JD.com reported its unaudited financial results for the second quarter of 2024, showcasing a solid performance in its core business areas.
Despite a modest 1.2% year-on-year increase in net revenues, the company demonstrated significant profitability improvements and strategic business growth, particularly in its retail, health, and logistics segments.
In the second quarter, JD Retail strengthened its market position by entering into strategic partnerships with prominent brands like Xiaomi, Lenovo, OPPO, and luxury fashion houses including MONCLER and alexanderwang.
These collaborations focused on smart devices, intelligent supply chain management, and AI integration, underscoring JD.com’s commitment to enhancing user experience and expanding its platform ecosystem.
JD Health continued to innovate by partnering with major pharmaceutical companies to debut new and specialty drugs online, such as the Alzheimer’s treatment drug Leqembi®. These efforts highlight JD Health’s advanced omni-channel supply chain and service capabilities.
JD Logistics, another key segment, saw a significant improvement in profitability due to continued optimization of its network layout, algorithm-based vehicle scheduling, and product structure. These enhancements contributed to cost reductions and efficiency gains, further solidifying JD.com’s leadership in China’s logistics industry.
Financial Highlights
JD.com reported a net revenue of RMB291.4 billion (US$40.1 billion) for the second quarter of 2024, a slight increase from RMB287.9 billion in the same period last year.
Despite the modest revenue growth, the company achieved significant improvements in profitability metrics. Cost of revenues slightly decreased by 0.4% to RMB245.5 billion, contributing to a gross margin increase of 137 basis points year-on-year to 15.8%.
Operating income for the quarter rose by 27.0% to RMB10.5 billion (US$1.4 billion), with an operating margin of 3.6%, up from 2.9% in Q2 2023. On a non-GAAP basis, operating income increased by 33.7% to RMB11.6 billion (US$1.6 billion), with a non-GAAP operating margin of 4.0%.
Net income attributable to JD.com’s ordinary shareholders saw a remarkable 92.1% year-on-year increase, reaching RMB12.6 billion (US$1.7 billion), while non-GAAP net income attributable to shareholders rose by 69.0% to RMB14.5 billion (US$2.0 billion).
This strong profit growth was reflected in the diluted net income per ADS, which nearly doubled, increasing by 97.3% to RMB8.19 (US$1.13).
JD.com also reported robust cash flow figures, with operating cash flow for the twelve months ended June 30, 2024, increasing by 40.9% to RMB74.0 billion (US$10.2 billion). Free cash flow, excluding the impact from consumer financing receivables, surged by 66.2% to RMB55.6 billion (US$7.7 billion).
Additionally, the company’s ongoing share repurchase program resulted in the buyback of approximately 224.3 million Class A ordinary shares during the first half of 2024, representing around 7.1% of its outstanding shares as of December 31, 2023. This move, coupled with JD.com’s record-high operating and net profits, underscores the company’s commitment to delivering long-term value to its shareholders.
Q1 2024
JD.com reported its unaudited financial results for Q1 2024, alongside significant operational developments.
Strategic and Operational Highlights
CEO Sandy Xu emphasized JD.com’s focus on improving user experience, leading to significant growth in active users and engagement. The company continues to provide a superior combination of selection, speed, quality, and price, resonating with consumers nationwide.
AI in Livestreaming
On April 16, 2024, JD.com introduced an AI digital representative of founder Richard Qiangdong Liu for its livestreaming rooms. This innovation attracted over 20 million views within the first hour, marking a significant milestone in AI integration within e-commerce.
Healthcare Expansion
JD Health partnered with pharmaceutical giants like Pfizer and Sanofi to debut new drugs online, enhancing accessibility and upgrading its one-stop medicine retailing and healthcare services through collaborations with Shanghai Pharmaceuticals and Daiichi Sankyo.
Logistics Growth
JD Logistics expanded its support for Chinese brands globally. In Q1 2024, it provided integrated supply chain services to MINISO stores in Australia and Malaysia, showcasing JD’s international warehousing and fulfillment capabilities.
Financial Highlights
- Revenue: Net revenues for Q1 2024 were RMB260.0 billion (US$36.0 billion), a 7.0% increase from Q1 2023.
- Income from Operations: Reached RMB7.7 billion (US$1.1 billion), up 19.8% from Q1 2023.
- Net Income: Net income attributable to ordinary shareholders was RMB7.1 billion (US$1.0 billion), up 13.9% from Q1 2023.
- Earnings per Share: Diluted net income per ADS was RMB4.53 (US$0.63), a 15.3% increase from Q1 2023.
Between January 1 and May 15, 2024, JD.com repurchased 98.3 million Class A ordinary shares (49.2 million ADSs) for US$1.3 billion, representing 3.1% of its outstanding shares as of December 31, 2023.