PDD Holdings Reports Strong Q2 2025 Earnings, Driven by Interest Income and Cost Cuts
PDD Holdings Inc. has reported strong earnings for Q2 2025, with revenues of RMB 104 billion and earnings per share of RMB 22.1, surpassing expectations. The company's unique communication style has historically driven superior results.
PDD's earnings beat was driven by a near doubling of interest income and lower-than-expected operating costs. The shift towards a semi-managed model reduced recognized revenue, but marketing expenses also declined due to lower U.S. spending and reduced voucher distribution in China. Despite this, revenue in China's marketing services grew by 13%.
Transaction Services, including Temu and Duoduo Grocery, remained flat, but Temu's gross merchandise volume (GMV) surged over 30% year-over-year. PDD's share price stood at $131.01 as of September 25th.
PDD is currently valued at an EV/FCF below 10 and has trailing and forward P/E ratios of 14.09 and 11.24 respectively, indicating it remains attractively priced. Positive theses on PDD Holdings Inc. stocks have been published on Natan's Substack, reflecting investor confidence in the company's future prospects.
