JD.com returned to profit growth in the second quarter of 2026 even as revenue declined, helped by stronger margins in its core retail business and a sharp reduction in losses from food delivery.
Revenue fell 2.9% year-on-year to RMB 346.4 billion (USD 51.3 billion) for the three months ended June 30, about RMB 10 billion (USD 1.5 billion) less than a year earlier. Even so, net income attributable to ordinary shareholders rose to RMB 7.1 billion (USD 1.1 billion) from RMB 6.2 billion (USD 918.7 million), while non-GAAP net income increased to RMB 8.9 billion (USD 1.3 billion) from RMB 7.4 billion (USD 1.1 billion). On an adjusted basis, JD.com earned about 21% more despite generating less revenue.
The improvement was more pronounced at the operating level. JD.com recorded RMB 4.5 billion (USD 666.8 million) in operating income, reversing a RMB 0.9 billion (USD 133.4 million) loss a year earlier. Its non-GAAP net margin rose to 2.6% from 2.1%, meaning it retained more profit from each yuan of revenue.
The main drag on sales came from electronics and home appliances, JD.com’s largest product category. Revenue from the segment fell 11.8% to RMB 157.9 billion (USD 23.4 billion), roughly RMB 21 billion (USD 3.1 billion) less than a year earlier. The company attributed the decline to a difficult comparison with the same quarter last year, when China’s trade-in subsidies boosted demand, as well as higher costs that raised prices for products including smartphones and PCs.
Other parts of the business performed better. General merchandise revenue grew 5.6%, while service revenue rose 6.8%, supported by marketplace, advertising, and logistics income. The shift in revenue mix also supported profitability, as those services generally carry higher margins than JD.com’s first-party retail business.
Management said electronics and home appliance sales began to improve in June. At JD Retail, gross margin rose to 18.5%, while operating margin edged up to 4.6% from 4.5%. JD.com said this was a record operating margin for a quarter that includes the heavily promotional 618 shopping festival. Management attributed the improvement to supply chain efficiencies and a larger contribution from higher-margin marketplace and marketing services.
Lower spending on newer businesses also helped. Marketing expenses fell by about a quarter from a year earlier to RMB 20.3 billion (USD 3 billion), mainly because JD.com spent less on promotions for new initiatives.
Food delivery was another contributor to the improvement. JD Food Delivery cut its losses by more than half from a year earlier as the company reduced subsidies per order, improved delivery efficiency, and generated more revenue from commissions and advertising. The broader new businesses segment still lost RMB 9.9 billion (USD 1.5 billion) during the quarter, but that was about RMB 5 billion (USD 740.9 million) less than the RMB 14.8 billion (USD 2.2 billion) loss recorded a year earlier.
CEO Sandy Xu described the quarter as a “definitive turning point” for JD.com’s profitability trajectory.
The results also exceeded market expectations. Analysts surveyed by LSEG had expected revenue of RMB 344.6 billion (USD 51.1 billion), according to Reuters, putting JD.com’s reported figure about RMB 1.8 billion (USD 266.7 million) above consensus. Separately, FactSet estimates pointed to non-GAAP net income of RMB 7.8 billion (USD 1.2 billion), meaning JD.com reported roughly RMB 1.1 billion (USD 163 million) more in adjusted profit than analysts had expected.
Management had warned after the first quarter that electronics and home appliances would remain under pressure because of a difficult comparison with last year’s trade-in-driven sales and higher product prices. The subsequent decline in the category was therefore broadly consistent with management’s earlier guidance.
Looking ahead, JD.com expects pressure on retail sales to ease. Management said JD Retail should return to revenue growth in the third quarter as the comparison base becomes less demanding, with electronics and home appliances expected to improve meaningfully in the second half. Higher product prices, however, could continue to weigh on consumer demand.
Food delivery could provide another lift to earnings if its losses continue to narrow. JD.com expects losses from the business to decline through the rest of the year as subsidies fall and efficiency improves. Advertising revenue could also benefit from a recovery in retail sales.
The company is continuing to invest heavily in technology. R&D expenses rose to RMB 7.3 billion (USD 1.1 billion) in the quarter, about 38% more than a year earlier, as JD.com increased spending on artificial intelligence and automation across advertising, customer service, sourcing, and logistics. The higher spending adds to near-term costs, while management is positioning the investments as a way to improve efficiency over time.
Note: RMB figures are converted to USD at rates of RMB 6.75 = USD 1 based on estimates as of August 17, 2026, unless otherwise stated. USD conversions are presented for ease of reference and may not fully match prevailing exchange rates.