Shares of China’s JD.com slide after rare revenue plunge

{"text":[[{"start":9.64,"text":"Shares of Chinese online retailer JD.com slipped more than 10 per cent in Hong Kong on Friday after the company reported its first decline in quarterly revenue since listing in 2014."}],[{"start":22,"text":"The fall followed a 7 per cent drop in the company’s Nasdaq-listed shares on Thursday."}],[{"start":40.28,"text":"Revenues fell nearly 3 per cent year on year in the second quarter to Rmb346bn ($51bn), the company reported on Thursday, after a government subsidy programme that encouraged consumers to upgrade electronics and other household goods ended."}],[{"start":44.74,"text":"The figure nevertheless came in ahead of analysts’ expectations, which had factored in a slowdown as the impact of the subsidy programme faded. JD.com is one of China’s largest ecommerce platforms and particularly strong in electronics and home appliances."}],[{"start":61.52,"text":"Profitability improved despite the revenue decline, with net income rising nearly 15 per cent to Rmb7bn. Marketing expenses fell sharply as JD.com reined in ad spending from its push into food delivery."}],[{"start":null,"text":"

"}],[{"start":75.64,"text":"The company spent heavily on advertising after launching its food delivery service in February last year. It sought to gain market share from incumbent Meituan, as well as Alibaba, which had also started muscling into food delivery."}],[{"start":90.04,"text":"Management said losses from the costly food delivery price war had narrowed during the second quarter. JD.com’s Hong Kong-listed shares are down more than 11 per cent over the past year. Its Nasdaq shares are down 7 per cent."}],[{"start":104.24,"text":"Robin Zhu, an analyst at Bernstein, said the share price decline was “unsurprising” following a “long rally in recent weeks”."}],[{"start":112.04,"text":"“JD’s continued emphasis on profitability as the company’s north star was reassuring,” Zhu wrote in a note. Management also told investors it expected growth to accelerate in the second half of the year."}],[{"start":124.88,"text":"JD.com has meanwhile stepped up its push into overseas markets, launching its Joybuy ecommerce platform in the UK and Europe this year in an effort to compete with Amazon."}],[{"start":136.12,"text":"The Chinese group had laid the groundwork for the expansion by building out its European logistics operations and acquiring warehouse space. It has also explored acquisitions as it seeks to expand its retail footprint in the region."}],[{"start":148.84,"text":"The company said it saw “surging sales” on Joybuy through its “Summer Black Friday” sales campaign, offering discounted electronics and home appliances with delivery and installation."}],[{"start":159.48,"text":"JD.com previously launched an unsuccessful takeover bid for UK electronics retailer Currys and last year abandoned talks to acquire Argos from British supermarket group Sainsbury’s."}],[{"start":171.76,"text":"It made a €2.2bn offer for Ceconomy, which operates more than 1,000 stores across Europe under the MediaMarkt and Saturn brands, last year."}],[{"start":181.52,"text":"The EU has opened an investigation into the bid under foreign subsidy rules, probing whether the deal involved unfair government subsidies."}],[{"start":194,"text":""}]],"url":"https://audio.ftcn.net.cn/album/a_1786701972_9093.mp3"}