JD.com unveils US$3b share buyback

JD.com (9618) reported better-than-expected fourth-quarter earnings and announced a share buyback plan of up to US$3 billion (HK$23.4 billion), with a dividend of 38 US cents per share.

The e-commerce giant said its quarterly revenue rose 3.6 percent to 306.1 billion yuan (HK$340 billion) from a year ago, compared with analysts' average estimate of 300.04 billion yuan, according to LSEG data.

The company's net profit grew by 12 percent to nearly 3.4 billion yuan for the fourth quarter from a year earlier. Its adjusted profit, which is a popular measure for tech firms, increased 9.9 percent to 8.4 billion yuan, also beating expectations.

For the full year, JD.com saw its net profit surge 133 percent to 24.2 billion yuan from the previous year. Revenue in 2023 climbed 3.7 percent to 1.08 trillion yuan.

JD.com said it will repurchase up to US$3 billion worth of its shares, including American depository shares, over the next 36 months through March 2027.

The company's US-listed shares jumped over 11 percent in the pre-market trading.

In the final three months of 2023, in which the largest annual Chinese shopping festival "Singles Day" was held, aggressive price cuts helped revive demand from consumers grappling with an uncertain economy.

China's shaky economic growth, high youth unemployment, and lower wages for office workers have led to consumers tightening their purse strings, driving retailers like JD.com to offer heavy discounts to support sales.

Sandy Xu Ran, chief executive of JD.com, said the firm's focus on user experience, price competitiveness, and platform ecosystem drives its growth.

Some analysts believe JD.com's popularity among cost-conscious buyers has grown over the quarter.

Analysts also said the "suspicious practices" that emerged in an internal audit of its Dada Nexus unit are unlikely to have had a sizeable impact on the company's overall revenue, abating investor concerns.

Meanwhile, its logistics unit JD Logistics (2618) swung to a profit of 616 million yuan last year, compared with a loss of 1.4 billion yuan a year ago.

Revenue for the period jumped 21.3 percent to 166.6 billion yuan.