PDD Holdings Announces Q2 2024 Financial Results

Intellectia.AI2024-08-26

Illustration by Intellectia.AI

PDD Holdings Announces Q2 2024 Financial Results

PDD Holdings Inc. (NASDAQ:PDD) reported its unaudited financial results for the second quarter ending June 30, 2024.

Key Financial Metrics

Metric	Q2 2024	Q2 2023	YoY Change	Consensus Estimates	Actual vs. Consensus
Total Revenue (USD)	$13,355.8 million	$7,192.3 million	+86%	$14.04B	Below
Earnings per Share (EPS)	Basic: $3.18; Diluted: $2.97	Basic: $1.33; Diluted: $1.24	+139%	$2.73	Above

Interpretation: PDD Holdings experienced significant growth in Q2 2024, with total revenues increasing by 86% year-over-year due to higher earnings from online marketing and transaction services. However, it fell short of Wall Street consensus estimates.

Segment Revenue Performance

Segment	Q2 2024 Revenue (RMB)	Q2 2023 Revenue (RMB)	YoY Change
Online Marketing Services	49,115.9 million	37,932.8 million	+29%
Transaction Services	47,943.7 million	14,347.9 million	+234%

Interpretation: The transaction services segment notably drove revenue growth with a 234% increase year-over-year, showing robust demand and performance.

Key Developments and Operational Highlights

Operating Profit: Increased by 156% to RMB32,564.5 million (US$4,481.0 million).
Non-GAAP Operating Profit: Increased by 139% to RMB34,987.3 million (US$4,814.4 million).
Net Income: Increased by 144% to RMB32,009.4 million (US$4,404.6 million).
Non-GAAP Net Income: Increased by 125% to RMB34,432.1 million (US$4,738.0 million).
Cash Flow: Net cash from operating activities was RMB43,792.6 million (US$6,026.1 million).
Cash and Short-term Investments: Stood at RMB284.9 billion (US$39.2 billion) as of June 30, 2024.

Executive Comments

Lei Chen, Chairman and Co-CEO: Emphasized the challenges ahead and the commitment to high-quality development and ecosystem sustainability, with significant investments prepared for trust, safety, and support of high-quality merchants.
Jiazhen Zhao, Executive Director and Co-CEO: Reinforced the commitment to nurturing a healthy merchant ecosystem and the determination to tackle low-quality merchants.
Jun Liu, VP of Finance: Cautioned about potential pressure on revenue growth and profitability due to intensified competition and ongoing investments.

Dividends and Share Repurchase Program

No information on dividends announced.
No information on share repurchase programs provided in the release.

Forward Guidance

No forward guidance provided in the release.

Stock Price Movement

Post-earnings release, PDD Holdings observed a -7.12% change in stock price.

PDD Holdings continues to exhibit strong profitability and cash flow metrics, driven by substantial growth in both its online marketing and transaction services segments. However, its results fell short of Wall Street consensus estimates, resulting in a negative reaction in the stock market.