The news: Pinduoduo owner PDD’s Q4 revenues grew 46% year-over-year (YoY) to 39.82 billion yuan ($5.79 billion)—far outpacing rivals JD.com and Alibaba. However, that result fell short of Refinitiv estimated revenues of 41.01 billion yuan ($5.96 billion).
China’s strict zero-COVID-19 policy cast a shadow over much of PDD’s Q4, which contributed to the company’s slower-than-expected growth.
China’s economic situation: China’s gross domestic product grew 3% last year, its weakest annual performance in decades, and well short of its 5.5% official target.
Temu’s growth strategy: PDD has big ambitions for Temu, which has been growing extremely quickly. The app went from zero to 44.5 million unique visitors between September and December of last year, according to Comscore.
The big takeaway: The end of China’s zero-COVID-19 policy hasn’t unleashed the flood of consumer spending that some expected. Instead, China’s consumer spending recovery is off to a relatively slow start with retail sales rising just 3.5% YoY in January and February, per China’s National Bureau of Statistics.
Go further: For more on China’s ecommerce landscape, read our China Ecommerce Forecast 2022.
This article originally appeared in Insider Intelligence's Retail & Ecommerce Briefing—a daily recap of top stories reshaping the retail industry. Subscribe to have more hard-hitting takeaways delivered to your inbox daily.
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