JD.com NASDAQ: JD reported a 2.9% year-over-year decline in second-quarter revenue to RMB 346 billion, as sales of electronics and home appliances faced comparisons against a high prior-year base and pressure from rising upstream component costs. Despite the revenue decline, the company reported stronger profitability, with non-GAAP net income attributable to ordinary shareholders rising 20.8% to RMB 8.9 billion.
CEO Sandy Xu said the company’s results were in line with expectations and reflected operational resilience amid macroeconomic and industry headwinds. Non-GAAP net margin increased by 0.5 percentage point to 2.6%, supported by margin expansion at JD Retail and a reduction in losses at JD Food Delivery.
“Q2 marked a definitive turning point for our profitability trajectory,” Xu said, citing JD Retail’s margin performance and JD Food Delivery’s year-over-year loss reduction of more than 50%.
JD Retail margins reach promotional-season record
JD Retail revenue declined 4.7% year over year to RMB 295 billion during the quarter. The company said electronics and home-appliance sales were affected by a high comparison base and higher consumer-electronics prices, although management said momentum improved in June.
JD Retail’s gross margin expanded 1.3 percentage points from a year earlier to 18.5%, its 17th consecutive quarter of year-over-year gross-margin expansion. Its non-GAAP operating profit reached RMB 13.5 billion, while operating margin rose 7 basis points to 4.6%, which management described as a record for a peak promotional season.
CFO Ian Su Shan attributed the improvement to supply-chain efficiencies, a greater contribution from higher-margin marketplace and advertising revenue, and improved marketing efficiency. JD Retail’s marketing expense ratio declined year over year for the fourth consecutive quarter, he said, though the company also increased research-and-development investment, particularly in artificial-intelligence applications.
Management expects JD Retail to return to positive revenue growth in the third quarter. Xu said the comparison base related to the prior-year trading program should normalize in the second half, while JD’s inventory management and supply-chain capabilities could help mitigate electronics price pressures.
General merchandise remained a relative source of growth. JD Supermarket delivered near-double-digit revenue growth, while healthcare and industrial products posted double-digit growth, according to management. JD said its third-party GMV growth outpaced first-party GMV for the third consecutive quarter, with the third-party contribution to total GMV expanding sequentially in the second quarter.
Service revenue and logistics growth offset product weakness
Service revenue increased 6.8% from a year earlier. Marketplace and marketing revenue rose 8.3%, driven primarily by advertising revenue, while logistics and other service revenue increased 5.9%.
Su said marketplace and marketing revenue continued to grow faster than product sales, a trend the company expects to remain an important source of margin expansion. Management expects advertising revenue growth to accelerate in the second half as overall sales recover, supported by AI-driven ad targeting, a larger mix of general merchandise categories and additional traffic from newer businesses including JD Food Delivery.
JD Logistics generated RMB 68.1 billion in revenue, up 24.3% year over year, primarily due to incremental on-demand delivery services. Non-GAAP operating income at the logistics segment rose 15.6% to RMB 2.3 billion, representing a 3.5% operating margin. Su said near-term margin fluctuations at JD Logistics were primarily related to Deppon Logistics.
Food delivery losses narrow while international investment rises
The company’s new businesses generated RMB 7.3 billion in revenue. The year-over-year decline in this segment reflected the transfer of on-demand delivery revenue recognition from new businesses to JD Logistics beginning in the first quarter of 2026.
Operating loss in the new-business segment narrowed significantly to RMB 9.9 billion. JD said JD Food Delivery reduced losses by more than 50% year over year through lower subsidies per order, improved delivery efficiency, commissions and advertising revenue.
Xu said food delivery also contributed to user acquisition and cross-selling opportunities across JD’s retail ecosystem. The company reported double-digit year-over-year growth in monthly active users, quarterly active customers and Plus members, while its 618 promotion set a record for purchasing users.
JD’s international business, Joybuy, doubled revenue within two quarters, according to Xu. The company said Joybuy’s European strategy centers on localized warehousing, same-day and next-day delivery in major cities, and integrated appliance delivery and installation. While Joybuy’s operating loss increased as it entered a scaling phase, its loss margin improved sequentially, management said. JD expects investment in the business to increase with order growth, while remaining disciplined and manageable.
Jingxi, which targets lower-tier markets, increased quarterly active customers by more than 40% year over year and contributed 40% of new active customers in the second quarter, according to management.
Cash flow, buybacks and second-half outlook
JD reported last-12-month free cash flow of RMB 31 billion at the end of the second quarter, compared with RMB 10 billion in the prior-year period. Su attributed the improvement to working-capital management, faster accounts-receivable collections and normalized cash outflows associated with the trading program.
Cash, cash equivalents, restricted cash and short-term investments totaled RMB 235 billion at quarter-end. During the first half, JD repurchased approximately 69.9 million Class A ordinary shares, equivalent to 34.9 million ADSs, for $1 billion. The company said the purchases represented about 2.5% of ordinary shares outstanding as of Dec. 31, 2025.
Management said it remains committed to dividends and share repurchases, noting that approximately $1 billion remained under its previously announced three-year, $5 billion repurchase program. Su said JD has returned about $13 billion to shareholders through dividends and buybacks since 2023.
Looking ahead, management expects revenue growth to accelerate across JD Retail categories during the second half and said it is confident of further group-level profit growth. The company also reiterated its long-term goal of achieving a high-single-digit margin at JD Retail, supported by supply-chain efficiencies, category mix improvement and growth in higher-margin commissions and advertising services.
About JD.com (NASDAQ:JD)
JD.com is a major Chinese e-commerce company that operates a comprehensive online retail platform selling a wide range of consumer goods, including electronics, appliances, apparel, groceries and everyday household items. The company combines direct retailing—purchasing inventory and selling products itself—with a marketplace for third-party merchants, offering consumers both self-operated and third-party choices. In addition to its core retail business, JD.com has expanded into adjacent services such as digital marketplaces for cross-border commerce, online pharmacy and healthcare services, and enterprise-facing cloud and technology solutions.
A distinctive feature of JD.com's business model is its integrated logistics and fulfillment network.
This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.
Continue following MarketBeat
Add MarketBeat as your preferred source on Google to see our latest stories in your feed.
Before you consider JD.com, you'll want to hear this.
MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and JD.com wasn't on the list.
While JD.com currently has a Moderate Buy rating among analysts, top-rated analysts believe these five stocks are better buys.
View The Five Stocks Here
Tesla, Nvidia, and Google helped shape the last era of market growth, but the next wave could come from a new group of companies. Inside this report, you’ll find 7 stocks that could play a major role in the next tech-driven market boom.
Get This Free Report
