Net revenues for the second quarter of 2022 were RMB267.6 billion (US$¹40.0 billion), an increase of 5.4% from the second quarter of 2021. Net service revenues for the second quarter of 2022 were RMB41.6 billion (US$6.2 billion), an increase of 21.9% from the second quarter of 2021.

Income from operations for the second quarter of 2022 was RMB3.8 billion (US$0.6 billion), compared to RMB0.3 billion for the same period last year. Non-GAAP² income from operations was RMB5.8 billion (US$0.9 billion) for the second quarter of 2022, as compared to RMB2.5 billion for the second quarter of 2021. Operating margin of JD Retail before unallocated items for the second quarter of 2022 was 3.4%, compared to 2.6% for the second quarter of 2021.

Net income attributable to ordinary shareholders for the second quarter of 2022 was RMB4.4 billion (US$0.7 billion), compared to RMB0.8 billion for the same period last year. Non-GAAP net income attributable to ordinary shareholders for the second quarter of 2022 was RMB6.5 billion (US$1.0 billion), as compared to RMB4.6 billion for the same period last year.

Diluted net income per ADS for the second quarter of 2022 was RMB2.74 (US$0.41), compared to RMB0.50 for the second quarter of 2021. Non-GAAP diluted net income per ADS for the second quarter of 2022 was RMB4.06 (US$0.61), compared to RMB2.90 for the same period last year.

Operating cash flow for the twelve months ended June 30, 2022 was RMB51.1 billion (US$7.6 billion), compared to RMB38.9 billion for the twelve months ended June 30, 2021. Free cash flow, which excludes the impact from JD Baitiao receivables included in the operating cash flow, for the twelve months ended June 30, 2022 was RMB27.7 billion (US$4.1 billion), compared to RMB31.9 billion for the twelve months ended June 30, 2021.

Annual active customer accounts³ increased by 9.2% to 580.8 million in the twelve months ended June 30, 2022 from 531.9 million in the twelve months ended June 30, 2021.

The U.S. dollar (US$) amounts disclosed in this announcement, except for those transaction amounts that were actually settled in U.S. dollars, are presented solely for the convenience of the readers. The conversion of Renminbi (RMB) into US$ in this announcement is based on the exchange rate set forth in the H.10 statistical release of the Board of Governors of the Federal Reserve System as of June 30, 2022, which was RMB6.6981 to US$1.00. The percentages stated in this announcement are calculated based on the RMB amounts.

See the sections entitled “Non-GAAP Measures” and “Unaudited Reconciliation of GAAP and Non-GAAP Results” for more information about the non-GAAP measures referred to in this announcement.

Annual active customer accounts are customer accounts that made at least one purchase during the twelve months ended on the respective dates, whether through online retail or online marketplace.

JD.com recently released its second ESG report, highlighting the company’s progress during 2021 in developing green supply chains, boosting the real economy and promoting high-quality consumption and social efficiency. In the report, JD.com proactively disclosed climate-related information for the first time according to the standards set by the Task Force on Climate-related Financial Disclosures (TCFD), an organization created by the Financial Stability Board in 2015 improving the reporting of climate-related financial information.

In June, JD Logistics pioneered and launched the “Delivered with Original Package” (DWOP) certification, its proprietary standard for green packaging. To mark the fifth anniversary of JD’s “Green Stream Initiative”, JD Logistics partnered with a number of leading brands and manufacturers to ensure that over 80% of packages for products sold via e-commerce channels are DWOP compliant by 2030. Over the past five years, JD Logistics has cooperated with upstream and downstream partners to promote the environmentally-friendly DWOP model, with over 10,000 SKUs shipped directly from the factory in their original packaging. To date, the effort has reduced disposable package use by over 10 billion pieces, equivalent to saving approximately 20 million trees.

During the 618 Grand Promotion, JD.com’s omni-channel supermarket (JD Super) collaborated with more than 27,000 brands and over 34,000 offline stores to leverage JD.com’s “one-hour delivery” service to provide consumers with on-demand shopping options in nearly 400 cities across China. More than 30,000 partner stores saw increases in transaction volume of over 500% year-on-year. In particular, certain omni-channel businesses of retail chains including Walmart, China Resources Vanguard (CR Vanguard), and Yonghui increased transaction volume in aggregate by over 660% year-on-year during the 618 Grand Promotion.

