On March 10, jd.nasdaq (9618. HK) released the fourth quarter and full year results of 2021.
According to the financial report, JD achieved a revenue of 275.9 billion yuan in the fourth quarter of 2021, a year-on-year increase of 23%. In 2021, JD realized a revenue of 951.6 billion yuan, a year-on-year increase of 27.6%.
JD’s operating loss in the fourth quarter was 392 million yuan, with an operating profit of 1.0% and 0.5% in the same period last year. JD’s annual operating profit was 4.1 billion yuan, with an operating profit margin of 1.4% and 2.1% in 2020, further maintaining a low profit margin.
In terms of the number of annual active users, JD maintained a rapid rise, from 471.9 million in 2020 to 569.7 million, an increase of 20.7%.
Jingdong US stocks showed a downward trend before trading. As of press time, the stock market of zhonggai fell generally, including Alibaba and pinduoduo.
In fact, since the beginning of the year, JD’s share price has been relatively resistant to decline, with a total decline of 9.43%. In contrast, Alibaba and pinduo’s share prices have fallen by 15.45% and 25.72% respectively since the beginning of many years.
JD’s performance supports its fall resistance to a certain extent. From the performance figures, we can also see the future trend of JD.
revenue growth is considerable
According to the financial report, JD achieved a revenue of 275.9 billion yuan in the fourth quarter of 2021, a year-on-year increase of 23%. Among them, the revenue from goods and services increased by 22.1% and 28.3% respectively year-on-year.
In the whole year, JD realized a revenue of 951.6 billion yuan, an increase of 27.6% over the previous year. Among them, the growth rate of commodity income and service income over the previous year reached 25.1% and 44.7% respectively.
In contrast, Alibaba, which recently announced its financial results, had a revenue growth rate of only 10% in the third quarter ended December 31, 2021.
The high growth rate of JD’s revenue is inseparable from its rapidly growing service revenue. In fact, JD’s service revenue has exceeded the growth rate of total revenue, accounting for more than 14%, higher than the same period last year.
Specifically, in the fourth quarter, the revenue of JD platform and advertising services reached 22.239 billion yuan, a year-on-year increase of 27.21%; Jingdong Logistics and other service revenue reached 18.994 billion yuan, a year-on-year increase of 29.67%. The service revenue of the above two parts in the whole year was 72.118 billion yuan and 63.819 billion yuan respectively, an increase of 34.87% and 57.77% respectively.
In addition to service income, the composition of JD commodity income is also continuously optimized.
In the fourth quarter, Jingdong achieved 140932 billion yuan in revenue from electronic products and household appliances, a year-on-year increase of 21.68%; The revenue of daily necessities reached 93.743 billion yuan, a year-on-year increase of 22.73%; In the whole year, the revenue of Jingdong electronic products, household appliances and daily necessities was 492592 billion yuan and 323063 billion yuan respectively, with a year-on-year increase of 22.86% and 28.73% respectively. Whether in a single quarter or the whole year, the revenue of Jingdong daily necessities accounted for nearly 40%, maintaining a high level.
In the view of Xu Lei, President of JD group, JD group’s growth rate stems from JD’s open ecology and supply chain ability, which brings operational efficiency improvement and sustained high-quality growth to partners, and creates unique value. “Looking forward to the future, we will always focus on creating value for users and partners to build our long-term business development strategy and investment layout.”
maintain low profit margin operation
JD’s net loss attributable to common shareholders in the fourth quarter was 5.2 billion yuan, and its net profit in the same period last year was 24.3 billion yuan. The net profit attributable to common shareholders under non GAAP was 3.6 billion yuan, compared with 2.4 billion yuan in the same period last year.
For the whole year of 2021, JD’s net loss attributable to ordinary shareholders was 3.6 billion yuan, its net profit in 2020 was 49.4 billion yuan, and its net profit attributable to ordinary shareholders under non GAAP was 17.2 billion yuan and 16.8 billion yuan in 2020.
One of the reasons why JD turned from profit to loss in the fourth quarter was the investment loss. BOE said that in the fourth quarter of 2021, the investment loss calculated by the equity method was 4.3 billion yuan and the annual loss was 4.9 billion yuan. In contrast, JD made a profit of 1.7 billion yuan and 4.3 billion yuan in the fourth quarter and the whole year of 2020.
