PDD's stock rockets as Temu parent crushes estimates, sees revenue nearly double

By Emily Bary

Company 'further deepened user mindshare in the third quarter,' exec says

Shares of PDD Holdings Inc. (PDD) were soaring 16% in premarket trading Tuesday after the Chinese e-commerce company blew past expectations for its latest quarter.

The company, which is the parent of popular fast-fashion platform Temu, reported third-quarter net income of RMB15.5 billion ($2.1 billion), or RMB10.60 per American depositary share, whereas it recorded net income of RMB10.6 billion, or RMB7.34 per ADS, in the year-earlier period.

On an adjusted basis, the company earned RMB11.61 per ADS, whereas analysts tracked by FactSet were modeling RMB8.94 per ADS.

See also: Temu is barely on the investor radar, but could threaten some legacy retail names, says Morgan Stanley

Revenue surged 94% to RMB68.8 billion, while analysts had been looking for RMB55.2 billion.

"Under our 'high-quality development' strategy, we increased our investment in technology and further deepened user mindshare in the third quarter," Jun Liu, the company's vice president of finance, said in a release.

Co-Chief Executive Jiazhen Zhao said that "consumption vitality kept improving" in the third quarter.

Don't miss: Fast-fashion giant Shein files for IPO, WSJ reports

-Emily Bary

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11-28-23 0722ET

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