On August twenty ninth, PDD launched its unaudited monetary report for the second quarter ending on June 30, 2023.
The monetary report reveals that in the course of the reporting interval, PDD’s whole income was 52.281 billion yuan ($7.17 billion), a 66% improve in comparison with the identical interval final 12 months. The web revenue attributable to atypical shareholders was 13.108 billion yuan ($1.81 billion), a 47% improve in comparison with the identical interval final 12 months. The non-GAAP web revenue attributable to atypical shareholders was 15.269 billion yuan ($2.11 billion), a year-on-year improve of 42%, exceeding market expectations. Previously, Bloomberg predicted PDD’s income and adjusted web revenue to be 43.282 billion yuan($5.95 billion) and 10.87 billion yuan ($1.49 billion) respectively.
The income development is principally pushed by the rise in on-line advertising and marketing and different service revenue, in addition to transaction service revenue. During the reporting interval, PDD’s community advertising and marketing providers and different revenue reached 37.933 billion yuan ($5.21 billion), a year-on-year improve of fifty%, whereas transaction service revenue reached 14.348 billion yuan ($1.97 billion), a year-on-year improve of 131%.
At the identical time, PDD’s working bills for this quarter additionally noticed a big improve. During the reporting interval, PDD’s whole working bills amounted to twenty.872 billion yuan ($2.86 billion), representing a 41% development in comparison with the identical interval final 12 months. In its monetary report, PDD talked about that the rise in bills was primarily resulting from greater gross sales and advertising and marketing expenditures. Specifically, PDD’s gross sales and advertising and marketing bills for Q2 had been 17.542 billion yuan ($2.41 billion), displaying a 55% YoY development, primarily used for promotional and promoting actions.
Recently, PDD’s cross-border platform Temu formally launched within the Philippines, taking its first step into Southeast Asia after beforehand launching in Chile. Public data reveals that as of now, Temu has lined 38 markets worldwide, together with varied international locations and areas in Asia, Europe, North America, Latin America, and Oceania. As Temu continues its low-cost growth technique abroad, PDD could proceed to extend its gross sales and advertising and marketing bills. In 2022, Liu Jun, the Vice President of Finance at PDD acknowledged throughout a monetary report assembly that Temu is just not pushed by monetary indicators.
At the identical time because the monetary report was launched, PDD additionally introduced that its board of administrators has appointed Professor Ivonne Rietjens as an unbiased director. Professor Rietjens has been a professor at Wageningen University within the Netherlands since 2001 and at the moment serves as the pinnacle of the Toxicology Department. Toxicology is a self-discipline that research the consequences of meals and medicines to make sure their security.
SEE ALSO: PDD Expands to Chile and Philippines Amid Warehousing Challenges
The monetary report additionally reveals that PDD’s web revenue margin within the second quarter was 25%, which decreased in comparison with the identical interval final 12 months. In the second quarter of 2022, PDD’s web revenue margin was 27.66%. Regarding this, Liu Jun, the Vice President of Finance at Pinduoduo, acknowledged that PDD won’t excessively concentrate on income and different monetary information. In the method of implementing its technique, PDD will improve funding in key areas, resembling rewarding shoppers. At the identical time, PDD can even additional put money into agriculture and manufacturing provide chains with hopes to additional leverage its worth throughout the billion-dollar ecosystem mission.
Facing business competitors and the issue of e-commerce platforms competing with low costs by subsidies, PDD’s Co-CEO, Zhao Jiazhen, stated, “Starting from shopper demand, it is a wholesome competitors that truly advantages the general growth of all the business and is sweet for each shoppers and platforms. For PDD, the core response to speedy modifications within the business is just not specializing in rivals’ methods however relatively based mostly on shopper wants, enhancing our personal capabilities, and dealing with competitors immediately.
At the identical time, Liu Jun talked about that Temu additionally faces many challenges in its growth course of, resembling cultural variations, social setting variations, and shopper demand variations. He stated that the general objective of PDD and Temu is to create higher worth for shoppers by such a platform. PDD will proceed to discover and try to raised perceive how the platform ought to be promoted globally, thus bringing extra worth to shoppers from completely different markets.
As of August twenty ninth, PDD’s US inventory has risen over 11%, with a worth of $80.76.
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