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JD.com, which is backed by Walmart Inc, Alphabet Inc's Google
and China's Tencent Holdings, has already lost nearly half of
its market value this year as it fights intense competition for
Chinese online consumers.
On Monday it said slower sales in its core e-commerce business,
particularly big ticket items, dented third-quarter earnings
growth.
While revenue rose 25 percent from the same period a year
earlier, it lagged analysts' forecasts and was well below
previous growth rates, which peaked at over 60 percent in 2015.
The company also forecast fourth quarter sales growth between 18
and 23 percent, slightly below an average analyst estimate of
23.5 percent.
JD.com's shares were down over 5 percent in pre-market trade on
Nasdaq.
Concerns over the Sino-U.S. trade war and a legal allegation
facing Chief Executive Richard Liu's have pushed down JD.com
shares by more than 44 percent this year. Shares of its bigger
rival Alibaba Group Holding have shed 11 percent.
Both firms are making efforts to reach new consumers in
Southeast Asia and rural China as demand tapers off in big
cities. Earlier this month, Alibaba lowered its forecast for
full-year sales, citing economic uncertainty linked to the trade
war.
JD.com's technology and content costs for the third quarter were
3.4 billion yuan, almost doubling from a year earlier,
reflecting a steep investment in research and development,
including warehouse technology, offline retail and drones.
In August the company said it will move its warehouse business
into a separate unit, offering logistics management to
third-party brands as well as its own platform, in a bid to
boost income.
JD.com said revenue totaled 104.8 billion yuan ($15.09 billion)
for the quarter ended Sept. 30, missing an average estimate of
106.2 billion yuan from 22 analysts, according to IBES data from
Refinitiv.
JD.com's volumes are seasonally lower in the third quarter as it
ramps up to its November Singles' Day promotion period. This
year, it sold 158.9 billion yuan in goods during the month-long
event, up 17 percent form a year earlier.
Despite the lower-than-expected sales, the company reported
income of 0.80 yuan per share, above an estimate of 0.72 yuan,
driven by stronger sales in its tech services unit, which grew
at almost twice the rate of its general product sales.
JD.com has recently been in news for the arrest of chief Richard
Liu, over alleged sexual misconduct in the United States.
He was released after a night in jail and JD.com has said the
accusation against Liu was unsubstantiated.
The firm did not make any further comment on the issue in what
is its first quarterly results since the arrest.
(Reporting by Cate Cadell in Beijing and Vibhuti Sharma in
Bengaluru; Editing by Adrian Croft and Susan Fenton)
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