JD once again demonstrated its ambition to expand the on-demand retail market.

On September 17th, dada nexus announced in its US stock announcement that jd.com has completed the purchase of 87.4813 million ordinary shares and 1.875 million American depositary shares held by walmart's subsidiary. As a result, jd.com has acquired all the shares held by walmart and its shareholding percentage has increased to 63.2%.

Influenced by this news, Dada Nexus and JD.com soared. As of the close of US stocks on Tuesday, Dada Nexus rose by as much as 22%, while JD.com rose by over 2%.

JD.com increased its shareholding in Dada Nexus.

On September 17th, dada nexus announced in its US stock announcement that jd.com has completed the purchase of 87.4813 million ordinary shares and 1.875 million American depositary shares held by walmart's subsidiary. As a result, jd.com has acquired all the shares held by walmart and its shareholding percentage has increased to 63.2%.

Dada Nexus was founded in 2014 and went public on the US stock market in June 2020. It is a local Chinese on-demand retail and delivery platform. The company has two core businesses: Dada Kuaidi, a local on-demand delivery platform, and JD Daojia, a local on-demand retail platform. As of the end of March this year, JD.com held 53.1% of Dada Nexus shares, while Walmart held 9% shares.

In May of this year, Dada Nexus announced that its business would accelerate full integration into the JD.com ecosystem. Its on-demand retail brands, JD Hour Delivery and JD Daojia, were fully integrated and upgraded into a unified "JD Instant Delivery" brand, which was pushed to the market, continuously improving industry competitiveness and optimizing user experience.

However, the latest financial report data shows that Dada Nexus had a revenue of approximately 2.35 billion yuan in the second quarter of 2024, a decline compared to the same period last year and the first quarter. During the same period, the company's net income was a loss of approximately 0.286 billion yuan. The two main businesses, JD Instant Delivery, had a revenue of 0.912 billion yuan, a year-on-year decrease of 43.6%; Dada Instant Delivery (renamed from Dada Kuaidi since August) had a revenue of 1.338 billion yuan, a year-on-year increase of 46.6%, mainly due to the increase in the volume of same-city delivery services.

Among them, the number of active riders in Dada Now is nearly 1.3 million, with tens of millions of registered riders accumulated. At the same time, the number of dining chain merchants cooperating with Dada Now is increasing. Dada Nexus CFO Mao Jun stated in the second quarter financial report conference call: "In the second quarter, the overall revenue of chain merchants increased by nearly 50% year-on-year, with the net income of dining chain merchants growing by nearly 80%, and the number of new stores more than doubled year-on-year."

Regarding the purpose of increasing shareholding in Dada Nexus this time, internal sources from JD.com told the media that this move demonstrates JD.com's confidence in Dada's long-term stable development, as well as a positive outlook and recognition of Dada's future prospects. It also reflects the importance of Dada's position within JD.com's ecosystem and the expectations for further deepening the strategic partnership between the two.

Focusing on the instant retail market.

In fact, JD.com has long sought to enter the instant retail market.

In 2015, JD.com was one of the investors in Ele.me's Series E financing round, along with China CITIC Bank, Tencent, Dianping, and Sequoia Capital China, with a total financing amount of $350 million (approximately 2.2 billion RMB).

In June 2022, JD.com's then Retail CEO Xing Lijun openly stated that JD.com was considering entering the food delivery business. "As for when to start, it depends on our capabilities and when we can form a talented team." At that time, JD.com's food delivery service chose to pilot in cities like Zhengzhou, with the subsidiary Dada responsible for delivery.

In mid-March 2024, JD.com announced the three must-win battles for 2024: "Content ecosystem, Open ecosystem, Instant retail." In May, it fully upgraded the instant retail business to "JD Instant Delivery," integrating the original JD Express and JD Daojia under a new brand image, providing consumers with shopping experiences like "Enjoying good products instantly," "Fastest delivery in 9 minutes," "Free shipping for 9.9 yuan," etc. All consumer touchpoints on the JD.com app originally known as "Express Delivery" were updated to "Instant Delivery."

Since then, JD.com has begun a comprehensive push into the instant retail business.

In July, JD Express officially announced the signing of former Olympic champion Liu Xiang as the "time witness", highlighting JD Express's pursuit of efficient delivery.

In August, JD Express launched services such as "refund for expensive drugs", "compensation for slow delivery", and "free shipping starting from 0 yuan" in Beijing, achieving efficient delivery with an average of 28 minutes and a minimum of 9 minutes.

In September, JD Express started allowing users to cancel orders during delivery to improve user experience.

According to JD's public data in May, JD Express currently covers over 2,300 counties and cities nationwide, cooperating with over 500,000 stores and covering all categories of goods.

In the second quarter, Non-GAAP net income increased by 69%.

In August of this year, JD Group released its second quarter and mid-year performance for 2024. The brand and merchants achieved quality growth, and JD maintained steady growth in user numbers, shopping frequency, and new merchants. The number of active users and shopping frequency continued to grow at a double-digit rate in the second quarter.

In the second quarter, JD Group's Non-GAAP net income attributable to ordinary shareholders of the listed company reached 14.5 billion yuan (about 2 billion US dollars), a year-on-year increase of 69%; the net profit margin reached 5% for the first time, well exceeding market expectations.

In the second quarter, JD Group's revenue reached 291.4 billion yuan (about 40.1 billion US dollars), and the revenue for the first half of the year reached 551.4 billion yuan (about 75.9 billion US dollars), continuing to grow. In the second quarter, the revenue from logistics and other services reached 34.1 billion yuan, a year-on-year increase of 7.9%. As of the second quarter, JD Logistics' operating profit under non-GAAP has achieved profitability for 5 consecutive quarters, and the operating profit margin under non-GAAP in the second quarter has reached a new high since the listing of JD Logistics.

In terms of stock price, JD.com's Hong Kong stock and US stock have experienced significant pullbacks since mid-May, but recently entered a period of sideways volatility. As of September 16, the year-to-date changes in the two stocks were -5.5% and -6.36% respectively.

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