Connect with us

Hi, what are you looking for?

Alive Business PlanAlive Business Plan

Stock

China’s JD.com struggles to shake off consumption weakness, misses revenue estimates

By Deborah Mary Sophia and Casey Hall

(Reuters) -Chinese e-commerce group JD (NASDAQ:JD).com missed market estimates for quarterly revenue on Thursday, as a persistent slowdown in the world’s second-largest economy pressured consumers to keep a tight hold on their purse strings.

JD.com’s U.S. shares rose 2% in pre-market trading.

A prolonged property sector crisis, a macroeconomic slowdown and heightened job insecurity have hammered consumer confidence in China, hurting retail sales and resulting in a bruising price war among major e-commerce platforms.

JD.com has been working to improve its share of sales from high-growth livestreamed e-commerce, as well as exploring international business growth, but trails rivals such as Alibaba (NYSE:BABA) in livestreaming and Temu-owner PDD Holdings in tapping overseas sales.

While the Chinese government has outlined stimulus measures to prop up economic growth, the lack of solid steps to boost consumption has also weighed on sentiment.

“We are encouraged by the more supportive policy environment,” JD.com chief executive Sandy Xu said. “While we are seeing consumer sentiment starting to improve, it will take time for the effect of government policies to seep through.”

JD.com said total revenue rose 5.1% to 260.4 billion yuan ($35.95 billion) in the third quarter, compared with estimates of 261.45 billion yuan, according to LSEG data.

Net income attributable to JD.com’s ordinary shareholders stood at 11.7 billion yuan in the July-September period, an increase of 47.8% from a year earlier.

This period coincides with a traditional lull in Chinese consumption between major shopping festivals in June and November.

China’s Singles’ Day sales period, a nationwide sales promotion event typically seen as a gauge of consumer sentiment, ran from Oct. 14 to Nov. 11 this year, 10 days longer than last year. That resulted in a 26.6% rise in sales across all major e-commerce platforms, according to data provider Syntun.

This year’s sales saw larger ticket household appliances perform better than last year, benefiting from a national 150 billion yuan trade-in subsidy scheme announced in July to help boost consumption.

JD.com has been a major proponent of the initiative and since August has launched trade-in programmes for over 20 provinces and cities across China as part of the government’s intiative.

“I was really just expecting a very sluggish spending environment, but people are still prioritizing purchases in these durable goods and large ticket items,” M Science analyst Vinci (EPA:SGEF) Zhang said. “I think it surprised me to the upside by a little bit, but not too much.”

($1 = 7.2428 Chinese yuan renminbi)

This post appeared first on investing.com
Become a VIP member by signing up for our newsletter. Enjoy exclusive content, early access to sales, and special offers just for you! As a VIP, you'll receive personalized updates, loyalty rewards, and invitations to private events. Elevate your experience and join our exclusive community today!

    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    You May Also Like

    Latest News

    The Gateway Pundit, a far-right website, published a note from its editor on Saturday acknowledging that two election workers in Georgia did not engage...

    Latest News

    New majorities in Congress, particularly when the incoming party has a new leader, offer the rare chance for the institution to take a breath...

    Latest News

    Sister Stephanie Schmidt had a hunch about what her fellow nuns would discuss over dinner at their Erie, Pennsylvania, monastery on Wednesday night. The...

    Investing

    JAKARTA (Reuters) -Indonesia has asked Alphabet (NASDAQ:GOOGL)’s Google and Apple (NASDAQ:AAPL) to block Chinese fast fashion e-commerce firm Temu in their application stores in...



    Disclaimer: alivebusinessplan.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.


    Copyright © 2024 alivebusinessplan.com