On August 13, JD.com released its second-quarter 2026 results, revealing a striking structural contrast: earnings beat market expectations while revenue posted a periodic decline. The company achieved total revenue of 346.4 billion yuan in the quarter, down 2.9% year-on-year, marking the first revenue decline since its listing. Operating profit swung from a 900 million yuan loss in the same period last year to a 4.5 billion yuan gain, while non-GAAP net profit attributable to shareholders reached 8.9 billion yuan, up 20% year-on-year, signaling a notable restoration in earnings quality.
During the earnings call, management defined this quarter as a "clear inflection point" in the group's profitability trajectory, while candidly acknowledging that revenue growth is encountering temporary disruptions, with demand in core categories such as home appliances and digital products under pressure. On one side, cost optimization and efficiency gains are delivering robust profits; on the other, growth in flagship categories is stalling, and new ventures like food delivery and overseas operations remain in their investment cycles. This report vividly illustrates JD.com's efforts to balance short-term profitability with medium-to-long-term growth, striving to carve out a new growth trajectory amid intense competition in the e-commerce sector.
Profitability Inflection Point Takes Hold
The standout feature of this quarter's report is the reversal in profitability. According to historical data, since the second quarter of 2025, JD.com's operating profit turned to a loss of 900 million yuan, which expanded to 5.849 billion yuan by the end of 2025. In the first quarter of this year, the company swung back to profitability with an operating profit of 3.8 billion yuan. By the second quarter, operating profit reached 4.5 billion yuan, turning positive year-on-year, with the operating margin recovering from -0.2% to 1.3%. Net profit attributable to shareholders stood at 7.1 billion yuan, growing steadily year-on-year, and the net profit margin climbed to 2.1%. Non-GAAP net profit attributable to shareholders was 8.9 billion yuan, up 20% year-on-year, with all profitability indicators moving in a positive direction.
The profit improvement primarily stems from higher gross margins in the core retail business, growth in high-value-added service revenue, and substantial loss reduction in the food delivery segment. In the second quarter, profitability in JD.com's core retail segment improved steadily, with the retail margin reaching a record high for a major promotional season. Management attributed this to improved margins in several key categories and faster growth in high-margin platform and advertising revenue, which together enhanced the overall revenue mix.
Data shows that service revenue in the second quarter totaled 79.286 billion yuan, up 6.8% year-on-year, accounting for 22.9% of total revenue. Platform and advertising service revenue reached 30.86 billion yuan, up 8.3%, while logistics and other service revenue totaled 48.426 billion yuan, up 5.9%. Since launching its local life services business last year, JD.com has expanded offerings around home, travel, and health scenarios, delving into housekeeping, car maintenance, and travel, while also focusing on emerging sectors like elderly care, pet services, and robot repair for on-demand and in-store quality services. In the second quarter, service revenue from home scenarios surged 69.6% year-on-year.
The significantly faster growth of high-margin service revenue compared to product sales indicates that JD.com is transitioning from a "product sales-centric" model to a "product plus services" integrated platform approach, continuously refining its earnings framework. Meanwhile, the long-contested food delivery business has moved beyond the phase of indiscriminate cash-burning expansion, with unit economics improving markedly and becoming a key contributor to group profit recovery. In the second quarter, total losses in the delivery business narrowed by over 50% year-on-year, with per-order subsidies steadily declining and per-order profitability optimizing, significantly easing the pressure of large-scale losses.
Management attributed the loss reduction to three core strengths: refined operational efficiency and improved subsidy allocation, with per-order subsidies clearly decreasing; enhanced delivery efficiency driven by scale growth; and diversified revenue from commissions and advertising. More critically, the ecosystem synergies of the delivery business are gradually materializing. Through coordination with the core retail business in user acquisition and cross-category shopping, quarterly active users have maintained double-digit year-on-year growth. Localized product supply and the merchant ecosystem are also expanding, and the underlying integration of delivery and logistics networks is underway, which is expected to boost the group's overall instant delivery capabilities and efficiency.
It is worth noting that while the loss reduction trend for the delivery business is clear, the competitive landscape remains intense, and medium-to-long-term profitability challenges persist. In the local life services sector, Meituan holds a dominant position, and price competition and merchant acquisition battles show no signs of abating. Changes in the expense structure are also pivotal. In the second quarter, marketing expenses fell 24.8% year-on-year to 20.3 billion yuan from 27 billion yuan, with marketing spend as a percentage of revenue dropping from 7.6% to 5.9%, primarily due to optimized spending on promotional activities for new businesses. This is also the core reason why, despite better-than-expected profits, the stock price did not rally: capital markets do not endorse profits achieved solely through cost-cutting but rather prioritize medium-to-long-term revenue growth capabilities and the sustainability of the business model.
