Shares of JD.com (9618.HK) fell as much as 9% on Thursday after the Chinese e-commerce leader posted second-quarter earnings that beat market expectations but flagged persistent weakness in retail sales.
The company reported net income of 6.8 billion yuan ($950 million) for the quarter ended June 30, up 24% year-on-year and exceeding analyst forecasts. Revenue rose 3.8% to 263.6 billion yuan, also topping estimates. However, JD’s core retail business, which accounts for the bulk of its revenue, grew just 2.3% in the period, down from 5.6% in the first quarter.
JD.com attributed the slowdown to softer consumer spending amid China’s prolonged property downturn and cautious household budgets. Management noted that while high-margin businesses such as electronics and home appliances performed better, demand for discretionary goods remained subdued.
The earnings report comes as China’s retail sector grapples with weak consumer confidence, a key drag on broader economic recovery. JD’s logistics and technology services, which include cloud computing and AI-driven supply chain solutions, posted stronger growth, rising 12% year-on-year.
Analysts at CICC and Goldman Sachs maintained neutral ratings on JD.com following the results, citing concerns over margin pressure and competitive intensity in the e-commerce space. The stock’s decline reflects broader investor caution toward Chinese consumer-facing companies amid regulatory scrutiny and economic headwinds.
JD.com’s shares have underperformed the Hang Seng Tech Index by nearly 15% over the past month, underscoring the challenges facing the sector.
