China’s biggest tech and e-commerce platforms have reported their Q2 2025 earnings, and the results paint a familiar but worrying picture: strong top-line growth is coming at the expense of profits. Investors are responding differently across the sector. JD.com’s shares slipped after its earnings announcement, while Meituan’s stock fell sharply following its results. By contrast, Alibaba Group has gained momentum in the Hong Kong market since releasing its figures last Friday.
JD.com initiated the price war, leads with growth, profitability suffers
JD.com is the first among China’s top three e-commerce giants to unveil its second-quarter earnings in mid-August. It leads the pack with a reported revenue of RMB 356.7 billion (US$49.8 billion), up 22.4% year-on-year—the fastest growth since late 2021. However, net income declined 51% to RMB 6.2 billion (approximately US$0.9 billion).
JD credits the growth to higher user traffic, more active shoppers, and increased activity in its Retail and Food Delivery segments. The expansion in food delivery, however, comes at a steep cost, with marketing spend at the platform increasing 128% year-over-year —a sharp spike from just 13.9% in Q1 2025. JD has aggressively invested in marketing its new initiatives amid the heated price wars. Government subsidies have also helped revenue, but the profit hit shows that market share doesn’t come cheap.
For comparison, Alibaba and Meituan are in a similar revenue situation this quarter and also experience pressure on profits.
Meituan's revenue growth masks a profit collapse
Meituan’s Q2 revenue rose 11.7% year-on-year to RMB 91.84 billion (US$12.8 billion). Yet adjusted net profit collapsed 89% to RMB 1.49 billion (US$0.21 billion), far below analysts' expectations. The culprit: “irrational competition” in food delivery and instant retail—a price war that has eroded margins.
The company is banking on celebrity marketing, naming Olympic star Sun Yingsha as its latest brand ambassador. But without operational changes, a KOL strategy alone may not be enough to recover the market share lost to JD and Taobao.
Alibaba: Integration and AI cushion e-commerce pressure
On the other hand, Alibaba reported a 2% year-over-year increase in revenue for the second quarter of 2025, reaching RMB 247.7 billion (approximately US$34.6 billion). Although its net income jumped 76% to 43.1 billion yuan (US$6 billion), on a non-GAAP basis, net income fell 18% to RMB 33.5 billion (US$4.7 billion), missing market expectations.
The decline was largely due to increased investment in Taobao Flash Sale, its new instant ecommerce initiative, as well as spending on user experience, customer acquisition, and technology upgrades.
Though e-commerce growth is still the pain point of Alibaba Group, Alibaba Cloud posted a 26% increase. AI-related product revenue continued its strong momentum, achieving triple-digit year-on-year growth for the eighth consecutive quarter.
Unlike JD or Meituan, Alibaba is integrating its initiatives rather than isolating them. Flash Sale leverages food delivery traffic to boost its broader ecosystem that links Taobao, Tmall, Ele.me, and Fliggy under the newly formed China E-commerce Group.
Early August’s multi-tiered loyalty programme further ties e-commerce, delivery, and travel services together. Analysts note that Flash Sale traffic drove a 12% YoY increase in Taobao advertising revenue and a 9% gain in CRM revenue, according to an analysis by Chinese media.
