Vipshop Stock Drops After ‘Slower Sales Momentum’ in Q2

Vipshop Holdings (VIPS) American depository receipts (ADRs) plunged in intraday trading Tuesday after the Chinese discount retailer reported falling second-quarter sales and an underwhelming outlook.

The company reported quarterly revenue of 26.88 billion yuan ($3.7 billion), down 3.6% year-over-year but above expectations, per Visible Alpha. Total orders dropped to 197.8 million from 213.8 million a year earlier. 

Chief Executive Officer (CEO) Eric Shen said the company’s Q2 results “reflected the agility of our team and the resilience of our business model, as we achieved operational excellence in the face of slower sales momentum.”

Vipshop Q3 Revenue Outlook Below Estimates

Vipshop projected third-quarter revenue between 20.5 billion and 21.6 billion yuan, a year-over-year decline of 10% to 5%, respectively, and below analysts’ consensus of 22.7 billion yuan. 

Vipshop ADRs dropped more than 16% to $11.70 as of 12:45 p.m. ET Tuesday. They have lost more than a third of their value this year.