PDD Holdings Q3 Earnings Beat Estimates, Revenues Increase Y/Y

PDD Holdings Inc. PDD reported third-quarter 2025 non-GAAP earnings of $2.96 per ADS (American Depositary Share), which surpassed the Zacks Consensus Estimate by 33.94%. The figure increased 11.7% year over year. In domestic currency (Renminbi), the company reported earnings of RMB 21.08, up 13.4% year over year.

Revenues of $15.21 billion rose 7.4% year over year. The figure missed the Zacks Consensus Estimate by 0.01%. In domestic currency, revenues increased to RMB 108.28 billion, a 9% year-over-year rise.

Revenues by Segments

Online marketing services and other revenues — representing 49.3% of total revenues — rose to RMB 53.35 billion ($7.49 billion), up 8% from the year-ago quarter.

Transaction services revenues, which accounted for 50.7% of total revenues, were RMB 54.93 billion ($7.72 billion), reflecting a 10% increase from the year-ago quarter.

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PDD Holdings Inc. Sponsored ADR price-consensus-eps-surprise-chart | PDD Holdings Inc. Sponsored ADR Quote

PDD’s Q3 Operating Details

In the third quarter, sales and marketing expenses were RMB 30.32 billion ($4.26 billion), down from RMB 30.48 billion in the year-ago quarter.

General and administrative expenses were RMB 1.76 billion ($246.6 million), decreased from RMB 1.81 billion year over year.

Research and development expenses were RMB 4.33 billion ($608.5 million), up from RMB 3.06 billion on a year-over-year basis. The increase was caused mainly by higher staff-related as well as bandwidth and server costs.

Non-GAAP operating profit was RMB 27.08 billion ($3.8 billion), down 1.2% year over year. The margin contracted to 25%, from 26.9% in the prior year.

PDD’s Balance Sheet & Cash Flow

As of Sept. 30, 2025, cash, cash equivalents and short-term investments were RMB 423.8 billion ($59.5 billion), up from RMB 387.1 billion ($54 billion) as of June 30, 2025.

Other non-current assets were RMB 90.5 billion ($12.7 billion) as of Sept. 30, 2025, compared with RMB 85 billion ($11.9 billion) as of June 30, 2025.

Net cash generated from operating activities was RMB 45.66 billion ($6.41 billion), up from RMB 21.64 billion ($3.02 billion) in the prior quarter.

PDD’s Zacks Rank & Stocks to Consider

Currently, PDD carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the broader Zacks Retail-Wholesale sector are Macy's, Inc. M, Dollar General DG and Stitch Fix SFIX, each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Shares of M have gained 15.5% year to date. It is set to report third-quarter fiscal 2025 results on Dec. 3.

Shares of DG have risen 35% year to date. It is set to report third-quarter fiscal 2025 results on Dec. 4.

Shares of SFIX have declined 5.8% year to date. It is set to report first-quarter fiscal 2026 results on Dec. 4.

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This article originally published on Zacks Investment Research (zacks.com).

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