Shares of JD.com, the Chinese e-commerce service competing with Alibaba, are rising today after the online store announced better than expected Q4 2018 earnings, which gives uncertainty about technology companies in China.  The company reported net sales of RMB 134.8 billion ($ 219.6 billion) for the quarter last year. Despite being the slowest growth rate year-on-year since the JD went public five years ago (22.3 percent), the figure beats the analyst at $ 19.1 billion. JD.com also posted earnings per share.
That combination saw the Nasdaq share price rise by as much as 14 percent in pre-trading, Reuters reports. The stock is up around five percent at the time of writing, according to Yahoo Finance data.
Chinese startup is a challenging economy in the country. Apple has recently cut its quarterly revenue forecast due to China's downturn, while domestic Chinese technology companies have gone further and reduced costs.
Some of these include Didi who puts down 15 percent of their employees and NetEase, which reduces multiple units, while JD .Com is of course separated by 10 percent of the management team as part of downsizing.
Against that background, expectations were enough to trigger investor interests despite the slow growth of JD.com's business. The last quarter of the year is usually the most lucrative in terms of revenue, thanks to the Singles' Day shopping festival. The company surveyed a total quarterly net loss of RMB 4.8 billion or $ 700 million in the fourth quarter.
JD.com's annual performance increased revenue by 27.5 percent in 2018 to reach RMB 462.0 billion ($ 67.2 billion) with a loss of RMB 2.5 billion, $ 400 million. In 2017, the business had a net income of $ 116.8 million, which converted to $ 18 million at that time.
On the technology side, JD.com has invested heavily in drones, unmanned delivery and automated warehouses with the advantage of playing the "long game" of cutting-edge technology over making short-term investment issues.
However, it has been plagued by scandal after CEO Richard Liu was arrested in the United States for suspected alleged sexual abuse. Finally, Liu was not charged after the authorities admitted that it was not possible to prove beyond reasonable doubt that the charges brought against him.