Good day, ladies and gentlemen. Thank you for standing by. Welcome to Alibaba Group's September Quarter 2019 Results Conference Call. [Operator Instructions] I would now like to turn the call over to the Rob Lin, Head of Investor Relations of Alibaba Group. Please go ahead.

Hello, everyone, and welcome to Alibaba Group's September quarter 2019 results conference call. With us are Daniel Zhang, Executive Chairman and CEO; Joe Tsai, Executive Vice Chairman; Maggie Wu, Chief Financial Officer. This call is also being webcast from our IR section of the corporate website. A replay of the call will be available on our website later today. Now let me quickly cover the safe harbor. Today's discussion will contain forward-looking statements. These forward-looking statements involve inherent risks and uncertainties that may cause actual results to differ materially from our current expectations. For detailed discussions of these risks and uncertainties, please refer to our latest annual report under Form 20-F and other documents filed with the U.S. SEC. Any forward-looking statements that we make on this call are based on assumption as of today, and we do not undertake any obligation to update these statements, except as required under applicable law. Please note that certain financial measures that we use on this call such as adjusted EBITDA, adjusted EBITDA margin, adjusted EBITA, adjusted EBITA margin, marketplace core commerce adjusted EBITA, non-GAAP net income, non-GAAP diluted earnings per share or ADS, and free cash flow are expressed on a non-GAAP basis. Our GAAP results and reconciliation of GAAP to non-GAAP measures can be found in our earnings press release. Unless otherwise stated, the growth rate of all stated metrics mentioned during this call refers to year-on-year growth versus the same quarter last year. With that, I will now turn the call to Joe.

Thanks, Rob. Thank you all for joining us. In past earnings calls, we have kicked off company management remarks with my overall observations on strategic issues or macro trends. Starting this quarter and going forward, Daniel Zhang, who has assumed our Executive Chairman role, will deliver the overall strategic and macro state of affairs as well as his usual discussion of business operations. I will continue to make myself available for Q&A after our prepared remarks. Daniel, please go ahead.

Thanks, Joe. Hello, everyone, and thank you for joining our earnings call today. In September, Alibaba just celebrated our 20th anniversary. We truly appreciate our shareholders' support in the past years. Today, I'm honored to speak to you in the role of the Executive Chairman of Alibaba Group for the first time. I would like to take this opportunity to share my thoughts about the opportunities and our strategy over the next several years. Our mission has not changed since day 1. It is to make it easy to do business anywhere. Today, our consumers, merchants and partners are entering a new journey in the digital era. We will continue to create value for them by leveraging the power of data technology to make it easy to do business for them anywhere for the decades to come. We have set a goal for the near term to serve over 1 billion consumers and achieve at least RMB 10 trillion consumption by fiscal year 2024. Geopolitical uncertainties have placed additional pressure to global growth. We believe this is both a challenge and opportunity for the Chinese economy; and finding more opportunities in such an uncertain environment is the key to our business and strategy. I would like to point out 2 long-term developments that are in Alibaba's favor. One is to consumers, 2C; and the other is to business, 2B. In terms of the 2C, we see great potential in domestic consumption as an important driver for Chinese economy. The overall size of consumption keeps growing with increasing penetration of digitalization. Specifically, China retail sales reached around RMB 30 trillion in the first 9 months of 2019, growing at 8.2% year over year. This outpaced the overall GDP growth at 6.2%. More importantly, online e-commerce is still the key driver of…

Thank you, Daniel. Thank you all for joining us. We had another strong quarter. So for today's call, I will start by going over financial highlights and end with how we view the coming quarters. Now let me go over the financial highlights. In the September quarter 2019, we delivered another strong quarter of user growth with mobile MAUs reaching 785 million, up 30 million compared to our June quarter. User engagement continues to improve with mobile DAU growing faster than MAU. In the first 6 months ended September, the Taobao app's DAU growth accelerated as a result of healthy organic traffic growth, effective user targeting and increasing engagement with interactive and entertainment features. For the September quarter, annual active consumers on our China retail marketplace reached 693 million, which increased by 19 million compared to our June quarter. The increase in consumer growth reflected our continued penetration in both developed and less-developed areas in China as we launched more effective consumer segmentation initiatives. These initiatives have been well-received by consumers, as evidenced by accelerating order growth from higher purchase frequencies. Our total revenue grew 40% year-on-year to CNY 119 billion in September quarter. Excluding the effects of consolidating acquired businesses, revenue would have grown 37% year-on-year, still very strong growth. The increase was mainly driven by robust growth of our China commerce retail business and Alibaba Cloud. We are very pleased to see that our operations is running in a very efficient way. Costs and the expenses are very well-controlled while our business has been continuously grow fast. Let's turn to our business segments. Our core commerce segment continue to be very strong. Core commerce revenue grew at 40% year-on-year to RMB 101 billion. The fundamentals of our China retail business continue to be strong. Customer management revenue grew…

Operator, we're ready.

