MUFG Profit Beats Estimates; Maintains Record Earnings Target
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Mitsubishi UFJ Financial Group Inc. kept its forecast for another year of record profit after earnings exceeded analysts' expectations in the first quarter, thanks to a drop in credit costs.
Net income fell 1.8% from a year earlier to ¥546.1 billion ($3.7 billion) in the three months ended June 30, Japan's largest bank said Monday. That beat the ¥490.1 billion average of five analysts' estimates compiled by Bloomberg.
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JD.com Announces Second Quarter and Interim 2025 Results
BEIJING, Aug. 14, 2025 (GLOBE NEWSWIRE) -- Inc. (NASDAQ: JD and HKEX: 9618 (HKD counter) and 89618 (RMB counter), the 'Company' or ' a leading supply chain-based technology and service provider, today announced its unaudited financial results for the three and six months ended June 30, 2025. Second Quarter 2025 Highlights Net revenues were RMB356.7 billion (US$149.8 billion) for the second quarter of 2025, an increase of 22.4% from the second quarter of 2024. Net income attributable to the Company's ordinary shareholders was RMB6.2 billion (US$0.9 billion) for the second quarter of 2025, compared to RMB12.6 billion for the second quarter of 2024. Non-GAAP2 net income attributable to the Company's ordinary shareholders was RMB7.4 billion (US$1.0 billion) for the second quarter of 2025, compared to RMB14.5 billion for the second quarter of 2024. Diluted net income per ADS was RMB4.15 (US$0.58) for the second quarter of 2025, compared to RMB8.19 for the second quarter of 2024. Non-GAAP diluted net income per ADS was RMB4.97 (US$0.69) for the second quarter of 2025, compared to RMB9.36 for the second quarter of 2024. JD Retail reported net revenues of RMB310.1 billion (US$43.3 billion) for the second quarter of 2025, an increase of 20.6% from the second quarter of 2024. Income from operations of JD Retail was RMB13.9 billion (US$1.9 billion) for the second quarter of 2025, compared to RMB10.1 billion for the second quarter of 2024. Operating margin of JD Retail was 4.5% for the second quarter of 2025, compared to 3.9% for the second quarter of 2024. 'In the second quarter, we saw robust growth in user traffic, quarterly active customers, and user shopping frequency on JD's platform, driven by sustained momentum across both our core JD Retail business and New Businesses including JD Food Delivery,' said Sandy Xu, Chief Executive Officer of 'JD Retail delivered a strong 20.6% year-on-year revenue growth during the quarter, with operating margin reaching 4.5%, a historic high across all promotion quarters. JD Food Delivery also made healthy progress during the quarter in metrics such as order volume growth, merchant base expansion, full-time rider recruitment, and more importantly, synergies with retail and other existing businesses of JD, having successfully achieved our initial strategic goals. Looking ahead, we are confident that our core retail business will remain a solid cornerstone of our operations as we continue to focus on delivering the best user experience, lowering costs, and improving efficiency. At the same time, we will continue to invest in new growth areas in alignment with our long-term strategic roadmap.' 'Our total revenues recorded 22.4% year-on-year growth in the second quarter, a clear testament to the strength of our supply chain and our commitment to superior user experience,' said Ian Su Shan, Chief Financial Officer of 'Our core JD Retail business has also continued to realize its potential in operating efficiency improvement, with gross margin rising year-on-year for thirteen consecutive quarters through Q2, while operating margin has maintained a steady upward trajectory. As our core JD Retail business continues to build steady momentum, we will execute our strategies at the appropriate pace to develop our New Businesses initiatives, including JD Food Delivery, ensuring that each step we take strengthens our long-term value creation capabilities.' Updates of Share Repurchase Program Pursuant to the Company's share repurchase program of up to US$5.0 billion adopted in August 2024 and effective through August 2027, the Company repurchased a total of approximately 80.7 million Class A ordinary shares (equivalent to 40.4 million ADSs) for approximately US$1.5 billion during the six months ended June 30, 2025. The remaining amount under the share repurchase program was US$3.5 billion as of the date of this announcement. The total number of shares repurchased by the Company during the six months ended June 30, 2025 amounted to approximately 2.8% of its ordinary shares outstanding as of December 31, 20243. All of these ordinary shares were repurchased from Nasdaq and the Hong Kong Stock Exchange pursuant to the share repurchase program. Business Highlights JD Retail: During the JD 618 Grand Promotion, JD Supermarket introduced a range of products with distinctive JD features, such as branded milk and yogurt in 211 milliliters and Chinese liquor in both 211- and 618-milliliter packages. JD Supermarket has been providing customers with a differentiated shopping experience through six tailor-made product portfolios: tailor-made packaging, IP, gift sets, craftsmanship, functions and raw material. These efforts also help suppliers avoid homogenized competition and price involution, bringing new growth opportunities for the broader industry. This stands as one of the most concrete manifestations of JD's supply chain strengths. On April 15, officially launched its 'One Step Ahead – Accelerated Upgrade Program' for 3C electronics products. The program aims to support manufacturers to drive new product sales and enhance user experience. With this program, JD is stepping up efforts in sales of emerging categories such as AI glasses and embodied intelligent robots, catering to consumers' diverse upgrade demands and helping to drive industry-wide innovation and growth. In the second quarter of 2025, JD MALL launched new stores in multiple cities including Beijing, Shenzhen, Nanjing, Wuhan and Taiyuan. As of the end of June 2025, JD MALL has opened a total of 24 stores. Differentiated from traditional offline stores, JD MALL leverages JD's supply chain strengths and offers customers an immersive, digitalized and one-stop shopping experience through in-depth integration of online and offline data, services and use cases. JD Logistics: While JD Logistics ('JDL') continues to strengthen its leading position in China's domestic integrated supply chain market, its 'Global Smart Supply Chain Network' plan is also ramping up with overseas warehousing capabilities at its core. JDL has been extending its years of warehousing operation experience and integrated supply chain capabilities to overseas markets, delivering high-quality, efficient and comprehensive solutions to a growing number of Chinese brands, overseas local customers, and cross-border e-commerce platforms. In the first half of 2025, JDL opened new overseas warehouses in multiple countries globally, including the United States, the United Kingdom, France, Poland, South Korea, Vietnam, and Saudi Arabia. As of June 30, 2025, JDL has operated over 130 bonded warehouses, direct mail warehouses, and overseas warehouses in total, with a total managed area exceeding 1.3 million square meters. Its overseas warehouses cover 23 countries and regions worldwide. Meanwhile, built upon its overseas warehouses, JDL has been further developing its global supply chain network that integrates overseas warehouse networks, international transit hubs, local transportation and distribution networks in overseas countries, and cross-border line-haul transportation networks. In particular, in June 2025, JDL launched its self-operated express delivery brand 'JoyExpress' in Saudi Arabia, officially commencing local delivery operations. With this, JDL has established a comprehensive logistics network in Saudi Arabia, covering everything from warehousing and sorting to last-mile delivery, marking a further enhancement of JDL's localized operating capabilities for overseas business. In the first half of 2025, the 'Zhilang' system, an efficient intelligent warehousing solution independently developed by JDL, has entered into the stage of large-scale nationwide application. It has been deployed in various types of warehouses across key cities such as Beijing, Guangzhou, Chengdu, and Fuzhou, marking JDL's acceleration of intelligent advancement. The 'Zhilang' system integrates core components such as handling robots, ladder-climbing robots, and stereoscopic racks, along with auxiliary facilities including automated storage and sorting workstations, as well as automated empty container return lines, which enables it to fully utilize the 12-meter clear height of warehouses to achieve high-density storage. The implementation of 'Zhilang' has also significantly increased in-warehouse operational efficiency, allowing order sorting to be completed in as fast as seconds, even in warehouses with tens of thousands of SKUs. JD Health: In the second quarter of 2025, JD Health further strengthened its position as 'the First Online Marketplace for New and Specialty Medicine Launches' in China. Innovent Biologics' self-developed innovative weight-loss drug Xin Er Mei (信爾美®) and Qingfeng Pharmaceutical's new domestic anti-influenza drug Yi Su Da (伊速達®), among others, became available for sale on JD Health's online platform. New Businesses: In the second quarter of 2025, JD Food Delivery continued its healthy growth trajectory. During the JD 618 Grand Promotion, JD Food Delivery's daily order volume exceeded 25 million, with over 1.5 million high-quality merchants on board. By the end of the second quarter, the number of full-time riders had exceeded 150,000. JD Food Delivery is deeply rooted in the JD ecosystem and is not a stand-alone business. It will continue to focus on the synergistic value with JD's existing businesses, including in the aspects of users, fulfillment and supply, propelling JD's improvement in efficiency and driving long-term healthy growth. In addition, in July 2025, launched 7Fresh Kitchen with a distinctive model to develop signature dishes with partners. 