During the second quarter, to enhance omni-channel retailing, JD.com’s Fashion and Lifestyle business upgraded to “The J Shop” and launched its online channel on JD.com’s app and offline pilot stores in cities including Xi’an, Shenzhen, Chengdu, Yinchuan and Beijing. As a new retail format that provides curated fashion and lifestyle collections, The J Shop takes full advantage of JD.com’s merchandising and service capabilities, intelligent social supply chain advantages and omni-channel capabilities. It is committed to meeting consumers’ evolving needs with a one-stop solution that provides seamless online and offline experience, swift product updates and turnover and interactive consumer engagement, as well as full-scope services along the purchasing path.

In the second quarter, CELINE, a luxury fashion brand under LVMH, partnered with JD.com and launched a flagship store on the platform. Others joining JD.com during the quarter also include French luxury fashion brand Maison Margiela, French multi-faceted lifestyle brand Maison Kitsuné, Canadian high-end outerwear and sportswear brand Moose Knuckles, and Italian streetwear brand GCDS. Meanwhile, beauty brands such as globally well-known LA MER, ARMANI, Jo Malone London, Shiseido and M.A.C joined JD.com and opened flagship stores, further enriching the Company’s offering of leading beauty and cosmetic products. In terms of home goods, British premium jewelry box brand WOLF and Italian heritage umbrella brand Pasotti also opened flagship stores on JD.com in the quarter.

JD Plus, the premium membership program of JD.com and the first paid membership program in China’s e-commerce industry, has exceeded the milestone of 30 million registered members in July 2022, setting a new record in scale. JD Plus members are among JD.com’s most active and loyal users with strong consumption power. Also notably, shopping frequency and spending of new JD Plus members increased significantly after joining the program. JD Plus also empowers vertical industries and upstream supply-chain enterprises to engage and create value to Plus members online and offline.

In June, JD Health upgraded its medical services and launched three new online consultation services: “Expert Consulting”, “Instant Consultation with JD Doctor” and “Nighttime Consultation” to further address users’ diverse medical needs. The “Expert Consulting” service cooperates with leading physicians from multiple “Grade 3A” hospitals in China; the “Nighttime Consultation” service arranges on-duty doctors to provide consultation services available overnight; and the “Instant Consultation with JD Doctor” service provides users with standardized medical consultation services through carefully selected in-house and external physicians.

In June, JD Health released its “Enterprise Health Strategy” offering corporate clients a full range of customized online and offline employee health management and medical services, covering multiple solutions including corporate emergency rescue management, employee weight management, and employee mental health management.

In June, JD Health jointly built an internet hospital with Hebei Cangzhou Central Hospital and became one of the first internet hospitals in Hebei Province to be officially connected with social health insurance system, enabling social insurance payment for healthcare services such as online consultation services, prescription purchases and home delivered services.

During the second quarter, JD Logistics launched two new Asia No.1 smart industrial parks into operations in the cities of Yiwu and Wenzhou in Zhejiang Province. Together with the existing Asia No.1 smart industrial park in Hangzhou, the three smart industrial parks cover the entire Zhejiang province and drive the same or next-day delivery ratio of JD Group’s online retail orders within the province to around 95%, while extending the service to the rest of Yangtze River Delta region.

As of June 30, 2022, JD Logistics operated over 1,400 warehouses. Including warehouse space managed through the Open Warehouse Platform, JD Logistics’s warehouse network had an aggregate gross floor area of approximately 26 million square meters.

During this year’s 618 Grand Promotion, in collaboration with more than 150,000 offline stores across all product categories, JD.com’s on-demand retail services including its Shop Now program and JD Daojia (JDDJ) provided more local products and one-hour delivery on-demand retail experiences for consumers in over 1,700 cities and counties across China. Shop Now and JDDJ altogether achieved a 77% increase year-over-year, while the number of users who placed orders through Shop Now increased by over 400% compared to the previous year. In addition, Dada Now, Dada’s diversified local on-demand delivery service, provided omni-channel fulfillment services for merchants in all industries, including small and medium-sized merchants which delivery volume increased 83% year-on-year.

