Temu-Owner PDD Beats Profit Estimates as Revenue Growth Slows to 8%
PDD Holdings posted adjusted quarterly earnings of 19.33 yuan per share, exceeding estimates of 18.51, with revenue up 8% to 112.4 billion yuan ($16.6 billion), missing forecasts. Shares rose approximately 3.5% premarket in New York.
Despite the profit beat, the single-digit revenue growth is a significant contrast to PDD's previous pace while expanding Temu globally. The company also addressed regulatory concerns:
“We view compliance as a fundamental priority and are fully committed to safeguarding consumer rights and building lasting trust," said co-chief executive Jiazhen Zhao.
PDD faces multiple European regulatory processes, including a €200 million fine for unsafe products and allegations of non-cooperation with an inspection regarding potential Chinese state subsidies, which could result in fines reaching 1% of total turnover.
The latest quarter, however, will be a critical test as the EU's low-value import duty exemption ended on July 1st. The new charge of €3 per item is not reflected in these financial results.
Story by Ana-Maria Stanciuc, Editor-in-Chief at TNW
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