JD.com (NASDAQ:JD) beat top and bottom line expectations in the second quarter, but posted its slowest year-on-year revenue growth on record, becoming the latest victim of a COVID-induced economic slowdown in China.
But the company got a boost from better profitability in its main retail business and logistics division, helped by the annual “618” shopping festival that takes place in China in June.
Revenue came in at 267.6 billion Chinese yuan ($40 billion U.S.) vs 262.3 billion yuan expected, a 5.4% year-on-year rise.
Net profit registered at 4.4 billion Chinese yuan vs. 1.36 billion yuan profit expected.
During the April to June quarter, China saw a resurgence of Covid-19 that led to lockdowns of major cities across the country, including the financial powerhouse of Shanghai, as authorities tried to contain the worst outbreak of the virus since the initial spread in 2020.
China’s economy grew just 0.4% year-on-year in the second quarter. Investment banks have cut their full-year growth outlooks for the world’s second-largest economy.
JD.com is not the only Chinese technology company suffering a fallout from the economic slowdown. This month, e-commerce rival Alibaba reported flat June quarter revenue for the first time while gaming and social media giant Tencent reported its first revenue decline on record.
JD shares opened Tuesday lower by 78 cents, or 1.4%, to $54.54.
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