Despite strong Q2, Temu parent PDD Holdings warns of slowing growth

PDD Holdings, owner of online marketplace Temu, reported second quarter revenues of 97,059.5 million Chinese yuan, an increase of 86 percent.

Net income increased 144 percent to 32,009.4 million Chinese yuan and non-GAAP net income rose 125 percent to 34,432.1 million Chinese yuan.

“While encouraged by the solid progress we made in the past few quarters, we see many challenges ahead. We are prepared to accept short-term sacrifices and potential decline in profitability,” said Lei Chen, chairman and co-chief executive officer of PDD Holdings.

Operating profit in the quarter was 32,564.5 million Chinese yuan, an increase of 156 percent, while non-GAAP operating profit reached 34,987.3 million Chinese yuan, an increase of 139 percent versus the same quarter of 2023.

The company’s revenues from online marketing services and others were 49,115.9 million Chinese yuan, an increase of 29 percent, while revenues from transaction services reached 47,943.7 million Chinese yuan, up 234 percent.

"Looking ahead, revenue growth will inevitably face pressure due to intensified competition and external challenges,” added Jun Liu, VP of finance at PDD Holdings.