Chinese e-commerce giant JD.com (JD 2.12%) reported second-quarter results on Tuesday, Aug. 13. The company smashed its own revenue guidance and swung to a net profit on the bottom line. Here's a closer look at JD's latest financial report.
JD's second-quarter results: The raw numbers
|
Metric |
Q2 2019 |
Q2 2018 |
Change |
|---|---|---|---|
|
Net revenue |
$21.9 billion |
$18.5 billion |
18% |
|
Net income (loss) |
$90 million |
($334 million) |
N/A |
|
GAAP earnings (loss) per American depositary share (diluted) |
$0.05 |
($0.23) |
N/A |
Data source: JD.com. GAAP = generally accepted accounting principles.
What happened with JD.com this quarter?
- Currency exchange trends made a significant difference to these results as the yuan weakened against the U.S. dollar over the last year. JD's sales rose 23% year over year in local currencies, ahead of the 21% guidance target.
- Retail sales rose by 20.5%, measured in yuan. Service revenue increased by 40%, led by sales nearly doubling for JD's logistics and shipping services.
- The company reported 321 million annual active customer accounts in the 12-month period that ended on June 30. That's up from 311 million at the end of the first quarter but down from 314 million in the year-ago report.
What management had to say
In the second-quarter earnings call, CEO Richard Liu highlighted how JD's expanding scale is generating shareholder value:
We will continue our investments on the technology in terms of AI, big data, cloud, and other new formats of business like fresh groceries and all kinds of new, innovative businesses. As we are gaining more profitability in various ... business, I believe our revenues will continue to grow, and our profits, in the long run, will continue to grow. Since our IPO, we have expressed that our growth will be mainly driven by our economies of scale and our advantages in the cost and our efficiency, and the day has come to fulfill our promises.
Image source: JD.com.
Looking ahead
Management expects third-quarter revenue to land near 128 billion yuan ($18.1 billion), which works out to roughly 22% year-over-year growth in local currencies. CFO Sidney Huang also expects adjusted full-year earnings to stop in the neighborhood of 9 billion yuan, reflecting both continued macroeconomic uncertainty and generally expanding net margins. JD's adjusted full-year earnings came in at 3.5 billion yuan ($500 million) in 2018.
