JD.com’s Unit Says It May Have Overstated Revenue
Dada Nexus, an on-demand retail and delivery subsidiary of Chinese e-commerce giant JD.com, said its internal audit found “suspicious practices” that could cast doubt on its revenue, causing Dada’s Nasdaq-listed shares to plunge 46% Monday.
In a statement, Dada said it may have overstated 500 million yuan ($70.4 million) of revenues from online advertising and marketing as well as 500 million yuan of expenses. The company withdrew its previous revenue guidance for 2023 and said it would conduct “an independent review to ascertain the financial impact and the scope of suspicious practices, if any, and the root cause.”
In China, Dada is a major competitor in China’s online grocery and delivery sectors. JD.com’s shares, also listed on Nasdaq, fell 2.7% Monday.