[Operator Instructions] Your first question comes from the line of Alicia Yap of Citigroup.

Congratulations on the strong quarter. My questions is related to the upcoming Singles Day this year. So does management view this as any big difference than the previous year, for example, in terms of the countries and the platforms that will be participating in the event? And in terms of product category, any specific product that management believe will be a big traction for consumer? And it also seems like there will be so many platforms throwing more discount to consumer this year. So do you think that the consumption demand will be there to assort the spending and allow all the platforms to win and gain? So any colors on the upcoming event would be helpful.

Thanks. This is Daniel. Let me answer this question. I think everybody understands that we are approaching to the 11.11 Singles Day, 11.11 day. So after the past 10 years' efforts, I think first of all, I think this November 11 has become a consumer shopping day. And people widely recognize that shopping day, and that's why we have a very organic momentum to -- for the consumers to join -- to enjoy that day. So people are ready to shop on that day. So this is the -- basically, this is a habit people formed in the last 10 years. The other side of the coin is the supply. And after 10 years' efforts and all the merchants, all the brand companies, retailers, they are actively preparing for this upcoming shopping day, shopping festival. So they will provide the best products with best price and services to the consumers. And commercial-wise, they view this as more like the commercial Olympic Games, and everybody want to be the champion in their sector. So that's why we gather momentum from both demand and supply side. And this year, I think that we -- all the category, we have many new tailor-made products for this November 11. And we even worked with many brand companies to tailor-made products exclusive for November 11 but with limited edition. So this is not only a shopping day, but also a marketing day for brands to market their brand and also engage the new customers. In terms of the market, I think not only China, but also our cross-border and international marketplaces, Lazada and AliExpress, both of them will participate in this shopping festival. But we localize the operation to meet the local demand of the customers. But we do see the synergies in terms of the product supply because most of the supplies from China can be consumed by the people in other markets as well via cross-border export. And we apply many, many new technologies into this November 11 preparation. And so far, we see a very, very good progress in terms of the warm-up activities. And we -- [ for ] the interactive features we created in our mobile Taobao app and other mobile apps in Alibaba ecosystem. We -- so far, we have achieved a very good user engagement for this upcoming shopping festival. So what we are -- we are ready for that day, and we will do all we can do to make sure we have another success on that day.

Our next question comes from the line of Eddie Leung of Bank of America Merrill Lynch.

I'm curious to hear your thoughts on the competitive environment you see today in the less-developed areas versus a few years ago when you competed in the Tier 1, 2 cities. At the moment, it seems to us that one similarity is the heavy discounts on certain standardized products. So just wondering how do you compete differently today versus a few years ago?

Well, actually, if you look at our customer base today, and we have nearly 700 million, I mean, annual active consumers -- 693 million annual active consumers as of September in our China retail marketplaces. These customers not only come from the top tier cities and many, many of them are from low tier cities. So we have the wide coverage. And I think for -- today, I think for the new customers on our platform, and our advantage is that we have the rich -- we have a rich -- we have in-depth selections covering all the categories, covering all the price point, price range, which is available for all the customers. So in this case, technology play a very important role in terms of matching the right demand with the right supplies. So, so far as I shared with you in my script, for the new customers on our platform, within 1 year, we saw very, very robust growth in ARPU. And that's a very good signal for us to show the power of our platform. And I will say, and for the newcomers, they may spend a lot of so-called marketing dollars to subsidize the customer, subsidize the merchants, but the marketplaces, I always believe that the key thing is generate sustainable value for both merchant and customers. And as a platform, if the bar is set as they transact between each other, but as a platform, you always subsidize. I don't see this as a sustainable model in the long run. I'm sure all the investors can -- will agree with this. And from our side, we invest to acquire new customers as we always do, and so that's why we see a very robust user growth. And we add another 30 million MAU in this quarter, but we are -- we care more about the retention of the customers. And so technology play -- will continue to play a very important role to improve the stickiness of the users.

