JD.com 3Q 2018 Update

My thoughts on JD’s third quarter

• JD's third-quarter report showed 25% revenue growth and fourth-quarter guidance of 18%-23%. A macro-driven slowdown is occurring, especially in big ticket durable goods.

• Management was clear that margin expansion is coming. Core JD Mall margins are improving and JD Logistics margins should significantly improve.

• JD appears extremely well-positioned to capitalize on China's multi-decade growth runway. Macro headwinds and Richard Liu's legal issues are providing a great entry point for long-term investors.

• A resolution to the U.S.-China trade war would likely help improve macroeconomic conditions and confidence in China.