What happened

Shares of Baozun Inc. (BZUN 2.52%), a leading-brand e-commerce service partner in China, released its financial results for the first quarter, prompting a questionable 12% slide in share price.

So what

Starting from the company's top line: Total net revenues checked in at RMB 804.9 million, or $116.9 million, which was a solid 20.5% increase compared to the prior year's result. That was just better than analysts' estimates calling for RMB 802.9 million. The company met estimates on the bottom line too, with non-GAAP (generally accepted accounting principles) net income per share checking in at RMB 0.50, or $0.07. There were some other highlights as well, including total gross merchandise volume (GMV) rising 60.5% compared to the prior year, to RMB 2,974.4 million.

A person's hands holding a phone, surrounded by an e-commerce graphic

Image source: Getty Images.

Said Vincent Qiu, chairman and CEO of Baozun, in a press release (italics are in original):

Our business continued to gain growth momentum with another strong quarter. ... On May 11, 2017, we held the second Global Brand E-commerce Summit in Shanghai with more than five hundred participants in attendance to discuss the future of the brand e-commerce industry. The theme of this year's conference was Bounded but Boundless Omni-marketing. We remain committed to finding more innovative ways to provide our brand partners with best-in-class e-commerce solutions to further reinforce our market leading position.

Now what

BZUN Chart

BZUN data by YCharts.

It's possible that despite the solid quarter, the market simply wasn't willing to sustain the company's lofty valuations after anything less than a blockbuster result. One slight knock against the results was rising costs -- including sales and marketing expenses, technology and content expenses, and fulfillment expenses -- but that's not unexpected from a young company growing quickly.

Looking ahead, the company will focus on its core vertical channels, offering more value to its brand partners through global expansion.