Analysis of Gross Margin Improvement in JD Logistics' Cold Chain Business

Based on collected public information, I hereby provide an analysis report on the gross margin improvement of JD Logistics’ cold chain business.

Based on the latest financial data, JD Logistics has shown a strong upward trend in profitability improvement in 2024 and the first three quarters of 2025 [1][2]:

Financial Indicator	Full Year 2024	First Three Quarters of 2025
Revenue	CNY 182.8 billion	CNY 155.1 billion
YoY Growth Rate	+9.7%	+24.1% (Q3 Single Quarter)
Adjusted Net Profit	CNY 7.9 billion	CNY 2.02 billion (Q3)
Gross Margin	~9.1%-9.2%	9.1% (Q3)
Net Profit Margin	~4.3%	3.3% (Q3)

JD Logistics’ business structure covers five segments, among which the

provides integrated cold chain warehousing, transportation, and distribution services to corporate and individual customers [1][2].

:

1. Cold Chain Warehousing Network
   : Building nationwide cold chain warehousing facilities to achieve full-temperature-range cold chain coverage for fresh produce from origin to table
2. Cold Chain Transportation Capacity
   : Deploying a professional cold chain transportation fleet to support multi-temperature zone distribution needs
3. Digital Management
   : Utilizing IoT and big data technologies to achieve full-process temperature control and traceability for cold chain operations
4. Direct Origin Shipping
   : Launching multiple fresh produce cold chain dedicated routes, such as the “Lanzhou-Wuhan” full cargo aircraft route for beef and mutton [1]

Although public disclosures do not separately provide gross margin data for the cold chain business, based on the overall gross margin improvement trend and business synergies, the profitability of the cold chain business shows a positive upward trend:

• In the first half of 2025, revenue from external customers accounted for 67% of JD Logistics’ total revenue, with revenue from integrated supply chain customers reaching CNY 50.11 billion, representing a YoY increase of 19.9% [3]
• The integrated supply chain model significantly reduces logistics costs through the “warehouse instead of transportation” approach, cutting the number of cargo handling times from over 10 in the early stage to 5 in 2024 [4]
• The proportion of logistics costs to commodity costs has dropped from over 20% in the early stage to 14.1%, directly expanding the gross margin room

• JD Logistics has deployed 43 “Asia No.1” smart warehouses to achieve warehouse automation [1]
• Introducing advanced technologies such as AI, big data, and digital twins to optimize cold chain operational efficiency
• Reducing empty driving rates and improving cold chain transportation loading efficiency through intelligent dispatching systems

• Cold chain services cover 2,851 district and county-level markets nationwide, with continuous expansion of customer scale [5]
• With the growth of business volume, the amortization effect of cold chain fixed costs is obvious
• Synergies with Deppon, Dada, and KuaiYue Express enhance the overall network operational efficiency

• High-end demand such as fresh e-commerce and pharmaceutical cold chain continues to grow
• The increase in value-added cold chain services drives gross margin improvement
• During the 2025 11.11 Shopping Festival, inventory turnover days dropped to 30.9 days, outperforming the ~40-day level of international retail giants [4]

Against the backdrop of price war pressures in the overall logistics industry, JD Logistics has achieved a counter-trend increase in gross margin through differentiated competition strategies [3]:

Competitor	Q3 2025 Net Profit Performance	Net Profit Margin
JD Logistics	+3.3%	3.3%
SF Holding	-8.5%	~2-3%
Yunda	-48.15%	1.98%
YTO Express	-1.83%	~4%

JD Logistics’ profitability performance outperforms most competitors, reflecting the competitive advantages of its integrated supply chain model.

1. Room for Further Gross Margin Improvement
   : As technology investments enter the payback period, the gross margin of the cold chain business is expected to continue improving
2. Sustained Growth in Cold Chain Demand
   : China’s cold chain logistics market has an average annual growth rate of ~5.98%, with broad development space [5]
3. Improved Cost Efficiency
   : The application of automation and AI technologies will continue to reduce operating costs
4. External Customer Expansion
   : The proportion of revenue from external customers is increasing, optimizing the customer structure

1. Industry Price Competition
   : The continuous decline in per-ticket prices in the express delivery industry may spread to the cold chain business
2. Capital Expenditure Pressure
   : Continuous investment is required for cold chain infrastructure construction
3. Integration Risks
   : The release of synergies after the integration of Deppon requires time

• The current stock price corresponds to a projected P/E ratio of ~12-15x for 2025/2026
• The average 12-month target price set by analysts is HKD 17.09, representing a 47.44% upside potential from the current stock price [2]
• Institutions including Citi, JPMorgan, and Nomura have given a “Buy” rating

The gross margin improvement of JD Logistics’ cold chain business mainly relies on the combined effects of its integrated supply chain strategy, technological innovation-driven optimization, and scale effects. Although public disclosures do not separately provide gross margin data for the cold chain business, the company’s overall gross margin has risen from a low level in the early stage to the current 9.1%-9.2%, reflecting that the profitability of all business segments, including the cold chain, has improved.

Against the backdrop of sustained growth in cold chain logistics demand and continuous improvement in the company’s cost efficiency, the gross margin of the cold chain business is expected to continue its upward trend. It is recommended to pay attention to the detailed disclosures of segment business in the company’s subsequent financial reports to obtain more accurate gross margin data for the cold chain business.

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[1] Baidu Encyclopedia - JD Logistics (https://baike.baidu.com/item/京东物流/20476410)

[2] Investing.com - JD Logistics (2618) Stock Analysis (https://cn.investing.com/equities/jd-logistics)

[3] TMTPost - Deppon Joins JD, J&T Clings to SF Holding (https://finance.sina.com.cn/stock/relnews/cn/2026-01-18/doc-inhhssaz3857130.shtml)

[4] Huxiu - The Dignity of Over 600,000 People (https://finance.sina.com.cn/stock/t/2026-01-16/doc-inhhnzaw0679141.shtml)

[5] Zhihu - Development History of JD Logistics (https://pic2.zhimg.com/v2-72e48042499101066cd480c7ed3958b1_1440w.jpg)