7Fresh Kitchen is committed to innovate and reform the supply chain model in the food delivery industry, driving the industry's high-quality growth through supply chain innovation. Environment, Social and Governance As a testament to unwavering commitment to creating more jobs and making contribution to the society, the total personnel under the JD Ecosystem4 was approximately 900,000 as of June 30, 2025, including the Company's employees, part-time staff and interns, as well as the personnel of the Company's affiliates in the JD Ecosystem. The total expenditure for such human resources, together with the expenditure for external personnel who work for the JD Ecosystem, amounted to RMB136.0 billion for the twelve months ended June 30, 2025. Second Quarter 2025 Financial Results Net revenues increased by 22.4% to RMB356.7 billion (US$49.8 billion) for the second quarter of 2025 from RMB291.4 billion for the second quarter of 2024. Net product revenues increased by 20.7%, while net service revenues increased by 29.1% for the second quarter of 2025, compared to the second quarter of 2024. . Cost of revenues increased by 22.2% to RMB300.0 billion (US$41.9 billion) for the second quarter of 2025 from RMB245.5 billion for the second quarter of 2024. . Fulfillment expenses, which primarily include procurement, warehousing, delivery, customer service and payment processing expenses, increased by 28.6% to RMB22.1 billion (US$3.1 billion) for the second quarter of 2025 from RMB17.2 billion for the second quarter of 2024. Fulfillment expenses as a percentage of net revenues was 6.2% for the second quarter of 2025, compared to 5.9% for the second quarter of 2024, as the Company continues to upgrade fulfillment capabilities and invest in human capital to enhance user experience. . Marketing expenses increased by 127.6% to RMB27.0 billion (US$3.8 billion) for the second quarter of 2025 from RMB11.9 billion for the second quarter of 2024. Marketing expenses as a percentage of net revenues was 7.6% for the second quarter of 2025, compared to 4.1% for the second quarter of 2024, primarily due to the increased spending in promotional efforts for new business initiatives. . Research and development expenses increased by 25.7% to RMB5.3 billion (US$0.7 billion) for the second quarter of 2025 from RMB4.2 billion for the second quarter of 2024. Research and development expenses as a percentage of net revenues was 1.5% for the second quarter of 2025, compared to 1.4% for the second quarter of 2024. . General and administrative expenses increased by 53.2% to RMB3.3 billion (US$0.5 billion) for the second quarter of 2025 from RMB2.1 billion for the second quarter of 2024. General and administrative expenses as a percentage of net revenues was 0.9% for the second quarter of 2025, compared to 0.7% for the second quarter of 2024, primarily due to the increase in share-based compensation expenses. Loss from operations for the second quarter of 2025 was RMB0.9 billion (US$0.1 billion), compared to an income of RMB10.5 billion for the second quarter of 2024. Operating margin was negative 0.2% for the second quarter of 2025, compared to 3.6% for the second quarter of 2024. Non-GAAP income from operations was RMB0.9 billion (US$0.1 billion) for the second quarter of 2025, compared to RMB11.6 billion for the second quarter of 2024. Non-GAAP operating margin was 0.3% for the second quarter of 2025, compared to 4.0% for the second quarter of 2024. The declines were primarily attributable to increased strategic investment in new business initiatives. Income from operations of JD Retail was RMB13.9 billion (US$1.9 billion) for the second quarter of 2025, compared to RMB10.1 billion for the second quarter of 2024. Operating margin of JD Retail for the second quarter of 2025 was 4.5%, compared to 3.9% for the second quarter of 2024. Non-GAAP EBITDA was RMB3.0 billion (US$0.4 billion) for the second quarter of 2025, compared to RMB13.5 billion for the second quarter of 2024. Non-GAAP EBITDA margin was 0.8% for the second quarter of 2025, compared to 4.6% for the second quarter of 2024. ''Net income attributable to the Company's ordinary shareholders was RMB6.2 billion (US$0.9 billion) for the second quarter of 2025, compared to RMB12.6 billion for the second quarter of 2024. Net margin attributable to the Company's ordinary shareholders was 1.7% for the second quarter of 2025, compared to 4.3% for the second quarter of 2024. Non-GAAP net income attributable to the Company's ordinary shareholders was RMB7.4 billion (US$1.0 billion) for the second quarter of 2025, compared to RMB14.5 billion for the second quarter of 2024. Non-GAAP net margin attributable to the Company's ordinary shareholders was 2.1% for the second quarter of 2025, compared to 5.0% for the second quarter of 2024. Diluted net income per ADS was RMB4.15 (US$0.58) for the second quarter of 2025, compared to RMB8.19 for the second quarter of 2024. Non-GAAP diluted net income per ADS was RMB4.97 (US$0.69) for the second quarter of 2025, compared to RMB9.36 for the second quarter of of June 30, 2025, the Company's cash and cash equivalents, restricted cash and short-term investments totaled RMB223.4 billion (US$31.2 billion), compared to RMB241.4 billion as of December 31, 2024. For the second quarter of 2025, free cash flow of the Company was as follows: For the three months ended June 30,2024 June 30,2025 June 30,2025 RMB RMB US$ (In millions) Net cash provided by operating activities 50,738 24,409 3,407 Add: Impact from consumer financing receivables included in the operating cash flow 2,138 641 90 Less: Capital expenditures, net of related sales proceeds (3,321 ) (3,032 ) (423 ) Capital expenditures for development properties (1,590 ) (1,076 ) (150 ) Other capital expenditures* (1,731 ) (1,956 ) (273 ) Free cash flow 49,555 22,018 3,074 * Including capital expenditures related to the Company's headquarters in Beijing and all other CAPEX. Net cash provided by investing activities was RMB8.2 billion (US$1.1 billion) for the second quarter of 2025, consisting primarily of net cash received from maturity of time deposits and wealth management products, partially offset by cash paid for capital expenditures. Net cash used in financing activities was RMB12.4 billion (US$1.7 billion) for the second quarter of 2025, consisting primarily of cash paid for dividend, repurchase of ordinary shares, and acquisition of additional equity interests in non-wholly owned subsidiaries, partially offset by net cash provided by proceeds from borrowings. For the twelve months ended June 30, 2025, free cash flow of the Company was as follows: For the twelve months ended June 30,2024 June 30,2025 June 30,2025 RMB RMB US$ (In millions) Net cash provided by operating activities 74,040 24,819 3,465 Less: Impact from consumer financing receivables included in the operating cash flow (639 ) (1,366 ) (191 ) Less: Capital expenditures, net of related sales proceeds (17,759 ) (13,377 ) (1,867 ) Capital expenditures for development properties (10,559 ) (6,327 ) (883 ) Other capital expenditures (7,200 ) (7,050 ) (984 ) Free cash flow 55,642 10,076 1,407 The Company reports three reportable segments, JD Retail, JD Logistics, and New businesses. JD Retail, including JD Health and JD Industrials, among other operating segments, mainly engages in online retail, online marketplace and marketing services in China. JD Logistics includes both internal and external logistics businesses. New Businesses mainly include JD Food Delivery, JD Property, Jingxi and overseas businesses. For the three months ended For the six months ended June 30, 2024 June 30, 2025 June 30, 2025 June 30, 2024 June 30, 2025 June 30, 2025 RMB RMB US$ RMB RMB US$ (In millions, except percentage data) Net revenues: JD Retail 257,072 310,075 43,285 483,907 573,920 80,116 JD Logistics 44,207 51,564 7,198 86,344 98,531 13,754 New Businesses 4,636 13,852 1,934 9,506 19,605 2,737 Inter-segment eliminations* (14,518 ) (18,831 ) (2,629 ) (28,311 ) (34,314 ) (4,790 ) Total consolidated net revenues 291,397 356,660 49,788 551,446 657,742 91,817 Less: cost of revenues: JD Retail (215,520 ) (256,527 ) (35,810 ) (405,582 ) (475,922 ) (66,436 ) JD Logistics (39,123 ) (46,234 ) (6,454 ) (78,175 ) (90,019 ) (12,566 ) New Businesses (3,643 ) (14,405 ) (2,011 ) (7,674 ) (18,991 ) (2,651 ) Inter-segment eliminations* 12,837 17,171 2,397 25,729 31,710 4,426 Less: operating expenses: JD Retail (31,444 ) (39,609 ) (5,529 ) (58,892 ) (71,213 ) (9,941 ) JD Logistics (2,901 ) (3,372 ) (471 ) (5,762 ) (6,409 ) (895 ) New Businesses (1,688 ) (14,448 ) (2,017 ) (3,197 ) (16,942 ) (2,365 ) Inter-segment eliminations* 1,681 1,660 232 2,582 2,604 364 Income/(Loss) from operations: JD Retail 10,108 13,939 1,946 19,433 26,785 3,739 JD Logistics 2,183 1,958 273 2,407 2,103 293 New Businesses (695 ) (14,777 ) (2,063 ) (1,365 ) (16,104 ) (2,248 ) Including: gain on sale of development properties — 224 31 — 224 31 Total segment income from operations 11,596 1,120 156 20,475 12,784 1,784 Unallocated items** (1,095 ) (1,979 ) (276 ) (2,274 ) (3,110 ) (434 ) Total consolidated income/(loss) from operations 10,501 (859 ) (120 ) 18,201 9,674 1,350 Share of results of equity investees 1,142 2,072 289 412 3,402 475 Interest expense (688 ) (643 ) (90 ) (1,289 ) (1,243 ) (173 ) Others, net 4,661 6,129 856 7,357 8,208 1,146 Total consolidated income before tax 15,616 6,699 935 24,681 20,041 2,798 For the three months ended For the six months ended June 30,2024 June 30,2025 June 30,2025 June 30,2024 June 30,2025 June 30,2025 RMB RMB US$ RMB RMB US$ (In millions, except percentage data) YoY% change of net revenues: JD Retail 1.5 % 20.6 % 3.9 % 18.6 % JD Logistics 7.7 % 16.6 % 11.0 % 14.1 % New Businesses (35.0 )% 198.8 % (27.7 )% 106.2 % Operating margin: JD Retail 3.9 % 4.5 % 4.0 % 4.7 % JD Logistics 4.9 % 3.8 % 2.8 % 2.1 % New Businesses (15.0 )% (106.7 )% (14.4 )% (82.1 )% * The inter-segment eliminations mainly consist of revenues from supply chain solutions and logistics services provided by JD Logistics to JD Retail and New Businesses, and property leasing services provided by JD Property to JD Logistics. ** Unallocated items include share-based compensation, amortization of intangible assets resulting from assets and business acquisitions, and effects of business cooperation arrangements. The tables below set forth the revenue information: For the three months ended June 30,2024 June 30,2025 June 30,2025 YoY%Change RMB RMB US$ (In millions, except percentage data) Electronics and home appliances revenues 145,061 178,982 24,985 23.4 % General merchandise revenues 88,847 103,432 14,439 