.August 26, 2024 6:12 PM

PDD Holdings (NASDAQ:PDD) shares plummeted by over 28% after reporting second-quarter revenue of RMB97.06 billion ($13.36 billion), missing analyst expectations of RMB99.42 billion. Despite beating earnings estimates with adjusted EPS of RMB23.24 ($3.20), the market reacted negatively to PDD’s cautious outlook on slowing growth.

The company warned of challenges ahead due to intensifying competition and external pressures, with a slowdown in revenue growth rate quarter-on-quarter. VP of Finance Jun Liu highlighted the impact of continued investment on future earnings, raising concerns about profitability moving forward.

Despite a significant increase in operating profit and net income, investors remained cautious about PDD Holdings’ long-term outlook. Chairman and Co-CEO Lei Chen emphasized the company’s focus on high-quality development, willing to endure short-term profitability declines to navigate the competitive landscape.