optimized revenue structure and improved profitability in the first half of the year - large internet companies are developing well
2024-10-05
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recently, internet companies have released their second quarter and interim performance reports one after another. faced with challenges such as intensifying market competition and compressed inventory space, large internet companies such as alibaba, tencent, baidu, jd.com, pinduoduo, and meituan are focusing on price competitiveness, optimizing platform ecology, and driving new technologies to actively explore overseas markets. , the overall situation shows a positive development trend of optimizing the revenue structure and improving profitability.
steady business growth
financial reports show that in the first half of the year, most internet companies achieved double growth in revenue and net profit, and some companies doubled their revenue.
specifically, in the first half of the year, jd.com group’s revenue continued to grow at 551.4 billion yuan; in the second quarter, revenue was 291.4 billion yuan, and net profit (non-gaap) attributable to common shareholders of listed companies reached 14.5 billion yuan, a year-on-year increase of 69 %. alibaba's second-quarter revenue was 243.236 billion yuan, a year-on-year increase of 4%, and its adjusted profit before interest and tax was 45.035 billion yuan. baidu group's total revenue was 65.4 billion yuan; second quarter revenue was 33.931 billion yuan, roughly the same as last year, and net profit attributable to the company was 5.488 billion yuan, a year-on-year increase of 5%. pinduoduo’s revenue was 183.9 billion yuan, a year-on-year increase of 104.9%; in the second quarter, it achieved revenue of 97.06 billion yuan, a year-on-year increase of 86%, and net profit attributable to ordinary shareholders was 32.0094 billion yuan, a year-on-year increase of 144%. meituan’s revenue was 155.527 billion yuan, a year-on-year increase of 22.9%; operating profit was 16.466 billion yuan, a year-on-year increase of 98.4%.
in addition to improving overall performance, the revenue structure has been optimized and the quality of earnings has improved. in the second quarter, tencent achieved revenue of 161.117 billion yuan, gross profit of 85.895 billion yuan, and operating profit (non-ifrs) of 58.443 billion yuan. the growth rates of gross profit and operating profit reached 21% and 27% respectively, continuously outperforming the revenue growth rate. alibaba's two core businesses of e-commerce and cloud continue to make positive progress. the operating efficiency of many other businesses has improved, the level of commercialization has improved, and losses in businesses such as ele.me and lazada have narrowed significantly. xu hong, chief financial officer of alibaba group, said that alibaba group continues to increase investment to promote the growth of its core business, and other businesses have reduced losses and maintained good profit margins by improving operating efficiency.
hu qimu, deputy secretary-general of the 50-person china digital real integration forum and chief researcher of the digital economy think tank, believes that the recovery in the performance of internet companies has benefited from many benefits: first, the consumer market has gradually recovered. from january to july, national online retail sales were 8.38 trillion. yuan, an increase of 9.5%. second, enterprises promote resource aggregation through optimization of personnel, organizational structure, and business lines, and achieve results by reducing costs and increasing efficiency. third, some companies strive to expand overseas business, bringing new market increments to the platform. fourth, some companies have applied years of technology accumulation to new scenarios, and have achieved good results in cultivating new business sectors.
the steady recovery of the consumer market has played a particularly obvious role. meituan cfo chen shaohui said that in the first half of the year, the local business sector represented by "food, accommodation, travel, shopping and entertainment" benefited from the traditional peak consumption season. meituan gave full play to its overall advantages on both ends of supply and demand, and used more diversified supplies to meet more needs. many new needs. according to jd.com’s financial report, its brands and merchants achieved quality growth in the second quarter. the number of quarterly active users and user shopping frequency maintained double-digit growth, which also reflects the heating up of the consumer market.
platform ecological optimization
as the e-commerce market increasingly enters the stage of stock competition, internet companies such as alibaba and jd.com are working together to optimize the platform ecosystem and strive to win more market share by improving user experience and strengthening price competitiveness.
alibaba has increased its investment in "good goods, good prices, and good services" and has successively launched a series of reform and innovation measures. for example, in order to improve user experience, taotian group took the lead in canceling the official pre-sale of "618", launched full price guarantees during major promotions, and upgraded 88vip membership rights within the quarter, which has an obvious positive cycle effect. in the second quarter, taotian group's gross merchandise volume (gmv) increased year-on-year, the number of buyers and the frequency of purchases continued to grow, and the order volume achieved double-digit growth year-on-year.
