Vipshop Q1 Results Disappoint, Stock Tanks 2%

Shares of Vipshop Holdings Limited (NYSE:VIPS) fell by as much as 2% on May 20 after the Chinese e-commerce operator delivered disappointing first-quarter 2025 results. The discount shopping platform delivered a 5% year-over-year revenue decline and logged 26.27 billion Chinese yuan ($3.64 billion) in sales. The  decline came as gross merchandise volume fell to RMB52.38 billion, compared to RMB52.44 billion delivered the same quarter last year.

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Consequently, net income attributable to shareholders dropped to RMB1.9 billion or $267.7 million compared to RMB2.3 billion delivered in the same quarter last year. On the other hand, it expects its second quarter revenues to average between RMB25.5 billion and RMB26.9 billion, representing a 5% to 0% year-over-year decline.

Amid the disappointing first quarter results, CEO Eric Shen insists they made progress on strategic actions that should return the company to robust growth.  For starters, Vipshop continues to expand its unique and high-quality off-price brand supply, which has driven double-digit growth in Super VIP customers.

Despite the earnings miss and disappointing outlook, Jefferies has reiterated a Buy rating on the stock and an $18.30 price target. According to Jefferies, Vipshop boasts a healthy gross profit margin of 23.5% while generating strong returns.

While we acknowledge the potential of Vipshop Holdings Limited (NYSE:VIPS) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than VIPS and that has 100x upside potential, check out our report about the cheapest AI stock.

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Disclosure: None.