What happened
Shares of JD.com (JD 5.80%) soared on Tuesday after the Chinese e-commerce leader's second-quarter financial results surpassed investors' expectations.
As of 2:33 p.m. EDT, JD.com's stock price was up more than 14%.
So what
JD.com's revenue surged 26.2% year over year to 253.8 billion yuan ($39.3 billion), besting analysts' estimates of 248.3 billion yuan. The increase was fueled by strong sales during its 618 Grand Promotion, a nationwide shopping festival that helped JD.com gain 32 million new users in the second quarter.
"JD has become China's leading supply chain-based technology and service company, serving a growing base of millions of partners and 532 million customers," CEO Richard Liu said in a press release.
Image source: Getty Images.
Moreover, while JD.com's growth investments contributed to a 17% decline in its adjusted earnings per American depositary share (ADS) to 2.90 yuan ($0.45), that was above the consensus forecast of 2.60 yuan.
Now what
Prior to today, JD.com's stock price was down 25% in 2021. A broadscale regulatory crackdown had raised fears among investors that the Chinese government would rein in the growth of its largest tech companies.
However, JD.com's strong second-quarter performance helped to alleviate those concerns. Additionally, after China passed a new data privacy law on Friday, the country is expected to slow its creation of new regulations.
With their fears subsiding, investors bid up JD.com's share price sharply on Tuesday.
