Shares up PDD Holdings Inc surged after the parent of shopping app Temu delivered significant revenue gains year-over-year.
The company posted revenue of $7.2 billion, up 66% from last year, and ahead of expectations of 43.3 billion yuan. Net income rose 47% over the same span.
PDD and Temu dramatically outperformed its peers in China in terms of growth, making up ground behind Alibaba Group (NYSE:BABA) Holding Ltd. and JD.com Inc (NASDAQ:JD). Temu, a discount shopping app, has been PDD’s effort to achieve market success internationally.
“Our business is closely tied to the overall consumption market and we noticed continued improvement in the macro trends and also consumers’ increasing willingness to shop,” co-Chief Executive Officer Zhao Jiazhen said.
Meanwhile, Morgan Stanley (NYSE:MS) has said PDD is “the only ecommerce play that can deliver alpha” in China as monthly use of its app increases. Temu was the most downloaded shopping app in the US, Australia and Germany over the past three months, according to market research firm Sensor Tower.
However, PDD noted that Temu still only accounted for 1% of PDD sales in the second quarter.
On Tuesday afternoon, PDD shares gained more than 15% to $93.44.
Contact Andrew Kessel at andrew.kessel@proactiveinvestors.com
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