---
title: "Alibaba, JD.com, and PDD Holdings: Three earnings reports, three different \"survival strategies\""
type: "Topics"
locale: "en"
url: "https://longbridge.com/en/topics/43776229.md"
description: "The "Big Three" in e-commerce have reached a crossroads; where will they go from here? Whale Business (ID: bizwhale) Original Author | Sanlun In late August, the earnings season for internet giants resembled a relay race. Alibaba revealed its hand first: revenue remained steady but profits bled out, with all hope pinned on AI cloud services. JD.com's results were counterintuitive—revenue fell for the first time in twelve years, yet profits surged against the trend. Pinduoduo continued its script of "increasing revenue without boosting profits," with net profit shrinking for the third consecutive quarter. Interestingly, shortly after the earnings reports were released..."
datetime: "2026-09-05T15:36:41.000Z"
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  - [zh-CN](https://longbridge.com/zh-CN/topics/43776229.md)
  - [zh-HK](https://longbridge.com/zh-HK/topics/43776229.md)
author: "[新用户_hzl2Sb](https://longbridge.com/en/profiles/35758180.md)"
generator: "portal-rs"
---

# Alibaba, JD.com, and PDD Holdings: Three earnings reports, three different "survival strategies"

The "Big Three" of e-commerce stand at a crossroads. Where do they go from here?

By Whale Business (ID: bizwhale) | Author: Sanlun

In late August, the earnings season for internet giants played out like a relay race.

Alibaba revealed its hand first: revenue was steady, but profits were bleeding, with all hope pinned on AI cloud services. JD.com's results were counterintuitive—revenue fell for the first time in twelve years, yet profits surged against the trend. Pinduoduo continued its script of 'revenue growth without profit growth,' seeing net profit shrink for the third consecutive quarter.

Interestingly, shortly after the earnings release, Alibaba announced its first new share placement since its Hong Kong listing. The HK$80 billion raise was oversubscribed in less than an hour, with all funds earmarked for AI infrastructure. The market's enthusiasm contrasted sharply with the bleak financial reports.

Viewing these three companies' reports together is like looking at three distinct oil paintings: **one depicts a future technological landscape, one prunes the branches of the present, and another cultivates roots deep underground.**

These tech giants are already pursuing different strategies. Alibaba has pushed its chips to the center of the AI table, JD.com seeks efficiency within heavy-asset supply chains, and Pinduoduo has plunged headfirst into factory floors and farmlands. As the traffic dividend in the e-commerce industry hits its peak and growth stories become unsustainable, these three former rivals running on the same track are answering the same question in completely different ways: Next, where should the money go?

# Three Revenues, Three Rhythms

Quarterly reports from the three e-commerce giants have dropped simultaneously, each delivering a vastly different scorecard.

Let's start with Alibaba. Group revenue in Q2 approached ¥268.953 billion, up 9% YoY, broadly in line with expectations. This number isn't bad, but the profit side looks like it's hemorrhaging: operating profit fell 57% YoY, and adjusted net profit declined 38%.

Where did the money go? The answer lies in the brightest label in the report: AI. External commercialization revenue for Alibaba Cloud surged 45%, hitting a high for 22 quarters. AI-related product revenue grew at a triple-digit rate for the 12th consecutive quarter, reaching ¥12.376 billion. Adjusted margin climbed to 12%, and EBITA exploded 133% YoY.

This means the heavy investments Alibaba has poured into cloud and AI over the years are finally starting to pay off. With a 38.1% market share firmly holding the No. 1 spot in China's AI cloud market, T-Head's self-developed AI processor, Zhenwu M890, has entered over 650 external clients across 20+ industries. From chips to models, computing power to applications, Alibaba is redefining itself as a 'full-stack AI company.'

But every coin has two sides. The e-commerce base, once Alibaba's strongest fortress, now shows cracks. China e-commerce business revenue fell 8% YoY, and customer management revenue dropped 7%. While instant retail surged 45% to ¥53.295 billion and 88VIP members grew to ~64 million, these new shoots are far from enough to cover the dead leaves on the main branches.

Its e-commerce base contributes over 3/4 of revenue, so its recovery strength directly dictates Alibaba's overall financial health. In other words, no matter how bright the AI cloud looks, it remains merely a 'second growth curve' while the first curve is losing speed.

JD.com's story is entirely different. Q2 revenue was ¥346.4 billion, down 2.9% YoY—the first quarterly revenue decline since its 2014 IPO. The drop was mainly driven by electrical categories; electronics and home appliance revenue fell 11.8% to ¥157.9 billion. Last year's high base from state subsidies combined with the 618 mega-sale, coupled with this year's subsidy cut from 20% to 15% and weak consumer electronics demand, caused the anchor to shake.

