JD.com Q4 Earnings Overview
JD.com (JD US, 9618 HK) announced Q4 financial results post-Hong Kong close/pre-US market open. We knew Q4 would be challenging as zero COVID’s end led to an outbreak across China. Management did a great job navigating a complex macro environment, cutting costs, and cutting unprofitable investments, allowing the company to pay a dividend to shareholders. Revenue barely missed analyst estimates, leading to headlines that “JD Misses” is absurd, especially as adjusted net income and EPS beat expectations handily. One should note the very healthy cash flow generated by the business. The Q&A with analysts was focused on the company’s announced discount/subsidiary program and whether or not a price war would break out amongst e-commerce companies. The answer was pretty standard, as management didn’t provide color on the 2023 outlook other than mentioning the company’s goal of fulfilling customers’ needs cost-efficiently and timely.
- Revenue increased +7% year over year to RMB 295.4B ($42.4B) vs estimate 295.5B ($42.5B) and Q3 2022’s RMB 275B ($39.5B)
- Adjusted Net Income RMB 7.659B ($1.1B) versus estimate 5.494B ($790M) and Q3 2022’s RMB 3.6B ($520M)
- Adjusted EPS RMB 4.81 ($0.69) versus estimate RMB 3.541 ($0.51) and Q3 2022’s RMB 2.21 ($0.32)
Key News
Asian equity markets were lower except for Japan overnight as the Asia dollar index posted an inverse James Bond -0.07% and China’s renminbi -0.09% on more Fed hikes.
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