Subscribe Beats Market Estimate with Strong 2019 Q4 Financials
COVID-19 and China
Image credit: Carlos Muza on Unsplash (JD: NASDAQ) disclosed its 2019 fourth quarter and full-year financials on March 3, 2020. Net revenue grew 26.6% year-over-year to CNY 170.7 billion (USD 24.5 billion), beating the previous market estimates of USD 23.7 billion.

Net income attributable to ordinary shareholders was CNY 3.6 billion (USD 0.5 billion), compared to a net loss of USD 4.8 billion the previous year. The adjusted net income was CNY 810.7 million (USD116.5 million).

Annual active customers increased by 18.6% to 362 million in 2019 compared to 2018. Monthly active users (MAU) in December 2019 rose by 41% versus December 2018, benefiting from the strong growth of users in low-tier cities.

“We achieved robust top-line growth for the fourth quarter as Chinese consumers increasingly associate the JD brand with trust and reliability,” said Richard Liu, Chairman and Chief Executive Officer of “We also saw strong customer growth, especially in China’s lower-tier cities, driven by innovative marketing, superior product selection and better customer service.”

During the coronavirus outbreak, has reacted swiftly to ensure the smooth transportation and supply of key medical resources and daily necessities nationwide by leveraging its in-house delivery team and its capabilities in areas including supply chain, logistics infrastructure and related technologies.

By examining JD’s net revenue structure, we can observe changes in the company’s strategy. Though net product revenue represented over 90% of revenue in 2018, the number decreased a bit to 88.5% in 2019. Further breaking down the net service revenue, we see a higher weight of revenue in logistics and other services, benefiting from the scale economies of JD’s self-operated logistics.

The revenue structure has coincided with JD’s strategy transition. In November 2019, released the complete technical layout for the first time, officially announcing a comprehensive transformation to a tech-driven company. It also made clear its market position to the public – a technology and service provider based on the retail business.

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