing a superior customer experience which will unlock long-term value for
Quarter 2025 Financial Results
revenues were RMB3.0 billion (US$421.5 million), representing a decrease of 16.7% from RMB3.6 billion in
the same quarter of last year.
Gross segment profit
(3) was RMB178.0 million (US$25.0 million), representing a decrease of 15.5% from RMB210.6
million in the same quarter of last year.
| (In thousands RMB) | For the three months ended September 30, | |||||||||||
| 2024 | 2025 | YoY | ||||||||||
| B2B Net Revenue | ||||||||||||
| Product | 3,514,298 | 2,925,641 | -16.8 | % | ||||||||
| Service | 21,731 | 14,245 | -34.4 | % | ||||||||
| Sub-Total | 3,536,029 | 2,939,886 | -16.9 | % | ||||||||
| Cost of Products Sold (4) | 3,340,998 | 2,773,020 | -17.0 | % | ||||||||
| Segment Profit | 195,031 | 166,866 | -14.4 | % | ||||||||
| Segment Profit % | 5.5 | % | 5.7 | % |
| (In thousands RMB) | For the three months ended September 30, | |||||||||||
| 2024 | 2025 | YoY | ||||||||||
| B2C Net Revenue | ||||||||||||
| Product | 61,031 | 58,294 | -4.5 | % | ||||||||
| Service | 3,615 | 2,640 | -27.0 | % | ||||||||
| Sub-Total | 64,646 | 60,934 | -5.7 | % | ||||||||
| Cost of Products Sold | 49,061 | 49,765 | 1.4 | % | ||||||||
| Segment Profit | 15,585 | 11,169 | -28.3 | % | ||||||||
| Segment Profit % | 24.1 | % | 18.3 | % |
Gross segment profit represents net revenues less cost of goods sold.
For segment reporting purposes, purchase rebates are allocated to the B2B segment and B2C segments primarily based on the amount of cost
of products sold for each segment. Cost of products sold does not include other direct costs related to cost of product sales such as
shipping and handling expense, payroll and benefits of logistic staff, logistic centers rental expenses and depreciation expenses, which
are recorded in the fulfillment expenses. Cost of service revenue is recorded in the operating expense.
expenses were RMB3.0 billion (US$421.8 million), representing a decrease of 16.5% from RMB3.6 billion in
the same quarter of last year, broadly in line with the decline in net revenues.
Loss from operations
was RMB2.3 million (US$0.3 million), compared to income from operations of RMB2.4 million in the same quarter of last year.
income from operations was RMB0.2 million (US$0.03 million), compared to RMB7.1 million in the same quarter of last year.
As a percentage of net revenues, non-GAAP income from operations accounted for 0.01% this quarter as compared to 0.2% in the same quarter
million (US$0.2 million), representing an improvement of 58.0% from RMB3.5 million in the same quarter of last year.
net income was RMB1.1 million (US$0.2 million), compared to RMB1.3 million in the
same quarter of last year. As a percentage of net revenues, non-GAAP net income accounted for 0.04%
this quarter, consistent with the same quarter last year.
Net loss attributable
to ordinary shareholders was RMB13.0 million (US$1.8 million), compared to RMB17.1 million in the same quarter of last
year. As a percentage of net revenues, net loss attributable to ordinary shareholders accounted for 0.4% this quarter as compared to 0.5%
in the same quarter of last year.
Non-GAAP net loss attributable
to ordinary shareholders (5) was RMB10.5 million (US$1.5 million), compared to RMB12.4 million in the same quarter of last
year. As a percentage of net revenues, non-GAAP net loss attributable to ordinary shareholders accounted for 0.3% of net revenues this
quarter, consistent with the same period last year.
Non-GAAP net loss attributable to ordinary shareholders represents net loss attributable to ordinary shareholders excluding share-based
compensation expenses, net of tax.
2025, the Company held cash and cash equivalents, restricted cash and short-term investments totaling RMB557.5 million (US$78.3 million),
compared to RMB518.3 million as of December 31, 2024. To date, amount of RMB1.1 billion has been included in the balances of redeemable
non-controlling interests and accrued expenses and other current liabilities. This amount is owed to a group of investors of 1 Pharmacy
Technology pursuant to equity investments made in 2020, as previously disclosed. 111 has received redemption requests from certain of
such investors in accordance with the terms of their initial investments in 1 Pharmacy
Technology. Following communication and negotiation, the Company has reached agreements with, or received commitment letters from, all
investors to reschedule the repayments, allowing for phased repayments at extended periods, if the investors exercise their redemption
rights. A portion of the redemption has been paid upon signing of these agreements. For further details about such investors' investments
in 1 Pharmacy Technology, please see "Item 4. Information on the Company-A. History and Development of the Company" in the
Company's annual report for the fiscal year ended December 31, 2024.
Executing Strategic Optimization: Embraces Asset-Light
Partnership Network Growth
In the third quarter of 2025 and subsequent to
third quarter, the Company proactively executed a strategic structural optimization by divesting its 100% equity interests in three subsidiaries,
namely Shanxi Yihao Yaofang Pharmacy Co., Ltd., Liaoning Yihao Pharmacy Co., Ltd. and Tianjin Yihao Pharmacy Co., Ltd. to several
independent third-party buyers. In connection with the divestiture, these buyers continue to operate on our platform as warehouse partners,
providing fulfillment services to our customers exclusively, as part of our core warehouse partnership strategy to drive asset-light,
This transaction was as part of our broader strategic
initiative to shift away from a capital-intensive, self-operated warehouse business model (which put pressure on our overall profitability
and liquidity) toward an asset-light partnership structure. Historically, the three subsidiaries were operated as self-run facilities
and incurred operating losses. In 2024, they generated a total revenue of RMB2.86 billion and a total net loss of RMB417 million and RMB407
million in net liabilities as of the divestment date. Through the divestiture of these entities and the transition of our business model
to a warehouse partnership model-where we generate recurring commission
income rather than assuming the operational and capital burdens-we
have strengthened our ability to further improve our profitability and liquidity profile.
We believe that this transaction reinforces our
focus on pursuing asset-light, profitable growth, strengthening our ability to scale the warehouse partnership network efficiently while
maintaining a healthier financial structure.
Use of Non-GAAP Financial Measures
In evaluating the business, the Company considers
and uses non-GAAP income from operations, non-GAAP net income (loss), non-GAAP net loss attributable to ordinary shareholders, and non-GAAP
loss per ADS, as supplemental measures to review and assess its operating performance. The Company defines non-GAAP income from operations
as income from operations excluding share-based compensation expenses. The Company defines non-GAAP net income (loss) as net loss excluding
share-based compensation expenses, net of tax. The Company defines non-GAAP net loss attributable to ordinary shareholders as net loss
attributable to ordinary shareholders excluding share-based compensation expenses, net of tax. The Company defines non-GAAP loss per ADS
as net loss attributable to ordinary shareholders per ADS excluding share-based compensation expenses, net of tax per ADS. The presentation