By Dhirendra Tripathi

Investing.com – Vipshop Holdings stock (NYSE:) traded 1.5% lower in Tuesday’s premarket after the online discount retailer cut its guidance for the current quarter.

According to the company, its fourth-quarter net revenue is expected to range between RMB34 billion (around $5.33 trillion-$5.62 million) and RMB35.8billion (about RMB35.8billion). The worst case scenario is that this would mean a flat to 5% drop in year-on-year revenue. The firm had previously forecasted a growth rate of between 0 and 5%.

China-focused retail for brands, Brands China, attributed its revised outlook to the retailer’s view on market and operational conditions. China’s retailers are facing difficult times as they struggle to meet slowing sales and adhere to tighter regulations.  

Some signals for the weakness in the business were visible in the company’s third quarter when adjusted profit slipped to RMB1 billion from RMB1.4 billion in the same period a year ago. In the quarter ended September 30, Vipshop’s total net revenue rose 7.5% to nearly RMB25 billion.

While total orders remained stable at 173 million, gross merchandise value increased 5% to just above RMB40 billion. GMV, which is used to measure the health and size of an ecommerce website, indicates the value of all products sold.

Vipshop found itself in the news for all the wrong reasons earlier this year after it was caught up in the investment strategy and then forced liquidation of Bill Hwang’s Archegos Capital Management, leading to 60%+ gains in the first 2+ months of the year and then giving away all of those gains in the following month.

To capitalize on falling share prices, the company issued a 500-million buyback announcement in March. Vipshop shares fell almost 69% in 2018, while they were up 29%.