PDD Holdings reported that total revenue for the quarter ended September 30 2025 rose 9% year‑over‑year to RMB 108.3 billion (US$15.2 billion). The growth rate, while still positive, fell short of the consensus estimate of roughly RMB 109.3 billion (US$15.32 billion), marking a miss of about US$90 million. The shortfall reflects a moderation in demand for the company’s core e‑commerce and Temu platforms amid intensified competition and a shift in consumer spending patterns.
Operating profit increased to RMB 25.0 billion (US$3.5 billion) from RMB 24.3 billion a year earlier, a 3% rise rather than the 7% figure originally reported. Net income attributable to ordinary shareholders reached RMB 29.3 billion (US$4.1 billion), up 17% YoY. Adjusted earnings per ADS of RMB 21.08 beat the consensus of RMB 16.59, a margin of roughly 27% above expectations, driven by disciplined cost management and a favorable mix of higher‑margin transaction services.
Revenue was driven by a 10% increase in transaction‑services revenue to RMB 54.9 billion and an 8% rise in online‑marketing‑services revenue to RMB 53.3 billion. However, the cost of revenue climbed 18% to RMB 70.5 billion, outpacing revenue growth, while research and development expenses surged 41% to RMB 12.4 billion. These higher costs reflect the company’s continued investment in merchant‑support programs, technology infrastructure, and global expansion of its Temu platform.
Senior executives highlighted the strategic context behind the numbers. Chairman Lei Chen said the company remains focused on long‑term value creation, “preparing for greater social responsibility as we scale.” Chief Financial Officer Jun Liu noted that “moderating growth reflects an evolving competitive landscape and external uncertainties, but our disciplined cost structure keeps earnings robust.” Executive Director Jiazhen Zhao emphasized the importance of sustained investment in merchant support, stating that “the platform’s long‑term health depends on continued ecosystem upgrades.”
Investors reacted with mixed sentiment. The revenue miss tempered enthusiasm for the earnings beat, while the company’s high‑investment stance and the continued pressure on cost of revenue raised concerns about future margin sustainability. Analysts noted that the company’s ability to maintain profitability amid rising costs signals operational resilience, but the modest revenue growth suggests that competitive headwinds and macro‑environmental factors may constrain upside in the near term.
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