JD.com returns to the black

Chinese e-commerce firm JD.com (9618) swung to a net profit of 10.4 billion yuan (HK$11.72 billion) last year from a loss of 3.6 billion yuan in 2021 and proposed a 31 US cents (HK$2.418) dividend.

Adjusted net income jumped 64 percent year-on-year to 28.2 billion yuan as revenue rose 9.9 percent to above 1 trillion yuan for the first time at 1.05 trillion yuan. Gross merchandise value increased by 5.6 percent and net service revenues soared by 33.3 percent.

Sales of its retail business grew 7.3 percent to 929.93 billion yuan and that of JD Logistics (2618) surged by 31.2 percent to 137.4 billion yuan.

The logistics segment narrowed its net loss by 91 percent to 1.4 billion yuan in 2022. Adjusted net profit was 866 million yuan, compared to an adjusted loss of 1.23 billion yuan.

The group's fourth-quarter net profit was 3 billion yuan, compared to a 2.9 billion yuan estimate and a net loss of 5.2 billion yuan a year ago. Adjusted net profit more than doubled to 7.7 billion, also beating estimates.

Quarterly sales, however, only rose 7 percent to 295.4 billion yuan, slightly below the 295.5 billion yuan average of analysts' projections.

"Looking ahead, amidst ever-evolving opportunities and challenges we will stay focused on lowering costs, increasing efficiency, and constantly improving user experience," chief executive Xu Lei said in a statement.

Bloomberg Intelligence analyst Catherine Lim and Trini Tan said JD.com's plan to offer 10 billion yuan worth of subsidies to shoppers on its platforms could lift average spending per active user and attract new customers this year. They said this may help the firm meet consensus expectations for an acceleration in revenue growth to 15 percent in 2023 versus about 10 percent the prior year.

JD's shares slid more than 5.5 percent in pre-market trading in New York.