Revenue Growth Lacks Momentum
Beneath the impressive profit figures, the pressure on revenue stands as the most critical weakness in this quarter's report. In the second quarter, total revenue was 346.4 billion yuan, down 2.9% year-on-year, marking the first revenue decline since JD.com's listing. Breaking down the segments, the core drag on revenue came from the main retail business: retail revenue was 295.383 billion yuan, down 4.7% year-on-year. The report attributes the weaker performance to the high base effect from the 2025 home appliance trade-in subsidy policy and price increases in electronics categories driven by rising raw material costs.
The divergence across categories is stark: electronics and home appliances, the cornerstone of JD.com's business, saw revenue plummet 11.8% year-on-year, making it the biggest drag, while daily necessities maintained steady growth of 5.6%, showcasing resilience in essential consumer goods. Home appliances and 3C electronics have been JD.com's core strength for years and serve as the foundation of its authenticity and expertise brand image. The double-digit revenue decline this quarter, beyond the high base effect, also reflects dual industry challenges. On one hand, large-ticket consumption in China has entered a consolidation phase, with consumers becoming more rational and replacement demand for appliances and digital products weakening, compounded by the high base from last year's policy stimulus, resulting in insufficient short-term growth momentum. On the other hand, content e-commerce continues to penetrate the 3C and appliance sectors, with live-streaming low-price models diverting users from traditional e-commerce, eroding the authenticity, expertise, and low-price perception JD.com has long cultivated and weakening its traditional competitive moat.
Addressing revenue pressures, management stated on the earnings call that starting in the third quarter, the impact of the high base from the national subsidy will gradually dissipate, and growth in electronics categories is expected to recover. Additionally, JD.com's supply chain capabilities will help mitigate price increase pressures to some extent. Product innovation and rapid advances in AI technology will create opportunities for product and category innovation, allowing the company to quickly apply new technologies to meet evolving user needs and even generate new demand. Management also noted that the effects of its omni-channel strategy are becoming evident, with offline businesses growing faster. Based on these factors, despite short-term sales fluctuations, the company remains highly confident in the long-term market position of its electronics categories and expects retail growth to accelerate in the second half of the year.
Seeking a Second Growth Curve
Combining the operational initiatives in the second quarter with signals from management on the earnings call, the strategic focus for the next phase is clear: leveraging the supply chain as the core foundation, consolidating the online retail base, while aggressively pursuing instant retail, offline stores, and overseas markets as three incremental growth tracks, alongside continued heavy investment in AI technology to empower the entire business chain. In the core retail segment, JD.com is advancing category structure optimization, stabilizing the home appliance and 3C base while capitalizing on new consumption trends like smart home devices, and expanding high-margin categories such as supermarket and home goods to increase the share of service revenue. The supply chain remains JD.com's most significant moat, with direct sourcing and upstream supply chain construction continuously optimizing product costs, while also expanding into the B2B market through JD Industrial's deep focus on corporate procurement.
In the instant retail arena, the immediate goal for the delivery business is no longer chasing order volumes but optimizing unit economics, integrating the logistics delivery network, and achieving deep synergy between delivery and self-operated retail. Offline initiatives are intensifying: the home appliances and home furnishing business group has established an offline business unit to strengthen user perception through online-offline integration; JD MALL is targeting core cities with immersive experiences for electronics and digital products; discount supermarkets are focusing on lower-tier markets in East and North China; JD Pharmacy continues to expand physical stores; and JD.com is leveraging AI and supply chain strengths to explore new offline consumption scenarios like unmanned coffee shops. Overseas operations have become a key priority. JD Joybuy replicates JD.com's supply chain capabilities in Europe, particularly in electronics categories where it holds advantages, creating differentiated user experiences through efficient self-operated retail and logistics fulfillment, driving stable improvements in user retention and achieving revenue doubling within two quarters.
On the AI front, JD.com adheres to an industry-specific AI strategy, distinct from general-purpose model providers, deeply embedding AI into supply chain, logistics, and retail operations to optimize demand forecasting, inventory turnover, and warehouse scheduling for sustained cost reduction and efficiency gains. This explains why JD.com continues to increase R&D spending even as marketing and administrative expenses shrink. In the second quarter, R&D expenses reached 7.3 billion yuan, up 37.7% year-on-year, with R&D as a percentage of revenue rising from 1.5% to 2.1%.
In summary, JD.com's second-quarter report presents a classic case of "profits beating expectations, revenue missing forecasts." The profitability inflection point is validated, but the market's key question is when the growth inflection will follow. Factors such as the pace of home appliance consumption recovery, the degree of consumer confidence improvement, and the speed of supply-side capability enhancements all remain variables. From an industry perspective, the domestic consumer market is in a slow recovery cycle, with consumers becoming more rational and price-sensitive, which both pressures JD.com's self-operated model and creates opportunities for high-quality products. In the short term, JD.com has successfully completed its profit recovery; in the medium-to-long term, by deepening supply chain capabilities, effectively utilizing AI, and steadily advancing new businesses like instant retail, offline, and overseas expansion, the operational resilience demonstrated in this report can be sustained.
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