Our next question comes from the line of Binnie Wong of HSBC.

My question is also on the less-developed market strategy. I recall company disclosed the percentage of new users coming from low end has been over 70% in the past several quarters. Just wonder if there's any update. And also with you expanding into the lower-tier products, how do you see that our Taobao or Tmall merchants are spending on their advertising budget would behave differently? And I guess also a quick follow-up on Maggie's comments on the 25% cross-selling on the local consumer services. How do we tap in -- what is our strategy to tap into the incremental to 75%, the cross-selling from our China retail marketplace into our consumer services?

Okay. In terms of the low-tier user add, overall, we're still showing very strong in the user acquisition. So after several quarters of strong acquisition from lower-tier cities, if you look at users coming from lower-tier cities as a percentage of total, it come down a little bit. But I think overall, it's very strong. We're not only acquiring users from lower tier; but on the top-tier cities, we also continuously to add consumers. I think one thing that's very important is that it's not only the user growth but also the ARPU growth that's very healthy. And one more thing that's very important is the retention. So as I talked during the Investor Day, if you look at our customer's retention, it's very high. Take an example of our high-end customers who spend over CNY 10,000 per annum. There are like over 100 million of them, 130 million actually for this year. And then when you look at the percentage staying on our platform, it's like 98%. So that gives you a sense that we're -- that's not only fast-growing but a more balanced, more healthy growth.

The other question was about cross-selling to the other 75% of the user.

I think this is the synergies we are in the process of realizing in the local consumer services, and we have integrated consumer marketplaces. And today, 25% of the China -- AAC, annual active users from the China retail marketplaces are the users' purchases in local services. We see huge synergies to improve this penetration. So that why we make continuous efforts to integrate our product and our technology infrastructure to make the whole platforms, entire platforms in Alibaba digital economy fully integrated. And going forward, we will continue to have more -- to strengthen our supplies from the local cities, to have more coverage in the local cities to make sure we have the good supply to the local base -- to the location-based consumers, which we know very clearly about their profile.

And the one other question was the ad spending of these Taobao or Tmall merchants in the lower tier cities. How do we target them?

I think the fundamental is still user growth and consumer experience. And then like we said several times in the past that our model is that merchant, as they themselves make decisions on how much budget they want to allocate to the platform. And they bid for the price they are willing to pay. So that's -- if you look at our revenue growth, it's the ultimate proof of the value we provided to not only the consumers but also the merchants. So I think it's not the lower tier city merchants across the country, right, or the brands, I think they have been making decisions to have the budget and increase their spending on our platform.

Our next question is from the line of Grace Chen of Morgan Stanley.

My question is about the differences in Alibaba's approaches to capitalize on opportunities in the affluent, middle-class and urbanization/low-tier cities. It will be great if the management can talk about the differences in the consumer behavior and preferences in these 2 segments, industrial strategies and also the differences in the compelling landscape in these 2 segments. If possible, can you use the upcoming 11.11 promotion as an example to elaborate your strategies, especially in the less-developed regions? And a follow-up is that we see the growth of users have been coming from -- the incremental user growth have been coming from the developed -- less-developed areas. What will be the implications on the financial numbers or cost structure with more users now coming from less-developed areas?

Well, I will say, if you look at the users' habits from different tier cities, I think it is highly relevant to their local lifestyle and their addressable income. So -- but I think in the different shopping events like -- especially like November 11, I think all the people want to get their best products even from the -- maybe some of them, they don't spend in the day-to-day on the brand products; but in the shopping festival, they will because of the good prices and the good products available on the platform. So most people will try to explore the branded products. But at the same time, I think for the day-to-day necessities, for a lot of categories which are not focused, people make shopping decisions don't focus on brands, so people will care more about their functions and, of course, the price advantage. So that's why we strongly believe the technology is so important to reflect this customer needs on a real-time basis. So I think that's the important successful factor in both the day-to-day operation and also in the big events like November 11.

In terms of the spending from the lower tier cities and the high end, so I talked about the high-end consumer spending pattern, very strong spending power and high retention. Lower-tier cities, we actually observed that the ARPU from the lower-tier city consumers are not as low as people imagine. The spending, I think, is more tied to the user experience or the consumer experience. And experience also includes that they can find whatever they want. So we talked about the product supply, different supplies and we talked about segmentation of the consumption. I think we have addressed that very well in our Taobao app, different demand from different level consumers.

