JD(JD) - 2024 Q2 - Quarterly Report

Financial Performance - Total net revenues for Q2 2024 were RMB291.4 billion (US $40.1 billion), a 1.2% increase from RMB287.9 billion in Q2 2023[7] - Net income attributable to the Company's ordinary shareholders for the three months ended June 30, 2024, was RMB 12,644 million, representing a significant increase of 92.5% compared to RMB 6,581 million for the same period in 2023[26] - Non-GAAP net income attributable to the Company's ordinary shareholders for the three months ended June 30, 2024, was RMB 14,460 million, up 68.5% from RMB 8,557 million for the same period in 2023[26] - Operating income for Q2 2024 was RMB 10.5 billion (US$ 1.4 billion), up 27.0% from RMB 8.3 billion in Q2 2023, with a non-GAAP operating income of RMB 11.6 billion (US $1.6 billion)[61][69] - The company reported a net income of RMB 20,959 million for the six months ended June 30, 2024, up 59.5% from RMB 13,122 million for the same period in 2023[18] Revenue Growth - General merchandise revenues grew by 8.7% year-over-year to RMB88.8 billion (US$ 12.2 billion) for Q2 2024[7] - Total net revenues for the six months ended June 30, 2024, reached RMB 551,446 million, an increase of 3.8% from RMB 530,887 million for the same period in 2023[18] - Total revenues increased by 1.2% year-on-year, driven by robust growth in the general merchandise category, particularly supermarkets[46] Cash Flow and Liquidity - Free cash flow increased to RMB55.6 billion (US $7.7 billion) for the twelve months ended June 30, 2024, compared to RMB33.5 billion for the same period in 2023[5] - Operating cash flow for the twelve months ended June 30, 2024, was RMB 74.0 billion (US$ 10.2 billion), a 40.9% increase from RMB 52.5 billion in the previous year[61] - Net cash provided by operating activities for the six months ended June 30, 2024, was RMB 39.42 billion, up from RMB 24.90 billion for the same period in 2023, reflecting a growth of 58.5%[86] Expenses - Marketing expenses increased by 7.3% to RMB11.9 billion (US $1.6 billion) for Q2 2024, compared to RMB11.1 billion for Q2 2023, representing 4.1% of net revenues[1] - Research and development expenses for the three months ended June 30, 2024, were RMB 4,217 million, a slight increase from RMB 4,072 million for the same period in 2023[18] - Fulfillment expenses for Q2 2024 were RMB 17.2 billion (US$ 2.4 billion), a 3.2% increase from RMB 16.7 billion in Q2 2023, representing 5.9% of net revenues[68] Shareholder Equity - Shareholders' equity decreased to RMB287.3 billion (US $39.5 billion) as of June 30, 2024, from RMB295.8 billion[17] - The company repurchased a total of 136.8 million Class A ordinary shares for a total of US$ 2.1 billion during the three months ended June 30, 2024[46] - The company repurchased approximately 4.5% of its ordinary shares outstanding for the three months ended June 30, 2024, and 7.1% for the six months ended June 30, 2024[63][64] Assets and Liabilities - Total liabilities rose to RMB363.7 billion (US $50.0 billion) as of June 30, 2024, up from RMB332.6 billion as of December 31, 2023[17] - Total assets rose from RMB 628.96 billion as of December 31, 2023, to RMB 651.64 billion as of June 30, 2024, marking a 3.6% increase[80] - Cash and cash equivalents increased from RMB 71.89 billion as of December 31, 2023, to RMB 84.50 billion as of June 30, 2024, a rise of 17.5%[80] Non-GAAP Measures - Non-GAAP EBITDA rose by 30.1% to RMB13.5 billion (US$ 1.9 billion) for Q2 2024, with a margin of 4.6%, up from 3.6% in Q2 2023[2] - The company's non-GAAP operating margin improved to 4.0% for the three months ended June 30, 2024, compared to 3.0% for the same period in 2023[25] - Non-GAAP net margin attributable to the Company's ordinary shareholders was 5.0% for Q2 2024, up from 3.0% for Q2 2023[97] Strategic Initiatives - JD.com entered into strategic partnerships with brands like Xiaomi, Lenovo, and OPPO to enhance cooperation in smart devices and AI technology[48] - JD Health debuted new and specialty drugs online, including the first domestic order of Leqembi® for Alzheimer's treatment[48] Future Outlook - The company plans to discuss its financial results for the three and six months ended June 30, 2024, in a conference call on August 15, 2024[9] - The company remains focused on enhancing user experience and price competitiveness to ensure sustainable growth in the future[62]