Alibaba arch-rival JD grows to 105M active shoppers

Chinese ecommerce site JD just released its quarterly earnings for the period ending on March 31, and the results show continual growth.

Gross merchandise volume (GMV) – the amount people spent on the estore – hit RMB 8.78 billion (about US$14.2 billion), marking a 99 percent increase year-on-year. Net revenues hit RMB 36.6 million (about US$14.2 billion), marking a 63 percent annual increase. The company attributes the revenue jumps to its growing customer base. Active customer accounts grew 90 percent to 105.2 million year-on-year, and fulfilled orders shot up 72 percent to 227.2 million.

JD is the biggest rival to Alibaba’s Tmall and Taobao in China. Taobao and Tmall collectively have more than 350 million active shoppers.

The company continues to operate at a slight loss, however. Non-GAAP net margin came in at negative 0.6 percent, and cost of revenues increased 58 percent annually. The company says the increase was due to the customer acquisition costs necessary for expansion.

JD remains significant in China’s ecommerce industry for its relationship with Tencent, the social giant best known for the ubiquitous WeChat messenger. After purchasing a 15 percent stake in JD last year, the latter firm assumed control of most of Tencent’s existing ecommerce stores, and powered a special shopping section inside WeChat. Neither company has publicly revealed how the partnership or the WeChat integration has affected revenues.

JD has invested aggressively in on-demand delivery startups in the past year. It participated in deals for Ele.me, a meal delivery startup that closed a US$350 million round last January, and Daojia, which secured a US$50 million round last September. JD has described those two firms as “major partners” of Paidaojia, the company’s standalone delivery app.

Editing by Steven Millward