Temu owner PDD misses on Q2 sales, but posts strong beat on earnings

PDD Holdings, the owner of global e-commerce marketplace Temu, reported a second-quarter revenue of 112.4 billion yuan (US$16.6 billion), which was lower than the expected 115.2 billion yuan. Despite missing Wall Street's expectations, the company's adjusted earnings per share exceeded projections, hitting 19.33 yuan per US share.

PDD became a prominent player in China's competitive e-commerce market by offering budget-friendly items to price-conscious consumers in remote or lower-tier cities. Known widely as Temu, the company competes with fashion retailers Shein and Amazon across the US and Europe. However, the Chinese entity faces growing regulatory scrutiny globally, particularly concerning the safety and quality of products sold on Temu.

In May, the European Union imposed a fine of 200 million euros on PDD for unsafe baby toys and other products, while also accusing Temu of obstructing a regulatory investigation in July. PDD's co-CEO, Zhao Jiazhen, emphasized the company's commitment to compliance and consumer rights in a statement.