Ladies and gentlemen, good day, and welcome to Full Truck Alliance's fourth quarter and full year 2021 earnings conference call. Today's conference call is being recorded. At this time, I would like to turn the conference over to Mao Mao, Head of Investor Relations. Please go ahead.
Thank you, operator. Please note that today's discussion will contain forward-looking statements relating to the company's future performance, which are intended to qualify for the safe harbor from liability as established by the U.S. Private Securities Litigation Reform Act. Such statements are not guarantees of future performance and are subject to certain risks and uncertainties, assumptions and other factors. Some of these risks are beyond the company's control and could cause actual results to differ materially from those mentioned in today's press release and discussion. A general discussion of the risk factors that could affect FTA's business and financial results is included in certain filings of the company with the SEC. The company does not undertake any obligation to update the forward statements, except as required by law. During today's call, management will also discuss certain non-GAAP financial measures for comparison purpose only.
For a definition of non-GAAP financial measures and a reconciliation of GAAP to non-GAAP financial results, please see the earnings release issued earlier today. Joining us today on the call from FTA senior management are Mr. Hui Zhang, our Founder, Chairman, and CEO, and Mr. Simon Cai, our CFO. Management will begin with prepared remarks, and the call will conclude with a Q&A session. As a reminder, this conference is being recorded. In addition, a webcast replay of this conference call will be available on FTA's Investor Relations website at ir.fulltruckalliance.com. I will now turn the call over to our Founder, Chairman, and CEO, Mr. Zhang. Please go ahead, sir.
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Hello, everyone. Thank you for joining FTA fourth quarter and full year 2021 earnings conference call today. [Non-English content] Over the past year, FTA has further solidified its leadership position in China's rapidly expanding logistics industry, and we are pleased to have capped a successful year with an excellent financial and operating performance in the fourth quarter. FTA's continued growth reflects our consistent monetization improvements and service optimization, as well as our business model's resilience and sustainability. By broadening our logistics network, utilizing our big data reserves, and intensifying our platform's positive network effects, we served a growing user base of truckers and shippers with increasingly efficient matching and convenient product functions in 2021. We also leveraged our digital capabilities to transform FTA into a green and low-carbon logistics service provider, and proudly fulfilled our social responsibilities by improving efficiency, promoting energy conservation, and reducing emissions.
We seek to benefit our industry and society at large as we enhance our value proposition for our users and investors. For full year 2021, our gross transaction value reached RMB 262.3 billion, an increase of 50.9% compared with the prior year. The number of fulfilled orders rose 78.8% year-over-year to RMB 128 million. For the fourth quarter of 2021, GTV increased 22.1% year-over-year to RMB 69.5 billion, extending the year's robust momentum, and the number of fulfilled orders climbed 41.6% year-over-year to RMB 34.8 million.
We witnessed a significant increase in average shipper MAUs of 20.6% year-over-year to RMB 1.57 million. As a result, we grew our total net revenues by 68.1% year-over-year to RMB 1.43 billion, and realized a non-GAAP adjusted net income of RMB 243 million in the fourth quarter. To usher in 2022, we will leverage our massive user base, data resources, and AI capabilities to drive growth across verticals and accelerate digitalization, which we believe is the future of our industry. To support our long-term healthy development, we will continue to explore new business models and strengthen our monetization system to optimize profitability as we holistically improve user experience.
In addition, we will increase our investment in R&D to fortify our technological innovation capabilities, creating new growth opportunities that also promote China's new carbon goals. Finally, we will spare no effort to establish a more comprehensive data security protection system and enlarge our safe yet efficient nationwide logistics network. [Non-English content]
As we welcome the digital age, we remain true to our original aspirations to make logistics smarter. FTA will work tirelessly to drive innovation, promote sustainability, and create value for all of our stakeholders as we continue to lead China's road transportation industry. With that, I will now turn the call over to our CFO, Simon. He will elaborate more on our fourth quarter progress and go over our operational and financial results in more detail. Simon, please go ahead.
Thank you, Mr. Zhang and Mao Mao, and hello, everyone. We're glad to have delivered another quarter of solid operational and financial results. I would now like to walk you through some details of our fourth quarter operations, beginning with our platform. The fourth quarter is normally the peak season. However, the suspension of new user registration, COVID recurrences, and electricity shortage induced production constraints since the end of September impacted our business. Fortunately, these obstacles are short-term. Our solid foundation and focus on improving user experience helped to mitigate macro impacts, and we successfully improved our fulfillment rate by five percentage points year-over-year to reach approximately 26%. In addition, the average freight matching time continued to decline, falling to less than 10 minutes in December, a substantial improvement primarily attributable to our advanced big data technology and algo capabilities.
