Chinese e-commerce site JD.com surges 17% as the company reports record user growth in the 2nd quarter and plays down impact of tech crackdown
- Chinese e-commerce giant
JD.comjumped as much as 16.6% on Tuesday reporting earnings.
- Second-quarter revenue came in 26% higher year-over-year, fueled by a record 32 million new users.
- Some investors seemed to be wading back into Chinese tech, with big-name investors like
Cathie Woodbuying the dip.
Chinese e-commerce giant JD.com jumped as much as 16.6% in Hong Kong on Tuesday after the company reported record user growth and shrugged off the worst of Beijing's regulatory crackdown.
The stock, listed on the Hong Kong stock exchange, surged as high as $284, up from $243.60 at the previous day's close.
Second-quarter revenue came in more than 26% higher year-over-year, above analyst expectations. That growth was fueled by a record 32 million new users, bringing the total number to over 530 million. However, profits fell sharply, owing to higher marketing and administrative costs.
For months, Chinese businesses have been battered by a suite of harsh regulations restricting sectors from tech to school tutoring. On the company's earnings call, JD.com execs played down the long-term impact of the government's campaign.
"I believe you have all paid attention to and may be concerned about the recent regulatory changes," said Xu Lei, CEO of JD's retail division. "We believe these policies are not intended to restrict or suppress the Internet and relevant industries but rather to create a fair and orderly business environment."
"We believe that the regulatory goals are conducive to JD's long-term business growth," Xu added.
Some international investors seemed to be wading back into Chinese tech stocks on Tuesday, with big-name investors like Cathie Wood buying the dip. Wood's Ark Autonomous Technology & Robotics ETF bought nearly 165,000 shares in JD.com on Monday, following the earnings call.
"For the first time in months, I had a heavy tilt to global, longer-term investors coming to buy [Chinese tech shares]," Andy Maynard, a trader at investment bank China Renaissance, told the Financial Times.
Still, Tuesday's rally was not enough to offset the beating that big Chinese tech stocks have taken this year. At Tuesday closing prices,
JD.com shares closed at 280 Hong Kong dollars, equivalent to about $36.
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