Key findings

• Vipshop reported a 3.6% year-on-year decline in revenue for the second quarter and a drop in orders from 213.8 million to 197.8 million.

• The retailer’s third-quarter sales forecast fell short of expectations.

• Vipshop’s American Depositary Receipts (ADRs) plunged in intraday trading on Tuesday.

VIPSHOP Holdings (VIP) American Depository Receipts (ADRs) plunged in intraday trading on Tuesday after the Chinese discounter reported falling second-quarter sales and disappointing outlook.

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

According to CEO Eric Shen, the second quarter results “reflect the agility of our team and the resilience of our business model as we delivered operational excellence despite weaker revenue momentum.”

Vipshop Q3 revenue forecast below estimates

Vipshop forecast third-quarter revenue of 20.5 billion to 21.6 billion yuan, down 10 to 5 percent year-on-year and below analyst consensus of 22.7 billion yuan.

Vipshop ADRs fell more than 16% to $11.70 as of 12:45 p.m. ET on Tuesday, losing more than a third of their value this year.

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