Temu owner PDD misses Q3 estimates as sales growth slows
Pinduoduo Inc.
$105.10
08:00 21/11/24
US-listed shares of Chinese ecommerce giant PDD Holdings dropped sharply on Thursday after the owner of online marketplace Temu undershot market estimates with its lowest quarterly revenue growth in two years.
The company, which is based in Shanghai but legally domiciled in Dublin, said third-quarter revenues totalled CNY99.35bn ($13.7bn), up 44% from CNY68.84bn the year before but short of the CNY102.43bn expected by the market.
This was the weakest rate of year-on-year growth since the second quarter of 2022, and significantly below the 86% annual growth seen in the second quarter and the first quarter's 131% gain.
"Our topline growth further moderated quarter-on-quarter amid intensified competition and ongoing external challenges", according to Jun Liu, the vice president of finance at PDD Holdings.
While transaction services revenues surged 72% to CNY50.0bn, revenues from online marketing services rose just 24% to CNY49.35bn.
Net profit rose 61% year-on-year to CNY24.98bn, well below the CNY26.75bn consensus forecast.
Sales and marketing expenses were up 40% at CNY30.48bn due to increased spending on promotional and advertising activities, general and admin costs jumped 138% to CNY1.81bn, while R&D spending rose 8% to CNY3.06bn.
The stock was down 5.8% at $109.72 in early deals on Wall Street.