From Q3 2023 to Q1 2024, Pinduoduo's total revenue increased by 93.89%, 123.21% and 130.66% year-on-year respectively. In Q2 this year, it dropped directly to 86%, "hitting" back to the level before the third quarter. In the previous quarter, the year-on-year growth rate of net profit attributable to the parent company was 245.61%, while in Q2 it was 144.2%, also returning to the growth rate of Q4 2023.
Source: Lieyun.com
Zhao Jiazhen, executive director and co-CEO of Pinduoduo, said country code philippines mobile that Pinduoduo's high revenue growth is unsustainable. Chen Lei, chairman and co-CEO of Pinduoduo, said that the general trend of Pinduoduo's profit gradually declining is inevitable. The company is facing fierce market competition in many lines and is still in the investment stage. There will be no repurchase or dividends in the next few years.
With the growth rate "slowing down" and senior executives "blowing cold wind", the secondary market responded quickly, and Pinduoduo seemed to have awakened from its dream.
If we break down this financial report, we can find clues of a "slowdown" in growth in the two major businesses.
In terms of business, Pinduoduo's revenue structure is divided into two categories: online marketing service revenue (also known as advertising revenue) and transaction services (i.e. commission income). The business structure is divided into the domestic main site and overseas Temu business divisions.
In the first quarter of this year, Pinduoduo's revenue reached 86.8 billion yuan, a year-on-year increase of 131%, mainly benefiting from the increase in online marketing services and transaction services revenue; adjusted net profit was 30.6 billion yuan, a year-on-year increase of 202%; operating profit exceeded Alibaba for the first time , reaching 25.9 billion yuan.
The low-price strategy helped boost performance, and the strong expansion of its cross-border e-commerce platform Temu led to a rise in Pinduoduo's stock price after the results, with its market value surpassing Alibaba at one point.
However, in the first half of this year, Alibaba, JD.com , and Douyin e-commerce offered low prices and services and increased subsidies to compare prices across the entire platform. By Q2, these two major businesses of Pinduoduo also began to be affected.