We took matching efficiency to a new level in the fourth quarter as we improved search functionality for users and generated more and better structured shipper and trucker data. For example, we enhanced our search features sorting logic based on driver fulfillment probability and filtered invalid information out of the results to maximize truckers' access to shipping orders. We also introduced a WeChat-based matching service to diversify matching methods. We encouraged adoption of our tap-and-go model with more reasonable pricing to further streamline matching and combine algo to accurately predict and distribute user rewards to guide transaction habits. We continuously strive for more accurate matching to truly optimize the allocation of logistics resources. Looking forward, we will remain focused on upgrading our logistics ecosystem to strengthen our comprehensive end-to-end platform and close loop business model.
Supported by our evolving big data and algo and cutting-edge AI technology, we're confident that these efforts will lead to stronger network effects as our business grows. Moving on to our users. Throughout 2021, we continued to enhance user experience and promote user activity, retention, and satisfaction by innovating products and services to upgrade our platform's one-stop service capabilities. Because the suspension of new user registration persisted throughout the fourth quarter, we focused on increasing user frequency with refinement to our freight matching and fulfillment process, as well as reactivating dormant users through targeted marketing.
Furthermore, we encouraged new users to engage more deeply with our platform by offering improved services for novices such as manual assistance and increased traffic exposure. Thanks to those efforts, average shipper miles in the fourth quarter swelled to 1.57 million, an increase of 20.6% year-over-year, while average trucker MAUs including those fulfilling and responding to orders remained stable, with 3.54 million active truckers fulfilling shipments in the past twelve months. We also witnessed excellent user stickiness with both twelve-month retention of paying shippers and next month retention of truckers who responded to shipping orders on our platform remained high at around 85%. Furthermore, our entrusted shipment program for direct shippers and other user composition optimization also continued to drive progress across our business.
Direct shippers are a critical part of our strategy to improve our fulfillment rate, and we expect the overall number as well as GTV contribution of direct shippers to continue to increase steadily, especially after new user registration resumes. Our online transaction service continued to be a powerful growth engine. Its net revenue were RMB 267.5 million in the fourth quarter, up 6.6 times year-over-year and 46.8% quarter-over-quarter, representing 18.7% of total net revenue in the fourth quarter. The increase was largely due to further implementation of our commission model, which we rolled out in 105 cities as of end of last year, compared with 95 cities as of September 2021.
User activity remained high in those cities with truckers next month retention reaching nearly 90%, a clear sign of commission model's scalability. We tailor our commission model to the unique characteristics of different businesses and regions with diverse commissioning methods, such as by time period and by distance. Going forward, we plan to optimize the commission rate and extend our commission coverage while providing additional value-added services and improving product functions to enhance our truckers user experience. To further protect the interests of both truckers and shippers, since the fourth quarter, we have continuously devoted more resources to upgrading our safeguard service and industry governance measures, reaffirming our position as the industry's most responsible, welcoming, user-friendly digital platform.
Our safeguard service protected the financial interests of 140,000 users in the fourth quarter, encompassing total compensation of more than RMB 16 million. Additionally, we established a professional service team of more than 100 personnel to assist truckers with late payment collection. Along with third-party legal aid, we helped truckers recover and aggregate RMB 250 million in freight charges from over 117,000 orders in the fourth quarter. To improve transaction stability, we imposed restrictions on shippers who frequently cancel orders, which has gradually improved shippers' fulfillment rates and reduced cancellation losses for truckers. With respect to industry governance, in the fourth quarter, we rolled out the system for assessing shippers' creditworthiness in certain regions based on shippers' behavior, truckers' feedback, and other data.
This system enables us to conduct hierarchical management to match truckers with trustworthy shippers and prime orders, protecting their rights and interests. Meanwhile, we began building a trucker credit system during the first quarter of this year to promote standardized services and enhanced benefits for high-quality truckers. We plan to start strengthening controls on truckers who receive a high number of complaints, limiting their rights on our platform. FTA remains committed to improving outcomes and creating value for each participant in the logistics ecosystem as we lead the industry's healthy development. Before we move on to financials, I'd like to touch on our new business initiatives and latest strategic investments. Both our intra-city and less-than-truckload shipping business, which are a natural extension of our existing full truckload business, recorded stable overall performance in the fourth quarter with steady GTV quarter-over-quarter.
