Pinduoduo's Net Profit Triples in Q1 2024

Chinese e-commerce giant Pinduoduo announced that its net profit for the first quarter more than tripled, as the Temu owner continues to boost its competitiveness in its home market and abroad.

Pinduoduo is one of China’s leading online retailers — owing largely to its success in reaching consumers in rural areas with a diverse offering of low-cost products.

The company’s overseas platform, Temu, has surged since its September 2022 launch to become one of the most popular online shopping sites in the United States, propelled by a marketing strategy that featured multiple prime-time Super Bowl advertisements.

Pinduoduo said net profit for the first three months of 2024 was $3.88 billion, up 246 percent from the same period last year.

The Shanghai-based firm added that sales in the first quarter were about $11.2 billion, an increase of 131 percent from the same period in 2023.

Temu expanded last year into the EU market, where it says its shopping app amassed an average of around 75 million monthly active users in the 27-country bloc.

But the shopping app’s rise has also encountered turbulence. In March, a promotional campaign in Britain and France backfired due to concerns over data privacy.

Earlier this month, European consumer rights groups accused it of using manipulative sales techniques and lacking transparency about traders on the platform.

Despite the setbacks, Pinduoduo remains the newest competitor to established e-commerce juggernauts, including Amazon in the United States and Alibaba in China.

At home, Pinduoduo has found growing success with low-price products as Chinese consumers curb their spending against a backdrop of economic slowdown and high youth unemployment.

In pre-market trading on the Nasdaq, Pinduoduo’s stock price rose around eight percent.

It was valued at around $202 billion, compared to Alibaba’s $209 billion.