For the latest news on U.S.- and Hong Kong-traded Chinese stocks, visit our new Bamboo Works site.
Tag Archives: JD.com
Jingdong (jd.com) latest Business & Financial news from Doug Young, the Expert on Chinese High Tech Market, (former Journalist and Chief editor at Reuters)
Bottom line: Baidu’s new upscale online shopping mall looks more focused and well designed than its earlier e-commerce initiatives, but could have a difficult time finding an audience due to stiff competition.
Baidu tries e-commerce again with upscale mall
Online search leader Baidu(Nasdaq: BIDU) is hoping the third time is the charm for its drive into e-commerce, with the formal launch of its new online mall with a distinctly foreign flavor targeting high-end shoppers. I’ve followed Baidu for a long time now, and the company certainly has a poor track record in e-commerce and more broadly for homegrown initiatives like this latest one called Baidu Mall.
But that said, the company has found more success recently by buying assets outside its core online search area, and then giving them access to its own vast cash and other resources to help them quickly gain market share. Perhaps it’s hoping to use that strategy as well for the newly launched Baidu Mall, even though the platform itself seems to be Baidu’s own creation rather than an acquisition. Read Full Post…
Bottom line: Lack of revenue figures in a wealth of new data on WeChat indicates the service continues to lose big money, and could become a drag on Tencent’s profits if commercialization efforts don’t accelerate soon.
WeChat: Where’s the revenue?
Social networking giant Tencent(HKEx: 700) has just released a wealth of information about its wildly popular WeChat, including a headline figure that the wildly popular mobile messaging service now has a whopping 570 million active users. But missing from the wealth of new information are any meaningful monetary figures, reflecting the slow progress that Tencent is making in commercializing a service whose huge popularity also means its quite costly to operate.
People love to talk about WeChat and how popular it is, but you see far less discussion about how much money Tencent is losing on the service. There’s even less discussion of when it might become profitable. But all that said, Tencent is such a cash-rich company it can easily afford to keep pouring money into WeChat for the next decade or more until the day when profits finally come. The big risks, of course, are that investors may not be that patient, and that newer and more popular services could come along. Read Full Post…
Bottom line: New signals that China’s 3 telcos are reducing their spending could presage a rumored consolidation of the trio into 2, with China Telecom and Unicom the most likely to be merged.
China telcos rope in spending
The latest sign of a potential shake-up in China’s stodgy telecoms sector came late last week, when global networking equipment giant Ericsson (Nasdaq: ERIC) attributed reorganization and weak spending by the nation’s big 3 carriers as a major factor behind its disappointing quarterly results. Despite expectation that China’s big 3 carriers would spend heavily on 4G this year, actual amounts so far have been relatively modest from the trio of China Mobile (HKEx: 941; NYSE: CHL), China Unicom (HKEx: 762; NYSE: CHU) and China Telecom (HKEx: 728; NYSE: CHA).
The unexpected spending slowdown could be the latest sign that Beijing is planning an industry overhaul, following reports that first emerged last month of a possible consolidation of the 3 current mobile carriers into just 2. Such a move would reflect Beijing’s disappointment at the failure of China’s state-run carriers to become global innovators over the last decade, even after receiving monopoly rights over a market that has become the world’s largest for mobile and broadband services. Read Full Post…
Bottom line: A growing alliance between JD.com and Tencent could start to seriously challenge Alibaba’s dominance of China e-commerce in the next 2 years, as the rivals use the upcoming November 11 Singles Day to showcase their prowess.
JD joins Nov 11 courtship of online shoppers
This year’s November 11 Singles Day shopping extravaganza is shaping up as a guerrilla courtship of Chinese online shoppers by the nation’s 2 e-commerce leaders, as each vies for supremacy on a date that’s become the world’s busiest for online buying. Just days after leading operator Alibaba (NYSE: BABA) announced its own grand plans to seduce shoppers, rival JD.com (Nasdaq: JD) has come out with its own counter scheme that aims to court China’s hordes or singles in an alliance drawing on its growing ties with leading social networking (SNS) operator Tencent (HKEx: 700).
The stakes in this brewing war are huge. Last year alone, Alibaba reported 278 million orders worth $9.3 billion around the promotion that it created on the November 11 holiday, which represents the epitome of singledom due to its numerical representation as 11-11, or four 1’s. JD declined to give a sales value for its orders last year, but said it posted 14 million orders, which would translate to far more modest but still significant sum of about $500 million worth of merchandise sold based on Alibaba’s rate. Read Full Post…
Bottom line: LeTV’s fledgling e-commerce business could rise quickly but may also experience growing pains that bring negative publicity, as media start to tire of the company’s constant hype and its fortunes start to stagnate.
LeTV jumps into e-commerce
Online video sensation LeTV(Shenzhen: 300104) has never been one to do anything quietly, and that’s true once more with its sudden jump into the hotly contested e-commerce space. In its usual high-profile fashion, LeTV has sent out emails to reporters detailing its huge success with a recent e-commerce promotion, and also its launch of a US e-commerce site.
But the media weren’t giving to much ink to LeTV’s hype, and instead focused on negative reports of logistical problems connected to its recent promotion on September 19. Such problems don’t come as a huge surprise for an e-commerce newcomer like LeTV, which is far better known for its online video service than Inernet shopping. Read Full Post…
Bottom line: Jiuxian’s decision to list in China and Dangdang’s continued effort to de-list from New York show that low-quality Chinese firms will have difficulty getting attention from US investors and are probably better listing in their home market.
