Why Is JD.com (JD) Stock Down Today?

Last week, stocks of many prominent Chinese companies slipped amid escalating geopolitical tensions. One name that fell was JD.com (NASDAQ:JD). Now, this week brings new troubles for the e-commerce firm. JD stock is back in the red after the company reported overall disappointing earnings for the final quarter of 2021.

JD.com (JD) logo displayed at the entrance to the company's Silicon Valley office.
Source: Sundry Photography / Shutterstock.com

Earlier today, JD.com reported that, although it had surpassed analyst expectations for earnings, revenue growth is slowing. The stock close down nearly 16% for the day after a failed attempt at a recovery rally. This pattern of decline is in keeping with its performance throughout the past month.

What else should you know about JD stock?

Why Is JD Stock Down Today?

According to Reuters, the figures reported today represent the weakest revenue growth from JD.com in the past six quarters. There have been plenty of factors contributing to JD stock’s decline.

For one, China’s relationship with Russia amid the Russian invasion of Ukraine is pushing Chinese stocks down across the board. The booming electric vehicle (EV) sector has seen many stocks fall this week as well, including Nio (NYSE:NIO) and Xpeng (NYSE:XPEV).

China’s e-commerce sector has certainly been feeling the sting, too. Industry giant Alibaba (NYSE:BABA) recently reported that the previous quarter brought its slowest revenue growth since its public debut, causing analysts to lower their price targets. As Alibaba goes, JD is likely follow.

The tech outlook for China appears grim, with regulatory concerns in the spotlight. Ongoing issues of data use, gaming, and antitrust policies have weighed on Alibaba, JD.com and their peers.

What It Means

JD.com already had market forces working against it when it was forced to report the type of earnings that don’t inspire investor confidence. The fact that JD stock is still down after reporting earnings that exceeded estimates should tell investors everything that they need to know. JD.com is fighting an uphill battle.

On the date of publication, Samuel O’Brient did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Samuel O’Brient has been covering financial markets and analyzing economic policy for three-plus years. His areas of expertise involve electric vehicle (EV) stocks, green energy and NFTs. O’Brient loves helping everyone understand the complexities of economics. He is ranked in the top 15% of stock pickers on TipRanks.


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