JD-SW(9618.HK)2Q26 RESULTS REVIEW：RETAIL EARNINGS RESILIENCE STANDS OUT AND THE GROUP‘S PROFIT INFLECTION POINT EMERGES WITH REVENUE EXPECTED TO RETURN TO POSITIVE GROWTH IN 3Q

机构：中信建投证券
研究员：YU Botao

Key takeaway
2Q 26 JD generated revenue of RMB346.4bn, down 2.9% YoY, and generated Non-GAAP net profit of RMB8.9bn, up 20.7% YoY, corresponding to an adjusted net margin of 2.6%. The Company's revenue growth still faces temporary headwinds, but profit improved substantially, marking a clear earnings inflection point. In the core business, general merchandise and service revenue maintained steady growth. However, revenue from electronics and home appliances declined due to the high base in the same period last year, dragging retail revenue down 4.7% YoY, while high-margin service revenue, including platform advertising, continued to grow rapidly. The retail business's operating margin reached 4.6%, a record high for a major promotional season, demonstrating strong operating resilience. New businesses substantially reduced losses following strategic adjustments, while the unit economics of the food delivery business continued to improve. Looking ahead to the second half of the year, revenue is expected to return to positive growth in 3Q, while the profit recovery trend is expected to continue.
Event
On August 13, 2026, JD released its results report for the second quarter and first half of 2026. In 2Q26, JD generated revenue of RMB346.401bn, down 2.90% YoY, and Non-GAAP net profit attributable to shareholders of the parent company of RMB8.930bn, up 20.80% YoY, corresponding to a net margin of 2.58%. Both revenue and profit exceeded Bloomberg consensus estimates, while the Group's profitability improved significantly.
Quick Take
Retail business under pressure, but profitability remains resilient. In 2Q26, JD Retail recorded revenue of RMB295.383bn, down 4.70% YoY, mainly due to the high base created by government subsidies for home appliances in 2Q25. Category sales showed a clear recovery in June, and retail revenue is expected to return to positive growth in 3Q26. By category, revenue from electronics and home appliances decreased by 11.8% YoY, while emerging categories such as AI-powered smart home appliances and AI PCs maintained strong momentum. Revenue from general merchandise increased by 5.6% YoY, with essential consumer categories remaining stable. The revenue mix continued to improve. Product revenue was RMB267.115bn, down 5.4% YoY, while service revenue was RMB79.286bn, up 6.8% YoY. Within service revenue, platform and advertising service revenue increased by 8.3% YoY, while logistics and other service revenue rose by 5.9% YoY, furthe r increasing the contribution from high-margin services. Profitability remained strong. JD Retail posted operating profit of RMB13.5bn in 2Q26, with its operating margin rising by 0.1 pct YoY to 4.6%, a record high for the 6.18 shopping festival. Gross margin increased YoY for the 17th consecutive quarter.
Logistics segment maintains rapid growth as supply chain value continues to be unlocked. In 2Q26, JD LOGISTICS recorded revenue of RMB64.102bn, up 24.3% YoY. Operating profit increased by 15.6% YoY to RMB2.263bn, with an operating margin of 3.5%. Both integrated supply chain customers and external ad hoc customers recorded growth. External revenue continued to expand following the integration of the on-demand delivery business. More than 1,000 autonomous delivery vehicles are now in regular operation across over 20 provinces in China, and autonomous nighttime delivery routes have been launched, leaving ample room for long-term improvements in last-mile fulfillment efficiency.
New businesses substantially narrow losses YoY as food delivery unit economics continue to improve. In 2Q26, revenue from JD’s new businesses was RMB7.260bn, down 47.6% YoY. Operating loss narrowed substantially to RMB9.854bn from RMB14.777bn in the same period of 2025, demonstrating a clear path toward loss reduction. By business segment, food delivery was the primary driver of loss reduction. Unit economics per order improved significantly in 2Q26, while industry-wide subsidies declined overall. The company continued to reduce marketing spending through refined operations, while commissions, advertising, and other diversified revenue streams provided additional support. In 3Q26, food delivery will enter its peak consumption season, and losses per order are expected to narrow further alongside healthy order volume growth. International operations and Jingxi continued to make strategic investments at a controlled pace. Joybuy’s European operations launched a summer Black Friday campaign, leveraging its 211 delivery service and integrated delivery and installation services to boost home appliance sales. Strategic investments are progressing as planned. Overall losses from new businesses narrowed significantly, and their drag on the group's profit continued to ease. Earnings forecast and valuation: The company's revenue is expected to reach RMB1,346.3bn and RMB1,474.0bn in 2026 and 2027, respectively, up 2.84% and 9.49% YoY, while non-GAAP net profit is expected to reach RMB31.619bn and RMB42.954bn, respectively, up 16.97% and 35.85% YoY. The “Buy” rating is maintained, with a target price of HKD148.26, implying 12x PE based on 2026 earnings.
Risks: Higher-than-expected investment in new businesses such as overseas expansion, intensified competition in the food delivery industry, and slower-than-expected loss reduction may weigh on the company's profit performance; weakness in the core retail business in the second half of the year may result in slower-than-expected growth; the trade-in policy may bring forward future demand, while the subsequent recovery in organic demand may fall short of expectations; weak macroeconomic conditions and retail sales growth; a larger-than-expected decline in market share; pressure on the profit margin of the core e-commerce business and limited scope for future cost reductions and efficiency improvements; regulatory risks in the internet/e-commerce industry; slower-than-expected interest rate cuts by the Federal Reserve; greater-thanexpected depreciation of the RMB; uncertainty over China-US relations and the risk of delisting for US-listed Chinese companies; and other overseas risk factors affecting the overall performance of Chinese internet stocks.