The owner of Temu reported its sales have more than doubled in its first quarter as demand for the online discount retailer skyrockets.
PDD Holdings beat market expectations as it delivered a 131% increase in sales to £9.42bn (86.8bn yuan), driven by the catapulting rise of Temu and its sister ecommerce platform, Pinduoduo.
The revenue boost was partnered with a 194% surge in costs to £3.54bn (32.7bn yuan), which the retail group attributed to increased fulfilment fees, payment processing fees, maintenance costs and the expense of running call centres.
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Temu is an Ireland-based online marketplace offering low-price goods, operating in Britain, the European Union and the US, while Pinduoduo is a discount etailer that’s popular in China amid an increase in local debt levels.
PDD’s co-CEO Chen Lei told analysts that competition has been fierce in the first quarter, with shoppers growing accustomed to making purchases from a variety of platforms, rather than defaulting to just one
“Our industry peers have significantly stepped up their efforts,” he said. “We welcome healthy competition. We also realise that consumer demand is constantly changing and we must do our best to keep up.”
PDD’s update comes after Temu rivals Alibaba and JD.com reported skyrocketing sales last week and said they expected an increase in consumer confidence in the year ahead.
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