PDD Holdings delivered stronger-than-expected third-quarter earnings on Tuesday, buoyed by steep discounts and aggressive marketing that continued to attract budget-conscious shoppers in China’s soft consumer climate. The e-commerce group — owner of Pinduoduo in China and Temu overseas — reported adjusted earnings per share of 21.08 yuan, well above the analyst consensus of 16.84 yuan.
Despite the upbeat profit numbers, U.S.-listed shares dipped around 3% in premarket trading amid broader market volatility.
China’s major online retailers, including PDD, Alibaba and JD.com, have been pushing price cuts and promotions to entice consumers who remain cautious due to job insecurity and prolonged weakness in the property sector. While these tactics have lifted sales, growth has cooled compared to the rapid double-digit expansion PDD enjoyed in previous years.
Revenue Growth Moderates
PDD said quarterly revenue rose 9% year-on-year to 108.28 billion yuan ($15.23 billion), slightly under the 108.41 billion yuan average estimate from LSEG. The company’s adjusted net income attributable to shareholders reached 31.38 billion yuan, up from 27.46 billion yuan a year earlier.
Jun Liu, PDD’s vice president of finance, said the slowdown reflects an evolving competitive environment and external uncertainties. The company reiterated that its financial results may fluctuate as it continues investing in merchant support programmes and platform upgrades.
The broader industry also showed signs of a tempered spending environment. This year’s Singles’ Day shopping festival — traditionally a major driver of sales — ended on a muted note, stretched into the longest promotional season yet as retailers launched early discounts.
According to Analysys, Pinduoduo achieved sales growth of 11.7% during the event, outperforming JD.com’s 8.3% and Alibaba’s 9.3%. Data provider Syntun reported total sales of 1.70 trillion yuan across Chinese platforms, up from 1.44 trillion yuan last year, though the 2024 promotional window was shorter on some sites.
With China’s consumer sentiment still fragile, analysts say PDD’s heavy reliance on discounts may support traffic in the near term but could challenge margins as the competitive landscape continues to intensify.