Yet miraculously, despite falling revenue, profits rose. Operating profit swung from a ¥860 million loss YoY to a ¥4.5 billion profit; Non-GAAP net profit reached ¥8.93 billion, up 20.8% YoY.

Where did the money come from? First, a significant cut in food delivery subsidies; Xu Ran revealed on the call that Q2 losses in the food delivery business narrowed by over 50% YoY. Second, high-margin platform and advertising revenue led growth, with service revenue share rising from 20.2% to 22.7%. Third, cost optimization from improved supply chain efficiency. JD's choice is clear: stop trying to have it all, trading revenue slowdown for profit improvement.

Finally, Pinduoduo. Revenue hit ¥112.4 billion, up 8% YoY, with growth clearly slowing. Online marketing services grew only 5%, showing weak ad momentum; transaction service revenue was ¥54.7 billion, up 13%, becoming the core growth engine. However, net profit was ¥27.2 billion, down 12% YoY—marking the third consecutive quarter of 'revenue up, profit down.'

Where did the profit go? Non-GAAP R&D investment was ¥4.3 billion, surging 40% YoY, directed toward risk control, AI, and platform governance. Sales and marketing expenses hit ¥29.7 billion, funding the '100 Billion Support Plan' to reduce fees for merchants and subsidize consumers. Free shipping to villages rolled out in over 10 provinces/cities, with county-level transit hubs and village-level collection points continuously laid out. Co-CEO Zhao Jiazhen was blunt: 'The primary task at this stage is helping merchants grow and strengthening the industrial ecosystem.' Trading short-term profit for long-term ecosystem.

With the three reports on the table, Alibaba seeks the future in AI, JD seeks profit in contraction, and Pinduoduo seeks ecosystem in investment. Different directions, but doing the same thing: stockpiling ammunition for the next cycle.

# Behind the Glamour, Worries Abound

Beneath the glossy numbers of big tech, each hides its own concerns. Some are dragged down by core growth, some face pincers from overseas regulators, and others are digging deeper into the hole of burning cash for the future.

No matter how compelling Alibaba's AI story is, it cannot bypass reality: the speed at which the core business makes money is far slower than the speed at which AI spends it. Core e-commerce remains under pressure. China e-commerce revenue fell 8% YoY, customer management revenue fell 7%. Although 88VIP membership reached 64 million with double-digit growth, slowing transactions are an undeniable fact. This indicates weakening merchant willingness to advertise on the platform and slowing consumer conversion.

International e-commerce revenue fell 1% YoY. Cross-border business is still adjusting, and changes in the global trade environment make the path to going global thorny. While instant retail's 45% growth and AI cloud's 45% growth are indeed eye-catching, the e-commerce base remains the main source of revenue and profit. The recovery strength of this segment impacts the group's financial health.

The issue of AI burning cash is even sharper. Single-quarter capex hit ¥67.7 billion, nearly 3 times the operating cash flow of the same period.

Furthermore, Alibaba's announcement of its first new share placement since its HK listing, raising HK$80 billion to be 100% invested in AI infrastructure, signals confidence in the direction but also reveals a problem: profits from the core business are no longer enough to fund the burn.

Eddie Wu said on the call that the ¥67.7 billion capex 'is indeed a bit high due to the cyclical nature of hardware delivery,' but overall they 'hope to maintain a more aggressive stance.' His break-even promise is three years, potentially shortening to 2.5 or 2 years as margins improve. But no matter how short the AI infrastructure ROI cycle is, it's still a future event; the current cash flow pressure is real.

JD's trouble lies on the other end. Its e-commerce base is shaking; electrical categories fell 11.8%, and H1 home appliance retail sales fell 9.9% YoY, making the industry ceiling faintly visible.

More tricky is the stalemate in the food delivery battlefield. Over the past year, JD, Alibaba, and Meituan have burned at least ¥150 billion on food delivery, pushing daily orders from 80-90 million to over 200 million. But after the 格局 stabilized, JD Food Delivery averages ~9 million orders daily, Taobao Flash Purchase ~50 million, and Meituan ~65 million. JD clearly lags behind.

Slightly better news is that JD is converting the capabilities burned into assets into actual assets; minute-level fulfillment capability fills logistics gaps, adding high-frequency demand to the retail main station. But transition pains are inevitable. Marketing expenses dropped from ¥27 billion to ¥20.3 billion, down 24.8% YoY; saved money was redirected, with fulfillment costs rising to ¥24.5 billion and R&D spending surging 37.7% YoY. Whether the path from burning cash for scale to using technology for efficiency works needs time to verify.