16.4 % Net product revenues 233,908 282,414 39,424 20.7 % Marketplace and marketing revenues 23,425 28,507 3,979 21.7 % Logistics and other service revenues 34,064 45,739 6,385 34.3 % Net service revenues 57,489 74,246 10,364 29.1 % Total net revenues 291,397 356,660 49,788 22.4 % For the six months ended June 30,2024 June 30,2025 June 30,2025 YoY%Change RMB RMB US$ (In millions, except percentage data) Electronics and home appliances revenues 268,273 323,277 45,128 20.5 % General merchandise revenues 174,143 201,446 28,121 15.7 % Net product revenues 442,416 524,723 73,249 18.6 % Marketplace and marketing revenues 42,714 50,827 7,095 19.0 % Logistics and other service revenues 66,316 82,192 11,473 23.9 % Net service revenues 109,030 133,019 18,568 22.0 % Total net revenues 551,446 657,742 91,817 19.3 % Conference Call management will hold a conference call at 8:00 am, Eastern Time on August 14, 2025, (8:00 pm, Beijing/Hong Kong Time on August 14, 2025) to discuss its financial results for the three months and six months ended June 30, 2025. Please register in advance of the conference using the link provided below and dial in 15 minutes prior to the call, using participant dial-in numbers, the Passcode and unique access PIN which would be provided upon registering. You will be automatically linked to the live call after completion of this process, unless required to provide the conference ID below due to regional restrictions. PRE-REGISTER LINK: CONFERENCE ID: 10048710 A telephone replay will be available for one week until August 21, 2025. The dial-in details are as follows: US: +1-855-883-1031 International: +61-7-3107-6325 Mainland China: 400-120-9216 Hong Kong, China: 800-930-639 Passcode: 10048710 Additionally, a live and archived webcast of the conference call will also be available on the investor relations website at About is a leading supply chain-based technology and service provider. The Company's cutting-edge retail infrastructure seeks to enable consumers to buy whatever they want, whenever and wherever they want it. The Company has opened its technology and infrastructure to partners, brands and other sectors, as part of its Retail as a Service offering to help drive productivity and innovation across a range of industries. Non-GAAP Measures In evaluating the business, the Company considers and uses non-GAAP measures, such as non-GAAP income/(loss) from operations, non-GAAP operating margin, non-GAAP net income/(loss) attributable to the Company's ordinary shareholders, non-GAAP net margin attributable to the Company's ordinary shareholders, free cash flow, non-GAAP EBITDA, non-GAAP EBITDA margin, non-GAAP net income/(loss) per share and non-GAAP net income/(loss) per ADS, as supplemental measures to review and assess operating performance. The presentation of these non-GAAP financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with accounting principles generally accepted in the United States of America ('U.S. GAAP'). The Company defines non-GAAP income/(loss) from operations as income/(loss) from operations excluding share-based compensation, amortization of intangible assets resulting from assets and business acquisitions, effects of business cooperation arrangements, gain on sale of development properties and impairment of goodwill and long-lived assets. The Company defines non-GAAP net income/(loss) attributable to the Company's ordinary shareholders as net income/(loss) attributable to the Company's ordinary shareholders excluding share-based compensation, amortization of intangible assets resulting from assets and business acquisitions, effects of business cooperation arrangements and non-compete agreements, gain/(loss) on disposals/deemed disposals of investments and others, reconciling items on the share of equity method investments, gain/(loss) from fair value change of long-term investments, impairment of goodwill, long-lived assets and investments, gain on sale of development properties and tax effects on non-GAAP adjustments. The Company defines free cash flow as operating cash flow adjusting the impact from consumer financing receivables included in the operating cash flow and capital expenditures, net of related sales proceeds. Capital expenditures include purchase of property, equipment and software, cash paid for construction in progress, purchase of intangible assets, land use rights and asset acquisitions. The Company defines non-GAAP EBITDA as non-GAAP income/(loss) from operations plus depreciation and amortization excluding amortization of intangible assets resulting from assets and business acquisitions. Non-GAAP basic net income/(loss) per share is calculated by dividing non-GAAP net income/(loss) attributable to the Company's ordinary shareholders by the weighted average number of ordinary shares outstanding during the periods. Non-GAAP diluted net income/(loss) per share is calculated by dividing non-GAAP net income/(loss) attributable to the Company's ordinary shareholders by the weighted average number of ordinary shares and dilutive potential ordinary shares outstanding during the periods, including the dilutive effects of share-based awards as determined under the treasury stock method and convertible senior notes. Non-GAAP net income/(loss) per ADS is equal to non-GAAP net income/(loss) per share multiplied by two. The Company presents these non-GAAP financial measures because they are used by management to evaluate operating performance and formulate business plans. Non-GAAP income/(loss) from operations, non-GAAP net income/(loss) attributable to the Company's ordinary shareholders and non-GAAP EBITDA reflect the Company's ongoing business operations in a manner that allows more meaningful period-to-period comparisons. Free cash flow enables management to assess liquidity and cash flow while taking into account the impact from consumer financing receivables included in the operating cash flow and the demands that the expansion of fulfillment infrastructure and technology platform has placed on financial resources. The Company believes that the use of the non-GAAP financial measures facilitates investors to understand and evaluate the Company's current operating performance and future prospects in the same manner as management does, if they so choose. The Company also believes that the non-GAAP financial measures provide useful information to both management and investors by excluding certain expenses, gain/loss and other items that are not expected to result in future cash payments or that are non-recurring in nature or may not be indicative of the Company's core operating results and business outlook. The non-GAAP financial measures have limitations as analytical tools. The Company's non-GAAP financial measures do not reflect all items of income and expense that affect the Company's operations or not represent the residual cash flow available for discretionary expenditures. Further, these non-GAAP measures may differ from the non-GAAP information used by other companies, including peer companies, and therefore their comparability may be limited. The Company compensates for these limitations by reconciling the non-GAAP financial measures to the nearest U.S. GAAP performance measure, all of which should be considered when evaluating performance. The Company encourages you to review the Company's financial information in its entirety and not rely on a single financial measure. CONTACTS: Investor RelationsSean Zhang+86 (10) 8912-6804IR@ Media Relations+86 (10) 8911-6155Press@ Safe Harbor Statement This announcement contains forward-looking statements. These statements are made under the 'safe harbor' provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as 'will,' 'expects,' 'anticipates,' 'future,' 'intends,' 'plans,' 'believes,' 'estimates,' 'confident' and similar statements. Among other things, the business outlook and quotations from management in this announcement, as well as strategic and operational plans, contain forward-looking statements. may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission (the 'SEC'), in announcements made on the website of the Hong Kong Stock Exchange, in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: growth strategies; its future business development, results of operations and financial condition; its ability to attract and retain new customers and to increase revenues generated from repeat customers; its expectations regarding demand for and market acceptance of its products and services; trends and competition in China's e-commerce market; changes in its revenues and certain cost or expense items; the expected growth of the Chinese e-commerce market; laws, regulations and governmental policies relating to the industries in which or its business partners operate; potential changes in laws, regulations and governmental policies or changes in the interpretation and implementation of laws, regulations and governmental policies that could adversely affect the industries in which or its business partners operate, including, among others, initiatives to enhance supervision of companies listed on an overseas exchange and tighten scrutiny over data privacy and data security; risks associated with acquisitions, investments and alliances, including fluctuation in the market value of investment portfolio; natural disasters and geopolitical events; change in tax rates and financial risks; intensity of competition; and general market and economic conditions in China and globally. Further information regarding these and other risks is included in filings with the SEC and the announcements on the website of the Hong Kong Stock Exchange. All information provided herein is as of the date of this announcement, and undertakes no obligation to update any forward-looking statement, except as required under applicable law. Inc. Unaudited Interim Condensed Consolidated Balance Sheets (In millions, except otherwise noted) As of December 31,2024 June 30,2025 June 30,2025 RMB RMB US$ ASSETS Current assets Cash and cash equivalents 108,350 116,547 16,269 Restricted cash 7,366 9,610 1,342 Short-term investments 125,645 97,291 13,581 Accounts receivable, net (including consumer financing receivables of RMB2.0 billion and RMB1.9 billion as of December 31, 2024 and June 30, 2025, respectively)(1) 25,596 41,983 5,861 Advance to suppliers 7,619 6,043 844 Inventories, net 89,326 103,537 14,453 Prepayments and other current assets 15,951 15,669 