Jd.com recorded a sales jump in the first quarter. The reason is a costly measure with which the Chinese e-commerce giant tries to establish itself in the country’s highly contested grocery sector. The shopping platform based in Beijing has come under pressure in recent years due to a continuing slump in domestic demand and the tightened competition with its main competitor Alibaba. Investor: Inside, now observing exactly how JD.com will work against the dominant grocery supplier Meituan after the company started its own meal service in February.
Jd.com achieved a net turnover of 301.1 billion yuan ($ 41.8 billion) in the three-month period until March 31, as can be seen from the results published on Tuesday on the Hong Kong. The number corresponds to an increase of 15.8 percent compared to the previous year and thus exceeds the Bloomberg forecast of twelve percent and more than twice the growth of the first quarter of the previous year.
In the first quarter, the net profit was 10.9 billion Yuan, an increase compared to 7.1 billion Yuan in the same period of the previous year. Despite a costly initiative, the profit rose to do without delivery fees for catering businesses this year, which registered before May 1st to win market shares from Meituan and Alibabas Ele.me.
On Tuesday, the company praised the “substantial progress in a very short time” when expansion to the field of grocery deliveries.
JD.com’s advance in the food sector takes place at a time when Beijing online service platforms are increasingly regarded as a useful engine for employment and domestic consumption in view of the broader growth pressure. The harder competition has also aroused concerns about unfair practices. China’s Supreme Market Authority announced on Tuesday evening that she had charged the leading providers of grocery delivery services, including JD.com, Meituan and Ele.me, for discussions in the last few days and asked them to comply with e-commerce laws.
Care for “serious problems in the current competition in the grocery delivery industry”, the state administration for market regulation said that they and several other government agencies had asked the companies to “promote the standardized, healthy and orderly development of the platform economy”.
The Chief Executive Officer (CEO) from JD.com, Sandy Xu, said on Tuesday that the company’s profits were increased by “improving consumer mood and the continuous improvement of the supply chain capacities and the user experience of JD”.
This is in contrast to the official data published at the weekend, which show that the expenses in the second largest economy in the world continue to remain in a doldrum.
On Monday, China and the United States announced a clear – albeit temporary – reduction in the mutual import tole after discussions in Geneva, which aimed at defusing their trade war.
This article was used with digital tools translated.
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