JD.com’s Revenue Beats Estimates, But Profits Slump on Delivery Gamble
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JD.com Inc. beat revenue expectations in the third quarter, but profits took a hit as the Chinese e-commerce company ramped up investment in its fledgling food delivery unit.
The U.S.- and Hong Kong-listed firm reported revenue of 299.1 billion yuan ($42 billion) for the three months ended Sept. 30, a 14.9% increase from a year earlier, exceeding market forecasts. However, net profit attributable to shareholders fell 54.7% to 5.3 billion yuan as spending on emerging businesses more than doubled marketing outlays.
The results underscore JD.com’s aggressive strategy to compete in high-frequency consumer services such as food delivery — an effort designed to drive user growth and boost traffic to its core retail platform.
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- JD.com’s Q3 2024 revenue rose 14.9% year-on-year to 299.1 billion yuan ($42 billion), exceeding expectations, but net profit dropped 54.7% to 5.3 billion yuan.
- Heavy investment in new businesses, notably food delivery, led to an operating loss of 15.7 billion yuan in this segment, despite revenue tripling to 15.6 billion yuan.
- Quarterly active users rose over 40% year-on-year, surpassing 700 million annual users in October.
- JD.com Inc.
- JD.com Inc. (京东) exceeded revenue expectations in Q3 with 299.1 billion yuan, a 14.9% increase year-on-year. However, net profit fell 54.7% to 5.3 billion yuan due to significant investment in its food delivery unit, causing marketing costs to more than double. Despite new business losses, JD.com's strategy aims for user growth and improved traffic to its core retail platform, showing early success in converting food delivery users to retail customers.
- JD Retail
- JD Retail demonstrated stable results for JD.com Inc. in the third quarter. Its operating profit increased by 27.7%, reaching 14.8 billion yuan. This performance contributed positively amidst the company's significant investments in new, emerging businesses like food delivery, which experienced substantial operating losses.
- JD Logistics
- JD Logistics' operating profit decreased by 38.5% to 1.3 billion yuan. Its operating margin also narrowed by 2.4 percentage points, settling at 2.3%.
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