2,187 Amount due from related parties 4,805 1,990 278 Assets held for sale 2,040 1,363 190 Total current assets 386,698 394,033 55,005 Non-current assets Property, equipment and software, net 82,737 87,160 12,167 Construction in progress 6,164 6,749 942 Intangible assets, net 7,793 7,256 1,013 Land use rights, net 36,833 37,173 5,189 Operating lease right-of-use assets 24,532 27,454 3,832 Goodwill 25,709 25,709 3,589 Investment in equity investees 56,850 48,225 6,732 Marketable securities and other investments 59,370 61,397 8,571 Deferred tax assets 2,459 2,881 402 Other non-current assets 9,089 8,902 1,243 Total non-current assets 311,536 312,906 43,680 Total assets 698,234 706,939 98, Inc. Unaudited Interim Condensed Consolidated Balance Sheets (In millions, except otherwise noted) As of December 31,2024 June 30,2025 June 30,2025 RMB RMB US$ LIABILITIES Current liabilities Short-term debts 7,581 11,661 1,628 Accounts payable 192,860 211,711 29,554 Advance from customers 32,437 33,517 4,679 Deferred revenues 2,097 2,387 333 Taxes payable 9,487 5,981 835 Amount due to related parties 1,367 939 131 Unsecured senior notes — 3,571 498 Accrued expenses and other current liabilities 45,985 44,555 6,220 Operating lease liabilities 7,606 8,285 1,157 Liabilities held for sale 101 25 3 Total current liabilities 299,521 322,632 45,038 Non-current liabilities Deferred revenues 502 429 60 Unsecured senior notes 24,770 21,141 2,951 Deferred tax liabilities 9,498 8,388 1,171 Long-term borrowings 31,705 35,454 4,949 Operating lease liabilities 18,106 20,680 2,887 Other non-current liabilities 835 926 129 Total non-current liabilities 85,416 87,018 12,147 Total liabilities 384,937 409,650 57,185 MEZZANINE EQUITY 484 — — SHAREHOLDERS' EQUITY Total Inc. shareholders' equity (US$0.00002 par value, 100,000 million shares authorized, 2,981 million shares issued and 2,836 million shares outstanding as of June 30, 2025) 239,347 227,160 31,710 Non-controlling interests 73,466 70,129 9,790 Total shareholders' equity 312,813 297,289 41,500 Total liabilities, mezzanine equity and shareholders' equity 698,234 706,939 98,685 (1) JD Technology performs credit risk assessment services for consumer financing receivables business and absorbs the credit risk of the underlying consumer financing receivables. Facilitated by JD Technology, the Company periodically securitizes consumer financing receivables through the transfer of those assets to securitization plans and derecognizes the related consumer financing receivables through sales type Inc. Unaudited Interim Condensed Consolidated Statements of Operations (In millions, except per share data) For the three months ended For the six months ended June 30, 2024 June 30, 2025 June 30, 2025 June 30, 2024 June 30, 2025 June 30, 2025 RMB RMB US$ RMB RMB US$ Net revenues Net product revenues 233,908 282,414 39,424 442,416 524,723 73,249 Net service revenues 57,489 74,246 10,364 109,030 133,019 18,568 Total net revenues 291,397 356,660 49,788 551,446 657,742 91,817 Cost of revenues (245,459 ) (300,020 ) (41,881 ) (465,738 ) (553,254 ) (77,231 ) Fulfillment (17,221 ) (22,145 ) (3,091 ) (34,027 ) (41,882 ) (5,846 ) Marketing (11,867 ) (27,013 ) (3,771 ) (21,121 ) (37,556 ) (5,243 ) Research and development (4,217 ) (5,299 ) (740 ) (8,251 ) (9,920 ) (1,385 ) General and administrative (2,132 ) (3,266 ) (456 ) (4,108 ) (5,680 ) (793 ) Gain on sale of development properties — 224 31 — 224 31 Income/(Loss) from operations(2)(3) 10,501 (859 ) (120 ) 18,201 9,674 1,350 Other income/(expenses) Share of results of equity investees 1,142 2,072 289 412 3,402 475 Interest expense (688 ) (643 ) (90 ) (1,289 ) (1,243 ) (173 ) Others, net(4) 4,661 6,129 856 7,357 8,208 1,146 Income before tax 15,616 6,699 935 24,681 20,041 2,798 Income tax (expenses)/benefits (2,022 ) 10 2 (3,722 ) (2,053 ) (287 ) Net income 13,594 6,709 937 20,959 17,988 2,511 Net income attributable to non-controlling interests shareholders 950 531 75 1,185 920 128 Net income attributable to the Company's ordinary shareholders 12,644 6,178 862 19,774 17,068 2,383 Net income per share: Basic 4.20 2.17 0.30 6.44 5.95 0.83 Diluted 4.09 2.07 0.29 6.34 5.68 0.79 Net income per ADS: Basic 8.39 4.35 0.61 12.88 11.89 1.66 Diluted 8.19 4.15 0.58 12.68 11.37 1.59 Inc. Unaudited Interim Condensed Consolidated Statements of Operations (In millions, except per share data) For the three months ended For the six months ended June 30, 2024 June 30, 2025 June 30, 2025 June 30, 2024 June 30, 2025 June 30, 2025 RMB RMB US$ RMB RMB US$ (2) Includes share-based compensation as follows: Cost of revenues (10 ) (25 ) (3 ) (36 ) (32 ) (4 ) Fulfillment (108 ) (75 ) (11 ) (218 ) (146 ) (20 ) Marketing (80 ) (49 ) (7 ) (163 ) (111 ) (16 ) Research and development (164 ) (296 ) (41 ) (339 ) (513 ) (72 ) General and administrative (304 ) (1,212 ) (169 ) (669 ) (1,622 ) (226 ) Total (666 ) (1,657 ) (231 ) (1,425 ) (2,424 ) (338 ) (3) Includes amortization of business cooperation arrangements and intangible assets resulting from assets and business acquisitions as follows: Fulfillment (103 ) (50 ) (7 ) (206 ) (99 ) (14 ) Marketing (226 ) (236 ) (33 ) (445 ) (515 ) (72 ) Research and development (68 ) (36 ) (5 ) (134 ) (72 ) (10 ) General and administrative (32 ) — — (64 ) — — Total (429 ) (322 ) (45 ) (849 ) (686 ) (96 ) (4) 'Others, net' consists of interest income; gains/(losses) related to long-term investments without significant influence, including fair value changes, acquisitions or disposals gains/(losses), and impairments; government incentives; foreign exchange gains/(losses); and other non-operating income/(losses). Inc. Unaudited Non-GAAP Net Income Per Share and Per ADS (In millions, except per share data) For the three months ended For the six months ended June 30, 2024 June 30, 2025 June 30, 2025 June 30, 2024 June 30, 2025 June 30, 2025 RMB RMB US$ RMB RMB US$ Non-GAAP net income attributable to the Company's ordinary shareholders 14,460 7,394 1,032 23,359 20,152 2,813 Non-GAAP net income per share: Basic 4.80 2.60 0.36 7.61 7.02 0.98 Diluted 4.68 2.48 0.35 7.49 6.71 0.94 Non-GAAP net income per ADS: Basic 9.60 5.20 0.73 15.22 14.04 1.96 Diluted 9.36 4.97 0.69 14.98 13.42 1.87 Weighted average number of shares: Basic 3,013 2,841 3,070 2,870 Diluted 3,085 2,970 3,114 3,003 Inc. Unaudited Interim Condensed Consolidated Statements of Cash Flows and Free Cash Flow (In millions) For the three months ended For the six months ended June 30,2024 June 30,2025 June 30, 2025 June 30,2024 June 30,2025 June 30,2025 RMB RMB US$ RMB RMB US$ Net cash provided by operating activities 50,738 24,409 3,407 39,423 6,147 858 Net cash (used in)/ provided by investing activities (38,527 ) 8,218 1,147 (10,113 ) 24,454 3,414 Net cash used in financing activities (8,969 ) (12,439 ) (1,736 ) (16,414 ) (19,727 ) (2,754 ) Effect of exchange rate changes on cash, cash equivalents and restricted cash (114 ) (88 ) (12 ) (247 ) (433 ) (60 ) Net increase in cash, cash equivalents and restricted cash 3,128 20,100 2,806 ... 12,649 10,441 1,458 Cash, cash equivalents and restricted cash at beginning of period, including cash and cash equivalents classified within assets held for sale 88,922 106,057 14,805 79,451 115,716 16,153 Less: Cash, cash equivalents and restricted cash classified within assets held for sale at beginning of period (3 ) —* —* (53 ) —* —* Cash, cash equivalents and restricted cash at beginning of period 88,919 106,057 14,805 79,398 115,716 16,153 Cash, cash equivalents and restricted cash at end of period, including cash and cash equivalents classified within assets held for sale 92,047 126,157 17,611 92,047 126,157 17,611 Less: Cash, cash equivalents and restricted cash classified within assets held for sale at end of period (2 ) —* —* (2 ) —* —* Cash, cash equivalents and restricted cash at end of period 92,045 126,157 17,611 92,045 126,157 17,611 Net cash provided by operating activities 50,738 24,409 3,407 39,423 6,147 858 Add/(Less): Impact from consumer financing receivables included in the operating cash flow 2,138 641 90 857 (377 ) (53 ) Less: Capital expenditures, net of related sales proceeds (3,321 ) (3,032 ) (423 ) (6,201 ) (5,355 ) (747 ) Capital expenditures for development properties (1,590 ) (1,076 ) (150 ) (2,950 ) (1,991 ) (278 ) Other capital expenditures (1,731 ) (1,956 ) (273 ) (3,251 ) (3,364 ) (469 ) Free cash flow 49,555 22,018 3,074 34,079 415 58 *Absolute value is less than RMB1 million or US$1 Inc. Supplemental Financial Information and Business Metrics(In RMB billions, except turnover days data) Q2 2024 Q3 2024 Q4 2024 Q1 2025 Q2 2025 Cash flow and turnover days Operating cash flow – trailing twelve months ('TTM') 74.0 52.8 58.1 51.1 24.8 Free cash flow – TTM 55.6 33.6 43.7 37.6 10.1 Inventory turnover days(5) – TTM 29.8 30.4 31.5 32.8 34.1 Accounts payable turnover days(6) – TTM 57.0 57.5 58.6 57.6 59.0 Accounts receivable turnover days(7) – TTM 5.7 5.8 5.9 6.4 7.4(5) TTM inventory turnover days are the quotient of average inventory over the immediately preceding five quarters, up to and including the last quarter of the period, to cost of revenues of retail business for the last twelve months, and then multiplied by 360 days.(6) TTM accounts payable turnover days are the quotient of average accounts payable for retail business over the immediately preceding five quarters, up to and including the last quarter of the period, to cost of revenues of retail business for the last twelve months, and then multiplied by 360 days.