Latest news with #JD.comInc
Malaysian Reserve
11 hours ago
- Business
- Malaysian Reserve
JD.com billionaire's viral stunt reignites China's food-delivery feud
ONE unusually warm evening in April, Richard Liu revved his scooter through Beijing's traffic-snarled streets alongside other delivery workers, and then personally handed food orders to surprised customers. Later that night, over spicy hotpot and ice-cold beer, the Inc. founder welcomed a pair of riders from two rival delivery firms to his company. The publicity stunt, broadcast on viral online videos, reignited a fight for China's $80 billion-plus food delivery market. In just a few months, JD, China's largest online retailer by revenue, amassed 25 million daily takeout orders across 350 cities, capturing more than half the volume of Alibaba Group Holding Ltd.'s the runner-up to market leader Meituan. Neither saw Liu coming. confirmed that the viral photo posted by a Beijing user showing that the rider who delivered his food was the company's founder and Chairman Richard Liu was genuine. The Chinese e-commerce platform recently forayed into food delivery service and started a… — Yicai 第一财经 (@yicaichina) April 22, 2025 China's food delivery industry has been in an effective duopoly after brutal price wars forced out many smaller players almost a decade ago. Takeout became more expensive even as merchants and riders complained about making less. Liu is now turning to an old playbook: charging restaurants no commission, generous hiring bonuses for 100,000 new full-time riders, plus a 10 billion yuan ($1.4 billion) discounting campaign for consumers. During its flagship shopping festival this month, JD sold coffee and bubble tea for as cheap as 1.68 yuan. The food delivery war is indicative of the bifurcation in China's mammoth tech industry. On the one hand, players like DeepSeek are spurring major tech firms to invest in innovations like generative AI. On the other, the effects of Beijing's yearslong Covid lockdowns and regulatory campaigns against Big Tech still linger, and many companies are desperately searching for sources of growth in a saturated market. Liu's marketing stunt is also personal. The viral videos of him waiting to pick up boxed lunches and downing beers with other riders mark a surprise return to the public eye for the 52-year-old tech mogul, who faded from the spotlight in 2018 when he was arrested in the US on suspicion of rape, though prosecutors in Minneapolis ultimately declined to press charges. During Beijing's crackdown on the tech sector in 2022, Liu joined a long list of tech founders who stepped down. His departure coincided with some of JD's toughest times since its founding as a tiny electronics outlet in 1998. Its premium online shopping service ran into China's slowing economy, its own bargain app flopped, and an overseas foray was abandoned. That left JD with no growth story, as giants Alibaba and Tencent Holdings Ltd. bet big on generative AI and smaller rivals such as Meituan and Didi Global Inc. exported their gig-economy models abroad. Even Meituan has begun selling and delivering everything from iPhones to washing machines in a few hours. 'For JD, it's a lost five years, to put it bluntly,' Liu said during a rare news conference at the company's Beijing headquarters Tuesday. 'No innovation, no growth, no progress. It should be considered the most unremarkable and least valuable five years in my entrepreneurial history.' Explaining their rationale of getting into food delivery, Liu said that it's about leveraging JD's battle-tested logistics network to acquire new users, 40% of whom have already been converted into e-commerce customers. 'Our losses are smaller than what we would have spent on advertising,' he said. Not everyone is convinced. JD's takeout business could generate as much as 18 billion yuan in annualized losses, wiping out 36% of its parent's operating profit for 2025, says JPMorgan Chase & Co.. Arete Research estimates that as the market leader, Meituan will only need to spend about a quarter of JD's costs to defend its position. JD's loss per order will narrow to 3 yuan in the second half of 2025 from 8 yuan this quarter as it pares back subsidies to confront the economic reality, the equity research house predicts. 'We do not think JD will find material success in local services like insta-commerce, but understand management's sense of urgency in needing to diversify its business mix and feeling threatened by Meituan,' Arete analysts Shawn Yang and Richard Kramer wrote in a note in June. Representatives for JD, Alibaba, and Meituan didn't respond to requests for comment for this story. What's clear is that JD has injected new life into a long-dormant market. hardest hit by JD's offensive, gave out 10 billion yuan in subsidies to customers, then another 1 billion yuan to restaurants. Alibaba also integrated the takeout app into its flagship e-commerce platform Taobao in the hope of diverting more traffic to it. Meituan for the first time ever is giving away vouchers on things like smartphones and liquor during the June 18 sales event that JD invented more than a decade ago. Its founder Wang