PDD Holdings, the Chinese e-commerce giant behind Pinduoduo and Temu, posted second-quarter revenue of 112.36 billion yuan ($15.7 billion), an 8% increase from the prior year but below the 116.35 billion yuan average estimate compiled by LSEG. Net income attributable to ordinary shareholders declined 12% to 27.2 billion yuan, reflecting margin pressures from heightened competition in China and elevated spending on logistics and merchant incentives.
The company’s domestic platform, Pinduoduo, operates in a market characterized by weak consumer confidence, persistent real-estate sector challenges, and aggressive discounting among rivals including Alibaba’s Taobao and Tmall, JD.com, and ByteDance’s Douyin. PDD has responded by increasing subsidies and expanding logistics infrastructure to reduce fulfillment costs, though investors remain concerned about the impact on profitability.
Temu, PDD’s international arm, continues to face headwinds from regulatory and cost pressures. Higher U.S. tariffs on Chinese imports and the removal of tax exemptions for low-value parcels have eroded its price advantage, prompting some merchants to raise prices. In Europe, new EU regulations targeting direct-imported goods from platforms such as Temu, Shein, and AliExpress are expected to further increase compliance and shipping costs, potentially dampening demand among price-sensitive consumers.
Shares of PDD rose 4.6% in volatile pre-market trading in New York following the results.
