First Read: JD.com "2Q26 preview; expect resilient earnings despite macro..."

Research evidence excerpt

First Read: JD.com "2Q26 preview; expect resilient earnings despite macro..."

m our channel checks, the execution efficiency of 12/28E 37.28 37.39 0 36.06

national subsidies improved in June, supported by a higher allocation to online sales,

which also drove a sequential growth recovery across 2Q. This might provide a cushion Kenneth Fong

for 2H growth. In addition, JD has stronger margin control in its 1P model, with Analyst

structural drivers including improving 1P efficiency and higher apparel/3P mix, kenneth-kc.fong@ubs.com

+852-3712 3890

potentially offsetting the topline pressure. 2) New businesses: With moderating quick

commerce competition amid regulatory draft guidance in 17 Jun, we see potential Sardonna Fong

upside to the pace of loss narrowing. Meanwhile, the pace of international expansion Analyst

also remains a key focus, with JoyBuy Europe now covering 6 countries. sardonna.fong@ubs.com

+852-3712 3042

What to do with the stock Dorothy Chen

Associate Analyst

Trading at 8x 2026E P/E, we continue to see attractive risk-reward in JD with c50% of

dorothy.chen@ubs.com

market cap as net cash and 9% shareholder return. JD is one of the few China internet +852-3712 2917

companies with visible earnings upgrade potential, underpinned by both resilient e-com

margins and quick commerce loss narrowing. In fact,we believe its strong price control

and efficiency should continue to be demonstrated in 2Q, which JDR margin should

continue to improve despite topline decline. In our view, 2Q should likely mark JD's

worst quarter on tough growth comp, with topline YoY growth likely returning to +ve

starting in 3Q. We see catalysts in unleashing margin upside.

Highlights (Rmbm) 12/23 12/24 12/25 12/26E 12/27E 12/28E 12/29E 12/30E