Xing declared to investors in May that it would do 'whatever measure it takes to win the game.' The renewed food-delivery battle is reminiscent of the all-out war in online shopping just years ago, when alleged abuses like forcing merchants into exclusive arrangements helped fuel Beijing's Big Tech crackdown, wiping out trillions in wealth. Though pressure has eased, government scrutiny remains heightened as high youth unemployment drives more and more people to take up gig work. Regulators in May summoned executives from the three takeout firms into meetings on fair competition and protection of riders, among other topics. By 2024, China had more than 10 million delivery riders, official data showed. In Beijing, there were 17,000 riders in the first half of 2024, up 50% from a year ago. And amid growing awareness of how riders often prioritize speed over safety to earn more, said in April that it would gradually phase out a cash penalty system for riders who miss their deadlines. JD is going further in worker benefits by paying social security — a government-sponsored welfare system including pensions and medical insurance — for all of its full-time riders. Meituan and followed suit with similar policies. JD has won over riders like Jiang Xiaoxi, a migrant worker in Shenzhen who joined Meituan before Covid but quit last year to take care of her sick grandfather in her hometown in Hunan province. When the 25-year-old returned to Shenzhen this year, she picked JD instead for regular eight-hour shifts and persuaded her peers to jump ship. 'I signed a contract on day one,' she said. 'Having social security as a full-time employee gives me a sense of belonging.' Others are wary of such promises, with memories of the past delivery price-war still fresh. Tang Zequan, 36, recalls how in 2016 he could make more than 10 yuan per order as a new driver for Meituan in Guangzhou. After Meituan emerged dominant, his earnings went down to 7 yuan per order. As a high-school dropout, he acknowledges that no other job could have helped him pay off debts so quickly after his real estate brokerage business went under during Beijing's crackdown on the property market. 'I have great gratitude for the food delivery industry, but I won't pay allegiance to any firm,' Tang said. 'Without choices we are left with a monopoly.' –BLOOMBERG
Business Times
15 hours ago
- Business
- Business Times
JD.com billionaire's viral stunt reignites China's food-delivery feud
ONE unusually warm evening in April, Richard Liu revved his scooter through Beijing's traffic-snarled streets alongside other delivery workers, and then personally handed food orders to surprised customers. Later that night, over spicy hotpot and ice-cold beer, the Inc. founder welcomed a pair of riders from two rival delivery firms to his company. The publicity stunt, broadcast on viral online videos, reignited a fight for China's US$80 billion-plus food delivery market. In just a few months, JD, China's largest online retailer by revenue, amassed 25 million daily takeout orders across 350 cities, capturing more than half the volume of Alibaba Group Holding's the runner-up to market leader Meituan. Neither saw Liu coming. China's food delivery industry has been in an effective duopoly after brutal price wars forced out many smaller players almost a decade ago. Takeout became more expensive even as merchants and riders complained about making less. Liu is now turning to an old playbook: charging restaurants no commission, generous hiring bonuses for 100,000 new full-time riders, plus a 10 billion yuan (S$1.8 billion) discounting campaign for consumers. During its flagship shopping festival this month, JD sold coffee and bubble tea for as cheap as 1.68 yuan. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up The food delivery war is indicative of the bifurcation in China's mammoth tech industry. On the one hand, players like DeepSeek are spurring major tech firms to invest in innovations like generative AI. On the other, the effects of Beijing's years-long Covid lockdowns and regulatory campaigns against Big Tech still linger, and many companies are desperately searching for sources of growth in a saturated market. Liu's marketing stunt is also personal. The viral videos of him waiting to pick up boxed lunches and downing beers with other riders mark a surprise return to the public eye for the 52-year-old tech mogul, who faded from the spotlight in 2018 when he was arrested in the US on suspicion of rape, though prosecutors in Minneapolis ultimately declined to press charges. During Beijing's crackdown on the tech sector in 2022, Liu joined a long list of tech founders who stepped down. His departure coincided with some of JD's toughest times since its founding as a tiny electronics outlet in 1998. Its premium online shopping service ran into China's slowing economy, its own bargain app flopped, and an overseas foray was abandoned. That left JD with no growth story, as giants Alibaba and Tencent Holdings bet big on generative AI and smaller rivals such as Meituan and Didi Global exported their gig-economy models abroad. Even Meituan has begun selling and delivering everything from iPhones to washing machines in a few hours. 