JD.com Q2 2025

Latest Quarter Earnings#

• Q2 2025 results: Net revenues were RMB 356.7 bn (≈US$49.8 bn), up 22.4 % YoY . Service revenue grew faster than merchandise revenue thanks to the JD Food Delivery business; the company fulfilled more than 2.2 billion orders during its "618" promotion .

• Operating expenses: Cost of revenues remains the largest expense (approx. 87 % of revenues). Fulfilment expenses were RMB 16.6 bn (4.6 % of revenue), marketing expenses RMB 13.9 bn (3.9 % of revenue), R&D expenses RMB 5.1 bn (1.4 %) and G&A expenses RMB 1.9 bn (0.5 %) . Fulfilment and marketing expenses rose due to investment in new businesses.

• Profitability: Operating loss was RMB 1.7 bn because of heavy investment in JD Food Delivery and other new services . Net income attributable to ordinary shareholders was RMB 6.2 bn; diluted EPS RMB 4.15 . Free cash flow for the quarter was RMB 22.0 bn and cash & cash equivalents were RMB 223.4 bn (≈US$31.2 bn) .

• Share repurchase: JD has a US$5 bn share repurchase program effective Sep 2024-Aug 2027 and had repurchased 80.7 M Class A shares (~40.4 M ADSs) for US$1.5 bn by 30 Jun 2025 .

Business Model#

• Revenue segments (2024): JD's business is divided into four segments: electronics & home appliances (≈51 % of revenue), general merchandise (18 %), marketplace & marketing services (5 %) and logistics & other services(26 %) . The pie chart below illustrates the mix.

• Customers: JD focuses on mass‑market consumers in China. It reported 588.3 million annual active customer accounts for the twelve months ended Sep 30 2022 . Shopping frequency rose over 40 % YoY in Q2 2025 , reflecting higher engagement.

• Scale & network: JD operates China's second‑largest e‑commerce platform with integrated self‑owned warehouses, last‑mile delivery fleet and cross‑border logistics. The ecosystem employs about 900 000 peopleand had over 60 000 suppliers as of 2024 . JD Food Delivery added 300 000 riders.

Sources of income#

1. Direct sales (electronics & general merchandise): JD sells products bought from suppliers and earns gross profit on the spread between sale price and procurement cost.

2. Marketplace & marketing: Third‑party merchants list products on JD's platform and pay commission and advertising fees.

3. Logistics & other services: JD Logistics provides warehousing and delivery services to JD and third‑party clients, charging service fees.

4. New businesses: On‑demand delivery (food delivery and groceries) and international cross‑border commerce.

Headwinds & Risks#

• Short‑term: Weak consumer demand in China amid economic slowdown; intense price competition from rivals (Alibaba, Pinduoduo, Douyin); higher fulfilment and marketing costs to build JD Food Delivery and overseas businesses; regulatory inspections on livestreaming and discounting.

• Long‑term: Structural decline in China's population and consumption; regulatory scrutiny on platform economy and data security; geopolitical tensions restricting cross‑border trade; supply‑chain disruptions and reliance on 60 000+ suppliers ; currency risk from RMB-USD translation; capital intensive logistics network requiring continual investment.

• Environmental/Social risks: High headcount and heavy reliance on riders pose labour‑cost and compliance risks; carbon‑emission goals may require costly upgrades.

Cost Structure#

• Fixed costs: Warehouses, logistics hubs, technology infrastructure and cloud computing; depreciation & amortisation; interest expense (≈US$397 M in 2024 ).

• Variable costs: Cost of goods sold (≈87 % of revenue), fulfilment (warehousing & delivery), marketing, R&D, payment processing and customer service. Marketing expenses were RMB 37.8 bn (3.6 % of revenue) in 2022, RMB 40.1 bn (3.7 %) in 2023 and RMB 48.0 bn (4.1 %) in 2024 . R&D expenses were around RMB 16-17 bn per year .

• Largest costs: Procurement (COGS) and fulfilment; marketing has been increasing as JD promotes new services.

• Trends: Gross margin has remained ~13 % since 2015, while operating margin improved to ~3 % in 2024; marketing spend as a percent of revenue is slowly rising . During recessions, JD tends to slash marketing and capex.

Management & Governance#

• Executive team: Founder Richard Qiangdong Liu chairs the board and remains involved. Sandy Ran Xu, former CFO, became CEO in May 2023; Ian Su Shan became CFO in May 2023 . Other executives include Pang Zhang (CHRO) and Chengfeng He (Chief Compliance Officer) .

• Board: Composed of Richard Liu, CEO Sandy Xu and several independent directors such as finance professor Ming Huang and former New Oriental president Louis T. Hsieh .