Also, we launched monetization pilots for our intra-city business in certain cities through trucker membership and commission model this quarter. Because new user registration remains suspended in the fourth quarter, these services are still in a trial period in a limited number of cities. However, existing users' retention rate on the platform is high, and the demand for repeat service is also strong. We plan to seize this positive momentum and extend the services to additional regions to meet shippers' one-stop shipment needs as soon as new user registration resumes. As we assess the industry's landscape, we see enormous opportunities in China's trillion-dollar road transportation market and its various verticals to create value for all of our stakeholders.
To capitalize, we will selectively make investments and acquisitions across verticals to augment our platform's existing strengths, enabling us to provide highly customized services to a broad range of specialized industries. We have established a team to research and conduct business development activities in different verticals and have already identified several investment candidates with industry insights, customer bases, and service capabilities complementary to ours. For instance, in the fourth quarter, we invested in a leading domestic heavy lift cargo transportation platform focusing on the engineering machinery and special project cargo transportation industry. Both are valuable verticals with large addressable market. Over the years, FTA has accumulated massive reserves of customers, brands and data, as well as deep experience in online operations.
We believe that by joining forces with partners in new verticals, we will discover new touch points, increase growth and deliver a better user experience to our customers. Now I'd like to provide a brief overview of our 2021 full year and fourth quarter financial results. Given the limited time on today's call, I will be presenting some abbreviated financial highlights. We encourage you to read through our press release issued earlier today for more details. Our total net revenue for the year were RMB 4.7 billion, representing an 80.4% increase year-over-year. Net revenue for the fourth quarter were RMB 1.4 billion, representing a 68.1% increase year-over-year.
For 2021, our net revenue from freight matching services, including service fee from freight brokerage model, membership fees from listing models and commissions from online transaction services were RMB 3.9 billion, up 102.7% from 2020. RMB 1.2 billion for the fourth quarter, up 85.7% year-over-year, primarily due to an increase in revenue from freight brokerage services as well as rapid growth in transaction commissions. Revenue from freight brokerage service reached RMB 2.5 billion for 2021, up 83.0% year-over-year.
On a quarterly basis, net revenue increased 61.1% to RMB 760.9 million in the fourth quarter, primarily driven by significant growth in transaction volume, partially offset by a decrease in average fee rate to attract more shippers to our service. Revenue from freight listing service were RMB 753.0 million for the full year, up 39.8% year-over-year, and rose 30% year-over-year in the fourth quarter to reach RMB 200.5 million, primarily attributable to an increase in total paying members and an increased shipper demand for our services as our business continues to extend.
Revenue from transaction commissions amounted to RMB 696.1 million in 2021, compared with RMB 43.1 million in 2020. On a quarterly basis, net revenue amounted to RMB 267.5 million in the fourth quarter, an increase of 6.6 times from the prior year period, primarily driven by a rapid ramp up of commissioned GTV penetration. Revenue from value-added services were RMB 710.1 million in 2021, compared with RMB 633.8 million in 2020. For the fourth quarter, net revenue increased to RMB 200.4 million from RMB 188.5 million in the prior year period, mainly attributable to increased revenue from credit solutions and other value-added services.
Cost of revenue in the fourth quarter was RMB 658.2 million, compared with RMB 398.4 million in the prior year. The increase was primarily attributable to an increase in VAT-related tax surcharges and other tax costs net of tax refunds from government authorities. These tax-related costs, net of refunds, totaled RMB 555.5 million, representing an increase of 67.4% from RMB 331.8 million in the same period of 2020, primarily due to an increase in transaction activities involving our freight brokerage service. Our selling and marketing expenses in the first quarter were RMB 239.4 million, compared with RMB 161.3 million in the prior year period.
The increase was primarily due to an increase in salary and benefits driven by an increase in sales and marketing headcount, as well as an increase in advertising and marketing expenses related to the promotion of new initiatives, partially offset by a decrease in share-based compensation expenses. General and administrative expenses in the fourth quarter were RMB 1.6 billion, compared with RMB 3 billion in the prior year period. The decrease was largely due to a lower share-based compensation expenses. Our commitment to innovation and broadening our technological capabilities through in-house R&D remains the cornerstone of our business. In the fourth quarter, R&D expense as a percentage of total revenues was 16.3%, compared with 14% in the prior year period.