(7) TTM accounts receivable turnover days are the quotient of average accounts receivable over the immediately preceding five quarters, up to and including the last quarter of the period, to total net revenues for the last twelve months and then multiplied by 360 days. Presented are the accounts receivable turnover days excluding the impact from consumer financing Inc. Unaudited Reconciliation of GAAP and Non-GAAP Results (In millions, except percentage data) For the three months ended For the six months ended June 30, 2024 June 30, 2025 June 30, 2025 June 30, 2024 June 30, 2025 June 30, 2025 RMB RMB US$ RMB RMB US$ Income/(Loss) from operations 10,501 (859 ) (120 ) 18,201 9,674 1,350 Add: Share-based compensation 666 1,657 231 1,425 2,424 338 Add: Amortization of intangible assets resulting from assets and business acquisitions 316 253 35 625 505 71 Add: Effects of business cooperation arrangements 113 69 10 224 181 25 Reversal of: Gain on sale of development properties — (224 ) (31 ) — (224 ) (31 ) Non-GAAP income from operations 11,596 896 125 20,475 12,560 1,753 Add: Depreciation and other amortization 1,934 2,103 294 3,842 4,141 578 Non-GAAP EBITDA 13,530 2,999 419 24,317 16,701 2,331 Total net revenues 291,397 356,660 49,788 551,446 657,742 91,817 Non-GAAP operating margin 4.0 % 0.3 % 3.7 % 1.9 % Non-GAAP EBITDA margin 4.6 % 0.8 % 4.4 % 2.5 % Inc. Unaudited Reconciliation of GAAP and Non-GAAP Results (In millions, except percentage data) For the three months ended For the six months ended June 30, 2024 June 30, 2025 June 30, 2025 June 30, 2024 June 30, 2025 June 30, 2025 RMB RMB US$ RMB RMB US$ Net income attributable to the Company's ordinary shareholders 12,644 6,178 862 19,774 17,068 2,383 Add: Share-based compensation 549 1,578 220 1,141 2,228 311 Add: Amortization of intangible assets resulting from assets and business acquisitions 151 169 24 294 355 50 Add/(Reversal of): Reconciling items on the share of equity method investments(8) 211 (185 ) (26 ) 581 779 109 Add: Impairment of goodwill, long-lived assets and investments 1,102 178 25 1,660 615 86 (Reversal of)/Add: (Gain)/Loss from fair value change of long-term investments (104 ) (531 ) (74 ) (112 ) 343 48 Reversal of: Gain on sale of development properties — (168 ) (24 ) — (168 ) (24 ) Reversal of: Gain on disposals/deemed disposals of investments and others (208 ) (30 ) (4 ) (230 ) (1,202 ) (168 ) Add: Effects of business cooperation arrangements 113 69 10 224 181 25 Add/(Reversal of): Tax effects on non-GAAP adjustments 2 136 19 27 (47 ) (7 ) Non-GAAP net income attributable to the Company's ordinary shareholders 14,460 7,394 1,032 23,359 20,152 2,813 Total net revenues 291,397 356,660 49,788 551,446 657,742 91,817 Non-GAAP net margin attributable to the Company's ordinary shareholders 5.0 % 2.1 % 4.2 % 3.1 % (8) To exclude the GAAP to non-GAAP reconciling items on the share of equity method investments and share of amortization of intangibles not on their books. Reconciliation between U.S. GAAP and IFRS Accounting Standards Deloitte Touche Tohmatsu was engaged by the Company to conduct limited assurance engagement in accordance with Hong Kong Standard on Assurance Engagements 3000 (Revised) 'Assurance Engagements Other Than Audits or Reviews of Historical Financial Information' ('HKSAE 3000 (Revised)') issued by the Hong Kong Institute of Certified Public Accountants on the reconciliation of the condensed consolidated statement of operations for the six months ended June 30, 2025 and the condensed consolidated balance sheet as of June 30, 2025 of the Company and its subsidiaries (collectively referred to as the 'Group') between the accounting policies adopted by the Group of the relevant period in accordance with the U.S. GAAP and the IFRS Accounting Standards (the 'IFRSs') issued by the International Accounting Standards Board (together, the 'Reconciliation'). The limited assurance engagement undertaken in accordance with HKSAE 3000 (Revised) involves performing procedures to obtain sufficient appropriate evidence about whether: the related adjustments and reclassifications give appropriate effect to those criteria; and the Reconciliation reflects the proper application of the adjustments and reclassifications to the differences between the Group's accounting policies in accordance with the U.S. GAAP and the IFRSs. The procedures performed by Deloitte Touche Tohmatsu were based on their professional judgment, having regard to their understanding of the management's process on preparing the Reconciliation, nature, business performance and financial position of the Group. Given the circumstances of the engagement, the procedures performed included: (i) Comparing the 'Amounts as recorded under U.S. GAAP' for the six months ended June 30, 2025 in the Reconciliation as set out in the Appendix with the Interim 2025 Results prepared in accordance with the U.S. GAAP;(ii) Evaluating the assessment made by the board of directors in identifying the differences between the accounting policies in accordance with the U.S. GAAP and the IFRSs, and the evidence supporting the adjustments and reclassifications made in the Reconciliation in arriving at the 'Amounts as recorded under IFRSs' in the Reconciliation as set out in the Appendix; and(iii) Checking the arithmetic accuracy of the computation of the Reconciliation as set out in the procedures performed by Deloitte Touche Tohmatsu in this limited assurance engagement vary in nature and timing from, and are less in extent than for, a reasonable assurance engagement. Consequently, the level of assurance obtained in a limited assurance engagement is substantially lower than the assurance that would have been obtained had a reasonable assurance engagement been performed. Accordingly, Deloitte Touche Tohmatsu does not express a reasonable assurance opinion. Based on the procedures performed and evidence obtained, Deloitte Touche Tohmatsu has concluded that nothing has come to their attention that causes them to believe that: (i) The 'Amounts as recorded under U.S. GAAP' for the six months ended June 30, 2025 in the Reconciliation as set out in the Appendix is not in agreement with the Interim 2025 Results prepared in accordance with the U.S. GAAP;(ii) The adjustments and reclassifications made in the Reconciliation in arriving at the 'Amounts as recorded under IFRSs' in the Reconciliation as set out in the Appendix, do not reflect, in all material respects, the different accounting treatments according to the Group's accounting policies in accordance with the U.S. GAAP and the IFRSs of the relevant period; and(iii) The computation of the Reconciliation as set out in the Appendix is not arithmetically accurate. Appendix The condensed consolidated financial statements are prepared in accordance with U.S. GAAP, which differ in certain respects from IFRSs. The effects of material differences between the condensed consolidated financial statements of the Group prepared under U.S. GAAP and IFRSs are as follows: For the six months ended June 30, 2024IFRSs adjustments Amounts asrecorded under Financialinstruments withspecial features Investmentsmeasured at fairvalue Leaseaccounting Impairment oflong-lived assets Convertiblesenior notes Share-based compensation Amounts asrecorded underIFRSs (RMB in millions) Note i Note ii Note iii Note iv Note v Note vi Cost of revenues (465,738 ) — — — 17 — — (465,721 ) Fulfillment (34,027 ) — — 495 7 — — (33,525 ) Marketing (21,121 ) — — 1 — — — (21,120 ) Research and development (8,251 ) — — 2 — — — (8,249 ) General and administrative (4,108 ) — — 2 — — — (4,106 ) Income from operations 18,201 — — 500 24 — — 18,725 Share of results of equity investees 412 — 78 — — — — 490 Interest expense (1,289 ) (5 ) — (290 ) — (124 ) — (1,708 ) Others, net 7,357 — (89 ) (84 ) — 1,141 — 8,325 Fair value changes of preferred shares — (48 ) — — — — — (48 ) Income before tax 24,681 (53 ) (11 ) 126 24 1,017 — 25,784 Income tax (expenses)/benefits (3,722 ) — 58 — — — (26 ) (3,690 ) Net income 20,959 (53 ) 47 126 24 1,017 (26 ) 22,094 Net income attributable to non-controlling interests shareholders 1,185 (11 ) 38 (47 ) 6 — (26 ) 1,145 Net income attributable to the Company's ordinary shareholders 19,774 (42 ) 9 173 18 1,017 — 20,949 For the six months ended June 30, 2025IFRSs adjustments Amounts asrecorded underU.S. GAAP Financialinstrumentswith specialfeatures Investmentsmeasured at fairvalue Leaseaccounting Impairment oflong-lived assets Convertiblesenior notes Share-based compensation Investment inJD Technology Amounts asrecorded underIFRSs (RMB in millions) Note i Note ii Note iii Note iv Note v Note vi Note vii Fulfillment (41,882 ) — — 818 57 — — — (41,007 ) Marketing (37,556 ) — — 2 — — — — (37,554 ) Research and development (9,920 ) — — 4 — — — — (9,916 ) General and administrative (5,680 ) — — 5 — — — — (5,675 ) Gain on sale of development properties 224 — — (123 ) — — — — 101 Income from operations 9,674 — — 706 57 — — — 10,437 Share of results of equity investees 3,402 — 9 — — — — (279 ) 3,132 Interest expense (1,243 ) (2 ) — (532 ) — (618 ) — — (2,395 ) Others, net 8,208 — 102 (31 ) — 493 — — 8,772 Fair value changes of preferred shares — (4 ) — — — — — — (4 ) Income before tax 20,041 (6 ) 111 143 57 (125 ) — (279 ) 19,942 Income tax (expenses)/benefits (2,053 ) — (57 ) — — — 221 — (1,889 ) Net income 17,988 (6 ) 54 143 57 (125 ) 221 (279 ) 18,053 Net income attributable to non-controlling interests shareholders 920 (1 ) — (19 ) 14 — 54 — 968 Net income attributable to the Company's ordinary shareholders 17,068 (5 ) 54 162 43 (125 ) 167 (279 ) 17,085 As of December 31, 2024IFRSs adjustments Amounts as recorded under U.S. GAAP Financialinstrumentswith specialfeatures Investments measured atfair value Leaseaccounting Impairmentof long-livedassets Convertiblesenior notes Share-based compensation Investment inJD Technology Amounts as recorded under IFRSs (RMB in millions) Note i Note ii Note iii Note iv Note v Note vi Note vii Property, equipment and software, net 82,737 — — — (2,172 ) — — — 80,565 Land use rights, net 36,833 — — — (1,175 ) — — — 35,658 Operating lease right-of-use assets 24,532 — — (1,448 ) — — — — 23,084 Investment in equity investees 56,850 — (29,772 ) — — — — 1,340 28,418 Marketable securities and other investments 59,370 — (2,907 ) — — — — — 56,463 Financial assets at fair value through profit or loss — — 33,977 — — — — — 33,977 Financial assets at fair value through other comprehensive income — — 237 — — — — — 237 Deferred tax assets 2,459 — 185 — — — (595 ) — 2,049 Total assets 698,234 — 1,720 (1,448 ) (3,347 ) — (595 ) 1,340 695,904 Other non-current liabilities 835 424 — — — — — — 1,259 Financial liability at fair value through profit or loss — 18,658 — — — 4,447 — — 23,105 Unsecured senior notes 24,770 — — — — (3,230 ) — — 21,540 Deferred tax liabilities 9,498 — 554 — — — — — 10,052 Total liabilities 384,937 19,082 554 — — 1,217 — — 405,790 Mezzanine Equity 484 (484 ) — — — — — — — Total Inc. shareholders' equity 239,347 (8,395 ) 1,155 (1,287 ) (2,509 ) (1,217 ) (474 ) 1,340 227,960 Non-controlling interests 73,466 (10,203 ) 11 (161 ) (838 ) — (121 ) — 62,154 Total shareholders' equity 312,813 (18,598 ) 1,166 (1,448 ) (3,347 ) (1,217 ) (595 ) 1,340 290,114 As of June 30, 2025IFRSs adjustments Amounts asrecorded underU.S. GAAP Financialinstrumentswith special features Investmentsmeasured atfair