【行业研究报告】京东-Better-than-feared 3Q results

16Nov2023
CMBInternationalGlobalMarkets|EquityResearch|CompanyUpdate
JD.com(JDUS)
Better-than-feared3Qresults
JD.com(JD)reported(15Nov)better-than-feared3Q23results:revenuewas
RMB247.7bn,up1.7%YoY,0.7/0.5%higherthanourforecast/Bloomberg
consensus.Non-GAAPnetincomewasRMB10.6bn,aheadofour/consensus
estimatesofRMB8.8/9.2bn,thankstobetter-than-fearedmarginperformance
ofJDRetail(JDR)business,inourview,demonstratingJD’sabilitytoretainthe
walletshareofitscoreconsumerbaseinaneffectiveway,andtranslatinginto
anon-GAAPNPMof4.3%(3Q22:4.1%).Managementhighlighteddouble-digit
orderandusergrowthduringtheDouble11shoppingfestival,notedthat
businessadjustmentimpactwilllargelywearoffin2024,andguidedtoachieve
abetter-than-Chinaretailsalesgrowthperformancein2024.WeliftourDCF-
basedTPby2%toUS$57.5(wasUS$56.5)tofactorinthebetter-than-expected
3Qresultsandbetter2024outlook.MaintainBUY.
BusinessadjustmentimpactonGMRgrowthgraduallywearingoff.
JD’snetproductrevenuewasRMB195.3bnin3Q23(79%oftotalrevenue),
JD’snetproductrevenuewasRMB195.3bnin3Q23(79%oftotalrevenue),
down0.9%YoY(3Q22:+5.9%),amongwhichelectronicsandhome
appliance(E&HA)revenuewasflatYoY(3Q22:+7.6%),duetoseasonality
andahighbasefromlastyear,andgeneralmerchandiserevenue(GMR)
wasdown2.3%YoY(3Q22:+3.5%)duetobusinesstransition.However,
theYoYdeclineinGMRhasseenanarrowingtrendonQoQbasis,from-
9%YoYinboth1Q/2Q23,asthebusinessadjustmentimpactisgradually
wearingoff.
Solidadvertisingrevenuegrowth.In3Q23,netservicesrevenuewas
RMB52.4bn(21%oftotalrevenue),up12.7%YoY,amongwhich
marketplaceandadsrevenuegrew3.0%YoY(3Q22:13.0%;2Q23:8.5%),
andlogisticsandotherserviceswasup19.3%YoY.Management
highlightedthatadvertisingrevenuehasseendouble-digitgrowthduring
3Q23,whilethedeclineincommissionrevenue,owingtoJD’sproactive
movetoprovidepreferentialcommissionratepoliciestomerchants,
weighedonoverallsegmentrevenuegrowth.
JDR:deliveredbetter-than-fearedOPMamidfierceindustry
competition.JDRinkedrevenueofRMB212.1bnin3Q23,flatYoYandwas
0.7%aheadofourforecast,whileOPMofJDRwas5.2%in3Q23,flatYoY,
andwasboth0.6pptaheadofourforecastandconsensusestimates.JD
announcedthatMs.SandyXU,CEOofJDwillconcurrentlyserveasCEO
ofJDR,aimingtodriveforbetteroperatingefficiencyimprovementandfor
morebusinesssynergiesacrossbusinessgroups.
Marginvolatilitymayexistinthenearterm.GPMforJDwas15.6%for
3Q23,up0.7pptYoY.OperatinglossofnewbusinesswasRMB140mnin
3Q23,improvingfromalossofRMB953mnin3Q22(excludinggainon
salesofdevelopmentproperties).WeexpectJD’sNPMtoexperiencesome
short-termfluctuationsuntilnewstrategybecomeseffectiveincombating
competitionandcreatingoperationalleverage.WeforecastJD’snon-GAAP
NPMtobe2.5%in4Q23E(4Q22:2.6%),and3.2%in2023E(2022:2.7%).