By Deborah Mary Sophia and Sophie Yu
March 5 (Reuters) – China’s JD.com missed market estimates for quarterly earnings on Thursday as tougher competition and government-subsidized profits hurt demand at the e-commerce giant.
Consumer demand in China has been weakened in recent years by a lingering slump in the property sector, employment concerns and geopolitical tensions, weighing on growth in the world’s second-largest economy.
This has hurt retailers such as JD.com, China’s largest seller of home appliances, as customers cut back on discretionary purchases.
While JD.com has benefited from government subsidies in recent quarters, the growing impact is becoming more severe year over year.
The company has also relied on other product categories and new revenue streams such as its instant retail business and advertising unit to increase sales.
“Our growth drivers are becoming more diversified, with the general merchandise category maintaining healthy growth, while service revenue, including advertising, will maintain a faster growth rate,” JD.com CEO Sandy Su said during a conference call with analysts on Thursday.
The electronics and home appliances category is expected to remain under pressure due to a higher base in the first quarter, but growth may accelerate in the second half and exceed the first, she told analysts during a quarterly call.
Investment in the food delivery business will decrease in 2026 compared to 2025, Zhou said.
Shares of the U.S.-listed company fell about 2% in early trading.
JD.com also faces competition from e-commerce rivals such as Alibaba and PDD Holdings as they ramp up discounts on China-focused platforms. Heavy investment in promotions and price cuts weakened profit margins.
Revenue rose 1.5% to 352.3 billion yuan ($51.12 billion) in the fourth quarter ended December, below the average estimate of 353.86 billion yuan, according to data compiled by LSEG.
JD.com’s net loss attributable to ordinary shareholders was 2.7 billion yuan for the quarter, compared with a profit of 9.9 billion yuan last year.
($1 = 6.8918 Chinese Yuan)
(Reporting by Deborah Sophia in Bengaluru and Sophie Yu in Beijing; Editing by Himani Sarkar, Maju Samuel and Nivedita Bhattacharjee)
