Image source: Visual China
China's three Fortune Global 500 Internet companies have released financial reports one after another, from which we can see that a slow recovery is taking place.
Yesterday, JD.com released its financial report for the first quarter of 2024, which showed that JD.com achieved revenue of 260 billion yuan in the quarter, a year-on-year increase of 7%, exceeding market expectations of 258.3 billion yuan; In terms of net profit, JD.com's adjusted net profit in the first quarter was 8.9 billion yuan, a year-on-year increase of 17%, far exceeding market expectations.
Similarly, a few days ago, Alibaba's 2024 fiscal year and fourth quarter financial report announced that the company's net profit attributable to ordinary shareholders for the full year of fiscal 2024 was 79.741 billion yuan, a year-on-year increase of 9.97%, and its operating income was 941.168 billion yuan, a year-on-year increase of 8.34%.
The most eye-catching is Tencent's financial report. Tencent's financial report for the first quarter of 2024 shows that its company's net profit is 50.265 billion yuan, with a year-on-year growth rate of 54%; The gross profit, which represents the company's operating quality, also reached 83.87 billion yuan, a year-on-year increase of 23%.
The earnings reports of the three companies all showed varying degrees of growth. Xu Ran, CEO of JD.com, said that 2024 is a year of execution, and we see tangible results across businesses. In particular, our focus on user experience led to strong growth in active users and user engagement in the first quarter.
The so-called "year of implementation" is that JD.com is returning to the essence of e-commerce's "low-price strategy". At the end of 2022, Liu Qiangdong, the founder of JD.com, emphasized at an internal meeting that "low price is the most important weapon for our success in the past, and it will also be the only basic weapon in the future." "After that, in 2023, Jingdong will launch a subsidy channel of 10 billion yuan, and open up POP investment, lower the freight threshold, etc., and it is these actions that will pay off in 2024. According to Xu Ran, JD.com's first quarter started steadily.
Alibaba has changed dramatically in the past year. At the end of last year, Pinduoduo's market value jumped beyond Alibaba. Then Ma Yun made a rare reply on the intranet: "Ali will change, Ali will change." Wu Yongming, who took over as CEO of Alibaba Group for less than half a year after 20 days, took over as Taotian's No. 1 position. After the release of the earnings report, Wu Yongming said that Alibaba is returning to the growth track. By focusing on user experience, Taotian and its international e-commerce businesses both achieved double-digit year-on-year growth in GMV.
Alibaba's co-founder, Joe Tsai, said in an interview in April: "We forgot who our real customers were and didn't give them the best experience. So in a way, we're kind of self-defeating. ”
To put it simply, JD.com and Ali are returning to "user experience" and "low-price essence". The two e-commerce giants are competing with Pinduoduo, and JD.com once thought that Pinduoduo was "tricky" and just a traffic business; And Alibaba didn't seem to be aware of the real threat of Pinduoduo before. Previously, both companies had been dealing with Pinduoduo in a variety of different ways, but eventually returned to the competition for low price and user experience.
Unlike the two e-commerce companies, Tencent's gross profit increased year-on-year in its three core business segments: online advertising, fintech and enterprise services, and value-added services. For example, the gross profit of Tencent's fintech and enterprise services and online advertising businesses increased by more than 40% year-on-year for two consecutive quarters.
Channels were once regarded as the "only hope" by Tencent Chairman Ma Huateng, but now it seems that Channels lives up to expectations. The financial technology and enterprise services business achieved revenue of 52.3 billion yuan, a year-on-year increase of 7%, and gross profit increased by 42% year-on-year. In this regard, Tencent explained that it mainly benefited from the strong growth of technical service fees for live streaming on Channels, as well as the increase in the commercialization of WeChat Work and other enterprise services.
Similarly, Tencent's game business, which once relied on for survival, has seen steady growth. Ma Huateng said that in the first quarter, the company's team adjustment in several top games in the domestic market and international markets has achieved initial results, and the total game turnover has increased, laying the foundation for the recovery of game revenue growth in the next few quarters.
If the three companies have something in common, they are expected to be in artificial intelligence. Liu Qiangdong, the founder of JD.com, returned to the front line in the way of "digital people", and at the same time, JD.com also announced that it would invest the greatest resources in the three core areas of traffic ecology, artificial intelligence technology and service capabilities during this year's 618 period to help merchants grow effectively; Tencent is empowering its social networking, gaming, video accounts, enterprise services and other businesses through artificial intelligence technologies such as NLP, knowledge graphs, and large models. Alibaba has also set up a dedicated artificial intelligence e-commerce team, increased the implementation of large models, and continued to strengthen investment in cloud computing and artificial intelligence infrastructure.
To sum up, all three companies are now returning to what they started about 20 years ago and putting user experience back first, and for the future, they are also integrating AI as a new productivity tool into their business, and recovery and new competition are happening. (Fortune Chinese Network)
Fortune magazine launched the "Fortune China Technology 50" list for the first time this year, trying to find these technology companies that were born in China and are influencing the world. Their success lies not only in their technology and products, but also in the spirit of innovation and global vision they represent. We look forward to these Chinese companies making more outstanding achievements in technological innovation and global expansion, and making greater contributions to technological and commercial progress.
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