Vipshop Holdings Ltd. (NYSE: VIPS) reported its first quarter financial results and missed analysts’ estimates for earnings, but topped revenue. Shares plummeted by 17.5 percent shortly after closing bell on Monday.
For the first quarter, Vipshop reported revenue of RMB19.9 billion or $3.2 billion, increasing 24.6 percent year over year and topping analysts’ estimates of $3.08 billion. The company reported an EPS of 17 cents, but missing analysts’ estimates by 1 cent.
The Chinese-based e-Commerce retailer reported 56.6 million active users for the twelve months trailing the end of March, only slight up from the previous year’s count of 55.5 million. Total orders increased by 25 percent to 90.2 million.
Vipshop’s average revenue per customer increased by 25 percent year over year, driven by improved customer shopping, said Vipshop Chief Financial Officer Donghao Yang.
Gross profits grew by 8.5 percent to RMB4.0 billion or $639.2 million. Despite the growth, non-GAAP net income still fell to RMB727.7 million or $116.0 million from RMB799.4 million the previous year’s same quarter.
In early March, Vipshop launched its JD flagship and opened up the entry on the homepage of JD’s app to all customers. The store drew in nearly half a million followers within the first two months. Vipshop also opened up access of its WeChat wallet entry to all traffic.
“Looking ahead, we will continue to work closely with Tencent and JD.comin order to improve the traffic flow and conversion rates, which will contribute meaningfully to our long-term customer and revenue growth." said Vipshop Chairman and Chief Executive Officer Eric Shen.
“Leveraging the support from Tencent and JD.com, we will continue to grow our topline and expand our market share." added Vipshop Chief Financial Officer Donghao Yang.
For the second quarter, Vipshop expects total net revenue between RMB20.5 billion and RMB21.3 billion, representing a 17 percent to 22 percent growth year over year.