Joyce Chu

Joyce Chu inquired about PDD Holdings' perspective on the recent recovery in the overall online retail sector and the observed slowdown in its online marketing service revenue, seeking clarification on the main growth drivers and anticipated trends for the coming quarters. Additionally, she asked for management's view on the evolving competitive landscape in China's e-commerce sector, particularly concerning new business innovations and increased investments by platform companies.

Answer

Executive Director and Co-CEO Zhao Jiazhen explained that the e-commerce industry has entered a new investment cycle with unavoidable competition, emphasizing PDD Holdings' focus on creating unique value for consumers and merchants through high-quality growth. He noted the positive trend in online retail recovery and highlighted the 100 billion support program and Merchant Protection Committee as key initiatives to foster innovation and optimize the business environment. Zhao Jiazhen cautioned that these long-term investments would impact revenue and profit, leading to potential fluctuations in future financial performance, and reiterated the platform's willingness to sacrifice short-term profits for ecosystem development.

Joyce Chu asked about the recovery in the overall online retail sector, the slowdown in PDD's Online Marketing Services revenue and its drivers, and management's view on the competitive outlook in China's e-commerce sector given new business innovations and increased investments by peers.

Answer

Zhao Jiazhen, Executive Director and Co-CEO, explained that the industry has entered a new investment cycle with unavoidable competition. PDD focuses on creating unique value for consumers and merchants, pursuing high-quality growth, and is encouraged by the overall online retail recovery. He noted that the 100 billion support program and other merchant initiatives are long-term investments that will impact revenue and profit, leading to potential fluctuations in financial performance. He reiterated PDD's willingness to sacrifice short-term profits for ecosystem development amidst intensifying competition and emerging new business models.