"jd.com continues to be committed to the sustainable and high-quality development of its business, constantly strengthening its supply chain capabilities, and optimizing user experience. through scale effects and improved procurement efficiency, it can bring low prices to users every day while ensuring quality." jd.com group ceo xu ran said that the above measures have been recognized by users, the number of users has grown steadily in the second quarter, and user participation continues to improve.
in addition to paying attention to the experience and feelings of consumers, the needs and healthy development of merchants have also received more attention. since this year, meituan has been continuously improving its products and services on the merchant side. meituan’s takeaway “brand satellite stores” provide more merchants with services such as commission returns, traffic support, and operational guidance. as of the end of june, 120 brands had opened more than 800 satellite stores across the country. meituan flash warehouse helps merchants improve the quality and efficiency of their operations by providing online operations, pricing strategies, traffic support and contract fulfillment services.
experts believe that, unlike blindly fighting for low prices and sacrificing the interests of partners, this wave of price competitiveness competition among internet companies focuses more on relying on economies of scale and supply chain innovation to build long-term development advantages. "if you rely solely on involutionary low-price competition or excessive subsidies, you may gain more market share in the short term, but it will be unsustainable in the medium and long term. platforms that continue to allocate resources to fight price wars will crowd out their resources for innovation. it is not conducive to the evolution and iteration of the platform itself. at the same time, part of the cost of the price war will inevitably be allocated to the real industry, thereby squeezing the profits of the real industry. "in the period of stock competition, who can improve efficiency and improve the platform user experience through technological progress. , whoever can win more market share and user trust.
“going overseas” takes steady steps
while competing for platform ecology, some internet companies are actively looking for new driving forces in new technologies, resolutely "going out" and striving to open up new growth space.
tencent introduced that its ai large models, saas and other "new sprout" businesses are growing vigorously, injecting new high-quality income into its main business. driven by large model technology and other factors, tencent's digital revenue represented by the financial technology and enterprise services sectors reached 50.4 billion yuan in the second quarter, a year-on-year increase of 4%; benefiting from video account advertising, ai efficiency improvement, etc., tencent's advertising revenue in the second quarter revenue of the value-added services segment in the second quarter was 29.9 billion yuan, a year-on-year increase of 19%; the value-added services segment revenue in the second quarter was 78.8 billion yuan, a year-on-year increase of 6%.
driven by ai technology, baidu's business has achieved high-quality growth. baidu founder, chairman and ceo robin li said that baidu is promoting ai to solve real-world problems and is committed to making wenxin large models more affordable and easy to use. recently, the average daily calls of the wenxin large model have exceeded 600 million times, and the average daily number of tokens processed exceeds 1 trillion times. at the same time, ai-driven baidu intelligent cloud maintained strong growth, with revenue in the second quarter increasing by 14% year-on-year, of which ai-related revenue accounted for 9%. alibaba has also firmly increased its investment in ai infrastructure, increased the adoption of public clouds in the ai era, improved its product structure, and improved operational efficiency. in the second quarter, alibaba cloud's revenue increased by 6%, and its adjusted profit before interest and tax reached 2.337 billion yuan, a year-on-year increase of 155%.
it is worth mentioning that internet companies’ “going global” pace remains steady. overseas markets have become a new battlefield for tencent's multiple businesses. with its self-developed "going overseas" and overseas studios, tencent's international market games have shown good growth, with revenue of 13.9 billion yuan in the second quarter, a year-on-year increase of 9%; wechat cross-border payment has also covered 74 countries and regions, with more than 1,000 overseas cooperative institutions and more than 6 million overseas merchants. the synergies between alibaba's cross-border business and cross-border fulfillment services continue to emerge, driving alibaba international digital business group and cainiao group to maintain rapid growth. in the second quarter, revenue increased by 32% and 16% respectively year-on-year.
although the overall performance of internet companies is improving, they still face many challenges in maintaining sustained growth in the future under the pressure of intensifying market competition and shrinking user growth space. "if internet companies want to make greater breakthroughs, they need to continue to explore new business scenarios and new breakthrough points in the integration of data and reality through technological progress. at the same time, they must find new market increments through high-quality international layout. in addition, they must transform the simple traffic monetization development model, provide more value-added services, and let data elements create more value," said hu qimu. (economic daily reporter li hualin)
source: economic daily
