JD Delivery

JD.com’s Q2 earnings revealed a 22.4% revenue surge to RMB 356.7 billion, driven by a strong 618 shopping festival and robust performance from JD Retail and JD Logistics. However, aggressive expansion into delivery services, particularly JD Delivery, led to substantial losses (RMB 14.8 billion) within the “new businesses” segment, offsetting retail profit gains. Despite increased user engagement and order volume, these subsidies significantly impacted overall profitability, prompting JD.com to shift towards cross-selling strategies to reduce reliance on its retail business.

JD.com’s food delivery service, JD Delivery, has significantly expanded its reach, serving over 15,000 corporate clients with a daily order volume exceeding 25 million. Holding a 31% market share, and 45% in the premium segment, the service operates in 350 cities, offering 1.5 million restaurant options. Partnerships with major firms provide corporate meal solutions. Nearly 70% of businesses become formal partners within a month, with weekly enterprise meal solution partnerships increasing tenfold in June. User subsidies further enhance the offering.

Sichuan regulators summoned JD Delivery executives to address operational violations impacting market integrity and consumer trust. Issues included mismatched merchant addresses, unauthorized business expansions, and unfair pricing. Authorities mandated immediate platform reforms, stricter oversight, and compliance with ethical practices. JD pledged enhanced vendor vetting, real-time audits, and expanded use of livestreamed “Transparent Kitchens” for accountability. This follows broader regulatory actions against China’s food delivery sector, including Meituan and Ele.me, amid concerns over monopolistic practices and labor standards.