JD.com Reports Lower-than-Expected Revenue Amid Economic Challenges

Investing.com — Chinese e-commerce giant JD.com (NASDAQ: JD) reported its quarterly revenue on Thursday, falling short of market expectations due to ongoing economic challenges that led to reduced consumer spending.

The company’s shares, listed in the US, dropped over 3% in premarket trading.

Financial Highlights

• Total Revenue: JD.com posted a 5.1% year-over-year increase, reaching 260.4 billion yuan ($35.95 billion), slightly below the expected 261.45 billion yuan according to LSEG data.
• Net Income: The net income attributable to ordinary shareholders rose by 47.8% year-over-year, reaching 11.7 billion yuan for the July-September quarter.

CEO’s Statement

“During the quarter, we were able to play an important role in China's trade-in program, thanks to our leading supply chain capabilities and fulfillment infrastructure that we've built over the past two decades,” said Sandy Xu, CEO of JD.com. “We believe we’ve laid a solid foundation for sustainable operational and financial progress in the months and years ahead.”

Market Challenges

China's prolonged property market crisis, combined with a broader economic slowdown and rising job insecurity, has heavily impacted consumer confidence in the world's second-largest economy, affecting retail demand.

Although the Chinese government has proposed stimulus measures to support economic growth, the lack of substantial actions to directly boost consumer spending has further dampened sentiment.

Operational Expenses

JD.com reported a fulfillment expense of 16.3 billion yuan for the quarter, which is up 7.2% year-over-year and exceeded the estimated 15.94 billion yuan.

Other Financial Metrics

• Adjusted EBITDA: 15.08 billion yuan, marking a 17% increase from the previous year, surpassing the forecast of 13.79 billion yuan.
• Adjusted Operating Margin: Improved to 5% from 4.5% a year ago and ahead of the estimated 4.49%.
• Adjusted EBITDA Margin: Rose to 5.8%, up from 5.2% last year, exceeding the expected 5.27%.