Shares of PDD Holdings (PDD), the Chinese company behind popular e-commerce site Temu, dropped nearly 4% on Tuesday after the company’s third-quarter results showed it exceeded Wall Street’s earnings per share expectations but missed on revenue.
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During the three months ended September 2025, PDD’s adjusted earnings per share jumped 13% from $2.62 a year ago to reach $2.97. The figure came in above analysts’ expected $2.33.
However, while Wall Street expected revenue of $15.38 billion, the major Chinese retailer reported $15.23 billion — the figure rose approximately 7% from $14.27 billion a year ago.
Furthermore, the Ireland-based company, which operates the retail platform Pinduoduo locally in China and its international version Temu, posted a 13% growth in net income. Its profit during the quarter hit $4.4 billion, up from $3.9 billion a year ago.
PDD Sees Moderate Growth amid Slower Spending
Despite the uneven performance — when compared to Wall Street’s projections — PDD’s revenue and profit growth during the quarter indicate that its discount strategy and aggressive marketing appear to be bearing fruit as consumers have been spending less over economic uncertainty. Data shows that China’s retail sales cooled marginally in October.
PDD, alongside domestic rivals such as Alibaba (BABA) and JD.com (JD), has been engaging in price reductions and other marketing promotions to encourage consumers to spend. The efforts appear to be paying off, as JD.com has also reported an 11.4% increase in its revenue during the same quarter despite a drop in its profits.
However, PDD’s sales growth was moderate during the quarter compared to past years. Jun Liu, vice president of finance at PDD, believes that this reflects “the ongoing evolution of the competitive landscape and external uncertainties.”
Going forward, PDD expects its earnings to remain unsteady as the company commits its resources to upgrading its platform and supporting merchants.
Is PDD a Good Stock to Buy?
Turning to Wall Street, PDD’s shares currently have a Moderate Buy consensus rating based on eight Buys and five Holds issued by 13 analysts over the past three months.
However, at $144.56, the average PDD price target indicates about a 12% upswing potential from the current trading level.
