(Reuters) -China’s JD.com topped market estimates for quarterly revenue on Thursday, as the e-commerce giant benefited from steady consumer spending on its platform thanks to government subsidies and lower prices.
U.S.-listed shares of the company rose nearly 5% in premarket trading.
Chinese retail majors including JD.com and Alibaba are using heavy discounts and price cuts to lure shoppers who are keeping a tight leash on their spending due to worries over job and income security.
JD.com, which is the top retailer of home appliances in China, has also benefited from government-backed trade-in policies that allow consumers to exchange older appliances for newer ones.
The company saw strong growth in both user base and customer shopping frequency in the July-September quarter, helping it hit a milestone of 700 million annual active customers in October, Chief Executive Sandy Xu said in a statement.
JD.com’s investments in new business segments are also showing signs of paying off. The company reported steady growth in order volume in its food delivery unit, where it competes with market leaders Meituan and Alibaba’s Ele.me – which was rebranded earlier this month to Taobao Shangou.
The improved performance in the division, which JD launched earlier this year, also helped the company narrow its investment in the business sequentially.
The company reported a 14.9% rise in total revenue to 299.1 billion yuan ($41.99 billion) in the third quarter ended September 30, compared with analysts’ average estimate of 294.05 billion yuan, according to data compiled by LSEG.
Quarterly net income attributable to JD.com’s ordinary shareholders fell to 5.3 billion yuan from 11.7 billion yuan a year earlier, as the company pours money into global expansion and promotional offers for Chinese consumers.
($1 = 7.1230 Chinese yuan renminbi)
(Reporting by Deborah Sophia in Bengaluru and Sophie Yu in Beijing; Editing by Anil D’Silva and Maju Samuel)