value Leaseaccounting Impairmentof long-livedassets Convertiblesenior notes Share-basedcompensation Investment inJD Technology Amounts asrecorded underIFRSs (RMB in millions) Note i Note ii Note iii Note iv Note v Note vi Note vii Property, equipment and software, net 87,160 — — — (2,135 ) — — — 85,025 Land use rights, net 37,173 — — — (1,155 ) — — — 36,018 Operating lease right-of-use assets 27,454 — — (1,305 ) — — — — 26,149 Investment in equity investees 48,225 — (28,554 ) — — — — 7,973 27,644 Marketable securities and other investments 61,397 — (1,906 ) — — — — — 59,491 Financial assets at fair value through profit or loss — — 31,876 — — — — — 31,876 Financial assets at fair value through other comprehensive income — — 237 — — — — — 237 Deferred tax assets 2,881 — 155 — — — (383 ) — 2,653 Total assets 706,939 — 1,808 (1,305 ) (3,290 ) — (383 ) 7,973 711,742 Accrued expenses and other liabilities 45,481 3,785 — — — — — — 49,266 Financial liability at fair value through profit or loss — 18,627 — — — 3,936 — — 22,563 Unsecured senior notes 24,712 — — — — (2,604 ) — — 22,108 Deferred tax liabilities 8,388 — 582 — — — — — 8,970 Total liabilities 409,650 22,412 582 — — 1,332 — — 433,976 Total Inc. shareholders' equity 227,160 (11,764 ) 1,216 (1,125 ) (2,466 ) (1,332 ) (312 ) 7,973 219,350 Non-controlling interests 70,129 (10,648 ) 10 (180 ) (824 ) — (71 ) — 58,416 Total shareholders' equity 297,289 (22,412 ) 1,226 (1,305 ) (3,290 ) (1,332 ) (383 ) 7,973 277,766 NotesUnder U.S. GAAP, certain financial instruments issued by subsidiaries of the Group in the form of shares with special features, including preferred shares and redeemable non-controlling interests, are accounted for as mezzanine equity or non-controlling interests depending on whether a redeemable feature exists, and whether the redemption is solely within the Group's control. Under IFRSs, since the Group does not have an unconditional right to avoid delivering cash upon the exercise of special features, the relevant financial instruments are classified as financial liabilities. Specifically, the redemption rights over non-controlling interests have been recognized as financial liabilities at present value of the redemption amount, while the preferred shares with certain special rights were entirely designated as financial liabilities at fair value through profit or U.S. GAAP, the Group uses measurement alternative to record the investments without readily determinable fair values at cost, less impairment, adjusted for subsequent observable price changes on a nonrecurring basis, and reports changes in the carrying value of the equity investments in profit or loss. Changes in the carrying value of the equity investments are required to be made whenever there are observable price changes in orderly transactions for the identical or similar investment of the same issuer. Those investments include convertible redeemable preferred shares, ordinary shares with preferential rights issued by privately held companies and equity investments in unlisted entities, in the form of ordinary shares without significant influence. In addition, the Group accounts for certain investments in private equity funds over which the Group does not have the ability to exercise significant influence under the existing practical expedient, and estimates fair value using net asset value per share (or its equivalent) of the investment. The Group also applies the equity method of accounting to account for certain equity investments in private equity funds. Under IFRSs, the aforementioned investments are classified as financial assets at fair value through profit or loss and measured at fair value, except for certain equity investments not held for trading but held for long-term strategic purposes, which are designated as financial assets at fair value through other comprehensive income. Fair value changes of these investments are recognized in profit or loss or other comprehensive income, classification and measurement Under U.S. GAAP, the amortization of the right-of-use assets and interest expense related to the lease liabilities are recorded together as lease expense to produce a straight-line recognition effect in profit or loss. Under IFRSs, the amortization of the right-of-use assets is on a straight-line basis while the interest expense related to the lease liabilities are measured at amortized cost. Sale-and-leaseback arrangements Under U.S. GAAP, if the sale-and-leaseback transaction qualifies as a sale, the entire gain on the transaction would be recognized. Under IFRSs, for sale-and-leaseback transactions that qualify as a sale, the gain would be limited to the amount related to the residual portion of the asset sold. The amount of the gain related to the underlying asset leased back to the lessee would be offset against the lessee's right-of-use U.S. GAAP, the Group takes a two-step approach to calculate an asset or asset group impairment by comparing the asset or asset group's carrying amount with the sum of future undiscounted cash flows as a test of recoverability, and record the amount by which the carrying value exceeds the fair value as impairment loss when the carrying amount is not recoverable. Under IFRSs, the Group takes a one-step approach to calculate an asset or cash generating unit impairment by recording the amount by which the carrying value exceeds the recoverable amount as an impairment loss when impairment indicators U.S. GAAP, Convertible Senior Notes are accounted for as debt in their entirety and are measured at amortized cost, with debt issuance cost amortized and recognized as interest expenses using the effective interest method. Under IFRSs, the Convertible Senior Notes are hybrid instruments, each of which consists of a host debt contract and embedded derivatives. The conversion feature is not accounted for as equity as it will not be settled by delivering a fixed number of the Group's own equity instruments and receiving a fixed amount of cash or another financial asset and is recognized as a separate derivative liability measured at fair value through profit or loss as it meets the separation conditions under IFRS 9. The embedded repurchase and redemption options of Convertible Senior Notes are closely related to the host debt contracts and therefore not accounted for as derivatives separately. The host debt contract is initially measured as the difference between the fair value of the entire hybrid instruments and the fair value of the conversion feature. Subsequent to the initial recognition, the host debt contracts are accounted for at amortized cost with interest expenses recognized using the effective interest method, and the changes in fair value of the conversion feature are recognized in profit or U.S. GAAP, for awards that ordinarily give rise to a tax deduction under existing tax law, deferred taxes are computed on the basis of the compensation expense that is recognized for financial reporting purposes. In addition, tax benefits in excess of or less than the related deferred tax assets are recognized in profit or loss in the period in which the amount of the deduction is determined (typically when an award vests or, in the case of options, is exercised or expires). Under IFRSs, for awards that will give rise to a tax deduction under the applicable tax law, deferred taxes are computed on the basis of the hypothetical tax deduction for the share-based payment that corresponds to the percentage earned to date (i.e., the intrinsic value of the award on the reporting date multiplied by the percentage vested). In addition, tax benefits less than or equal to the related deferred tax assets are recognized in profit or loss, otherwise are recognized in U.S. GAAP, for the modification of redemption terms and sequent redemptions/new shares issuance carried out by JD Technology, the Group's indirectly acquired equity interests was accomplished through a transaction under common control. Accordingly, the Group recognizes its investment in JD Technology based on its proportionate share of JD Technology's net assets and records the difference between the proceeds transferred and the carrying amounts of its investment in JD Technology in additional paid-in capital. Under IFRSs, the indirect acquisition of equity interests in JD Technology is accounted for in the same way as a purchase of additional interests in the investee. The carrying value of the Group's investment in JD Technology does not change before and after the transaction. In addition, under U.S. GAAP, JD Technology has remeasured the fair value of relevant shareholders' investments due to the modification of redemption terms and recognized the changes of fair value in profit and loss, which has further affected the Group's results of equity investees using equity-method. Under IFRSs, JD Technology has recognized the loss on derecognition of the redeemable liabilities for early redemption, and the interests accrued till liabilities redeemed. It also further affected the Group's results of equity investees using equity method. ________________________ 1 The U.S. dollar (US$) amounts disclosed in this announcement, except for those transaction amounts that were actually settled in U.S. dollars, are presented solely for the convenience of the readers. The conversion of Renminbi (RMB) into US$ in this announcement is based on the exchange rate set forth in the H.10 statistical release of the Board of Governors of the Federal Reserve System as of June 30, 2025, which was RMB7.1636 to US$1.00. The percentages stated in this announcement are calculated based on the RMB amounts.2 See the sections entitled 'Non-GAAP Measures' and 'Unaudited Reconciliation of GAAP and Non-GAAP Results' for more information about the non-GAAP measures referred to in this announcement.3 The number of ordinary shares outstanding as of December 31, 2024 was approximately 2,903 million shares.4 JD Ecosystem is a closely integrated business network providing comprehensive service for customers and comprises the Company and certain affiliates who share the 'JD' brand name, currently including Jingdong Technology Holding Co., Ltd. and Allianz Jingdong General Insurance Company Ltd.
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NetEase Cloud Music Inc. Reports First Half 2025 Financial Results
