Shares of Jumei International Holding (JMEI) jumped as much as 26.2% higher on Monday following a strong earnings report. As of 2:40 p.m. EDT, the stock had cooled down to a 15.9% gain.
The China-based e-tailer reported second-quarter results after the closing bell on Friday, giving investors the weekend to mull over its report. Net revenue in the first half of 2018 fell 23% year over year to $369 million, driven by lower order volumes and fewer active customers. At the same time, adjusted earnings soared from $0.11 to $0.69 per American depositary share.
Jumei's strong bottom-line result sprung from tight operating cost controls and a more efficient order-fulfillment process. The business mix also shifted away from low-margin online product sales and into more profitable segments like the third-party Marketplace selling service and TV content production.
The stock is prone to wild swings due to its small-scale operations, low media and analyst interest, and generally plunging share prices. Jumei investors have absorbed a 35% haircut so far in 2018 and a 92% decline since the IPO in 2014.