JD.com’s Strategic Moves: Share Buybacks and AI Growth Amid Divergent Analyst Views

JD.com is deploying a dual strategy of aggressive share repurchases and investment in high-growth artificial intelligence product categories, against a backdrop of mixed analyst sentiment. While these initiatives have provided some uplift to investor confidence, questions remain about their ability to fully counterbalance persistent margin pressures and downward revisions to profit forecasts.

A cornerstone of the company's recent financial strategy has been a substantial share buyback program. In 2025 alone, JD.com repurchased and subsequently cancelled approximately 183.2 million Class A ordinary shares, representing an outlay of around US$3.0 billion. This reduction in the share count provides direct support for earnings per share (EPS) and is a clear near-term catalyst for the stock. The company has signaled its commitment to continuing this approach, with a remaining budget of about US$2.0 billion available under a program extending through August 2027, as of December 31, 2025.

On the operational front, CEO Sandy Xu Ran has highlighted explosive growth within specific AI product lines, reporting triple-digit and even tenfold sales increases in certain categories during 2025. Furthermore, JD.com is pursuing international expansion through its National Pavilion program, with plans to add 50 new online country shops by 2026. This initiative aims to broaden product assortment and increase import volumes, offering growth avenues beyond the core domestic business.

The Profitability Conundrum and Market Opinion

The fundamental picture for JD.com presents a contrast. Attractive valuation metrics, including trailing and forward price-to-earnings (P/E) ratios hovering near 9.76, are paired with robust operating cash flows. However, these positives are weighed against narrower margins and a pattern of analysts reducing their earnings estimates.

Should investors sell immediately? Or is it worth buying JD.com?

This dichotomy is reflected in a divided analyst community. The consensus recommendation stands at "Moderate Buy," with an average price target of US$38.40. Yet the range of opinions is wide. Mizuho Securities maintains a target of US$41, while Morgan Stanley adopted a more cautious "underweight" stance and cut its target to US$24. This divergence underscores varying assessments of JD.com's near-term profitability and operational efficiency.

Key Data Points:
* Recent Trading: Shares last closed at €24.95, reflecting a 12-month decline of 33.6% and a drop of approximately 39.6% from the 52-week high.
* Share Repurchases: 2025 buybacks totalled ~US$3.0 billion (cancelled); remaining budget ~US$2.0 billion.
* Valuation: P/E ratio (trailing/forward) ≈ 9.76.
* Growth Drivers: Exceptional revenue growth in AI products; planned launch of 50 new online country pavilions in 2026.

Path Forward and Critical Factors

The stock's near-term trajectory is likely to hinge on two pivotal developments. First, the pace and scale at which JD.com deploys its remaining US$2.0 billion buyback authorization will be closely watched for its ongoing EPS impact. Second, the market will seek evidence that the company can stabilize its margins under current profitability pressures. Potential drivers for this could include achieving greater scale in its burgeoning AI segment or realizing margin improvements within its international trade operations.

Additional milestones that will provide relevant insight include the concrete execution of the National Pavilion expansion plans in 2026 and further operational guidance from the company's management.