Shares of JD.com (JD -5.30%) fell today due to the news that Walmart (WMT 0.59%) has sold its stake in the Chinese e-commerce company, according to a filing with the US Securities and Exchange Commission (SEC) this morning.

JD and Walmart were once considered partners in China, but the share sale seems to indicate that Walmart no longer values ​​the relationship as much, especially after JD.com’s stock has underperformed in recent years.

As of 11:38 a.m. ET on Wednesday, JD.com’s share price had fallen 5.2% following the news.

Image source: Getty Images.

Another setback for JD.com

The stock sale brings Walmart $3.6 billion and ends an eight-year investment.

Walmart received a 5% stake in the company in 2016 in exchange for the sale of its online grocery business Yihaodian to JD.com. At the time, the stake was valued at $1.5 billion.

In a statement published by Reuters, Walmart said: “This decision allows us to focus on our strong China businesses for Walmart China and Sam’s Club and deploy capital to other priorities.”

What this means for JD.com

Walmart’s share sale is unlikely to have a direct impact on JD’s business, but it is the latest sign that investors are abandoning the once-promising Chinese e-commerce sector as the company’s revenue growth has been sluggish since the pandemic.

Sales rose just 1.2% in the quarter as the retailer continued to struggle with a weak consumer in China and increasing competition from rivals such as PDD Holdings’ Pinduoduo and ByteDance.

While JD reported a stronger improvement in its earnings, the stock is unlikely to recover until sales growth picks up. It’s not surprising that Walmart has been selling its shares.