Chinese e-commerce giant JD.com beat analysts’ expectations over the second quarter of 2020 (ending June 30) by logging $720 million (5 billion yuan) in income.
During Q2, the company’s revenue grew by 33.8 percent to $ 28.5 billion (201 billion yuan) year-on-year. The sales of general merchandise products and services increased 45.4 percent to $9.1 billion (64 billion yuan) and 36.4 percent to $3.2 billion (22.9 billion yuan), respectively.
Q2 has seen the Nasdaq-listed e-tailer take large strides in transforming into a supply chain-based tech company and service provider. It also pocketed $3.9 billion during its second listing on the Hong Kong Stock Exchange despite market concerns over delisting threats from the US.
Among major business activities for the quarter, its mid-year 618 shopping bonanza was embraced by a national audience that was eager to spend after a long bout with the COVID-19 pandemic.
Xu Lei, the JD Retail chief who has slowly been taking the reins from JD.com chief executive officer Richard Liu, said the company’s extra marketing activities fueled the outstanding results from this year’s 618. “Together with partners, we have done a lot of marketing activities on decentralized platforms,” he said through an interpreter during the earnings call. “The results are beyond our expectations.”
Meanwhile, Sandy Xu, the chief financial officer of JD.com, said in a statement that “our scale advantages and cost efficiency enabled us to provide attractive prices during our June 18 sales promotions… as China’s economy emerges from the difficult pandemic period.”
In the company’s transformation to become a logistics service provider, JD.com has been ramping up the expansion of its logistics in China. Just before the 618 Shopping Festival, JD Logistics announced plans to provide 24-hour delivery service in second-to-fifth-tier cities. And after recently buying a stake in one of the world’s oldest supply chain managers, Li & Fung, it announced it was acquiring Shenzhen-based Kuayue Express for $432 million (3 billion yuan) on August 13.
JD’s logistics services upgrade is also expected to benefit JD Retail, which oversees partnerships with luxury fashion and beauty brands. During Q2, JD.com wooed several luxury brands to launch on this platform, including Prada Group’s Church’s, Christopher Kane, Tom Dixon, and Sergio Rossi.
The e-tailer’s stock shot up by more than 6 percent to $66 a share during Tuesday’s pre-market hours and opened at $65.02.