JD.com (JD) Misses Q4 EPS by 36c

JD.com (NASDAQ: JD) reported Q4 EPS of $0.08, $0.36 worse than the analyst estimate of $0.44. Revenue for the quarter came in at $82.46 million versus the consensus estimate of $166.72 million.

Fourth Quarter and Full Year 2019 Highlights

• Net revenues for the fourth quarter of 2019 were RMB170.7 billion (US$124.5 billion), an increase of 26.6% from the fourth quarter of 2018. Net service revenues for the fourth quarter of 2019 were RMB21.0 billion (US$3.0 billion), an increase of 43.6% from the fourth quarter of 2018. Net revenues for the full year of 2019 were RMB576.9 billion (US$82.9 billion), an increase of 24.9% from the full year of 2018. Net service revenues for the full year of 2019 were RMB66.2 billion (US$9.5 billion), an increase of 44.1% from the full year of 2018.
• Income from operations for the fourth quarter of 2019 was RMB529.5 million (US$76.1 million), compared to loss from operations of RMB938.9 million for the same period last year. Non-GAAP2 income from operations for the fourth quarter of 2019 was RMB704.0 million (US$101.1 million), compared to RMB313.0 million for the fourth quarter of 2018. Income from operations for the full year of 2019 was RMB9.0 billion (US$1.3 billion), compared to loss from operations of RMB2.6 billion for the same period last year. Non-GAAP income from operations for full year of 2019 increased by 364% to RMB8.9 billion (US$1.3 billion) with a non-GAAP operating margin of 1.5%, as compared to RMB1.9 billion for the full year of 2018 with a non-GAAP operating margin of 0.4%.
• Net income attributable to ordinary shareholders for the fourth quarter of 2019 was RMB3.6 billion (US$0.5 billion), compared to a net loss attributable to ordinary shareholders of RMB4.8 billion for the same period last year. Non-GAAP net income attributable to ordinary shareholders for the fourth quarter of 2019 was RMB810.7 million (US$116.5 million), compared to RMB749.9 million for the same period last year. Net income attributable to ordinary shareholders for the full year of 2019 was RMB12.2 billion (US$1.8 billion), compared to a net loss attributable to ordinary shareholders of RMB2.5 billion for the full year of 2018. Non-GAAP net income attributable to ordinary shareholders for the full year of 2019 increased by 211% to RMB10.7 billion (US$1.5 billion), compared to RMB3.5 billion for the full year of 2018.
• Diluted net income per ADS for the fourth quarter of 2019 was RMB2.44 (US$0.35), compared to diluted net loss per ADS of RMB3.32 for the fourth quarter of 2018. Non-GAAP diluted net income per ADS for the fourth quarter of 2019 was RMB0.54 (US$0.08), compared to RMB0.51 for the same quarter last year. Diluted net income per ADS for the full year of 2019 was RMB8.21 (US$1.18), compared to diluted net loss per ADS of RMB1.73 for the full year of 2018. Non-GAAP diluted net income per ADS for the full year of 2019 was RMB7.25 (US$1.04), as compared to RMB2.35 for the full year of 2018.
• Operating cash flow for the full year of 2019 increased to RMB24.8 billion (US$3.6 billion) from RMB20.9 billion for the full year of 2018. Free cash flow, which excludes the impact from JD Baitiao receivables included in the operating cash flow, for the full year of 2019 increased to inflow of RMB19.5 billion (US$2.8 billion), compared to outflow of RMB7.9 billion for the full year of 2018.
• Annual active customer accounts3 increased by 18.6% to 362.0 million in 2019 from 305.3 million in 2018. Mobile monthly active users4 in December 2019 increased by 41% as compared to December 2018.

“We achieved robust top-line growth for the fourth quarter as Chinese consumers increasingly associate the JD brand with trust and reliability,” said Richard Liu, Chairman and Chief Executive Officer of JD.com. “We also saw strong customer growth, especially in China’s lower-tier cities, driven by innovative marketing, superior product selection and better customer service.”

Richard Liu continued, “Since late January, we’ve spared no effort in the fight against COVID-19 in China. Our leading supply chain and logistics network have been called upon to address unmet needs across China. We’ve been ensuring consumers’ livelihoods while partnering with public institutions to ensure access to emergency supplies. In Hubei, the epicenter of the outbreak, we have been providing medical supplies and facilitating relief organizations to maintain continuous supply to hospitals, in addition to rolling out a suite of innovations across our business to help the country. All of us at JD will continue working around the clock to help Chinese consumers, merchants and communities get through this challenging time.”

“We are pleased to conclude 2019 with another strong set of results in the fourth quarter,” said Sidney Huang, Chief Financial Officer of JD.com. “The year 2019 sets a new milestone in our corporate history with record earnings and excellent cash flow on an annual basis as our continued investments in infrastructure and technology began to yield solid financial results. Our vertically integrated ecommerce model, resilient self-built logistics network and high level of consumer trust allow us to continue serving consumers effectively now and in the long term.”

For earnings history and earnings-related data on JD.com (JD) click here.

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