(Reuters) – PDD Holdings, which operates the Pinduoduo and Temu, missed market estimates for quarterly revenue on Thursday, as demand remained weak in the company’s Chinese e-commerce business despite deep discounts and government stimulus to boost spending.
U.S.-listed shares of PDD fell more than 3% in premarket trading.
While government stimulus measures and deep price cuts from retailers have drawn some shoppers, PDD’s sales report indicates persistent weakness in the Chinese economy is still forcing consumers to keep a tight lid on their spending.
The company is also facing stiff competition from e-commerce industry leaders Alibaba and JD.com, with both reporting better-than-expected revenues in recent weeks. PDD operates Pinduoduo only in China, and Temu internationally.
The company reported revenue of 110.61 billion yuan ($15.27 billion) for the three months ended December 31, compared with analysts’ average estimate of 115.38 billion yuan according to data compiled by LSEG.
Net income rose to 27.45 billion yuan from 23.28 billion yuan in the same period a year earlier.
($1 = 7.2421 Chinese yuan renminbi)
(Reporting by Deborah Sophia in Bengaluru; Editing by Krishna Chandra Eluri)
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