JD.com Q2 Earnings Call Centers on Retail Growth Recovery

JD Eyes a Q3 Retail Growth Pivot

Chief executive officer (CEO) Sandy Xu said JD Retail's momentum improved in June and expects the segment to return to positive revenue growth in the third quarter after second-quarter revenues fell 4.7% year over year.

In Q&A, a UBS analyst asked about the electronics and home appliance outlook. The CEO said growth should improve as last year's trade-in comparison base normalizes, while inventory management helps cushion component-driven price pressure.

Xu also expects general merchandise to maintain healthy growth, supported by supermarkets and third-party participation. JD Retail's third-party GMV has outpaced first-party GMV for three consecutive quarters.

JD.com Protects Margin Through Mix and Efficiency

Chief financial officer (CFO) Ian Shan highlighted JD Retail's gross margin of 18.5%, up 1.3 percentage points year over year, and a 4.6% operating margin, a record for peak promotional seasons.

The CFO tied the improvement to supply-chain efficiency, better product margins, commissions and advertising, while marketing efficiency created room for higher AI-focused research and development spending.

In Q&A, a Jefferies analyst asked about the second-half margin outlook. Shan said JD Retail’s gross margin should keep improving and reiterated a long-term high-single-digit margin target, even as research and development expenses continue growing.

JD Food Delivery Losses Keep Narrowing

CEO Xu said JD Food Delivery cut losses by more than 50% year over year while maintaining healthy order growth, aided by lower subsidy per order, better delivery efficiency and growing commission and advertising revenues.

CFO Shan said New Businesses' operating loss narrowed to RMB9.9 billion in the second quarter, and food-delivery losses should decline substantially year over year in the second half.

In Q&A, a Citi analyst asked about food-delivery scale and synergies. CEO Xu emphasized cross-sell, user acquisition and fulfillment integration with logistics while keeping scale growth tied to unit economics improvement.

JD.com Sees More Advertising Upside

CEO Xu said monthly active users, quarterly active customers and Plus members all grew at double-digit rates, while management is shifting from rapid acquisition toward improving user quality and lifetime value.

CFO Shan noted marketplace and marketing revenues rose 8.3% year over year, faster than total revenues, with advertising showing stronger momentum.

In Q&A, a Citi analyst asked about second-half monetization. The CFO said advertising growth should accelerate as sales recover, supported by AI-driven targeting, general merchandise mix and incremental traffic from food delivery.

JD Balances Overseas Expansion and Returns

A Goldman Sachs analyst asked whether stronger free cash flow could support a formal shareholder-return ratio. CFO Shan reiterated a flexible mix of reinvestment, dividends and share repurchases focused on long-term total shareholder returns.

The CFO said JD repurchased $1 billion of shares in the first half, equal to about 2.5% of outstanding ordinary shares at year-end 2025, with roughly $1 billion remaining under the program.

On Joybuy, CEO Xu said revenues doubled within two quarters, and investment will rise as service coverage expands, but spending will remain disciplined and manageable while unit economics improve.

JD.com Keeps the Focus on Profitable Growth

Management's second-half message centered on reaccelerating revenue alongside continued efficiency gains. CEO Xu emphasized supply-chain execution, AI integration and financial discipline across new businesses.

CFO Shan said the group expects profit growth to accelerate in the second half, supported by core retail health and narrower new-business losses.

JD’s Zacks Rank & Style Scores Show Mixed Signals

JD currently carries a Zacks Rank #3 (Hold), and A grades for Value, Growth, Momentum and VGM Score. Under the Zacks Style Score framework, A is the strongest grade, and favorable style scores complement the rank.

The combination reflects broad style strength but lacks the higher timeliness associated with Zacks Rank #1 (Strong Buy) or 2 (Buy) stocks. The Zacks Rank can change as earnings estimates are revised following the just-reported results. You can see the complete list of today’s Zacks #1 Rank stocks here.

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