After all, capital market logic is cruel: it can tolerate you losing money, but not tolerates you slowing down. Once the growth train slows, more people will get off than get on.

Pinduoduo's trouble is the most complex and hidden.

Temu is experiencing its 'darkest hour' overseas. On May 28, the EU fined Temu €200 million under the Digital Services Act, the highest single fine since the law took effect.

Even EU investigators posing as ordinary consumers ordering on Temu found many chargers failed basic safety tests, and baby toys posed risks of chemical overdose and suffocation.

That's not all. Starting July 1, the EU canceled tariff exemptions for low-value packages, uniformly levying fees on small parcels from China. This means the 'cross-border direct mail' model Temu relied on to sweep Europe will see costs rise significantly. The response strategy is shifting to local merchants and local warehouses, moving from light to heavy assets, meaning more burning cash and a slower pace.

Domestically, it's not easy either. Online marketing service growth slipped from double digits to single digits, indicating the ad monetization ceiling is approaching. Pinduoduo's proud low-cost traffic advantage begins to show diminishing marginal returns after user growth slowed. The '100 Billion Support' and 'Free Shipping to Villages' are long-term investments, but their drag on short-term profit has manifested for three consecutive quarters.

Three companies, three dilemmas. Alibaba struggles between 'going all-in' on AI and current cash flow; JD walks a tightrope between growth deceleration and profit repair; Pinduoduo makes trade-offs between short-term profit and long-term ecosystem. No path is easy, but no one is lying flat.

# The Road Ahead: AI, Efficiency, and Supply Chain

Looking ahead, the three paths diverge further.

Alibaba chose the most radical path—All in AI. Its bold claims of an HK$80 billion share placement, over ¥60 billion in single-quarter capex, and a 3-year break-even mean Alibaba is betting its entire fortune on AI infrastructure. From the chip layer's T-Head Zhenwu M890, to the model layer's Qwen3.8-Max, to the application layer's Tongyi Office and Tongyi App, Alibaba attempts to connect the full-stack value chain from underlying computing power to upper-layer applications.

Eddie Wu said that 凭借 the full-stack AI strategy, Alibaba is in a favorable position to capture the significant growth in AI computing demand. Spoken with confidence, but the cost behind it is equally shocking: Adjusted EBITA loss for the AI Lab and Application segment expanded from ¥3.224 billion YoY to ¥13.861 billion. Alibaba bets that today's bleeding will 换来 tomorrow's blood-making, that AI will become infrastructure like electricity, and Alibaba will be the power seller.

JD.com chose another path, not following the AI large model race, but rooting AI in real scenarios. JD Logistics' 'Zhi Lang' warehousing system is applied in over 60 warehouses globally; the JoyAI large model has landed in over 2,000 scenarios in the supply chain; the Embodied Data Collection Center plans to accumulate over 10 million hours of data within two years.

H1 R&D investment grew 53% YoY, with Liu Qiangdong personally leading the Exploration Research Institute. JD's AI path is clear: use real data generated daily to feed the model, and use stronger model capabilities to continuously reduce costs and increase efficiency. Warehouses, logistics networks, and delivery teams, which were costs during the retail high-growth era, can be transformed into core assets in the AI era. This path is slow, but solid.

Pinduoduo hasn't made AI its core narrative at all. 'New Pinmu' is the keyword for the next decade. A 3-year, ¥100 billion investment integrates Pinduoduo and Temu's global supply chain, systematically 自营 s and incubates brands for different markets. This is a turn from 'matchmaker' to 'controller.'

Zhao Jiazhen said 'supply chain investment is the major direction,' and Chen Lei said 'the company is currently in a transformation and development stage.' Pinduoduo bets that Chinese manufacturing supply chain capabilities will ultimately beat algorithms and traffic. But this bet is huge; the profit margin of the 自营 model is naturally lower than the platform model. Whether 'New Pinmu' can run successfully may take three, five, or even longer years to verify.

In short, the three giants are parting ways from the same track. Alibaba bets on tech infrastructure, wanting to become the 'shovel seller' of the AI era; JD bets on supply chain efficiency, aiming to build a moat with heavy assets plus AI; Pinduoduo bets on brand and supply upgrades, attempting to transform from a 'low-price matchmaker' to a 'quality definer.'

No path is easier, nor is any destined for success. But it is certain that the era of making money lying down 依靠 traffic dividends, subsidy wars, and scale myths has completely ended. Future e-commerce wars will no longer be about who runs faster, but who survives longer and whose roots dig deeper. Only by first planting roots in the soil do you qualify to talk about the next spring.

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> **Disclaimer: This article is for reference only and does not constitute any investment advice.**