Alibaba Versus JD: The Illustrative Debate Ensues

By James Sands:

Alibaba Group (Pending:BABA) is consistently touted as being the largest e-commerce company in the world for good reason. When considering gross merchandise volume, or GMV, this statement is entirely true.

However, JD.com Inc. (NASDAQ:JD) has appeared on the scene as an anomaly. The company generates about a tenth of Alibaba’s GMV yet is on pace to produce roughly 64% more total revenue by 2015.

For investors considering an investment in either company, the tradeoff seems quite simple, revenue growth for profits with Alibaba being a profit generating monster. However, net income may not be the best way to measure profits, as certain line items are murky and free cash flow gets at each company’s operating “profitability” more clearly.

Alibaba recently provided Amendment No. 5 to Form F-1 to the Securities and Exchange Commission, or SEC. This amendment included Alibaba’s updated information for the June 30, 2014 second quarter.

This information


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