Jd.com (JD) Traded Down Due to Its Aggressive Expansion

Ariel Investments, an investment management company, released its “Ariel Global Fund” second-quarter 2025 investor letter. A copy of the letter can be downloaded here. The second quarter marked a period of extremes. The stocks fell after the “Liberation Day” tariff announcement in early April and rebounded following the pause in tariff implementation. Enthusiasm for artificial intelligence (AI) themed stocks and robust corporate earnings results lifted global and U.S. indices to new highs. Against this backdrop, the Ariel Global fund traded +7.38% higher in the quarter, compared to the +11.53% return of the MSCI ACWI Index and +5.84% return of the MSCI ACWI Value Index. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its second-quarter 2025 investor letter, Ariel Global Fund highlighted stocks such as JD.com, Inc. (NASDAQ:JD). Headquartered in Beijing, the People's Republic of China, JD.com, Inc. (NASDAQ:JD) is a supply chain-based technology and service provider. The one-month return of JD.com, Inc. (NASDAQ:JD) was 11.36%, and its shares gained 28.94% of their value over the last 52 weeks. On September 16, 2025, JD.com, Inc. (NASDAQ:JD) stock closed at $34.71 per share, with a market capitalization of $53.45 billion.

Ariel Global Fund stated the following regarding JD.com, Inc. (NASDAQ:JD) in its second quarter 2025 investor letter:

"Alternatively, China-based e-commerce company, JD.com, Inc. (NASDAQ:JD) declined during the quarter primarily due to concerns surrounding the company's aggressive expansion into the highly competitive food delivery business. Specifically, the magnitude of investment and incremental return on the initiative remains unclear. Meanwhile, the core e-commerce business continues to deliver strong results highlighted by double-digit top line growth and margin expansion. Although the valuation remains attractive and the core business is doing well, we have trimmed the position to reflect our emerging concerns."

JD.com, Inc. (NASDAQ:JD) is not on our list of 30 Most Popular Stocks Among Hedge Funds. According to our database, 54 hedge fund portfolios held JD.com, Inc. (NASDAQ:JD) at the end of the second quarter, compared to 66 in the previous quarter. While we acknowledge the potential of JD.com, Inc. (NASDAQ:JD) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

In another article, we covered JD.com, Inc. (NASDAQ:JD) and shared the list of best Asian stocks to buy according to hedge funds. In addition, please check out our hedge fund investor letters Q2 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.