In July 2022, JD Property entered into an agreement to set up its third logistics properties core fund, with a leading global investment institution as its core investor. Prior to that, JD Property has successfully completed the fundraising for two logistics properties core funds, one logistics properties development fund, and one logistics M&A fund. Upon the completion, the total assets transferred under management of the aforementioned core funds, development fund and M&A fund would exceed RMB27.3 billion.

Net cash provided by operating activities

Add: Impact from JD Baitiao receivables included in the operating cash flow

(Less)/Add: Capital expenditures, net of related sales proceeds

Capital expenditures for development properties

Other capital expenditures*

Free cash flow

Including capital expenditures related to the company’s headquarters in Beijing and all other CAPEX.

Net cash provided by operating activities

Add/(Less): Impact from JD Baitiao receivables included in the operating cash flow

Less: Capital expenditures, net of related sales proceeds

Capital expenditures for development properties

Other capital expenditures

Free cash flow

Net revenues:

JD Retail

JD Logistics

Dada

New businesses

Inter-segment*

Total segment net revenues

Unallocated items**

Total consolidated net revenues

Operating income/(loss):

JD Retail

JD Logistics

Dada

New businesses

Including: gain on sale of development properties

Total segment operating income

Unallocated items**

Total consolidated operating income

The inter-segment eliminations mainly consist of revenues from supply chain solutions and logistics services provided by JD Logistics to JD Retail, on-demand delivery and retail services provided by Dada to JD Retail and JD Logistics, and property leasing services provided by JD Property to JD Logistics.

Unallocated items include share-based compensation, amortization of intangible assets resulting from assets and business acquisitions, effects of business cooperation arrangements, and impairment of goodwill and intangible assets, which are not allocated to segments.

Electronics and home appliances revenues

General merchandise revenues

Net product revenues

Marketplace and marketing revenues

Logistics and other service revenues

Net service revenues

Total net revenues

ASSETS

Current assets

Cash and cash equivalents

Restricted cash

Short-term investments

Accounts receivable, net (including JD Baitiao of RMB2.5 billion and RMB3.2 billion as of December 31, 2021 and June 30, 2022, respectively)⁽¹⁾

Advance to suppliers

Inventories, net

Prepayments and other current assets

Amount due from related parties

Assets held for sale

Total current assets

Non-current assets

Property, equipment and software, net

Construction in progress

Intangible assets, net

Land use rights, net

Operating lease right-of-use assets

Goodwill

Investment in equity investees

Investment securities

Deferred tax assets

Other non-current assets

Amount due from related parties

Total non-current assets

Total assets

LIABILITIES

Current liabilities

Short-term debts

Accounts payable

Advance from customers

Deferred revenues

Taxes payable

Amount due to related parties

Accrued expenses and other current liabilities

Operating lease liabilities

Liabilities held for sale

Total current liabilities

Non-current liabilities

Deferred revenues

Unsecured senior notes

Deferred tax liabilities

Long-term borrowings

Operating lease liabilities

Other non-current liabilities

Total non-current liabilities

Total liabilities

JD Technology performs credit risk assessment services for JD Baitiao business and absorbs the credit risk of the underlying Baitiao receivables. Facilitated by JD Technology, the company periodically securitizes Baitiao receivables through the transfer of those assets to securitization plans and derecognizes the related Baitiao receivables through sales type arrangements.

