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JD.com beats forecasts by 22 per cent and the turnover increased

A JD.com without drivers, the delivery robot is to see in the front of the lots outside a JD.com logistics drive to the Renmin University of China, a day after the Singles Day online shopping festival in Beijing, China, November 12, 2018. Liu Hongsheng/Qianlong.com via REUTERS

BEIJING (Reuters) – JD.com Inc., China’s second largest e-commerce company, reported a 22.4 increase in fourth-quarter sales on Thursday, beating analyst estimates on the back of the stronger online retail sales, and sending the U.S.-listed shares up 8 percent.

The results, partly due to the company’s November sale promotions, defying a wider drop-off in consumer spending in China in recent months.

The results are still the company’s slowest quarterly sales growth since its 2015 initial public offering, such as an economic recession, the impact of China’s top e-commerce companies.

JD.com’s sales are seasonally high in the fourth quarter as promotions of “One Day”, a China-wide online shopping frenzy that peaks on 11 November.

For the current quarter, JD expected that the turnover of 118 billion yuan and 122 billion yuan. That compares to a consensus of analysts estimate of 119.48 billion yuan, according to the IBES data of Refinitiv.

JD, that is supported by Walmart Inc., Alphabet, Inc. Google and China’s Tencent Holdings, posted a net loss of 3.32 yuan, or 48 cents per American depository share, compared with a loss of 0.64 yuan a year earlier.

The company posted 134.83 billion yuan ($20.17 billion) total net income for the quarter ended december. 31 compared with a consensus estimate of 132.42 billion yuan.

Analysts and managers in the industry have pointed to lower sales of big ticket items, such as smartphones and devices, as the driving factor behind the lower sales figures JD.com and competitor Alibaba Group Holding Ltd.

For the full year, the turnover for 2018 is 462.02 billion, an increase of 27.5 percent of 362.3 billion in 2017, beating analyst expectations and China’s wider internet industry, that has seen full-year sales to rise an average of 20.3 percent, according to China’s ministry of industry.

Reporting by Cate Cadell and Munsif Vengattil; editing by Patrick Graham

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