The SEC, in a Friday cease-and-desist order, said Shanghai-based Dada Nexus faked certain online advertising and marketing deals from October 2022 through September 2023 to help hit revenue goals over multiple quarters. According to the agency, the arrangements involved nearly identical cash movements that lacked real business purpose or proper documentation, and collectively inflated the figures for reported net revenue and for operation and support expenses by more than $160 million. Dada consented to the fine while not conceding the allegations, and company representatives did not promptly answer a request for comment placed after hours.
Regulators said the questionable transactions caused Dada to overstate net revenue by 8% in the second quarter of fiscal 2023 and by 9% in the third quarter of that year. In setting the settlement terms, the SEC said it considered the company's cooperation with investigators and the steps it took to remediate internal control issues.
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In January 2024, Dada said it was investigating "suspicious practices" that could undermine the revenue it booked from online advertising and marketing services for Q1 through Q3 of 2023, estimating at the time that millions of dollars may have been overstated. JD.com's shares fell 46% on that disclosure. In June 2025, JD.com completed a deal to delist Dada Nexus and make it a wholly owned subsidiary.
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