Both loss from operations and net loss further narrowed in the fourth quarter, totaling RMB 1.35 billion and RMB 1.32 billion respectively, compared with RMB 2.81 billion and RMB 2.78 billion in the prior year period. Under non-GAAP measures, our adjusted operating income in the fourth quarter was RMB 159.1 million, compared with RMB 121 million in the prior year period. Our adjusted net income in the fourth quarter was RMB 242.8 million, compared with RMB 147.9 million in the prior year period. Basic and diluted net loss per ADS were RMB 1.23 in the fourth quarter, compared with RMB 16.97 in the prior year period.
Non-GAAP adjusted basic and diluted net income per ADS were RMB 0.23 in the fourth quarter, compared with non-GAAP adjusted basic net income per ADS of RMB 0.16, and non-GAAP adjusted diluted net income per ADS of RMB 0.03 in the prior year period. Our cash position remains strong. At the end of 2021, our cash and cash equivalents, restricted cash and short-term investments totaled RMB 26 billion, compared with RMB 18.9 billion as of the end of 2020. For the fourth quarter, net cash provided from operating activities was RMB 433.9 million. Looking at our business outlook for the first quarter of 2022, we expect our total net revenue to be between RMB 1.04 billion and RMB 1 point...
RMB 1.09 billion, representing a year-over-year growth rate of approximately 19.8%-25.3%. These forecasts reflect the company's current and preliminary view on the market, operational conditions, and the impact of the pending cybersecurity review, recurring COVID-related disruptions, extreme weather conditions, and production constraints brought about by electricity shortage in parts of China, which are subject to changes and cannot be predicted with reasonable accuracy as of the date hereof. We're excited to enter 2022 on an upbeat note and expect our increasingly efficient matching technology, solid user base, and multi-faceted strategic initiatives to help us continue to deliver strong results and value for our users and shareholders alike. That concludes our prepared remarks. We would now like to open the call to Q&A. Operator, please go ahead.
Operator, please open the line for Q&A, please.
We will now begin the question-and-answer session. To ask a question, you may press star and then one on your touch tone phone. To withdraw your question, please press star then two. Once again, it is star and then one to ask a question. Our first question today will come from Ronald Keung with Goldman Sachs. Please go ahead with your question.
Thank you. Thank you, Hui Zhang and Simon.
Thank you management, I have, and congratulations on the solid results. I just wanna ask, this quarter on how has our entrusted shipment program progressed since its launch, last year? What are your future rollout plans, for this program? Thank you.
As our platform continues to grow, we have seen gradual changes in the shipper composition with a broader range of small to medium-sized direct shippers choosing our platform. We introduced our entrusted shipment program to better meet their needs and conducted our initial pilot test in Wuxi in June last year. As of the end of January this year, we had successfully launched the program in 39 cities in Jiangsu, Zhejiang, Shanghai and Anhui provinces.
We plan to roll out this service in more regions by end of this quarter, and we expect that its revenue contribution will continue to increase.
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Our entrusted shipment program mainly targets the small and medium-sized companies. Current operating data shows that the project is running well with an average fulfillment rate over 70%. The successful launch of the entrusted shipment program so far enables us to further improve our user ecosystem and optimize user composition while creating additional monetization opportunities for the platform. As of now, we have implemented a commission model for this program in three cities.
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Going forward, by leveraging our extensive transaction data and advanced algo capabilities, we will continue to improve the product functions and provide more reasonable and accurate pricing to drive user stickiness and enhance our platform's overall matching efficiency and fulfillment rate.
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Okay, next question, please.
Thank you. Our next question today will come from Charlie Chen with China Renaissance. Please go ahead with your question.
[Non-English content] 。Thanks for taking my question.
The platform's fulfilled GTV and the number of fulfilled orders both maintained year-on-year growth in the fourth quarter, but the quarter-over-quarter growth declined compared with the same period last year. What are the key drivers of this decline? And how do you think fulfilled GTV and the number of fulfilled orders will trend in the first quarter of this year? Thank you.
Thank you, Charlie. This is Simon Cai here. I'll address your question directly in English. The year-over-year growth in the platform's GTV and number of fulfilled orders in the fourth quarter was primarily attributable to sustained increase in market penetration as well as our platform's fulfillment efficiency. As of Q4, average shipper miles reached RMB 1.57 million, growing over 20% year-over-year. Average trucker miles who responded to shipping orders also exceeded 3 million. Given that new user registration was still suspended during the quarter, such robust numbers are a strong indication of FTA's solid leadership in the FTL industry. As the platform's network effect growth, more and more shippers and truckers are relying on our platform for shipment.
