How does Jingdong avoid weaknesses with this double-edged sword in the new crown epidemic？
How does Jingdong avoid weaknesses with this double-edged sword in the new crown epidemic?
Thanks to the advantages of self-operated logistics, JD.com ‘s performance in the first quarter of this year broke through the test of the new crown epidemic.On May 15, Jingdong Group released the first quarter results for the year, and the financial report showed that the company achieved revenue of US $ 146.2 billion and increased by 20.7%; under US accounting standards, the net profit attributable to ordinary shareholders is US $ 1.1 billion (approximately US $ 200 million), which is 85% from the US $ 7.3 billion in the same period last year.Under the impact of the Xinguan epidemic, most of the company’s business has been damaged, but JD’s self-managed logistics has ensured that the operation of e-commerce business has not been interrupted to a certain extent, thus becoming one of the few companies that can maintain growth.Huang Xuande, CFO of JD Group, said, “JD.com’s business model drove steady growth in revenue and profits in the first quarter and exceeded our expectations.”Under the epidemic, JD.com’s business is not completely undisturbed-except for the return of compliance fees to more than 7%, JD.com’s free cash flow turned from positive to negative in the first quarter, and the growth rate of net service income also fell to a new low threshold.JD.com stated that in order to support its partners in resisting the epidemic, JD.com’s cash flow crisis of pre-paid supplementary payments to merchants going out-reflected in the financial report, in the first quarter the company should respond to 51 days of account turnover.7 days, decrease by 5 every year.7 days.Under the epidemic, users have greatly increased, and JD Health has attracted much attention. In this quarterly report, the biggest bright spot of JD.com was that the number of active users increased by more than 25 million in a single quarter.As of March 31, JD.com had 3 active users in the past 12 months.87.4 billion, an increase of 24 compared with the same period last year.8%, this growth rate is 18.5% higher than the previous quarter.6% continued to pick up.Last year, JD.com ‘s social e-commerce platform “Jingxi” was regarded as an important piece of the company ‘s attracting new users. However, affected by the epidemic, Jingxi ‘s performance in the first quarter was not as expected.Xu Lei, CEO of JD Retail, said in the earnings conference call that the company’s overall user growth is very good, especially the increase in old users and sleepy users, but Jingxi is in February and March because of the double impact of the Spring Festival and the epidemic.Gradually the company expected.But Xu Lei, the user growth of Jingxi, has been contagious and has returned to normal levels before the Spring Festival, so some foreign trade factories have turned to domestic sales, and the slow sales of agricultural products have allowed the company to see many opportunities.”If we look at the user’s delivery address, our third- to sixth-line users account for more than 60%, and GMV accounts for more than half.”He attributed the company’s recent recovery of user growth to the newly established user growth department, which is the first-level department of JD Retail. It unifies the assets and related responsibilities of all users of the company and uses an algorithm toConvert and operate users.In addition, Xu Lei has not disclosed that JD.com plans to transform its No. 1 store into a No. 1 member store at the end of the second quarter and the beginning of the third quarter of this year, and launch a membership service for selected products for mid-to-high-end people in the high-end market.He believes that in China’s online retail market, JD.com is the e-commerce platform with the highest proportion of mid-to-high-end people and home users, and it has an advantage in the operation of this group.In addition to user growth, JD’s health business is the most popular area for investors.JD Health’s business was formally and independently operated in May last year and became the third unicorn company after JD Logistics and JD.com. After completing the A round of financing last November, JD Health’s valuation has reached US $ 7 billion.The data disclosed by JD Chuang Huang Xuande shows that in the first quarter, JD Health ‘s active user growth reached three digits, net operating income increased by 65%, and revenue has exceeded China ‘s largest offline pharmacy.Xu Lei said that in addition to the conventional drug supply chain and e-commerce business, JD.com’s health care services have also done a good job, and the number of remote consultations on the Internet has achieved explosive growth during the epidemic.According to the data revealed by JD.com in its financial report, since its launch in late January to April 30, JD.com ‘s free online consultation service has accumulated more than 11 million users.Revenues from technical services have fallen to new lows, and free cash flow is rarely negative. Although domestic users ‘e-commerce consumption has increased significantly during the epidemic, not all categories, such as home appliances and fashion, will sell well.JD.com’s 