China-based online marketplace JD.com (JD) Thursday reported a wider net loss for the second quarter, adding to the woes of the e-commerce sector that is going through a slump. Though revenues grew sharply during the period, the results came in below market expectations.
Net loss from continuing operations attributable to ordinary shareholders widened to 2.2 billion yuan (US$334.4 million) or 1.54 yuan (US$0.23) per American depositary share from 287 million yuan or 0.35 yuan per share in the second quarter of 2017. On an adjusted basis, the company posted earnings of 0.33 yuan (US$0.05) per American depository share, lower than 0.67 yuan per share recorded last year. The result fell short of estimates.
Revenues surged 32% annually to 122.3 billion yuan (US$18.5 billion), with service and product revenues growing 51% and 29.4% respectively. The company had annual active customer accounts of 313.8 million at the end of June 30, 2018, up 22% compared to last year.
The company had annual active customer accounts of 313.8 million at the end of June, up 22%
“Our new business initiatives continue to gain impressive traction across the industry. We will maintain a balanced, long-term approach to investing in the technologies that will define the future of retail,” said Chief Financial Officer Sidney Huang.
Pursuant to a recent partnership with Google (GOOGL), JD.com is currently exploring joint development of retail solutions to enhance customer experience around the world, and a tie-up with Google Shopping to cater to customers in multiple regions.
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Earlier this week, e-commerce stocks suffered severely after the companies, including those based in China, came out with an unimpressive outlook for their upcoming fiscal quarters, reflecting the softness in local markets and the continuing fallout from the Turkish financial crisis.
Among JD.com’s rivals, Alibaba (BABA) is scheduled to report results for the June quarter on August 23. Alibaba’s stock, which has been losing progressively since the market opened this week, recovered modestly in premarket trading Thursday. Vipshop Holdings (VIPS), another leading online marketplace, lost 16% after the company guided its third-quarter earnings below consensus.
JD.com shares ended the last trading session down 4.5%. The stock fell sharply following the earnings report, before gaining modestly as trading progressed.