Shares of Vipshop Holdings (VIPS 1.45%) have soared today, up by 16% as of 11 a.m. EDT, after the company reported second-quarter earnings results. The Chinese online discount retailer beat profit forecasts.
Revenue in the second quarter increased 10% to 22.7 billion yuan ($3.3 billion), with gross merchandise value (GMV) rising 11%. That top-line growth represents acceleration from the first quarter. Vipshop posted adjusted net income of 1.1 billion yuan ($154.8 million), or 1.58 yuan ($0.23) per American depositary share (ADS). Analysts had been modeling for $0.15 per ADS in adjusted profits.
The number of active customers grew 11% to 33.1 million, with total orders jumping 33% to 147.8 million.
In a statement, CEO Eric Shen said:
We are delighted to have finished the second quarter of 2019 with strong operational and financial results. During the quarter, we continued to demonstrate healthy growth momentum in our total active customers, which increased by 11% year over year. In addition, we recently announced our strategic acquisition of Shan Shan Outlets, aiming to further enhance our ecosystem and explore opportunities in online-and-offline integration. Since we refocused on discount apparel and our profitability, we have seen substantial improvement in our financial results and key operating metrics, proving our strategy is very effective.
In terms of guidance, Vipshop expects revenue in the third quarter to be flat to up 5% in the range of 17.8 billion yuan to 18.7 billion yuan ($2.5 billion to $2.7 billion based on current exchange rates). The midpoint of that forecast is shy of the 18.6 billion yuan that analysts are expecting.