(Yicai Global) Aug. 14 -- JD.Com's stock price surged after the Chinese e-commerce player reported a second-quarter profit, defying market expectations for a loss.
JD.Com swung into the black with a net profit of CNY3.6 billion (USD513 million) in the three months ended June 30, according to the Beijing-based company's earnings report published yesterday. Analysts had forecast a CNY59 million loss following a year-earlier one of CNY2.21 billion. Revenue rose 23 percent to CNY150.28 billion, beating estimates for CNY147.39 billion.
The company's New York-listed shares [NASDAQ:JD] jumped 12.9 percent to end yesterday at USD30.66 each. They have gained more than 46 percent so far this year.
JD.Com's annual mid-year shopping festival around June 18 helped to boost performance in the quarter, Chairman and Chief Executive Richard Liu said during the firm's earnings conference call.
Second only to Alibaba Group Holding among China's e-commerce titans, JD.Com reported record sales of USD29.2 billion for the 18 days of the so-called 6.18 shopping extravaganza.
The company projects this quarter's total revenue at between CNY126 billion and CNY130 billion, an annual rise of about 20 percent to 24 percent.
In the past few years, JD.Com's businesses have started turning a profit. Its logistics segment is nudging the break-even point. The company did not lop off loss-making businesses to max profits, Liu said, but is still investing in many areas to grow profits and will continue to spend on artificial intelligence, cloud computing, Big Data, supermarkets and fresh food, he added.
The company will create a new ecosystem on tech giant Tencent Holdings' ubiquitous WeChat messaging and payment app that targets women and first-tier cities mainly to attract more vendors and products. Its low membership fee will also cater to demand among consumers in smaller cities, tech media 36Kr reported.
JD.Com's compliance costs ate up 6.1 percent of net income in the second quarter, lower than the 6.7 percent at the same time last year, its earnings report shows.
Editor: Ben Armour