(Bloomberg) – PDD holding actions Inc. climbed after the owner of TEMU announced an increase in profits of 18% faster than expected, assuming investors’ concerns concerning a vulnerable company to American prices and intensifying internal competition.
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The action won 4% in New York, even if the electronic commerce company declared lower income from 110.6 billion yuan ($ 15.3 billion) for the December quarter. Net profit has climbed around 27.4 billion yuan stronger than expected.
The results of the PDD are at a time of increased uncertainty about its activities in the country and abroad, which helped reduce expectations. TEMU is struggling with American prices raised on Chinese products and the potential closure of a tax escape for small value packages. At the national level, PDD has warned against competition since August and predicted that its profitability is down over time.
The “profits should help restore market confidence in its profits in 2025,” wrote Morgan Stanley analysts, adding that action was only negotiated the benefits planned in 2025. “Due to the overhang of TEMU tariff and competition in the EC, market expectations for the year are not high.”
However, leaders recognized the challenges of growing global uncertainty on Thursday and said that intense competition also affected short -term growth. They reiterated their support for merchants and efforts to stimulate consumer experience.
“As mentioned in the previous quarters, our important investment in the ecosystem associated with a rapidly evolving external environment and an intensified competition landscape will have an impact on short-term finances,” said the president and general co-director, CHEN LEI, analysts on a call.
On the other hand, Rivals JD.com Inc. and Alibaba Group Holding Ltd. Sales better than projected for the December quarter when Beijing increased policies such as subsidies and commercial incentives to increase spending. The government has prioritized the expansion of domestic demand while the country seeks to compensate for the impact of the prices of US President Donald Trump and achieved a growth target of around 5%.
Thursday’s report “Lack of major light points”, JP Morgan analysts, Andre Chang and Alex Yao, wrote in a note, which cited shortcomings on the income of transaction services and income from online marketing services.