From an operational perspective, we continue to optimize user experience and refine our operational capabilities during the quarter to raise new users, user usage frequency, and conversion rate, while elevating the activity level and retention rate for existing users, creating a dual engine effect to drive the continued growth of our overall business. Regarding your question on the sequential trend, the fourth quarter of the year is typically a peak freight season, so overall shipment demand increases on a quarter-over-quarter basis. However, in 2021, the seasonal upside was partially offset by external factors such as the suspension of new user registration, the COVID recurrences, and production constraints related to electricity shortage that lead to slightly lower quarter-over-quarter growth. Unfortunately, we believe all these external factors are temporary and will not have a substantial impact on the platform's long-term growth.
As for Q1, it is outside of the peak freight season, and the demand for shipping always tends to be lower in Q1, especially during the Chinese New Year period. This explains the relatively low GTV and number of fulfilled orders in Q1 compared to the rest of the year.
Thank you very much.
Thank you.
Our next question will come from Brian Gong with Citigroup. Please go ahead.
[Non-English content] I will translate myself. How did user composition and the user activity change in Q4 2021?
The median average freight matching time in December dropped to below 10, as management just mentioned. What drove the decrease? Thank you.
Thank you, Brian. In terms of user composition and behavior, there was no obvious change in the past quarter versus Q3. Despite the impact of multiple external factors, our trucker and shipper MAUs remained steady. In the meantime, our existing users continued to exhibit strong stickiness. For Q4 shippers, shipper MAUs, 12-month retention rate remained steady quarter-over-quarter at approximately 85%. With respect to user composition, the GTV contribution from direct shippers in Q4 was stable compared to Q3. We expect the GTV contribution from direct shippers to increase steadily, especially after new user registration resumes. The major drivers of changes in our user composition and behavior include our platform's growing network effect, consistently improving data algo and enhanced product functions, such as tap-and-go and entrusted shipment.
These all increase the matching efficiency. Coupled with our continuous efforts to optimize user experience, these features intensified our users' dependence on our platform. The reduction in Q4's average freight matching time was primarily attributable to our ongoing algo refinement. For instance, we optimized all the searching and sorting logic by taking drivers' fulfillment probability into account. We also improved the accuracy of the targeted recommendations by filtering out invalid order placements and further enhanced user experience. Optimizing both the search process and recommended results substantially heightened our overall matching freight efficiency in Q4.
Thank you. That's very helpful.
Our next question will come from Dialu Li of CICC. Please go ahead.
Thank you for taking my question. [Non-English content] Have you seen any significant change in the competitive landscape since the suspension of the new user registration in the fourth quarter? Thank you.
Thank you. We have not seen any substantial changes in the FTL market's competitive landscape since the fourth quarter. An effective FTL network typically involves a highly complex and dynamic combination of millions of shippers and truckers and hundreds of thousands of transportation routes, making it very difficult to replicate. Once a nationwide network is fully established, it has enormous impact on the industry and forms a very high barrier for new entrants. Our nationwide platform and high matching efficiency, which naturally attract both shippers and truckers, are our competitive edge. We help shippers save 10%-15% on shipping costs compared with traditional channels. This is an advantage new entrants cannot match when they start from scratch.
On trucker side, new industry entrants are unable to compete with our platform's significant economies of scale, even with short-term subsidies or promotions. Rather than other platforms, our true competitors on the trucker side are offline model brokers and contract carriers, and we're confident that our brand, reputation, standardized services, and more reasonable freight prices will continue to attract users to our platform. In the early stages of our business, we accumulated a nationwide user base at a very low cost by deploying local sales team to recruit users at offline logistics parks. Our user acquisition system is built on our premium user experience and good word-of-mouth referrals among users, resulting in a high retention rate at very low cost. Going forward, we will strive to maintain our digital freight platform's leading position in the industry.
We will continue to expand our network and leverage our big data capabilities and technological advantages to advance industry-wide digitalization and create greater value for our users.
Thank you. Very clear. Yeah.
Ladies and gentlemen, at this time, we will conclude our question and answer session. I'd like to turn the conference back over to Mao Mao for any closing remarks.
Thank you once again for joining us today. If you have any further questions, please feel free to contact us at Full Truck Alliance directly or TPG Investor Relations. Our contact information for IR in both China and the U.S. can be found in today's press release. Have a great day.
Ladies and gentlemen, the conference is now concluded. We thank you for attending today's presentation, and you may now disconnect your lines.