Our next question is from the line of Zachary Schwartzman of RBC Capital Markets.

Profit growth trends across the business as a whole and on the core, core marketplaces have stabilized or even accelerated. I guess giving you some more flexibility, as you said, in discretionary investing to strengthen your strategic moats. Maggie, can -- more on expense discipline and operating efficiencies as you expand some of the recently integrated businesses in core commerce? And just to confirm, was there any change in priority here with your final comments in your prepared remarks for the second half of the year?

Yes. I mentioned that we're going to focus on 3 key things, right? And improved user experience is always the most important thing. And this will result in higher engagement and customer spending. And so I also talked about reinvesting back to these competitive areas. Just like what we did in previous years to expand our B2C market leadership, I think we have been very successful on that round of reinvestment and expand our market share. So we're going to continue to do that in these strategically important areas. And number 3, I also talked about the discipline, right, the operating efficiency. I think it's very important because Daniel mentioned that we don't believe continuous subsidizing or just tremendous spending in the marketing would bring sustainable business. We're going to be smart, spend our money and continue to focus or emphasize on operating efficiency.

Yes. And also, Zachary, I just want to address sort of the seeming conflict between expense, operating efficiency with discipline versus being aggressive in reinvesting our profits into strategic areas that are discretionary. I'll give you an example. In terms of acquiring new users, for example, in lower-tier cities, we can now acquire users in our -- for the Taobao channel retail marketplace, but the same user could also potentially be a user for our local service business. So we only have to spend the marketing dollars once to acquire that user, but then use our cross-selling with our multiple platforms to further penetrate those users that have not used, for example, local services before. So the discipline is a result of the synergies because we have multiple platforms and multiple services targeting the same user base. And that creates -- those synergies create operating synergies. But we could be, at the same time, aggressively investing into the lower-tier cities.

Our next question is from the line of Alex Yao of JPMorgan.

Congratulations on a very strong quarter. I would like to follow up with the previous question, specifically regarding Maggie's comment that you guys plan to reinvesting the discretionary profit in the second half, backing the strategic areas. I think if we take a look at your first half financial results, the financial impact from new initiatives under core commerce continue to be narrowing, which leads to very strong profit growth. So should we think that you will be incrementally more aggressive in those initiatives in the second half such that the financial result trend in the first half cannot be extrapolating to the second half? And also, can you talk about your priorities across the 4 initiatives, i.e. local consumption, international, logistic and new retail?

Sure, Alex. Firstly, I want to highlight again to our investors that if you look at our revenue growth and profit growth, both are very strong, right, way ahead of almost all of our global peers. So we do have this luxury, if you recall, to reinvest because strong core and very good management of -- managing the business. And so talking about the second half, in those strategic areas like -- things like local consumer service, things like globalization and also the DME, also logistics, we're going to continue to invest. At the same time, if you look at the competitive landscape, right, so we've seen competitors have been very aggressive investing in the China retail commerce business, also in the local service businesses. So we -- it's not reactive to competition, but also for our own to expand the user base. Also to [ deepen ] this user base, we're going to -- it's a good time for us to reinvest. And profit trend, et cetera, although we don't guide on profitability, but I've mentioned that we do care about the efficiency of the business and also the profit growth. So I think this is a very important measure among our senior management of the business growth. I think the prioritization of the investment will result on this our [ PPC ], the investment areas. I would say that these areas are equally important, not only the cloud and the DME, but also the local consumer service and the -- like logistics, New Retail and globalization.

Our next question is from the line of Gregory Zhao of Barclays.

I have a question to Daniel. So as you highlighted during the prepared remarks and at the Investor Day, so BABA is enhancing the digital economy strategy, and then you split it, the economy, into 2 groups, the to consumer and to business segment. I mean given the difference between the 2 business, the nature, I just wanted to understand more about the execution and how do you coordinate between the 2 segments. As well globally, we see several successful examples like Amazon, like Microsoft. And how's your strategy different from these peers? And also a very quick follow-up on the Singles Day. So we see some delivery companies announced to increase delivery fee during the 11.11 promotion this year. So can you help us understand what's the implication to you and your competitors.