3C digital products and home appliance categories have always been the main sales force. The first quarter report shows that the growth rate above it is only 9.8%, significantly lower than the company’s overall growth rate.However, under the influence of the epidemic, the selling of daily necessities and fresh products replaced this deficiency.In the first quarter, JD.com ‘s net income from general merchandise sales reached US $ 52.5 billion, a 38% increase.2%.Jing Xuan CFO Huang Xuande said that in the first quarter, Jingdong supermarket business group revenue increased by 47%, and revenue in the past year was 150 billion yuan, nearly 20% higher than China’s largest offline supermarket chain.In addition, due to the epidemic situation, JD.com’s performance cost in the first quarter increased significantly, an increase of 29% over the same period of the previous year. The performance cost accounted for 7% of the company’s revenue.1%, compared with 6 in the fourth quarter of last year.4% has a significant increase.The earliest is that JD.com’s technical service revenue, which has maintained a high growth rate in recent years, fell to only 29 in the first quarter of this year.6%, well below the level in 2019.Judging from the data disclosed in the financial report, the revenue growth rate of Jingdong logistics and advertising business caused a rapid decline, which affected the performance of technical service revenue.Xu Lei said on the conference call that the performance of the advertising business in the first quarter was in line with the company’s expectations. He pointed out that although most of the advertisers of JD.com are SMEs, from an absolute amount perspective, the company’s advertising business is still dominated by large and medium-sized enterprisesDuring the epidemic, JD.com was still the most important place for advertisement placement for medium and large advertisers and businesses.”Through the recovery of the epidemic, the advertising activity of SME advertisers is increasing, but the biggest difference this year is that their requirements for ROI will be higher.”Because of proactive support to suppliers during the epidemic, JD.com ‘s free cash flow in the first quarter was negative 3 billion US dollars. Huang Xuande said that cash flow can currently meet the company ‘s bottom line, and it is expected to gradually increase profits. The company ‘s cash flowWill be further improved.The financial report shows that JD.com replaced 51 accounts payable turnover days in the first quarter.7 days, decrease by 5 every year.7 days, which means that JD.com ‘s payment time to suppliers has been shortened.Xu Lei revealed that because of the epidemic situation, this year’s “6.18” promotion is the highest level of business participation in 17 years, he said that “6.18” promotion is the home of Jingdong, the company has a natural advantage to occupy consumersMind.In previous years, due to the relationship between “6.18” and Double Eleven, the second quarter and the fourth quarter were the peak sales seasons in the e-commerce industry.Between 1800ppm and 1950ppm, an annual increase of 20% to 30%.JD.com said in its financial report that the forecast is that the new crown epidemic will not cause significant disruption to the company’s business for the remainder of the second quarter.Frequent capital market second-level listings are subject to official announcements. In addition to performance, JD.com ‘s recent actions in the capital market are frequent. In addition to Dada Group ‘s official IPO in the United States, the company also announced in a quarterly report that its subsidiary JD.Financing agreement, financing 2.USD 300 million, led by GGV Jiyuan Capital, Sequoia Capital China Fund, CPE and other diversified institutions.JD.com said that JD.com is committed to achieving the connection of the upstream and downstream of the industrial manufacturing industry chain through technology, and providing procurement platforms and supply chain solutions for corporate customers.In addition, Jingdong said that in January of this year, Jingdong Logistics Real Estate Group and the Singapore government investment company GIC jointly established a second logistics real estate fund with a total asset size of 4.6 billion US dollars. It is expected that the second half of this year will receive most of the proceeds of the transaction.Last year, Jingdong Logistics Real Estate Group and GIC cooperated for the first time to set up a logistics real estate fund, with a total asset scale of 10.9 billion US dollars. Last year, it brought 7.9 billion yuan in revenue to Jingdong.JD.com reopened any secondary listings in the financial report and conference call. Recently, there have been reports that the conversion of JD.com has been listed and listed on the Hong Kong Stock Exchange for six months. At that time, JD.com will be the second company to go to Hong Kong for the second time after AliListed Internet companies.In recent years, JD’s sustainability has continued to pick up. After the release of the first quarter report this year, the company’s breakthrough has hit a record high, which proves that the capital market recognizes its business model.Sauna, Night Net Editor Lu Caifu Yue Caizhou proofreading He Yan