MEZZANINE EQUITY

Convertible redeemable non-controlling interests

SHAREHOLDERS’ EQUITY

Total JD.com, Inc. shareholders’ equity (US$0.00002 par value, 100,000 shares authorized, 3,178 shares issued and 3,123 shares outstanding as of June 30, 2022)

Non-controlling interests

Total shareholders’ equity

Total liabilities, mezzanine equity and shareholders’ equity

Net revenues

Net product revenues

Net service revenues

Total net revenues

Cost of revenues

Fulfillment

Marketing

Research and development

General and administrative

Gain on sale of development properties

Income from operations⁽²⁾⁽³⁾

Other income/(expenses)

Share of results of equity investees

Interest expense

Others, net⁽⁴⁾

Income before tax

Income tax expenses

Net income

Net loss attributable to non-controlling interests shareholders

Net income attributable to mezzanine equity classified as non-controlling interests shareholders

Net income attributable to ordinary shareholders

Net income per share:

Basic

Diluted

Net income per ADS:

Basic

Diluted

(2) Includes share-based compensation expenses as follows:

Cost of revenues

Fulfillment

Marketing

Research and development

General and administrative

(3) Includes amortization of business cooperation arrangement and intangible assets resulting from assets and business acquisitions as follows:

Fulfillment

Marketing

Research and development

General and administrative

(4) Others are other non-operating income/(loss), primarily consist of gains/(losses) from fair value change of long-term investments, gains/(losses) from business and investment disposals, impairment of investments, government incentives, interest income and foreign exchange gains/(losses).

Non-GAAP net income attributable to ordinary shareholders

Weighted average number of shares:

Basic

Diluted

Non-GAAP net income per share:

Basic

Diluted

Non-GAAP net income per ADS:

Basic

Diluted

Net cash provided by operating activities

Net cash used in investing activities

Net cash provided by/(used in) financing activities

Effect of exchange rate changes on cash, cash equivalents and restricted cash

Net increase/(decrease) in cash, cash equivalents and restricted cash

Cash, cash equivalents and restricted cash at beginning of period⁽⁵⁾

Cash, cash equivalents and restricted cash at end of period⁽⁵⁾

Net cash provided by operating activities

Add: Impact from JD Baitiao receivables included in the operating cash flow

(Less)/Add: Capital expenditures, net of related sales proceeds

Capital expenditures for development properties

Other capital expenditures

Free cash flow

Including cash, cash equivalents and restricted cash classified as assets held for sale of RMB133.6 million, nil and nil as of June 30, 2021, December 31, 2021 and June 30, 2022, respectively.

Free cash flow (in RMB billions) – trailing twelve months (“TTM”)

Inventory turnover days⁽⁶⁾ – TTM

Accounts payable turnover days⁽⁷⁾ – TTM

Accounts receivable turnover days⁽⁸⁾ – TTM

Annual active customer accounts (in millions)

(6)   TTM inventory turnover days are the quotient of average inventory over the immediately preceding five quarters, up to and including the last quarter of the period, to cost of revenues of retail business for the last twelve months, and then multiplied by 360 days.

(7)   TTM accounts payable turnover days are the quotient of average accounts payable for retail business over the immediately preceding five quarters, up to and including the last quarter of the period, to cost of revenues of retail business for the last twelve months, and then multiplied by 360 days.

(8)   TTM accounts receivable turnover days are the quotient of average accounts receivable over the immediately preceding five quarters, up to and including the last quarter of the period, to total net revenues for the last twelve months and then multiplied by 360 days. Presented are the accounts receivable turnover days excluding the impact from JD Baitiao.

Income from operations

Add: Share-based compensation

Add: Amortization of intangible assets resulting from assets and business acquisitions

(Reversal of)/Add: Effects of business cooperation arrangements

Reversal of: Gain on sale of development properties

Non-GAAP income from operations

Add: Depreciation and other amortization

Non-GAAP EBITDA

Total net revenues

Non-GAAP operating margin

Non-GAAP EBITDA margin

Net income attributable to ordinary shareholders

Add: Share-based compensation

Add: Amortization of intangible assets resulting from assets and business acquisitions

(Reversal of)/Add: Reconciling items on the share of equity method investments⁽⁹⁾

Add: Impairment of goodwill, intangible assets, and investments

Add/(Reversal of): Loss/(Gain) from fair value change of long-term investments

Reversal of: Gain on sale of development properties

(Reversal of)/Add: Net (gain)/loss on disposals/deemed disposals of investments and others

(Reversal of)/Add: Effects of business cooperation arrangements and non-compete agreements

Add/(Reversal of): Tax effects on non-GAAP adjustments

Non-GAAP net income attributable to ordinary shareholders