HANGZHOU, China, Aug. 14, 2025 /PRNewswire/ -- NetEase Cloud Music Inc. (HKEX: 9899 or the "Company"), a leading interactive music streaming service provider in China, today announced its financial results for the first half of 2025 ended June 30, 2025. Summary of Key Financial Metrics (RMB in thousands, unless otherwise stated) Six months ended 30 June 20252024 (Unaudited)(Unaudited) Revenue3,827,1174,070,493 Gross profit1,392,4851,425,731 Operating profit844,506599,933 Profit before income tax1,068,060813,578 Profit for the period (1)1,882,142809,949 Non-IFRS Measure(2): Adjusted operating profit905,360670,850 Adjusted net profit 1,946,353880,749Note: (1) During the period ended 30 June 2025, the Group recognised a deferred income tax credit of RMB849.4 million which primarily arose from the recognition of deferred tax assets in respect of cumulative tax losses incurred by a wholly-owned subsidiary. These tax losses are available to be carried forward against future taxable income. Deferred tax assets relating to tax losses and temporary differences are recognised to the extent that it is probable that future taxable profit will be available against which the temporary differences or tax losses can be utilised. (2) Adjusted operating profit and adjusted net profit are defined as operating profit and profit for the period attributable to the equity holders of the Company adjusted by adding back equity-settled share-based payments as appropriate. For details of the reconciliation of the operating profit and the profit for the period attributable to the equity holders of the Company to the adjusted operating profit and the adjusted net profit of our Group, see the section headed "Financial Review" below. First Half 2025 Key Financial Highlights Revenue was RMB3.8 billion, a decrease of 6.0% compared with RMB4.1 billion for the same period of 2024. Online music services:-Revenue from online music services was RMB3.0 billion, an increase of 15.9% compared with RMB2.6 billion for the same period of 2024.-Revenue from sales of membership subscriptions increased to RMB2.5 billion from RMB2.1 billion for the same period of 2024. Social entertainment services and others:-Revenue from social entertainment services and others was RMB859.8 million, compared with RMB1,510.8 million for the same period of 2024. The decrease was mainly due to a more prudent operational approach for social entertainment services, along with a focused emphasis on core music business. Gross profit was RMB1,392.5 million, a slightly decrease of 2.3% compared with RMB1,425.7 million for the same period of 2024. Gross margin improved to 36.4% from 35.0% for the same period of 2024. Operating profit was RMB844.5 million, an increase of 40.8% compared with RMB599.9 million for the same period of 2024. Adjusted operating profit was RMB905.4 million, an increase of 35.0% compared with RMB670.9 million for the same period of 2024. Net profit reached RMB1,882.1 million, compared with net profit of RMB809.9 million for the same period of 2024. Adjusted net profit reached RMB1,946.4 million, compared with adjusted net profit of RMB880.7 million for the same period of 2024. Business Overview We entered 2025 with an unwavering commitment to driving quality development across our core music ecosystem. Throughout the period, we provided our community with an unparalleled music experience, successfully engaging more music lovers while enriching our unique content ecosystem and advancing the growth of original music. Our enhancements focused on premium offerings, including enhanced content, improved personalised distribution, more innovative features and reinforced community attributes, all of which boosted our appeal to users and deepened their engagement. Paired with advanced membership privileges, these initiatives also spurred growth in our subscription-based membership, improving our profitability. We continued to engage users across our growing music-inspired community. Our total monthly active users (MAUs) maintained steady growth momentum in the first half of 2025, fuelled by an enhanced user experience and stronger brand influence. Meanwhile, our DAU/MAU ratio (daily active user/monthly active user ratio) grew steadily, consistently exceeding 30%. Users also spent more time listening to music on our mobile app, reflecting higher engagement. Our diverse initiatives focusing on premium content and user experiences, continue to attract music enthusiasts and convert them into loyal platform fans. In the first half of 2025, we consistently enriched our unique content offerings by curating a diverse range of music tailored to our audience, while actively promoting original Chinese music. We further expanded our copyrighted content library, incorporating popular Korean music labels such as RBW and StarShip Entertainment, as well as works from renowned Chinese artists. We maintain a robust roster of independent artists and remain committed to fostering in-house music. Recently, several in-house tracks gained traction both internally and externally, such as "Liang Nan" (《 两难》). In terms of product focus, we consistently enhance the premium music listening experience and refine personalised recommendations to meet the needs of our users. In the first half of 2025, we further upgraded our main product to make it more visually appealing, streamlined and user-friendly. We improved music discovery and consumption with advanced personalised distribution and innovative features, such as our "Magic Light Player" (神光播放器), for an excellent audio-visual experience. Besides, we strengthened our music-centric community by expanding and enhancing interactive scenarios that boost user activity and engagement. During the first half of 2025, we focused on enhancing our music-centric monetisation, sustaining healthy growth. Subscription-based membership revenue increased by 15.2% compared to the same period last year, primarily driven by an increase in our subscriber base, though slightly offset by a dilution in monthly ARPPU (average revenue per paying user) due to changing subscriber mix. We rolled out various premium offerings, including expanded content and innovative features, as well as broadened membership benefits such as functional tools, social features and dress-up privileges. Notably, our rapidly growing subscriber base showed stronger engagement with higher retention rate during the Reporting Period. We further improved our profitability during the first half of 2025. Our gross margin reached 36.4% for the first half of 2025, a notable increase from the same period in 2024, owing to our increased business scale, strong monetisation of our core online music business and ongoing cost optimisation. Going forward, our focus will remain on delivering an even richer music experience and deepening user engagement across our platform by expanding access to high-quality content, innovating products and features, and nurturing our community. Our strategic priorities include the following initiatives: Further diversifying and enhancing our differentiated content offerings with greater efficiency. We plan to deepen our collaboration with copyright holders and strengthen our capabilities in independent artist incubation and in-house music production, focusing on our signature music genres; Meeting the needs of users by optimising the music listening experience and recommendation features, to deliver the ultimate music experience; Nurturing our music-oriented community ecosystem and exploring innovative inter-person interaction via enhancements to our comprehensive product offerings, including broadening communicative scenarios and ecology; Cultivating our users' willingness to pay and subscribe to premium offerings by improving user experience, deepening user engagement, enhancing membership privileges and broadening consumption scenarios; and Improving profitability through continued cost optimisation, operating efficiency enhancement and disciplined cost control. Comprehensive and differentiated content ecosystem We continually expand our unique content library, including both licensed tracks and original music. By supporting independent musicians and developing in-house music, we actively promote the growth of original Chinese music. We remain focused on promoting genres that resonate with our users, such as hip-hop. Enhancing partnerships with copyright holders Throughout the Reporting Period, we continued to strengthen partnerships with music copyright holders through a disciplined and collaborative approach. Expansive catalogue of music labels. In the first half of 2025, we expanded our music label catalogue, particularly through new partnerships with Korean labels and Chinese artists. We secured copyright agreements with popular K-Pop labels, such as RBW and StarShip Entertainment, enriching our K-Pop library with tracks from influential artists and groups. Additionally, we added works from renowned Chinese artists like Li Jian (李健), Lay Zhang (张艺兴), Chen Chusheng (陈楚生), Summer Jikejunyi (吉克隽逸), etc., featuring their popular tracks on the platform. We also expanded our collaboration with Jackson Wang (王嘉尔), introducing his two new hits, "High Alone" and "GBAD", in the first quarter of 2025. Amplifying offerings in signature music genres. We actively expanded our content library to enhance our platform's appeal to younger audiences, focusing on popular music genres like hip-hop, Japanese ACG, and Western music. We expanded content in those signature genres throughout the period, featuring new songs from rappers like KeyNG (杨和苏) and MaSiWei (马思唯), among others. In-depth collaborations with copyright partners. We successfully collaborated with copyright holders and artists, expanding our collaborative efforts in content distribution and commercialisation, which drove impressive sales of premium albums on our platform. Through these expanded collaborations, new albums from Hua Chenyu (华晨宇), David Tao (陶喆) and Allen Ren (任嘉伦) achieved impressive sales on our platform. We also facilitated the sales of physical album from popular artists, such as Ele Yan (颜人中) and BLACKPINK's Jennie and Lisa. Strengthening our leading independent artists' ecosystem We offer continuous support to independent artists, providing comprehensive assistance throughout their music creation journey. By June 2025, our platform had over 819,000 registered independent artists contributing 4.8 million music tracks to our library. Supporting musicians in content creation. We recently introduced two new roles for music creators