'For JD, it's a lost five years, to put it bluntly,' Liu said during a rare news conference at the company's Beijing headquarters Tuesday. 'No innovation, no growth, no progress. It should be considered the most unremarkable and least valuable five years in my entrepreneurial history.' Explaining their rationale of getting into food delivery, Liu said that it's about leveraging JD's battle-tested logistics network to acquire new users, 40 per cent of whom have already been converted into e-commerce customers. 'Our losses are smaller than what we would have spent on advertising,' he said. Not everyone is convinced. JD's takeout business could generate as much as 18 billion yuan in annualised losses, wiping out 36 per cent of its parent's operating profit for 2025, says JPMorgan Chase & Co. Arete Research estimates that as the market leader, Meituan will only need to spend about a quarter of JD's costs to defend its position. JD's loss per order will narrow to 3 yuan in the second half of 2025 from 8 yuan this quarter as it pares back subsidies to confront the economic reality, the equity research house predicts. 'We do not think JD will find material success in local services like insta-commerce, but understand management's sense of urgency in needing to diversify its business mix and feeling threatened by Meituan,' Arete analysts Shawn Yang and Richard Kramer wrote in a note in June. Representatives for JD, Alibaba, and Meituan didn't respond to requests for comment for this story. What's clear is that JD has injected new life into a long-dormant market. hardest hit by JD's offensive, gave out 10 billion yuan in subsidies to customers, then another 1 billion yuan to restaurants. Alibaba also integrated the takeout app into its flagship e-commerce platform Taobao in the hope of diverting more traffic to it. Meituan for the first time ever is giving away vouchers on things like smartphones and liquor during the June 18 sales event that JD invented more than a decade ago. Its founder Wang Xing declared to investors in May that it would do 'whatever measure it takes to win the game.' The renewed food-delivery battle is reminiscent of the all-out war in online shopping just years ago, when alleged abuses like forcing merchants into exclusive arrangements helped fuel Beijing's Big Tech crackdown, wiping out trillions in wealth. Though pressure has eased, government scrutiny remains heightened as high youth unemployment drives more and more people to take up gig work. Regulators in May summoned executives from the three takeout firms into meetings on fair competition and protection of riders, among other topics. By 2024, China had more than 10 million delivery riders, official data showed. In Beijing, there were 17,000 riders in the first half of 2024, up 50 per cent from a year ago. And amid growing awareness of how riders often prioritise speed over safety to earn more, said in April that it would gradually phase out a cash penalty system for riders who miss their deadlines. JD is going further in worker benefits by paying social security - a government-sponsored welfare system including pensions and medical insurance - for all of its full-time riders. Meituan and followed suit with similar policies. JD has won over riders like Jiang Xiaoxi, a migrant worker in Shenzhen who joined Meituan before Covid but quit last year to take care of her sick grandfather in her hometown in Hunan province. When the 25-year-old returned to Shenzhen this year, she picked JD instead for regular eight-hour shifts and persuaded her peers to jump ship. 'I signed a contract on day one,' she said. 'Having social security as a full-time employee gives me a sense of belonging.' Others are wary of such promises, with memories of the past delivery price-war still fresh. Tang Zequan, 36, recalls how in 2016 he could make more than 10 yuan per order as a new driver for Meituan in Guangzhou. After Meituan emerged dominant, his earnings went down to 7 yuan per order. As a high-school dropout, he acknowledges that no other job could have helped him pay off debts so quickly after his real estate brokerage business went under during Beijing's crackdown on the property market. 'I have great gratitude for the food delivery industry, but I won't pay allegiance to any firm,' Tang said. 'Without choices we are left with a monopoly.' BLOOMBERG
Bloomberg
14-05-2025
- Business
- Bloomberg
Why US-Listed Chinese Stocks Risk Expulsion in Trump's Trade War
Tariffs aren't the only battleground to keep an eye on in the trade war between the US and China. Access to Wall Street could be used as a lever in the negotiations, leaving almost 300 Chinese companies listed in the US at risk of being removed from American stock exchanges. That includes e-commerce giants Alibaba Group Holding Ltd. and Inc. While the two countries reached a temporary tariff truce in May, drastically lowering their taxes on each other's exports for 90 days, a final trade deal that resolves their differences could take longer to hash out. In the meantime, a re-escalation of tensions isn't out of the realm of possibility.
