On August 14, JD.com released its second-quarter 2025 results. Quarterly net revenue was RMB 356.7 billion, up 22.4% year over year—the fastest quarterly growth in nearly three years. Net income attributable to shareholders was RMB 6.2 billion; on a non-GAAP basis, net income attributable to shareholders was RMB 7.4 billion. Management said the core retail business remained solid, and new initiatives including food delivery boosted user scale and purchase frequency, though the investment phase is pressuring margins.

Results at a Glance: Strong Top Line, a Trade-off of Lower Profit

Second-quarter revenue rose from RMB 291.4 billion a year ago to RMB 356.7 billion, driven by both merchandise revenue and service revenue, which grew about 20.7% and 29.1% year over year, respectively. As investment in new businesses expanded, operating income turned to a small loss on a GAAP basis; on a non-GAAP basis, operating income was about RMB 0.9 billion, indicating a modest positive operating leverage despite heavier spending. Diluted net income per ADS was RMB 4.15, and RMB 4.97 on a non-GAAP basis.

Business Breakdown: Retail as the Ballast, Logistics Expands Steadily, Food Delivery Fuels New-Business Surge

Retail. JD Retail generated revenue of RMB 310.1 billion in Q2, up 20.6% year over year; operating profit reached RMB 13.9 billion with a 4.5% operating margin, up 0.6 percentage point from a year earlier. Management noted retail gross margin has improved year over year for 13 consecutive quarters. Electronics and home appliances led growth, while general merchandise maintained double-digit expansion—reflecting supply-chain efficiency and improved campaign mix during the 618 shopping festival.

Logistics. JD Logistics recorded Q2 revenue of RMB 51.56 billion, up 16.6% year over year. On a first-half basis, revenue totaled RMB 98.53 billion (+14.1%). Integrated supply-chain customer revenue was RMB 50.1 billion in 1H (+19.9%), with the Q2 growth rate reaching 26.3%. The company also launched its self-operated courier brand “JoyExpress” in Saudi Arabia as it continues to expand overseas.

New businesses (including food delivery and local services). Q2 revenue from new businesses reached RMB 13.85 billion, up 198.8% year over year, but operating loss widened to RMB 14.78 billion, implying an operating margin of about −106.7%. During the 618 campaign, peak daily food-delivery orders exceeded 25 million; more than 1.5 million quality merchants joined the platform; and the fleet of full-time couriers surpassed 150,000. New businesses showed strong top-line momentum and cross-business synergy with retail and logistics, while subsidies and user acquisition remained the main sources of margin pressure.

Expenses and cash flow. Q2 marketing expenses were RMB 27.0 billion (+127.6% YoY), and fulfillment expenses were RMB 22.1 billion (+28.6% YoY). The temporary elevation in the expense mix is closely tied to subsidies in new businesses. The company emphasized it will pace its new-business investments to avoid disorderly subsidies.

(Image: JD.com 2Q25 earnings)

Market Reaction and Outlook

On the first Hong Kong trading day after the release, JD.com (9618.HK) opened lower and weakened, falling about 3% intraday. The move broadened alongside the Hang Seng Index, suggesting investors are pricing “revenue up, profit not up.” The core concern is that food delivery and other new businesses may require sustained investment, compressing margins: the adjusted net margin fell from 5.0% to 2.1% in Q2, while the operating loss of new businesses (including food delivery) was about RMB 14.78 billion. Investors worry that subsidies and user-acquisition spending may continue to weigh on profit recovery in the second half.

Key watch-items ahead: first, the unit-economics improvement path in food delivery—whether higher order density and fulfillment efficiency reduce subsidy intensity at the margin, which would directly influence valuation; second, whether retail margins can extend the 618-driven uplift and whether platform advertising and third-party services can sustain high growth to underpin the share price; third, the execution of capital-allocation and localization moves, such as buybacks and the integration of Hong Kong offline retail (the company has completed the acquisition of “Jiabao” and announced in-store promotions). If these bring both cash-flow and brand-mindshare reinforcement, they could offset the near-term profit drag from food-delivery investments.

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