JD.com shares jump 13% after surprise revenue rise
JD.com’s second quarter revenues have well outpaced analyst estimates despite fears the escalating trade war would dampen sales, sending shares skyrocketing.
The Chinese ecommerce giant saw shares jump nearly 13 per cent after reporting a 23 per cent revenue rise to 150.28 billion yuan (£17.74 billion), well above analyst estimates of 147.49 billion yuan (£17.41 billion).
This surprise boost in sales follows its slowest revenue growth on record over the first quarter, seeing net revenues grow 21 per cent, with revenues hitting 121.1 billion yuan (£13.8 billion), edging just ahead of analyst expectations.
Net income topped 618.8 million yuan (£73.06 million), well above the predicted 44.2 million (£5.22 million) loss as well as the 212.4 million yuan (£25.09 million) loss seen in the same period a year earlier.
Its online products business, including retail sales, saw growth of 21 per cent to 133.52 billion yuan (£15.77 billion).
Its chief executive Richard Liu said investment in logistics and second-tier cities helped drive the better than expected results, however analysts have highlighted a VAT tax cut in Beijing as the key driver.
This comes amid a more a more widespread downturn across China’s largest tech companies, with combined revenues expected to have dropped 26 per cent over the last quarter, the slowest growth in 18 months.
Though these results were a pleasant surprise for investors, increasing tensions since the end of JD.com’s second quarter are expected to have a more tangible impact.