The company released FY2Q24 results, and profits exceeded expectations. 24Q2 achieved revenue of 291.4 billion yuan (yoy +1%); non-GAAP net profit of 14.46 billion yuan (yoy +69.0%), exceeding Bloomberg's agreed expectations.
Product revenue: The company achieved commodity revenue of 233.91 billion yuan (yoy +0.0%) in 24Q2. Charging was pressured by the high base during the same period, and large supermarkets drove steady daily growth. 1) Charged category: 24Q2 achieved revenue of 145.06 billion yuan (yoy -4.6%). Affected by the high base for the same period last year, revenue growth was under pressure. Hot weather in the same period last year boosted sales of summer categories such as air conditioners, compounded by demand for decoration, and the electrified category had a high base during the same period. 2) Daily 100:24Q2 achieved revenue of 88.85 billion yuan (yoy +8.7%), with the supermarket category maintaining a strong growth trend.
Service revenue: The company achieved service revenue of 57.49 billion yuan (yoy +6.3%) in 24Q2. 1) Platform and advertising service revenue: 24Q2 achieved revenue of 23.43 billion yuan (yoy +4.1%). 2) Logistics and other revenue: 24Q2 achieved revenue of 34.06 billion yuan (yoy +7.9%).
Segment profit: 1) JD retail: achieved revenue of 257.07 billion yuan (yoy +1.5%) and operating profit of 10.11 billion yuan (profit margin 3.9%, yoy+0.72pct). Q2 JD has signed strategic cooperation agreements with brands such as Xiaomi, Lenovo, and OPPO to deepen strategic cooperation in various areas such as smart products, intelligent supply chains, and AI technology integration. 2) JD Logistics: Achieved revenue of 44.21 billion yuan (yoy +7.7%) and operating profit of 2.18 billion yuan (profit margin 4.9%, yoy+3.7pct). Q2 JD Logistics continues to optimize its network layout, algorithm-based vehicle scheduling capabilities, and product structure to reduce costs and increase efficiency, and improve profit levels.
24Q2 Group's gross margin increased, and profitability improved. 24Q2's gross margin was 15.8% (yoy+1.4pct). Thanks to supply chain capacity and disciplined investment, the Group's gross margin optimization helped quarterly non-GAAP operating profit/non-GAAP net profit reach record highs, reaching 11.6 billion yuan (profit margin 4.0%, yoy+0.97pct) /14.46 billion yuan (profit margin 5.0%, yoy+1.99pct), respectively. Fulfillment/sales/R&D/management expenses were 5.9%/4.1%/1.5%/0.7%, respectively, and +0.12/+0.23/+0.03/-0.09pct, respectively.
According to the latest results announcement, we adjusted our profit forecast to forecast revenue of 1141/1204.2/1279.8 billion yuan for 24-26 (original 24-26 forecast was 1157.4/1222.5/1299.5 billion yuan), and adjusted net profit to mother was 39.2/42.2/44 billion yuan (original 24-26 forecast was 35.9/37.7/40.2 billion yuan). Referring to comparable companies, maintain JD's retail business at 11xPE in 2024. The segmental valuation calculated that the company's market value was 390.4 billion yuan, corresponding to a share price of HK$133.8 (RMB to HKD exchange rate of 1.09), maintaining a “buy” rating.
Risk warning: Industry competition is intensifying, new business incubation falls short of expectations, and industry regulations are getting stricter