Okay. I think the first one is a very good question. I think when we said that we are -- we are having 2 flying wheels, 2C strategy and 2B strategy, I think these 2 strategies are relevant to different type of businesses which requires different skill set and even DNA of the team. So that's why we said Alibaba is a digital economy which have a diversity of the skill set of people and even the way of working. So from a consumer business, as we always said, we encourage young people to take more responsibility to innovate the product features which fit for the needs of the young customers. So we always do this bottom-up on the innovations. But for the enterprise services, and actually, via the past 10 years efforts' in Tmall, we've already built a enterprise services model like to some big brands and retailers. And now we roll this over to more categories, even into cloud services to corporate clients, and we have already built a very good team in terms of the cloud services, and also to integrate multiple services from Alibaba to 1 corporate client. So we will continue to do so and we believe to have 2 flying wheels, 2C and 2B, but with a good connection and with a good chemistry is the core value of Alibaba and the core competitive advantage of Alibaba. And in terms of the logistic companies performance for pricing strategies in November 11, I don't -- so far, I don't hear any, I mean, big pricing change from our logistic partners. Actually, we are working very closely with all the logistic partners and we prepare for a long time to make sure we have the right capacity and the right service available for the upcoming shopping event.

Our next question is from the line of Tina Long of Crédit Suisse.

Congratulations again on the results. I have one quick question on the live streaming. As the format of live streaming gets increasingly popular, can you give us update on the GMV contribution for this format in first half this year? And also, I want to understand the monetization for this format, especially when the live streaming is native versus those from third-party sites like Douyin or Kuaishou.

Sure. Live streaming, if you look at the GMV side, this is already what we call this new swimming lane that generates over CNY 100 billion GMV per annum. So if you look at our -- the merchants who have been using this service, over 50% of them are using live streaming. So this is a very popular and value-added service to these merchants. And in terms of the monetization, we haven't really started. They're in very early-stage tests. So there are multiple ways we can monetize the service. And we'll give you an update when we start a formal monetization.

Next question is from the line of Jerry Liu of UBS.

I have 2 quick ones. One is at the Investor Day, we talked about multiple new revenue drivers, whether that's live streaming at the secondhand platform. Just thinking ahead into next year, as we look at these opportunities in addition to the feed, is the feed still the primary one we're looking to monetize? Are some of these other opportunities also possible as we head into next year?

Sure. In terms of growth driver, as I mentioned, happy that you heard that we have so many new business and services that already generate quite big size of business. And they are opportunities for us to monetize these businesses, such as Idle Fish, the biggest secondhand platform in China and also like our live streaming platform also like Taobao Factory. If you look into next year, yes, we do have opportunity where I should say it's possible that we start to monetize because these are necessarily big businesses that we can start thinking about that. Monetization on the recommendation fees. I think the way we look at this is that, like we have been always doing, where we tend to rather undermonetize than overmonetize. We already have a test and extended a little bit on the test on monetizing recommendation fees. But whether we're going to expand it, we'll see and decide later on. Overall, we already have shown 40% year-on-year revenue growth, right, so for the past 2 quarters. And our guidance shows like a 30-ish, which is way ahead of a lot of our global peers. So we're going to have a more balanced approach on monetization to look after consumer experience, merchants' ROI as well as our revenue growth.

Our next question is from the line of Youssef Squali of SunTrust.

Two quick questions. First, can you provide us with an update on the food delivery traction in lower-tier cities? Maybe number of cities and the competitive intensity there? And second, kind of a broader question for either Joe or Daniel. We've seen some conflicting data on the Chinese economy recently. NBS for July and September suggests a slowdown in the economy in general. And even online, this morning, there was a new private survey that showed actually manufacturing expanded, I think, in October much faster than expected. So just what do you make of it? And just generally, how much of a predicter is this of demand for BABA's services when -- particularly from us looking at this from the outside?

Let me answer the first question. Actually, in the local service food delivery business, actually we are expanding our coverage in the low-tier cities in terms of the local suppliers. In the past 1 year, we've already successfully expand to many low-tier cities, but I think that's not enough. We'll continue to do so to strengthen our supply, which we believe very important in the local service business. We have huge advantage in the consumer side, and we can leverage a lot in the -- as we said, in the digital economy in terms of the cross-sell to the consumers in the ecosystem. But I think that from the supply side, we have done a lot. And so far, we see very good, I mean, opportunity and very good trend if we have the right supply in a particular region. But we will continue to do so and have a more strong local supply.

