JD.com offers no update on founder Richard Liu’s US case amid weak earnings
- The Beijing-based e-commerce company’s third-quarter revenue growth was the slowest since it went public in 2014
JD.com founder Richard Liu Qiangdong, who was arrested and then released in the US in August after being accused of rape, provided no update on the case in the e-commerce company’s first quarterly results since that incident.
In a conference call before the US market opened on Monday, it seemed business as usual for Liu, who has maintained a low profile in China since his arrest on August 31, as he fielded questions from analysts, saying his personal focus was on “strategy, culture, team and new businesses”.
When Wendy Huang, the head of Asian internet and media research at Macquarie Group, asked for new information about the US case, it was another executive who answered the question.
“We really do not have any new information to share with you,” said Sidney Huang, JD.com’s chief financial officer. “And honestly, we cannot further comment, because it is important that we respect the due process of the US justice system.”
Huang emphasised that the US case “did not and was not expected to have any material impact” on Nasdaq-listed JD.com.
“Our strong senior leadership team, with most of its members having spent five to 10 years with the company, continues to effectively guide our company towards its goal to grow our business and serve our customers,” he said.
That, however, failed to reassure investors, as JD.com’s shares ended down 8.4 per cent at the close of US trading on Monday because of the company’s slowest quarterly revenue growth since it went public in 2014. JD.com reported a 25 per cent increase in revenue to 104.8 billion yuan (US$15 billion) for the third quarter, which missed analysts’ estimates.
The Beijing-based e-commerce services provider did not respond immediately to a request for comment on Tuesday.
The appearance of Liu, who serves as JD.com’s chairman and chief executive, at the company’s third-quarter earnings call followed his conspicuous no-show at the World Internet Conference held earlier this month in Wuzhen, a picturesque canal-lined town in the eastern coastal province of Zhejiang.
Liu was also not among the top private business leaders invited to meet with Chinese President Xi Jinping at a symposium last month, which included the founders and chief executives of Tencent Holdings, Baidu, Xiaomi and Alibaba Group Holding.
His low profile in China contrasts with previous years when he was seen at similar events along with other senior tech industry executives. Liu, however, attended the wedding of Princess Eugenie last month in London with his wife Zhang Zetian.
Efforts by Liu to maintain a low profile in China followed his arrest in the US, which was triggered by a complaint filed by a 21-year-old female University of Minnesota student to the Minneapolis police. The case has dragged on without resolution, creating a cloud of uncertainly around JD.com. The company’s shares have fallen by more than 44 per cent this year.
In September, Reuters published an account about the night Liu was accused of rape. His accuser had sent a WeChat message to a friend around 2am on August 31 about being forced her to have sex with the JD.com founder, according to the report.
Liu has denied any wrongdoing through his lawyer.
Minneapolis police said on September 20 that an initial investigation into the rape allegation against Liu had been completed. The matter was handed to local prosecutors for possible charges.
There is no deadline for the decision. Liu could face a prison sentence of up to 30 years if he is charged and convicted.
Before his rape arrest, Liu had worked hard to raise his international profile as JD.com aimed to expand beyond China.
Backed by Walmart, Google and Tencent Holdings, JD.com is China’s second-biggest e-commerce services provider. It is now competing aggressively with Alibaba, the parent company of the South China Morning Post, in expanding online retail operations across Southeast Asia.