China e-commerce giant JD.com on Thursday reported fourth-quarter that came in above analyst expectations, coming at a time when China stocks have been beaten down due to regulations, continued pandemic problems and a slowing economy. JD stock plunged.
The China internet giant reported adjusted earnings of 35 cents a share on revenue of $43.3 billion. Analysts expected JD to report earnings of 24 cents a share on revenue of $43.3 billion.
Earnings jumped 52% from the year-ago period, reversing two straight quarters of declines. Revenue climbed 26%, JD's second straight quarter of revenue acceleration. It ended the year with 569.7 million active annual customers, up 29% from the prior year.
JD stock plummeted 15.8%, closing at 52.52 on the stock market today.
Alibaba Group, JD's main competitor in the China e-commerce market, reported fourth-quarter results on Feb. 24 that missed expectations. Revenue grew 10%, its slowest quarterly growth rate for the company since its 2014 initial public offering.
Alibaba blamed sluggish consumer spending and increasing competition for the slow revenue growth. Alibaba stock is down 58% over the past 12 months.
JD Stock: Will Earnings Report Turn The Tide?
The JD earnings report comes as China stocks have been hammered since late 2020. That's largely due to extensive crackdowns by Chinese government regulators. Slower consumer spending has also taken a toll. In addition, China has experienced flare-ups of Covid infections.
The regulations have targeted specific sectors such as e-commerce platforms, financial technology, social media and online education.
And last week, China set a target for slower economic growth of around 5.5% this year, compared with growth of 8.1% last year, Reuters reported. Headwinds for JD stock include an uncertain global recovery.