Yes. On the other question about sort of whether the total macroeconomic data is a good predicter of Alibaba's performance, well, I think you have seen that we have just multiple quarters where Alibaba's business outperforms the whole economy and even outperforms total retail sales. So currently, we're looking at total retail sales growing at around 8% and yet e-commerce, based on the NBS data, is growing in the high teens in the latest data that's available. But Alibaba's growth is -- we're outgrowing the entire retail sector as well as the e-commerce sector. I think there's a secular trend. Obviously, e-commerce is taking share away from the traditional retail economy. So Alibaba is very much driving that secular trend. But vis-a-vis peers, we're also outgrowing the peers in e-commerce because now, as Daniel has referred to many times, we are getting synergies from a few areas. Number one, technology. Being able to match a variety of product supply in different formats and also different types from standardized products to long-tail products, our technology will match the right products to the right consumers. That is giving us a leg up vis-a-vis competitors. And the other area of synergy is that now we have close to 700 million annual active consumers in our China retail marketplace that we're able to do the cross-selling of additional services like local services and entertainment to our base of close to 700 million active consumers in the China retail marketplace. So these synergies are now starting to come through and that's also giving us an advantage over our peers.

Our last question comes from the line of Piyush Mubayi of Goldman Sachs.

Maggie, on the points you made about improving user experience that will result in higher engagement and customer spend -- the customer spend exactly, can I just ask where you are on user experience in terms of how you're defining that and where do you want to take it? And second, does that not mean, and I know that you have talked about the contradiction -- seeming contradiction here. Where does this -- what does this mean for the ability for you to control or to bring down your spend, in particular in the second half? And there was a specific word you used there, that was "aggressively reinvesting." Just wanted to ask why that word aggressively was used. And I'm sorry I'm being very picky.

That's fine, Piyush. So in terms of the user experience, we have many measures, actually. But on the ones -- for your easy understanding, that we see user expansion, first of all, is word of mouth. Besides our marketing activities, there is also word of mouth and, more importantly, is the user retention and also user spending and also users' time spent on our platform and also cross-platform time spending by the users. So there are many ways. And the other matters you might be interested is the conversion, right? It's how many just users convert into buyers and then the buyer convert into the repeated buyers. So -- and then the loyal customers, where we have 88 VIP members on our platform who actually, spending level's very high. So this is what we're very happy to see. And in terms of our spending, and why we used aggressively -- I think, okay, this is a question, very interesting. I thought about this. If we say we're very disciplined in spending, right, some people may be worried about you might lose -- you might give more room to the competitors because they're spending very aggressively and you're emphasizing on discipline. But if we're talking about aggressive spending, then other group of people are worried about how this is going to impact your profit margin, et cetera. So actually, this is a game that we play every day. It's a decision we need to make every day. So this -- we're -- first of all, when you look at our strong profit growth that gives us the bullets as well to fight. So we do have a very strong profit and cash flow to invest. And secondly, while in the past several quarters, you've seen the efficiency out of our platform, when you look at the market spending as a percentage of revenue, when you look at SG&A and when you look at all of this spending as a total revenue, we have very good control on the spending. And we measure ROIs at very different levels. So I think today, we still see the potential in so many areas. And we do believe we have -- we are the ones that have the best -- in the best position to extend our service across all of these areas in commerce and to help merchants and consumers. So I think it's -- we're in a good position to spend. Aggressively, I think we have said that several times like in the past year when we expand our -- when we investment in our cost business, we talk about aggressive spending. When we invest into our B2C business, we always talk about aggressive spending. The key thing is that we spend aggressively, but the return should be ensured. So that's our thinking on that.

I think what Maggie means is simply that we can afford to be aggressive when we want to be. And there's -- market conditions may change from quarter-to-quarter and -- but we have the luxury. So if you look at our quarterly earnings before interest, tax and amortization, the EBITA measure, this quarter, we had CNY 45 billion of EBITA, and we're taking about 15% of that number to aggressively invest into the core commerce areas like local services, international, New Retail and logistics. And so we could be very aggressive, but still just spend 15% of our EBITA in those core areas. I think we simply mean we've got the luxury to do that.

Right. While some companies spend like 50% of their revenue, right, in their marketing.

Okay. Thank you, everyone. That was the last question. And if you have any questions, feel free to reach out to the Alibaba IR team. Thank you.

Thank you. Ladies and gentlemen, that does conclude the conference for today, and thank you for participating. You may now disconnect.