JD.com Falls 6.6% Despite Upbeat Q4 Results

E-commerce company JD.com (JD) has reported upbeat results for the fourth quarter of 2021 on the back of strong demand for online shopping. However, its shares declined 6.6% at the time of writing.

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Adjusted earnings per share (EPS) during the quarter stood at RMB2.21 ($0.35), up 48.3% from the same quarter last year. Net revenues increased 23% year-over-year to RMB275.9 billion ($43.3 billion).

The growth in net revenues can be attributed to a 25.1% rise in net product revenues, which accounted for 85% of the total revenues. Net service revenues increased 28.3% to RMB41.2 billion ($6.5 billion).

The company’s annual active customer accounts climbed to 569.7 million in the twelve months ended December 31, 2021, from 471.9 million in the twelve months ended December 31, 2020.

JD.com incurred research and development expenses worth RMB4.1 billion ($0.6 billion), compared to RMB4.5 billion in the year-ago quarter. Also, fulfillment expenses, which primarily include procurement, warehousing, delivery, customer service and payment processing expenses, increased 10.7% to RMB16.3 billion ($2.6 billion).

For full-year 2021, JD.com reported net revenues of RMB951.6 billion ($149.3 billion), up 27.6% from 2020. Also, adjusted EPS improved marginally to RMB10.75 ($1.69) during the quarter.

The Chief Financial Officer of JD.com, Sandy Xu, said, “During the quarter, we further optimized our operational efficiency through technology and innovation, increasing our competitiveness as well as our ability to support our business partners. In 2022, we will continue to execute our business strategies and focus on sustainable high-quality growth across all of our business lines.”

Stock Rating

Overall, the Street is bullish on the stock and has a Strong Buy consensus rating based on 7 unanimous Buys. The JD.com price target of $99.29 implies upside potential of about 59.1% from current levels.

Website Traffic

TipRanks’ Website Traffic tool, which uses data from SEMrush Holdings (SEMR), the world’s biggest website usage monitoring service, offers insight into JD.com’s performance.

According to the tool, compared to the previous year, the JD.com website recorded a 40.7% decrease in global unique visits from October to January. Meanwhile, year-to-date, the website traffic has declined 26.5% against the same period last year.

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