JD.com (NASDAQ:JD) stock price is down nearly 4% in pre-market Monday after Hong Kong-listed shares of the company closed 1.75% in the red today.
A recent report published in the China Fund News included a letter by JD.com that gave rise to rumors about a potential company-wide layoff, sending the eCommerce company's shares declining for a fourth consecutive day in Hong Kong.
According to the letter, several JD's business units have set layoff ratios in the range of 10% to 30%. The company said layoffs represent a regular optimization of its business divisions, with the core business still seeing healthy growth.
"There may be some near-term cost impact from the streamlining of headcount, depending on the number of the employees affected," says Catherine Lim, an analyst at Bloomberg Intelligence.
Lim expects the recent shutdown of the factory in Shanghai due to the surge in coronavirus cases will pressure stocks with exposure to the retail sector, such as JD.com.
By Senad Karaahmetovic