JD(09618)2023-08-16 10:11Financial Performance - In Q2 2023, JD.com reported revenue of RMB 287.9 billion (USD 39.7 billion), an increase of 7.6% compared to Q2 2022[3] - Operating profit for Q2 2023 reached RMB 8.3 billion (USD 1.1 billion), up from RMB 3.8 billion in the same period last year[3] - Net profit attributable to ordinary shareholders for Q2 2023 was RMB 6.6 billion (USD 0.9 billion), compared to RMB 4.4 billion in Q2 2022[3] - The diluted earnings per American depositary share for Q2 2023 was RMB 4.15 (USD 0.57), an increase from RMB 2.74 in Q2 2022[3] - Total revenue for the six months ended June 30, 2023, was RMB 530,887 million, an increase from RMB 507,255 million in the same period of 2022, representing a growth of 4.8%[20] - JD Retail revenue for the three months ended June 30, 2023, was RMB 253,280 million, compared to RMB 241,557 million in the same period of 2022, reflecting a growth of 4.7%[18] - Operating profit for the six months ended June 30, 2023, was RMB 14,697 million, up from RMB 6,166 million in the same period of 2022, representing a significant increase of 138.5%[18] - The company reported a net profit attributable to ordinary shareholders of RMB 8,557 million for the three months ended June 30, 2023, representing a 32% increase from RMB 6,489 million in the same period last year[32] - The company reported a net profit attributable to ordinary shareholders of RMB 1,385 million for the six months ended June 30, 2023, a decrease of 81% compared to the previous year[41] Cash Flow and Liquidity - Cash flow from operating activities for the twelve months ending June 30, 2023, was RMB 52.5 billion (USD 7.2 billion), compared to RMB 51.1 billion for the previous year[3] - Free cash flow for the same period was RMB 33.5 billion (USD 4.6 billion), up from RMB 27.7 billion in the prior year[3] - Free cash flow for Q2 2023 reached RMB 44.5 billion (USD 6.1 billion), compared to RMB 30.0 billion in Q2 2022[14] - The company achieved a free cash flow of RMB 44,490 million for the six months ended June 30, 2023, significantly up from RMB 21,212 million in the same period last year, marking an increase of 109%[33] - Operating cash flow for the second quarter of 2023 was RMB 46,511 million, compared to RMB 33,667 million in the same quarter of 2022, indicating a year-over-year increase of 38%[33] - Cash and cash equivalents increased to RMB 91.0 billion as of June 30, 2023, up from RMB 78.9 billion at the end of 2022, reflecting a growth of 15.4%[27] - The cash and cash equivalents, restricted cash, and short-term investments totaled RMB 243.3 billion (USD 33.5 billion) as of June 30, 2023, up from RMB 226.2 billion at the end of 2022[13] Revenue Breakdown - Service revenue for Q2 2023 was RMB 54.1 billion (USD 7.5 billion), reflecting a growth of 30.1% year-over-year[3] - In Q2 2023, product revenue increased by 3.5% year-over-year, while service revenue surged by 30.1%[10] - JD Logistics revenue increased to RMB 41,033 million for the three months ended June 30, 2023, up from RMB 31,272 million in the same period of 2022, marking a growth of 31.1%[18] Expenses and Investments - The marketing expenses in Q2 2023 increased by 16.7% year-over-year to RMB 11.1 billion (USD 1.5 billion), representing 3.8% of total revenue[10] - Research and development expenses for the second quarter of 2023 were RMB 4.1 billion, slightly up from RMB 4.0 billion in the same quarter of 2022[30] - The company’s research and development expenses for the second quarter of 2023 were RMB 325 million, compared to RMB 155 million in the same quarter of 2022, indicating a significant investment in innovation[31] Operational Highlights - The number of third-party merchants increased more than twofold in Q2 2023, reaching a historical high[4] - JD Logistics' Kunshan Asia No. 1 smart industrial park processed over 4.5 million packages daily during the 618 shopping festival in June 2023[8] - During the 618 shopping festival, JD.com upgraded its home appliance services and opened new flagship stores in multiple cities[6] Non-GAAP Metrics - The company utilizes non-GAAP financial metrics such as operating profit/loss, net profit/loss attributable to ordinary shareholders, and EBITDA to assess business performance and inform strategic planning[24] - Non-GAAP operating profit/loss excludes stock-based compensation, intangible asset amortization from acquisitions, and other non-recurring items, providing a clearer view of ongoing operations[25] - Non-GAAP operating profit margin for the three months ended June 30, 2023, was 3.0%, compared to 2.1% in the same period of 2022, reflecting an improvement of 0.9 percentage points[36] - The company reported a non-GAAP EBITDA margin of 3.7% for the six months ended June 30, 2023, compared to 2.6% in the same period of 2022, indicating an improvement of 1.1 percentage points[36] Risks and Forward-Looking Statements - Forward-looking statements regarding the company's strategic and operational plans are subject to risks and uncertainties, including market trends and regulatory changes[26] - The impact of COVID-19 and geopolitical events are acknowledged as potential risks affecting business performance[26] - The company does not undertake any obligation to update forward-looking statements unless required by law[26] Assets and Liabilities - The total assets of JD.com as of June 30, 2023, amounted to RMB 603.9 billion, an increase of 1.1% from RMB 595.3 billion at the end of 2022[29] - Total liabilities decreased to RMB 316.6 billion as of June 30, 2023, down from RMB 321.1 billion at the end of 2022, reflecting a reduction of 1.4%[28] - The company’s total liabilities increased to RMB 338,245 million, reflecting a rise in financial obligations[43] - Total liabilities reached RMB 336,191 million, including preferred shares valued at RMB 18,484 million[44]