(MENAFN- The Peninsula) AFP
Beijing: Chinese e-commerce giant Pinduoduo announced Wednesday its net profit for the first quarter more than tripled, as the Temu owner continues to boost its competitiveness in its home market and abroad.
Pinduoduo is one of China's leading online retailers -- owing largely to its success in reaching consumers in rural areas with a diverse offering of low-cost products.
The company's overseas platform, Temu, has surged since its September 2022 launch to become one of the most popular online shopping sites in the United States, propelled by a marketing strategy that featured multiple prime-time Super Bowl advertisements.
Pinduoduo said net profit for the first three months of 2024 was $3.88 billion, up 246 percent from the same period last year.
The Shanghai-based firm added that sales in the first quarter were $112 billion, an increase of 131 percent from the same period in 2023.
Temu expanded last year into the EU market, where the platform quickly amassed an average of 75 million monthly active users.
But the shopping app has also encountered turbulence, such as in March this year, when a promotional campaign in Britain and France backfired due to concerns over data privacy.
In April, regulators in South Korea opened an investigation into Temu on suspicion of unfair practices including false advertising and poor product quality.
Earlier this month, European consumer rights groups accused it of manipulative sales techniques and a lack of transparency about traders on the platform.
'Critical' year
Despite the setbacks, Pinduoduo remains the newest competitor to established e-commerce juggernauts, including Amazon in the United States and Alibaba in China.
The latest results come after the firm announced in March near-double annual profits in 2023, a year in which it briefly surpassed Alibaba -- owner of Chinese e-commerce behemoth Taobao -- in terms of market capitalisation for the first time.
Pinduoduo was on Tuesday valued at around $202 billion, compared to Alibaba's $209 billion.
In pre-market trading on the Nasdaq on Wednesday, the company's stock price rose around 8 percent.
Pinduoduo's executive director and co-CEO Jiazhen Zhao said in a statement: "This year is critical for us to deepen the execution of our high-quality development strategy.
"We will focus our efforts on improving the overall consumer experience, strengthening our supply chain capabilities, and fostering a healthy platform ecosystem."
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