Vipshop Earnings Top, Sales Guidance Light; VIPS Stock Falls

Vipshop Holdings reported better-than-expected first-quarter earnings early Wednesday, but revenue was in line and its sales guidance was light. VIPS stock tumbled on the news.

The China e-commerce company reported adjusted earnings of 37 cents a share on revenue of $4.33 billion. Analysts expected Vipshop to report earnings of 35 cents on revenue of $4.3 billion, according to FactSet.

The company guided low on second-quarter revenue. That prompted VIPS stock to plunge 10.7% to 22.05 after the opening bell on the stock market today.

To draw in buyers to its website, Vipshop specializes in promotions and “flash sales” on a daily basis. It typically involves a curated selection of popular branded products in limited quantities. It’s gone a long way to help VIPS stock and aid in boosting its repeat business.

Founded in 2008, Vipshop offers thousands of domestic and international brands at discount prices. It appeals to urban, fashion-oriented and value-conscious consumers.

  • Vipshop Holdings Ltd reported first-quarter FY21 revenue growth of 51.1% year-on-year to $4.334 billion (RMB28.4 billion), marginally missing the analyst consensus of $4.34 billion.
  • GMV rose 59% Y/Y to RMB46.1 billion, and the number of active customers increased 54% Y/Y to 45.8 million.
  • Total orders rose 44% Y/Y to 175.5 million.
  • Gross profit rose 54.7% Y/Y to $853.9 million (RMB5.6 billion). The margin expanded 50 basis points to 19.7%.
  • Non-GAAP operating income increased 66% Y/Y to $265.2 million (RMB1.7 billion). The margin expanded 50 basis points to 6.1%.
  • Non-GAAP net income rose 73.7% Y/Y to $261.4 million (RMB1.7 billion). The margin expanded 80 basis points to 6%.
  • Non-GAAP EPS of $0.37 was at par with the consensus.
  • Vipshop held $2.3 billion (RMB15.1 billion) in cash and equivalents and used $67 million (RMB439.0 million) in operating cash flow.
  • Guidance: Vipshop sees Q2 revenue guidance between RMB28.9 billion – RMB30.1 billion.
  • Vipshop is keenly focused on strengthening leadership in China’s discount retail market through the solid execution of merchandising strategy, Chair and CEO Eric Shen said.
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