PDD’s Shares Climb After Earnings Beat Soothes Worst Trade Fears

The banal gained 4% successful New York adjacent though the e-commerce institution reported lower-than-anticipated gross of 110.6 cardinal yuan ($15.3 billion) for the December quarter. Net income climbed to a stronger-than-expected 27.4 cardinal yuan.

PDD’s results travel astatine a clip of heightened uncertainty astir its concern some domestically and abroad, which has helped tamp down expectations. Temu is grappling with elevated US tariffs connected Chinese products and the imaginable closure of a taxation loophole for small-value parcels. Domestically, PDD has warned astir contention since August and predicted that its profitability volition inclination downward implicit time.

The “earnings bushed should assistance reconstruct marketplace assurance successful its 2025 net outlook,” Morgan Stanley analysts wrote, adding that the banal was trading astatine conscionable 11-times projected 2025 earnings. “Because of the tariff overhang connected Temu and contention successful EC, marketplace expectations for the twelvemonth are not high.”

Still, executives connected Thursday acknowledged challenges from increasing planetary uncertainty and said aggravated contention besides affected short-term growth. They reiterated their enactment for merchants and efforts to boost the user experience.

“As mentioned successful erstwhile quarters, our important ecosystem concern coupled with fast-changing outer situation and intensified contention scenery volition interaction short-term financials,” Chairman and Co-Chief Executive Officer Chen Lei told analysts connected a call.

In contrast, rivals JD.com Inc. and Alibaba Group Holding Ltd. reported better-than-projected income for the December quarter, erstwhile Beijing ramped up policies specified arsenic subsidies and trade-in incentives to boost spending. The authorities has prioritized expanding home request arsenic the state seeks to offset the interaction of US President Donald Trump’s tariffs and execute a maturation people of astir 5%.

Thursday’s study “lacks immoderate large agleam spot,” JP Morgan analysts Andre Chang and Alex Yao wrote successful a note, which cited misses connected some transaction work gross and online selling work revenue.