Temu owner PDD sees 10% plunge in pre-market trading despite 44% revenue growth

PDD’s results, including a 66 per cent jump in net revenue, outperformed rivals, but it did not allay investor concerns amid e-commerce competition

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Published: 9:56pm, 21 Nov 2024Updated: 10:39pm, 21 Nov 2024

PDD Holdings shares plunged by more than 10 per cent in pre-market trading, despite a 44 per cent rise in third-quarter revenue, as concerns around China’s economic slowdown and fierce e-commerce competition weigh on investor sentiment.

The owner of the budget-focused shopping app Pinduoduo and its overseas sibling Temu on Thursday reported 99.35 billion yuan (US$13.7 billion) in revenue in the three months through September. Net income jumped 66 per cent year on year to 24.98 billion yuan.

Chen Lei, company chairman and co-CEO, said PDD is focused on “driving the high-quality development” of its platforms and will keep “investing consistently and patiently” in the platform ecosystem.

Intense price competition has emerged in China’s e-commerce market amid weak consumer spending and a challenging macro environment in the world’s second-largest economy.

Rivals Alibaba Group Holding and JD.com each reported roughly 5 per cent revenue growth for the quarter. Alibaba owns the South China Morning Post.

The battle for consumers’ wallets has led to a price war in the e-commerce industry. Some see Pinduoduo, which has long focused on cut-to-the-bone pricing to attract consumers, as exacerbating the problem.