Vipshop Holdings Ltd. (NYSE:VIPS) stock traded lower Tuesday after the Chinese discount retailer reported a steep decline in adjusted profit and issued a weaker-than-expected third-quarter sales forecast.
Vipshop reported second-quarter adjusted earnings of 12 cents per American depositary share, missing the analyst estimate of 51 cents. Revenue fell 4.3% year over year to $3.641 billion but topped the $3.620 billion estimate.
Consumer Weakness Pressures Operations
Gross merchandise value declined to 50.6 billion yuan from 51.4 billion yuan a year earlier. Active customers fell to 42.3 million from 43.5 million, while total orders dropped to 182.4 million from 193 million.
Gross margin narrowed to 23.3% from 23.5%. Adjusted operating income fell to 2 billion yuan from 2.4 billion yuan. The adjusted operating margin contracted to 8.1% from 9.3%.
