citic securities·2026-03-06 13:02Investment Rating - The report assigns a positive investment rating to JD Health, indicating strong performance and growth potential [4]. Core Insights - JD Health's performance in the second half of 2025 significantly exceeded expectations, with revenue growing by 28% year-on-year to 38.2 billion yuan and adjusted EBITDA increasing by 88% to 1.9 billion yuan [4]. - The company is expected to maintain revenue momentum into 2026, primarily driven by prescription drugs, with adjusted net profit growth projected to remain in the low single digits due to increased investments in O2O, offline pharmacies, and AI [4]. Summary by Sections Revenue Growth - Direct sales revenue increased by 28% year-on-year to 38.2 billion yuan in the second half of 2025, with pharmaceutical sales growing by 30% and nutritional products by 20% [5]. - The number of active users rose to 218 million, a 19% increase year-on-year, representing about 30% of JD's active buyers [5]. Platform and Advertising Revenue - Revenue from platforms, digital marketing, and other services grew by 34% year-on-year to 6.6 billion yuan, driven by increased digital marketing service fees and a rise in the number of advertisers [6]. Profitability - Adjusted EBITDA surged by 88% year-on-year, with a profit margin increase of 1.6 percentage points to 5% due to operational optimization and advertising growth [7]. - Adjusted net profit grew by 38% year-on-year, with a profit margin of 7.7%, reflecting a 0.6 percentage point increase [7]. Catalysts - Support from JD Group's traffic and revenue sharing from advertising, along with favorable policies in the internet and healthcare sectors, are seen as key catalysts for growth [8].