(Bloomberg) -- JD.com Inc.’s revenue accelerated in the second quarter after its signature 6.18 festival scored with shoppers, helping the company defy worsening Chinese economic volatility.
China’s No. 2 online retailer reported a 7.6% rise in revenue to 287.9 billion yuan ($39.5 billion) in the June quarter, versus the 279.1 billion yuan average of analysts’ estimates. Net income climbed 50% to 6.6 billion yuan.
The report was the first under new Chief Executive Officer Sandy Xu, who took the helm in June and now shoulders the task of reviving one of China’s largest and highest-profile public companies. JD’s results, which followed better-than-anticipated numbers from larger rival Alibaba Group Holding Ltd., suggest online commerce held up during the key summer shopping season despite a patchy Chinese economy.
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JD’s performance remains a far cry from the double-digit percentage expansions of previous years, before Beijing’s 2021 clampdown on internet spheres from online commerce to ride-hailing chilled a once-free-wheeling tech sector. Alibaba and its smaller rival are struggling to regain momentum after years of punishing Covid Zero restrictions gutted the world’s No. 2 economy. JD itself is coming off its worst-ever quarterly revenue performance, for the January to March period.
The company is now spending on incentives to ward off intensifying competition from upstarts such as PDD Holdings Inc. and ByteDance Ltd. It launched a 10 billion yuan discount campaign to capture new Chinese users in March even as it pulled away from Southeast Asian e-commerce, closing its Indonesian and Thailand e-commerce sites to try and shave costs elsewhere.
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China’s largest tech companies, including Alibaba and Tencent Holdings Ltd., have rallied since May in anticipation of a gradual return to consistent double-digit growth. Investors are hoping Beijing, driven by a need to rejuvenate the nation, will allow tech leaders like Alibaba and JD to again pursue aggressive growth initiatives after almost two years of stasis.
JD avoided the worst of that years-long crackdown that hit Alibaba hard. In May, Xu said JD is pivoting toward offering consumers wider price ranges and product categories, diversifying from its traditional focus on bigger-ticket items such as smartphones, in an adjustment to more frugal post-pandemic shoppers.
--With assistance from Mayumi Negishi.
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