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1. Company Snapshot

1.a. Company Description

PDD Holdings Inc., through its subsidiaries, operates an e-commerce platform in the People's Republic of China.It owns and operates a portfolio of businesses, including Temu, an e-commerce marketplace in the United States; and operates Pinduoduo, a mobile platform that offers a range of products, including apparel, shoes, bags, mother and childcare products, food and beverages, fresh produce, electronic appliances, furniture and household goods, cosmetics and other personal care items, sports and fitness items, and auto accessories.The company was formerly known as Pinduoduo Inc.


and changed its name to PDD Holdings Inc.in February 2023.PDD Holdings Inc.


was incorporated in 2015 and is headquartered in Shanghai, the People's Republic of China.

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1.b. Last Insights on PDD

Have nothing to say about that one ...

1.c. Company Highlights

2. PDD Holdings' Q3 2025 Earnings: Steady Revenue Growth Amidst Intense E-commerce Competition

PDD Holdings reported a revenue of RMB 108.3 billion for Q3 2025, a 9% year-over-year increase, driven primarily by growth in online marketing services and transaction services. However, the revenue growth was under pressure due to intensified competition in the e-commerce sector. The company's non-GAAP operating profit stood at RMB 27.1 billion, down from 27% in the same quarter last year. The basic earnings per ADS were RMB 20.96, while the diluted earnings per ADS were RMB 19.7. Notably, the actual EPS came out at RMB 2.96 (though not directly stated, it can be inferred that this is the figure when considering the context of '2.96' relative to estimates at '2.21'), beating estimates. The company's operating margin decline narrowed compared to the previous quarter.

Publication Date: Nov -19

📋 Highlights
  • Revenue Growth:: Achieved RMB 108.3 billion, a 9% YoY increase driven by online marketing and transaction services.
  • Merchant Support Investments:: Launched RMB 100 billion support program and RMB 10 billion fee reduction to bolster SMEs and ecosystem growth.
  • Non-GAAP Operating Profit Decline:: Fell to RMB 27.1 billion, reflecting continued platform investments and competitive pressures.
  • Strong Cash Flow:: Generated RMB 45.7 billion in operating cash flow, up 66% YoY, with RMB 423.8 billion in cash reserves.
  • Profitability Challenges:: Operating margin decline narrowed, but sustained investments may pressure future profitability amid intensified competition.

Investments in Merchant Support Initiatives

The company has made significant investments in merchant support initiatives, including a RMB 10 billion fee reduction program and a RMB 100 billion support program. These investments aim to drive industry upgrades, provide more savings and fun to consumers, and support the growth of small and medium-sized enterprises (SMEs). As the company mentioned, "the company plans to continue investing substantial capital to strengthen its platform ecosystem, with initiatives such as a CNY 10 billion fee reduction program and a CNY 100 billion support program," indicating its commitment to long-term value creation.

Financial Position and Valuation

As of September 30, 2025, PDD Holdings had RMB 423.8 billion in cash, cash equivalents, and short-term investments. The net cash generated from operating activities was RMB 45.7 billion, up from RMB 27.5 billion in the same quarter last year. With a P/E Ratio of 12.13 and an EV/EBITDA of 11.11, the market seems to have priced in a certain level of growth. Analysts estimate next year's revenue growth at 15.7%, which may justify the current valuation to some extent. The company's ROE stands at 30.52%, indicating strong profitability.

Competitive Landscape and Future Outlook

The e-commerce competition remains intense, with new business models emerging and the market landscape constantly evolving. PDD Holdings plans to further raise its standards, strengthen its core capabilities, and continue to deepen its efforts in supply chain improvement and platform ecosystem development. The company's focus on creating unique value for consumers, merchants, and other participants is expected to drive its long-term sustainable development.

Conclusion on Investment

While the company's financial results may fluctuate from quarter to quarter due to its continued investments in the platform ecosystem, its commitment to high-quality development and long-term value creation is evident. With a strong financial position and a focus on innovation, PDD Holdings is poised to navigate the challenges of the competitive e-commerce landscape.

3. NewsRoom

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Market Today: Deal Talks, Retail Wins, AI Chips, and Crypto Volatility

Dec -02

Source: gurufocus.com

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First Look: Versace deal, crypto slump, WBD bids and Airbus woes

Dec -02

Source: gurufocus.com

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PDD: Cash Keeps Piling Up

Nov -25

Source: seekingalpha.com

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535 Shares in PDD Holdings Inc. Sponsored ADR $PDD Purchased by Bank Julius Baer & Co. Ltd Zurich

Nov -25

Source: defenseworld.net

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PDD Holdings Inc. Sponsored ADR (NASDAQ:PDD) Given Consensus Rating of “Hold” by Brokerages

Nov -25

Source: defenseworld.net

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Why PDD Holdings Stock Slipped 13.6% This Week

Nov -21

Source: fool.com

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Why PDD Holdings Stock Slipped Today

Nov -19

Source: fool.com

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These Chinese Tech Stocks Crushed Q3 EPS Expectations

Nov -19

Source: zacks.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (25.00%)

6. Segments

Internet Software & Services

Expected Growth: 25.0%

PDD's e-commerce and online entertainment platforms, Pinduoduo and Temu, are expected to drive growth through increasing user engagement, expanding merchant base, and growing demand for online shopping and social media services in China and globally.

7. Detailed Products

Temu

Temu is an e-commerce platform that offers a wide range of products across various categories, including electronics, fashion, home goods, and more. It is known for its competitive pricing and vast product selection.

Pinduoduo

Pinduoduo is a popular Chinese e-commerce platform that allows users to participate in group buying and enjoy discounts. It offers a variety of products, including fresh groceries, clothing, and household items.

8. PDD Holdings Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

PDD Holdings Inc., the parent company of Pinduoduo, operates in the e-commerce and online retail space, offering a wide range of products. While there are substitute platforms and retail channels, the threat is moderate due to Pinduoduo's unique social commerce model and user base. However, customers can easily switch to other e-commerce platforms like Alibaba's Taobao or JD.com, posing a moderate threat.

Bargaining Power Of Customers

Pinduoduo has a large and diverse customer base, which reduces the bargaining power of individual customers. The platform's business model, which focuses on group buying and social interactions, also makes it less likely for customers to negotiate prices or terms. However, the low score reflects the competitive nature of e-commerce, where customers have multiple choices and can easily switch platforms.

Bargaining Power Of Suppliers

Pinduoduo's suppliers, primarily small and medium-sized enterprises (SMEs) and manufacturers, have some bargaining power due to the platform's dependence on them for product offerings. However, Pinduoduo's large user base and scale provide it with negotiating power. The medium score reflects the balance between these factors.

Threat Of New Entrants

The e-commerce market in China and globally is highly competitive, with relatively low barriers to entry for new players. The rise of social commerce and the success of Pinduoduo have attracted new entrants. This high score reflects the potential for new competitors to emerge and challenge PDD Holdings Inc.'s market position.

Intensity Of Rivalry

The e-commerce industry, particularly in China, is characterized by intense rivalry among existing competitors like Alibaba, JD.com, and newer entrants. PDD Holdings Inc. faces significant competition for market share, user engagement, and merchant relationships, driving a high level of rivalry.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 3.27%
Debt Cost 4.29%
Equity Weight 96.73%
Equity Cost 7.23%
WACC 7.13%
Leverage 3.39%

11. Quality Control: PDD Holdings Inc. passed 7 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

117.62$

Current Price

117.62$

Potential

-0.00%

Expected Cash-Flows