• Past performance: Management delivered strong revenue growth and improved margins, but profits remain volatile due to heavy investment cycles. The company promptly discloses results and holds earnings calls; there are no major accounting scandals reported. However, founder Richard Liu faced a high‑profile personal allegation in 2018; the case was settled and he remains Chairman.

• Value alignment: Richard Liu owns ≈11.4 % of shares and thus benefits from long‑term value creation. Other executives receive stock‑based compensation. JD regularly repurchases shares, which aligns incentives.

Shareholders & Capital Returns#

• Top shareholders: Founder Richard Liu (11.4 %); institutional investors BlackRock (4.55 %), Vanguard(3.72 %), Fidelity (2.83 %), Invesco and Dodge & Cox . These funds typically support management proposals; there have been no major proxy fights. Agenda items usually include board elections, share repurchase approvals and incentives.

• Share repurchase: In Aug 2024 JD completed a US$3 bn program, repurchasing 255.3 M Class A shares (~8.1 % of shares outstanding) . A new US$5 bn program runs until Aug 2027 .

• Dividends: JD currently pays no dividend, preferring share buybacks and reinvestment.

Value Investor History#

• Notable investor Michael Burry (Scion Asset Management) accumulated JD shares from 2019, buying around 300 k shares at ~US$25.42. He increased the position in 2020-2024 but fully exited in Q1 2025, having sold at an average price around US$40.06 . His trades suggest a value‑driven entry and profit‑taking exit. Other "smart money" investors (e.g., Hillhouse, GQG) have held stakes but data is limited.

10‑Year Key Metrics#

A detailed table with 2015‑2024 data is provided in the attached CSV ( ). It includes revenue, net income, cash, assets, liabilities, gross profit, operating income, free cash flow, book value per share, market price, market cap, margins, ROE, ROA, ROIC, debt ratios, current ratio and depreciation/Gross Profit. Here are some highlights:

• Revenue: Climbed from US$27.99 bn in 2015 to US$158.76 bn in 2024, a 10‑year CAGR of ~22 %.

• Net income: Negative until 2018; positive since 2019 but volatile (peak US$7.57 bn in 2020, US$5.67 bn in 2024).

• Free cash flow: Fluctuated widely (US$3.31 bn-6.28 bn) with a negative year in 2015; FCF margin around 3-4 %.

• Book value per share: Rose from US$5.25 in 2015 to US$27.92 in 2024; P/B ratio ~1.1 at 2024 share price of US$33.70 .

• ROE & ROIC: Averaged 7 % and 5 % respectively, below Buffett's preferred 15 % threshold.

• Debt: Debt‑to‑equity ratio ~0.60 and current ratio ~1.4; the company has sizable cash reserves.

Key Metrics Charts#

Below are selected trends (English versions); Chinese versions are included in the attached package.

• Closing Price Trend: Shows price volatility; the stock peaked near US$90 in 2021 then fell to ~US$33 in 2024 .

• Revenue Growth: Revenue grew steadily, with a sharp increase during the pandemic (2020) but moderating afterwards.

• Net Income: Profits turned positive post‑2018 but remain volatile.

• Cash & Cash Equivalents: Cash reserves expanded to more than US$33 bn in 2024.

• Gross Margin: Remained around 13 % over the past decade.

• Net Margin: Improved to ~3-4 % recently but remains low.

• Return on Equity: Low single digits; peaked at 15 % in 2020 due to exceptional earnings.

• Free Cash Flow: Exhibits cyclicality; positive but not steadily growing.

Buffett‑Style Checklist#

Summary: JD.com meets valuation criteria (low P/E, reasonable P/B), but it fails most profitability and efficiency standards used by Warren Buffett. The business is capital‑intensive with low margins and heavy investment requirements. Therefore, from a Buffett‑style perspective, JD would not qualify as a "wonderful company at a fair price."

Discounted Cash Flow (DCF) Analysis#

We estimate intrinsic value using a 10 % discount rate and a 2.5 % terminal growth rate. FCF estimates are based on annual FCF from 2019‑2024 (to avoid early negative values), converted to USD.

The conservative scenario suggests JD's current price (~US$33) is significantly above the intrinsic value, while the nominal and optimistic scenarios show large upside. Given FCF volatility and low margins, the conservative case likely better reflects reality.

Cross‑validation & Sources#

Where possible, data points were cross‑checked across JD's SEC Form 20‑F, investor relations releases and Macrotrends. For example, revenue, net income, cash and liabilities from Macrotrends (USD) were checked against 2024 Form 20‑F (RMB). Marketing expenses and suppliers came from the Form 20‑F . Customer numbers and headcount came from JD's IR releases . Share repurchase data came from Q2 2025 and Q4 2024 releases . Investor trades were sourced from Stockcircle . We used multiple sources to validate figures.