T. H. Data Flash – JD.com, Inc. – August & 3Q19E: Investment In New Initiatives Led To Better Performance In 3Q19
We are positive on JD’s 3Q19 performance. Based on our data and calculations, we believe JD’s net revenue is likely to reach RMB129.2B in 3Q19E, up 23.3% Y/Y vs. 22.9% in 2Q19, better than consensus at RMB127.9B (22.1% Y/Y growth). In the 1H2019, the company accomplished 2.5% non-GAAP net margin, and it plans to invest more back into new business initiatives such as a new version of Pingou on WeChat, lower tier city expansion and category expansion. The current expectation for JD’s 2H2019 net income has already reflected that, in our opinion.