JD.com (JD) Q2 Earnings Shock: Revenue Jumps 22.4% While Profits Tank—Growth at What Cost?

JD.com's latest earnings drop a bombshell: sales skyrocket while margins get crushed. Here's the breakdown.

Revenue on Fire, Profits in Freefall

The Chinese e-commerce giant posted a blistering 22.4% revenue surge—but bottom-line numbers tell a darker story. Heavy investments in logistics and tech are eating profits alive.

Wall Street's Growth Addiction

Another quarter of 'growth over profits' theater—because nothing pleases analysts more than a company burning cash to hit arbitrary top-line targets. The market rewards the revenue pop while ignoring the profit plunge. Classic.

Can JD balance its spending spree with shareholder expectations? Or is this just another tech giant buying growth at unsustainable costs? The numbers don't lie—but the narrative might.

TLDR

• JD.com Grows Revenue 22%, But Profit Sinks Amid Bold Expansion Push
• Retail Booms, Margins Bust: JD.com Invests Big in Growth Verticals
• JD Retail Shines, Yet Heavy Spending Slashes Overall Profits
• Strong Sales, Weak Margins: JD’s Logistics & Food Bets Take Toll
• JD.com’s Q2: Big Gains in Retail, But Costs Eat Into Bottom Line

JD.com opened lower today, trading at $31.93, down 1.78%.

JD.com, Inc. (JD)

The company posted its unaudited Q2 2025 financial results, highlighting a 22.4% year-over-year revenue increase. However, profit margins fell due to intensified investment in strategic growth initiatives and rising operational expenses.

Strong Retail Performance but Pressure on Profitability

JD.com reported net revenues of RMB356.7 billion ($49.8 billion) for Q2 2025, driven by a 20.7% rise in product revenues. JD Retail contributed RMB310.1 billion ($43.3 billion), showing 20.6% growth and an improved 4.5% operating margin. This growth stemmed from user activity and performance during the JD 618 Grand Promotion.

JD Retail’s operational income ROSE to RMB13.9 billion ($1.9 billion), up from RMB10.1 billion in the same quarter last year. The segment maintained strong momentum while introducing product innovations and expanding JD MALL locations across key cities. Despite higher retail profits, total company income from operations turned negative at RMB0.9 billion.

While JD Retail saw healthy margins, overall company profitability dipped due to strategic funding of new verticals. JD.com’s diluted net income per ADS dropped to RMB4.15 ($0.58), down from RMB8.19 year-over-year. Non-GAAP diluted net income per ADS also fell to RMB4.97 ($0.69), a sharp drop from RMB9.36 in Q2 2024.

Aggressive Investments in New Business Units

The company increased its marketing expenses by 127.6%, reaching RMB27.0 billion ($3.8 billion) in Q2. This surge reflected the push behind new initiatives such as JD Food Delivery and related platform expansions. Fulfillment expenses rose 28.6% to RMB22.1 billion, reflecting infrastructure upgrades and logistics scaling.

JD Food Delivery showed growth with 25 million daily orders during the JD 618 event, supported by over 150,000 full-time riders. The platform now works with over 1.5 million merchants, aligning with JD.com’s broader supply chain and retail units. In July, JD launched 7Fresh Kitchen to enhance its food delivery capabilities through custom menu collaborations.

The company’s non-GAAP EBITDA dropped to RMB3.0 billion ($0.4 billion), down from RMB13.5 billion, and the margin fell to 0.8%. JD.com continues to prioritize user experience and technology-driven efficiency, but these initiatives are reducing near-term profitability. The expansion of services and business units has increased pressure on overall operating margins.

Global Logistics Network Expansion and Share Repurchases

JD Logistics scaled its global presence with new overseas warehouses across the US, UK, France, Poland, and several Asian countries. The division now operates more than 130 international warehouses with over 1.3 million square meters in total area. In June, JD Logistics launched “JoyExpress” in Saudi Arabia, extending its last-mile delivery services there.

JD.com deployed the AI-powered “Zhilang” warehousing system in cities like Beijing and Chengdu, boosting fulfillment speeds and storage density. The technology integrates robotic automation to improve efficiency in high-SKU environments. These logistics investments reflect JD’s goal of becoming a global supply chain leader.

Under its $5.0 billion share repurchase program initiated in August 2024, JD.com repurchased $1.5 billion in shares in H1 2025. The repurchases covered 2.8% of total outstanding shares as of December 2024. JD.com plans to continue the program through August 2027, with $3.5 billion still available.

While JD.com’s Q2 revenue grew strongly, rising costs and strategic investments weighed on bottom-line performance. The company remains focused on long-term growth through ecosystem expansion and supply chain innovation.