PDD Holdings’ (PDD) shares gained early Wednesday, even after the parent company of the popular Chinese e-commerce site Temu released disappointing fourth-quarter 2025 results. The Dublin-based company also warned that its “firm and long-term” investments “will inevitably affect our financial performance.”
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PDD’s Profits Shrink in 2025
During the three-month period that ended on December 31, PDD saw its adjusted earnings per share fall by about 12% to $2.53 (RMB 17.69), missing analysts’ estimate of RMB 20.71. Also, although quarterly revenue rose by 12% year-over-year to $17.72 billion (RMB 123.91 billion), the figure fell short of the Wall Street estimate of $18 billion (RMB 124.71 billion).
In addition, PDD shares rose even though the company’s quarterly profit shrank by 11% from a year ago to $3.5 billion.
For the full year, the Chinese company’s revenue expanded by 10% to $61.75 billion, driven by earnings from online marketing services and transaction services. However, yearly profits and adjusted earnings per share both declined by 12% to RMB 72.38 and $15.34 billion, respectively.
PDD to Accelerate Supply Chain Investments
During the third quarter, PDD’s profits came in better-than-expected, although its revenue of $15.38 billion disappointed Wall Street. Its sales growth in 2025 comes as the company — which operates Pinduoduo, the Chinese local version of the globally focused Temu — has been engaging in aggressive marketing tactics such as discounting to win customers from rivals such as Alibaba (BABA) and JD.com (JD).
Looking forward, PDD plans to double down on its investments as the global retail market remains highly competitive and continues to evolve.
“Going into this new [2026] chapter, supply chain investment is where we will place our greatest conviction,” said Jiazhen Zhao, PDD’s co-chair and co-CEO.
Is PDD a Good Stock to Buy?
On Wall Street, PDD’s shares hold a Moderate Buy consensus rating based on one Buy and one Hold rating assigned over the last two months.
However, the average PDD price target of $145 implies about 36% upside from current trading levels. It is also important to note that analysts’ consensus rating may change following the latest earnings update.
