JD.com First-quarter Revenue Grew 39%, Beating Estimates

What’s new: JD.com Inc. reported better-than-expected first-quarter revenue and profit Wednesday as growth remained robust in China’s e-commerce sector following the Covid-19 pandemic.

For the three months ended March 31, JD.com posted net income of 3.6 billion yuan ($600 million), or $0.34 per ADS, more than triple the 1.1 billion yuan of the same period last year.

Revenue increased 39% from to $31 billion, beating analysts’ expectation of $29.8 billion. The jump reflected robust growth in services revenue as the e-commerce giant is transforming into a leading supply chain-based technology and services provider. In the first quarter, net service revenue increased 73% to $4.3 billion, accounting for nearly 14% of total revenue.

JD.com’s number of annual active customers increased by 29% to almost 500 million in the 12 months ended March 31.

The background: JD.com is reorganizing its sprawling business. It recently kicked off an initial public offering to spin off its logistics division, JD Logistics Inc. The delivery unit plans to raise as much as HK$26.4 billion ($3.4 billion) in the Hong Kong IPO.

Meanwhile, JD.com’s fintech unit JD Technology withdrew its $3 billion IPO application from Shanghai’s Nasdaq-style STAR Market last month.

The IPO withdrawal came one day after JD.com sold cloud and artificial intelligence businesses valued at a combined 15.7 billion yuan to JD Technology. The move is expected to dilute the role of the financial business in JD Technology’s bottom line, which may help it sidestep some tougher new rules in the future.

Quick Takes are condensed versions of China-related stories for fast news you can use. 

Contact reporter Denise Jia (huijuanjia@caixin.com) and editor Bob Simison (bobsimison@caixin.com)

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