August 26, 2024 - Shares of the Temu parent company $PDD Holdings (PDD.US)$ slumped 26.10% to $103.37 in early trading on Monday.

Today, the company reported its Q2 unaudited financial results that fell short of expectations. The China-based online retailer reported revenue below analysts' estimates, and management indicated that revenue growth pressures are expected to continue due to heightened competition and other challenges.

Highlights for Q2 earnings

• Q2 total revenue of RMB97,059.5 million (US$13,355.8 million), an increase of 86% from RMB52,280.7 million in the same period last year, but falling short of the market expectation of RMB99,985 million.

• Q2 net income attributable to ordinary shareholders of RMB32,009.4 million (US$4,404.6 million), an increase of 144% from RMB13,108.1 million in the same period last year.

• Q2 non-GAAP net income attributable to ordinary shareholders of RMB34,432.1 million (US$4,738.0 million), an increase of 125% from RMB15,269.4 million in the same quarter of 2023.

• In this quarter, revenues from online marketing services and others of RMB49,115.9 million (US$6,758.6 million); and revenues from transaction services of RMB47,943.7 million (US$6,597.3 million).

• Non-GAAP diluted earnings per ADS were RMB23.24 (US$3.20)

• Additionally, cash, cash equivalents and short-term investments were RMB284.9 billion (US$39.2 billion) as of June 30, 2024, compared with RMB217.2 billion as of December 31, 2023.

Chairman and Co-Chief Executive Officer of PDD Holdings, Mr. Lei Chen said:

“While encouraged by the solid progress we made in the past few quarters, we see many challenges ahead, We are committed to transitioning toward high-quality development and fostering sustainable ecosystem. We will invest heavily in the platform’s trust and safety, support high-quality merchants, and relentlessly improve the merchant ecosystem. We are prepared to accept short-term sacrifices and potential decline in profitability.”