on our platform: AI Musician (AI音乐人) and Trainee Musician (见习音乐人). These pathways provide fresh opportunities for budding music creators to grow and contribute to the diversity of our content creation ecosystem. We will provide ongoing guidance to nurture their growth and help them evolve into skilled musicians. Starting in 2021, we organized nine sessions of our signature offline songwriting camps, producing over 120 tracks that have collectively garnered more than 6 billion plays. Exploring and improving the exposure of musicians and their work. We recently participated in China's first hip-hop-themed exhibition, "Chengdu Hip-Hop Exhibition". By integrating offline experiences and online content such as "Chengdu Rap Map", we offered a comprehensive view of Chengdu's hip-hop music, and promoted high-quality content in our signature genre. Enhancing commercial resources for musicians. Through collaborations with musicians on our platform, we partnered with various brands to create themed songs and background music for advertising. This initiative boosts musicians' visibility and provides them with valuable commercial opportunities. Notable examples include tracks from Anzi & Jiumei (安子与九妹乐队), YUGO (羽果乐队), Zaliva-D, and COM'Z (康姆士乐队), featured in campaigns for ONVO, Salomon, Miu Miu, and Luckin Coffee, respectively. Developing and promoting differentiated in-house music Since the beginning of 2025, our in-house studios have successfully produced and popularised multiple hit songs across our community and external platforms. We emphasise our signature genres, such as hip-hop, and popularised multiple in-house hip-hop tracks during the Reporting Period, including "Liang Nan" (《两难》) and "Mo Chou Xiang" (《 莫愁乡》). Additionally, we are dedicated to cultivating high-quality, refined music content. Older self-produced tracks, such as "Shi Hao" (《嗜好》) and "You" (《你》), are gradually reaching a wider audience and gaining recognition, showcasing the enduring appeal and value of exceptional music. Diversified audio-based content offerings We have been actively expanding the long-form audio offerings on our platform. In the first half of 2025, consumption of our long-form audio content continuously increased, with the average listening time per user showing consistent improvement. PUGC/UGC – podcast. With our podcasts' focus on music-inspired content, they offer music fans an enjoyable way to discover quality and lesser-known songs. Our podcast "Dear Music – The season of New Voices" (《亲爱的音乐 • 宝藏新声季》), co-created with a radio DJ, delves into the stories behind hit songs by Chinese singer-songwriters and has surpassed 100 million plays. Our newly introduced "Music Neighbour Program" (音乐友邻计划) features KOLs such as Lo Ta-yu (罗大佑) and Terry Lin (林志炫), who host exclusive music podcasts and share their personal music playlists with listeners. PGC – audiobooks & radio dramas. We have been expanding our library of PGC long-form audio content cost-effectively. During the Reporting Period, our self-produced audiobooks, such as《大师兄明明是酒鬼怎么会这么强》and《黑相术》, have become new hits on our platform. We also introduced high-quality content, such as our in-depth collaboration with Pu Yixing (蒲熠星) on his new audiobook "Someone Fell from the Forest" (《有人自林中坠落》). Product innovation and community ecosystem During the Reporting Period, we continued to elevate users' premium music experience through product innovation and revitalising our community. Through ongoing main product upgrades in the first half of 2025, we have enhanced our product's visual appeal, streamlined its functionality and made it more user-friendly. Our efforts have yielded improved user engagement metrics, including higher activity ratio and increased time spent listening to music within our app. Optimising users' music discovery and listening experience We deepened our efforts to improve users' music discovery and consumption experience via enhancements to personalised content recommendations and innovative features for a premium music listening experience. Music content discovery and distribution. We elevated our efforts to improve the recommendation experience and efficiency, boosting user stickiness through the following initiatives: 1) streamlining homepage modules, removing inefficient playlists, and optimising display timing to enhance distribution efficiency; 2) refining the user experience for liking and collecting, improving user genre preference data accuracy, and responding to user feedback in real time; 3) enriching interest and preference data for new users and adding new trending content recommendations; and, 4) upgrading the access experience for vertical genre zones in the discovery channel. Enhancing the music consumption experience. We enhanced the music experience and expanded more audio-visual needs. We further streamlined the product homepage by merging the "Recommendation" and "Discovery" channels and simplifying the bottom tab navigation for a better user experience. Innovations like the "Magic Light Player" (神光播放器), which immersively displays lyrics and uses special visual effects to highlight choruses and simulate the ambience of a live performance, received widespread acclaim. "Magic Light" mode now supports landscape orientation, boosting user screen-on time. We launched "Music Cards" (音乐小卡片), allowing users to showcase their unique tastes. Leveraging the DeepSeek model, we also introduced the "Interpret Your Music Taste" activity, further boosting music consumption. Expanding music consumption scenarios We continuously expand our multi-terminal layout, with our IoT coverage consistently being improved with enhancements to multi-terminal experiences. In the first half of 2025, we extended in-car coverage to new brands and models through partnerships with Jetour and LYNK & CO, among others. Additionally, we are improving the IoT device experience to boost user engagement. For in-vehicle scenarios, we added features like "Heartbeat Mode" (心动模式), Audio Vivid and podcasts, while enhancing seamless playback. For TV devices, we are expanding the reach of innovative features like "Ambient Roaming" (氛围漫游), and emphasising audio-visual entertainment on TV terminals through features such as "Sing at Will" (随心唱), "Lyric Animation" (歌词动效), and "Magic Light Player" (神光播放器). Conference Call The Company's management will host an earnings conference call at 7:00 p.m. Beijing/Hong Kong Time on Thursday, August 14, 2025 (7:00 a.m. U.S. Eastern Time on the same day). Details for the conference call are as follows: Event Title: NetEase Cloud Music Inc. First Half 2025 Earnings Conference CallRegistration Link: All participants must use the link provided above to complete the online registration process in advance of the conference call. Upon registering, each participant will receive a set of dial-in numbers, an event passcode, and a personal access PIN, which will be used to join the conference call. A replay of the call will be accessible by phone at the following numbers and entering PIN: 10049196. The replay will be available through August 21, 2025. Chinese Mainland: 400-120-9216 Hong Kong: 800-930-639 United States: 1-855-883-1031 Additionally, a live and archived webcast of the conference call will be available on the Company's investor relations website at About NetEase Cloud Music Inc. Launched in 2013 by NetEase, Inc. (NASDAQ: NTES; HKEX: 9999), NetEase Cloud Music Inc. (HKEX: 9899) is a well-known online music platform featuring a vibrant content community. Dedicated to providing an elevated user experience, NetEase Cloud Music Inc. provides precise, personalised recommendations, promotes user interaction and creates a strong social community. Its focus on discovering and promoting emerging musicians has made NetEase Cloud Music Inc. a destination of choice for exploring new and independent music among music enthusiasts in China. The platform has been recognised as the most popular entertainment app among China's vibrant Generation Z community. Please see for more information. Forward Looking Statements This press release contains forward-looking statements relating to the business outlook, estimates of financial performance, forecast business plans and growth strategies of the Company. These forward-looking statements are based on information currently available to the Company and are stated herein on the basis of the outlook at the time of this press release. They are based on certain expectations, assumptions and premises, some of which are subjective or beyond our control. These forward-looking statements may prove to be incorrect and may not be realised in the future. Underlying these forward-looking statements are a lot of risks and uncertainties. In light of the risks and uncertainties, the inclusion of forward-looking statements in this press release should not be regarded as representations by the Board or the Company that the plans and objectives will be achieved, and investors should not place undue reliance on such statements. Non-IFRS Measure To supplement our consolidated results, which are prepared and presented in accordance with International Financial Reporting Standards ("IFRS"), our Company uses adjusted operating profit and adjusted net profit as additional financial measures, which are not required by, or presented in accordance with IFRS. We believe that these measures facilitate comparisons of operating performance from period to period and company to company by eliminating the potential impact of items that our management does not consider to be indicative of our Group's operating performance, such as certain non-cash items. The use of these non-IFRS measures has limitations as an analytical tool, and shareholders and potential investors of our Company should not consider them in isolation from, as a substitute for, as an analysis of, or superior to, our Group's results of operations or financial condition as reported under IFRS. In addition, these non-IFRS financial measures may be defined differently from similar terms used by other companies, and may not be comparable to other similarly titled measures used by other companies. Our presentation of these non-IFRS measures should not be construed as an implication that our future results will be unaffected by unusual or non-recurring items. Investor Enquiries: Angela XuNetEase Cloud Music View original content: SOURCE NetEase Cloud Music Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