Jiuxian wine cellar to list on China’s OTC
Two news items continue to show a growing distaste for New York by Chinese web firms, led by word that veteran online wine seller Jiuxian has just received approval for an IPO on China’s over-the-counter (OTC) board. The second items comes from veteran e-commerce site Dangdang (NYSE: DANG), whose outspoken CEO is quoted complaining about his company’s low valuation and saying his plans are moving forward to de-list from New York and re-list in China.
The most commonly heard theme to these stories is that Chinese firms can get better valuations in their home market than New York, because their names are more recognized in China. But another theme that gets far less attention is that many of these complaining companies are simply low-quality products whose only real attraction is their “made in China” label. Read Full Post…
Bottom line: New global initiatives by Alibaba and JD.com are largely cosmetic and could bring some short-term support to their stocks, but both will need to show results to satisfy investors over the longer term.
Alibaba, JD in outbound migration
China’s 2 leading e-commerce firms are in a sudden migratory mood, with Alibaba(NYSE: BABA) and JD.com (Nasdaq: JD) both announcing the opening of new offices in the US and Europe. At the same time, Alibaba has also declared that the headquarters for its annual November 11 Singles’ Day shopping extravaganza will migrate, leaving its original location in the company’s hometown of Hangzhou to set up a new shop in Beijing.
The sudden migratory story looks squarely aimed at investors, who want to see these domestic e-commerce giants laying the groundwork for future growth beyond their home China market. But while opening new offices may look nice on the surface, the US and European markets that both companies are targeting will be extremely tough due to competition from entrenched local players and global giant Amazon (Nasdaq: AMZN). Read Full Post…
The following press releases and media reports about Chinese companies were carried on October 13. To view a full article or story, click on the link next to the headline.
══════════════════════════════════════════════
Tsinghua’s Latest Deal Is Adding Chairman of Micron (Nasdaq: MU) Venture (English article)
JD.com (Nasdaq: JD) Opens First US Office in Silicon Valley (company announcement)
Baidu (Nasdaq: BIDU), Taikang Life Lead $200 Mln Series C in E-tailer Womai (English article)
58.com (NYSE: WUBA) Unit 58 Home Raises US$300 Mln Series A Funding (PRNewswire)
China RE IPO Raises Nearly $2 Bln, Shares to Debut on Oct 26 (Chinese article)
Bottom line: Apple’s new drive to sell legal music, books and video in China stands a reasonably good chance of success, banking on consumers’ growing willingness to pay for such products if they are convenient and affordably priced.
iTunes comes to China
Following the record-breaking debut for its iPhone 6s models, tech giant Apple (Nasdaq: AAPL) is taking a big new risk by attempting something no one has done yet successfully: making profits from selling legal music and movies in China. The move was part of a newly announced major expansion of Apple’s online store in its second largest global market. But while Chinese consumers have shown a big willingness to pay huge premiums for iPhones, it’s far from clear they’ll do the same for movies and music that they can usually download for free.
Apple sold a record 13 million iPhone 6s models worldwide in their first weekend on sale, easily beating the previous record of 10 million for the iPhone 6 models. China was an important factor in achieving the new record, since the iPhone 6 wasn’t available here during the first weekend of its global launch due to technical reasons. Apple hasn’t given any individual country figures yet, but it’s probably safe to assume it sold at least 3 million of the new iPhones in China during their opening weekend. Read Full Post…
Bottom line: iPhone 6 sales are likely to start slow in China, but could pick up momentum as the nation’s 3 wireless carriers launch aggressive promotions to attract users for their new 4G services.
iPhone 6s in subdued China launch
As everyone awaits the first sales figures for the iPhone 6 after its launch last Friday, it’s becoming apparent that Apple’s (Nasdaq: AAPL) newest smartphone isn’t drawing quite as much buzz as earlier models in China. But that said, strong promotions from some of China’s leading e-commerce sites, a price that’s relatively unchanged from previous ones and the Chinese obsession with owning the newest of everything could work to the new iPhone’s advantage in the world’s largest smartphone market.
In case anyone out there can’t tell, most of us really have no idea how the new iPhone is selling in China for this latest launch, thanks to the huge number of sales channels Apple now has in the country. In addition to official Apple stores and the nation’s 3 wireless carriers, consumers can buy their new iPhones through thousands of unauthorized Apple shops, as well as through top e-commerce sites like the ones operated by Suning (Shenzhen: 002024) and JD.com (Nasdaq: JD). Read Full Post…
The following press releases and media reports about Chinese companies were carried on September 25. To view a full article or story, click on the link next to the headline.
══════════════════════════════════════════════
China Telecom (HKEx: 728), Unicom (HKEx: 762) May Merge – Deutsche Bank (Chinese article)
Didi Kuaidi in Strategic Partnership with LinkedIn (NYSE: LNKD) (Chinese article)
Toshiba in White Goods Deal with China’s Skyworth (HKEx: 751) (English article)
Huishang Bank Turns to HK for Share Sale After China Rout (English article)
JD.com (Nasdaq: JD) Boosts Asia Reach With HK Office, Logistics Tie-Up (GlobeNewswire)
