With a revenue of 260 billion in the first quarter, JD.com is on the right track

E-commerce newspaper Pro

2024-05-20 15:06Posted on the official account of Guangdong E-commerce News

JD.com released its first-quarter earnings report

2023 is the year of adjustment for JD.com, which adheres to the low-price strategy, tries the live broadcast business, and makes many personnel adjustments and organizational structure changes.

In the past year, JD.com has faced internal and external crises one after another, with the growth of its core retail business slowing down, Pinduoduo's fierce momentum, pressing JD.com, the lack of implementation of low-price advantages, and many other problems that need to be solved urgently.

In the face of the crisis, Liu Qiangdong, who rarely shows up, even left a message on the intranet in person: "Jingdong must change, otherwise there is no way out." ”

After reflection, JD needs to implement it. In the view of Xu Ran, CEO of JD.com, 2023 is a "year of adjustment" and 2024 is a "year of implementation". The first quarter of this year shows the effectiveness of JD.com's implementation.

On the evening of May 16, JD.com announced its financial report for the first quarter of 2024. According to the report, JD.com's net revenue in the quarter reached 260 billion yuan, a year-on-year increase of 7.0%; net profit attributable to ordinary shareholders was 7.1 billion yuan, compared with 6.3 billion yuan in the same period last year, an increase of 13% year-on-year;

Non-GAAP net profit attributable to ordinary shareholders of listed companies was RMB8.9 billion, up 17.2% year-on-year, exceeding market expectations.

Source: JD.com

Looking at revenue and net profit alone, JD.com's performance is still stable and rising. Regarding the growth of performance, Shan Su, chief financial officer of Jingdong Group, said that the company's revenue growth rate has accelerated and profits have remained healthy. "During this period, the momentum of the company's daily necessities category continued to rebound, which was mainly due to the strong recovery of the large supermarket category."

In terms of categories, the revenue of Jingdong's electronic products and household appliances was 123.212 billion yuan, the revenue of daily necessities was 85.296 billion yuan, and the service revenue was 51.541 billion yuan.

Among the highlights, the revenue growth rate of daily necessities in the quarter reached 8.6%. In the past year, JD.com has continued to engage in low prices, and has also focused on live broadcast business, providing a lot of help for the development of large supermarkets.

In terms of specific business, JD Retail's revenue was 226.835 billion yuan, a year-on-year increase of 6.8%; JD Logistics' revenue was 42.137 billion yuan, a year-on-year increase of 14.7%; new business was 4.87 billion yuan, a year-on-year increase of 19.2%. Intersegmental offsetting was 13.793 billion yuan.

Overall, JD.com's profitability is getting stronger and stronger. Affected by the good performance, as of the close of May 16, JD.com's U.S. stock closed at $34.27, up 1.93%; Hong Kong stocks closed at HK$132.4, up 2.56%.

It is worth mentioning that from January 1 to May 15 this year, JD.com repurchased a total of about 1.3 billion US dollars (about 9.4 billion yuan), and the repurchase efforts have increased significantly.

Previously, JD.com also announced that in 2024, it will join forces with partners in categories such as 3C digital, home appliances and automobiles to jointly invest 6.5 billion yuan to support trade-in

JD.com, which has achieved more than expected performance in the first quarter, will continue to develop steadily. Xu Ran, CEO of JD.com, said that JD.com will celebrate its 10th anniversary on the NASDAQ this year and is confident that it will continue to grow its market share in the future.

JD.com's live broadcast business should be serious

This year, Liu Qiangdong made his debut in the live broadcast room as a digital person "Purchasing and Selling Dongge", which caused heated discussions in the industry.

As the industry's first entrepreneur digital person, "Purchasing and Selling Dongge" received more than 20 million views within 1 hour, and the cumulative turnover of the live broadcast exceeded 50 million, with outstanding results.

From this move, JD.com pressed out the heavy bet of the group's founder, which shows that JD.com is really going to be ruthless in the live streaming business. Of course, JD.com also invested real money, taking out 1 billion cash and 1 billion traffic as rewards to attract more original creators and high-quality content institutions to settle in.

The scope of the subsidy covers more than 20 creative fields such as digital 3C, home appliances, mother and child, sports, beauty and personal care.

