Dingdong (NYSE: DDL) shares rose 2.2% in pre-market trading on Thursday after the Chinese grocery delivery firm reported adjusted earnings per share that topped analyst forecasts, even as revenue fell short of expectations.
The company posted adjusted EPS of RMB0.90 ($0.13) for the second quarter, exceeding the market consensus. Revenue totaled RMB6.49 billion ($956.1 million), below the estimated RMB6.9 billion but up 8.6% from RMB5.98 billion in the same period last year. China business revenue, which accounted for the bulk of total revenue, increased 8.3% year-over-year to RMB6.41 billion ($945.3 million), while overseas revenue surged 36.2% to RMB73.2 million ($10.8 million).
Adjusted net income reached RMB281.3 million ($41.5 million), a 120.2% increase from RMB127.8 million in the prior-year quarter. Net income totaled RMB271.7 million ($40.0 million), compared with RMB107.2 million a year earlier. The company attributed part of the net income increase to RMB199.1 million ($29.3 million) in savings from ceasing depreciation and amortization on assets classified as held-for-sale.
Gross margin improved to 29.6% from 28.8% in the second quarter of 2025, while operating income jumped 209.6% year-over-year to RMB252.8 million ($37.3 million). Dingdong also reported its fifteenth consecutive quarter of adjusted profitability.
CEO Song Wang highlighted growth in average monthly transacting users and higher order frequency as key drivers, though he noted downward price pressure in categories such as pork. The company remains in the process of divesting its China business to Meituan (HKEX: 3690), pending anti-monopoly approval.
