Abstract: Based on resource-based theory and dynamic capability theory, the article constructs a theoretical framework of the impact of digital technology application on firm performance, and analyzes the intrinsic mechanism of the role of business model and dynamic capability between them. Through an empirical test on the data of A-share listed companies in the retail industry from 2013 to 2020, the results found that digital technology application has a significant positive impact on corporate performance; business model has a partially mediating role between digital technology application and corporate performance; dynamic capability has a partially mediating role between digital technology application and corporate performance; business model and dynamic capability in the business model and dynamic capabilities play a chain mediating role in the mechanism of the effect of digital technology application on firm performance.