In the past few years, compared with Alibaba, Douyin, and Kuaishou platforms, JD.com's live broadcast business is indeed much inferior, and it has not yet been able to support the head anchors of the façade. Until last year,Jingdong brought Luo Yonghao,5month31On the night of Jingdong618's good start,Luo Yonghao appeared in the Jingdong live broadcast room,The sales of the first live broadcast exceeded 150 million,More than 17 million viewers。

At the end of January this year, media sources said that in the work group called "Jingdong Live Anchor Recruitment Promotion", a JD personnel issued a notice, saying that JD is urgently formulating an anchor recruitment plan, and does not assess GMV, gross profit and other requirements for recruiting anchors. JD.com did not respond to the authenticity of the recruitment plan.

While looking for anchors, Jingdong has also developed a characteristic "procurement and sales live broadcast" model, shouting out the slogan of "no live broadcast pit fees, no talent commissions, so it is cheaper", so that consumers can get real benefits with absolute price advantages.

During last year's Double 11, Jingdong's live broadcast room took advantage of the situation, and the total number of viewers exceeded 380 million. JD.com's live broadcast room may be an occasional event, but it has brought a new direction for JD.com, and JD.com can promote the development of e-commerce business with the help of live broadcasts and other content forms.

In March this year, JD Retail set three must-win battles in 2024, namely "content ecology, open ecology, and instant retail". Among them, "content ecology" was proposed for the first time, covering live broadcasts, short videos, graphics and other sectors.

It is worth noting that the significant advantage of JD's content ecology is that the content is purposeful and the categories are clear. The "Evaluation" column only contains the evaluation videos of the digital 3C, and the "Dressing" only focuses on beauty and clothing. Unlike Taobao, short videos, live broadcasts, online articles, short dramas and other content are mixed together.

Source: Jingdong APP

In the current e-commerce industry, user growth is slowing down, traffic is peaking, and the cost of acquiring traffic is rising. At this point, it's a good idea to engage users with high-quality content to maintain user retention and increase conversions.

Xu Ran, CEO of JD.com, said that he believes that richer and more high-quality content will bring new traffic to JD.com, reduce the cost of customer acquisition, and also help the construction of the platform ecology. ”

In addition, JD.com will also increase investment in AI technology in content and e-commerce business. Some time ago, Xu Ran revealed a new initiative of Jingdong 618. She said that JD.com will open the live broadcast technology of AI digital humans to merchants for free to help merchants start live broadcast activities at a lower cost.

In addition, JD.com will also actively cooperate with other traffic platforms to jointly improve the traffic acquisition and conversion efficiency of merchants and create more business value for merchants.

JD.com can't be taken lightly

Although JD.com achieved revenue and net profit in the first quarter of 2024 that exceeded market expectations, this does not mean that JD.com can sit back and relax.

Compared with previous years, although JD.com's revenue has been in a growth trend, the growth rate has dropped sharply. Taking the past three years as an example, from 2021 to 2023, JD.com's revenue growth rate will be 27.59%, 9.95%, and 3.67% respectively.

JD.com's revenue in recent years Source: Oriental Fortune Network

The growth rate of net profit attributable to the parent company is also unstable, from 391.57% in 2022 to 132.82% in 2023.

The growth rate in the first quarter of this year is also much worse than before, only 13.88%, while in the same period in 2023, it will be as high as 309.33%.

It can be seen that the growth of JD's e-commerce business has become more difficult. As a result, JD.com needs to continue to optimize its business model and improve operational efficiency to maintain profitability.

In addition, JD.com's external competitive pressure is still very high. The competition in the e-commerce market has become white-hot, and major platforms are competing for market share through price wars, quality wars, service wars and other means.

This year, Tmall shouted the slogan of "the simplest 618 in history", and even canceled the official pre-sale, directly launched spot sales, and continued to upgrade the user service experience. It can be seen that Tmall directly copied JD's homework, as early as last year's double 11 promotion, JD no longer has pre-sale.

Compared with the past, Ali also emphasizes the importance of users, and "returning to users" has become Alibaba's strategic focus. In terms of service experience, Ali also launched free shipping in Xinjiang, 88VIP member return free shipping and other services, Ali's move to please users is obvious.

Pinduoduo has also continuously upgraded its express delivery services and implemented free shipping delivery to villages in Xinjiang. Recently, Pinduoduo won the express delivery business license, officially entered the express delivery industry, and further strengthened the layout in the field of terminal logistics.

With the intensification of competition in the e-commerce market, major platforms are actively seeking growth points and breakthroughs, and JD.com also needs to continue to find new growth points in such an environment.

In short, earnings exceeding expectations is only a phased achievement in JD.com's development process, and JD.com also needs to continue to work hard to cope with the challenge of weak growth in e-commerce business and continue to maintain steady development.

Author | Zhou Wenjun

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