In terms of operation, JD’s operating loss in the fourth quarter was 392 million yuan, its operating profit in the same period last year was 595 million yuan, and its operating profit under non GAAP was 2.8 billion yuan, compared with 1.2 billion yuan in the same period last year. In 2021, JD’s operating profit was 4.1 billion yuan, compared with 12.3 billion yuan in the previous year. The operating profit of JD under non GAAP was 13.4 billion yuan, compared with 15.3 billion yuan in the previous year.
As a new entity enterprise, JD still maintains low profit margin operation. In the fourth quarter, JD retail’s operating profit margin was 2.1%, 1.9% in the same period last year, 3.1% in the whole year and 3.0% in the previous year. Overall, JD’s profit margin in the fourth quarter increased to 1.0% from 0.5% in the same period last year, and the annual profit margin fell to 1.4% from 2.1% in 2020.
BOE said that in the past three years, JD has invested more than 2 trillion yuan in the real economy, such as commodity procurement, infrastructure, technology research and development, logistics performance, employee compensation and welfare, brand business support and so on.
As of December 31, 2021, JD logistics has operated more than 1300 warehouses and added 400 warehouses a year. The total storage area, including the cloud warehouse area managed by JD logistics, has exceeded 24 million square meters. By the end of 2021, JD logistics had more than 300000 front-line employees. In addition, since the all-round technology transformation in early 2017, JD system has invested nearly 80 billion yuan in technology.
Omni channel Gmv increased by 80% year on year
With a large amount of investment in infrastructure and digital technology innovation, JD is also continuously improving its ability, helping partners improve operational efficiency and accelerate capital turnover.
In the fourth quarter of 2021, on the basis of nearly 10 million self operated SKU commodities, JD further reduced the inventory turnover days to 30.3 days, accelerating by 8 days in the past three years; The turnover days of accounts payable further decreased to 45.3 days, which has been shortened by nearly 15 days in the past three years.
At the same time, JD is also expanding its omni-channel layout, so as to apply its technology, supply chain, digital operation and other capabilities to Wuxi Online Offline Communication Information Technology Co.Ltd(300959) diversified scenarios. In 2021, JD’s omni-channel Gmv increased by nearly 80% year-on-year.
At present, Jingdong has laid out tens of thousands of offline stores, including Jingdong Mall, Jingdong electric appliance super experience store, Jingdong home appliance store, Jingdong computer digital store, Jingdong home, Jingdong pharmacy, Qixian supermarket, Jingdong convenience store, Jingdong jingche club, etc.
In order to improve a more convenient and efficient real-time consumption experience, JD and dada further deepened their omni-channel cooperation in 2021 and helped partners, especially offline businesses, continuously optimize costs, efficiency and experience through model innovation.
Also under the investment of many parties, the number of Jingdong third-party merchants has also ushered in rapid growth. In the fourth quarter of 2021, the number of new third-party merchants in JD retail exceeded the sum of the first three quarters. In 2021, JD’s new product release scale increased by more than 150% year-on-year, and the new product turnover of more than 25000 brands doubled year-on-year. In the past five years, the types of goods sold by jd.com have expanded by 83% and the number of new brands has increased by 40%.
“In the uncertain environment, jd.com helps its partners better resist the impact of external factors, improve business efficiency and reduce operating costs, so as to achieve business certainty and stability. Therefore, the recognition of different types of partners to jd.com is constantly improving,” Xu Lei pointed out at the performance exchange meeting after the release of the financial report, “We believe that the number of partners will continue to grow healthily in the future.”
The omni channel strategy and the construction of third-party business platform ecology have brought new imagination space for the growth of JD’s active users. As of December 31, 2021, the number of active purchase users in the past 12 months was about 570 million, with a net increase of nearly 100 million in one year. “We think the ceiling of our user growth is still high, and we are confident that our active users will maintain healthy growth in the next few years.” Xu Lei stressed.
At the same time, the growth point of JD’s active users is also reflected in JD’s Omni channel strategy and third-party merchant platform ecology. “It will make our sources of users more diverse, and the platform ecology of our cooperation with merchant brands and Wuxi Online Offline Communication Information Technology Co.Ltd(300959) business ecology will also actively promote the growth of new users.” Xu Lei pointed out.