Yahoo
14-05-2025
- Business
- Yahoo
JD.com Inc (JD) Q1 2025 Earnings Call Highlights: Strong Revenue Growth and Strategic Investments
Total Revenue Growth: Up 16% year on year to RMB301 billion in Q1 2025. Non-GAAP Net Profit: Increased by 43% year on year to RMB13 billion. Net Margin: Expanded by 82 basis points to 4.2%. Gross Margin: Improved by 60 basis points to 15.9%. Electronics and Home Appliances Revenue Growth: Up 17% year on year. General Merchandise Revenue Growth: Up 15% year on year. Service Revenues Growth: Accelerated to 14% year on year. Marketplace and Marketing Revenues: Increased by 16% year on year. JD Retail Non-GAAP Operating Income: Up 38% year on year to RMB13 billion. JD Logistics Revenue Growth: Up 11% year on year. New Business Revenue Growth: Positive growth of 18% year on year. Free Cash Flow: RMB38 billion as of the end of Q1 2025. Cash and Cash Equivalents: Totaled RMB203 billion at the end of Q1 2025. Warning! GuruFocus has detected 2 Warning Sign with JD. Release Date: May 13, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Inc (NASDAQ:JD) reported a 16% year-on-year increase in total revenues for Q1 2025, showcasing robust growth across all major categories. The company achieved a 43% year-on-year increase in non-GAAP net profit, with net margin expanding to 4.2%, driven by improvements in gross margin. Inc (NASDAQ:JD) saw double-digit growth in its quarterly active customer numbers, with increased shopping frequency and notable acceleration. The company's food delivery business is rapidly growing, with daily order volumes nearing 20 million, indicating strong market demand and potential synergies with JD's core retail operations. Inc (NASDAQ:JD) is actively leveraging AI and automation technologies to enhance operational efficiency, improve user experience, and drive long-term growth across its ecosystem. Despite the positive growth, Inc (NASDAQ:JD) faces challenges in maintaining its momentum in the highly competitive food delivery market, which requires significant investment and operational enhancements. The company's new business segment reported a widened non-GAAP operating loss of RMB1.3 billion, primarily due to investments in expanding its presence in lower-tier markets. Inc (NASDAQ:JD) is still in the early stages of optimizing its food delivery operations, with ongoing system enhancements needed to improve user experience and operational efficiency. The company's free cash flow decreased to RMB38 billion from RMB61 billion in the same period last year, primarily due to cash outflows associated with the trading program and efforts to secure product supplies. Inc (NASDAQ:JD) faces pressure to balance short-term financial targets with long-term strategic investments, particularly in its food delivery and AI initiatives. Q: What is strategy for the food delivery business in the medium term, and how does it fit into the overall business ecosystem? A: Sandy Xu, CEO, explained that food delivery is a natural extension of its core retail business, aiming to provide diverse shopping experiences. The food delivery business is integrated into JD's ecosystem, creating synergies in user engagement, supply chain, and fulfillment. The focus is on enhancing user and merchant experience, scaling the business, and achieving investment ROI. aims to leverage its brand strength and logistics capabilities to address market demands effectively. Q: How has achieved growth in the general merchandise and fashion categories, and what are the plans to sustain this momentum? A: Sandy Xu, CEO, highlighted that has seen double-digit growth in general merchandise, with supermarkets and fashion categories accelerating. The company has focused on enhancing operational capabilities and user experience. For fashion, plans to expand brand selection and leverage supply chain advantages. In supermarkets, aims to utilize its efficient business model and supply chain to meet diverse user needs, driving sustainable growth. Q: Can you provide insights into AI adoption and its impact on advertising and other business segments? A: Sean Zhang, Director of Investor Relations, stated that is actively integrating AI across its operations to enhance efficiency and user experience. AI is being used to improve demand-supply matching, optimize advertising algorithms, and enhance fulfillment processes. The company is developing AI-powered tools for merchants and leveraging AI in logistics to reduce costs and improve productivity. Q: What are the key metrics and financial impacts of food delivery business? A: Sean Zhang, Director of Investor Relations, noted that food delivery business has seen rapid growth in order volume and user engagement. The company is focusing on building fundamental capabilities and enhancing user experience. While still in the early stages, the business is expected to generate synergies with JD's core retail operations, driving incremental growth and efficiency improvements. Q: How does plan to enhance shareholder returns, and what are the recent updates on share buybacks and dividends? A: Sandy Xu, CEO, reported that has repurchased approximately 80.7 million ordinary shares in 2025, representing 2.8% of outstanding shares. The company also completed a $1.44 billion dividend payout. remains committed to returning value to shareholders through dividends and buybacks while focusing on long-term growth in business scale, profitability, and cash flow. For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus. Sign in to access your portfolio
Bloomberg
22-04-2025
- Business
- Bloomberg
JD.com, Meituan Shares Plunge as Delivery Competition Heats Up
Shares of Meituan and Inc. tumbled as competition heated up in the Chinese food delivery space. fell as much as 8.1% in Hong Kong on Tuesday, while Meituan shares slumped 7.1% to their lowest in about 7 months. Both stocks were among the worst performers on the Hang Seng Tech Index.
