PDD PDD Holdings Inc

 

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 6-K

 

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16 UNDER

THE SECURITIES EXCHANGE ACT OF 1934

 

For the month of November 2024

 

 

Commission File Number: 001-38591

 

 

PDD Holdings Inc.

 

First Floor, 25 St Stephen’s Green,

Dublin 2, D02 XF99

Ireland
(Address of principal executive offices)

 

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

 

Form 20-F x       Form 40-F ¨ 

 

 

 

 

Exhibit Index

 

Exhibit 99.1—Press Release (Earnings Release)

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

PDD HOLDINGS INC.

 

	By	:	/s/ Lei Chen
	Name	:	Lei Chen
	Title	:	Chairman of the Board of Directors and Co-Chief Executive Officer

 

Date: November 21, 2024

 

 

 

Exhibit 99.1

 

PDD Holdings Announces Third Quarter 2024 Unaudited Financial Results

 

DUBLIN and SHANGHAI, November 21, 2024 (GLOBE NEWSWIRE) – PDD Holdings Inc. (“PDD Holdings” or the “Company”) (NASDAQ: PDD), today announced its unaudited financial results for the third quarter ended September 30, 2024.

 

Third Quarter 2024 Highlights

 

●

Total revenues in the quarter were RMB99,354.4 million (US$114,157.9 million), an increase of 44% from RMB68,840.4 million in the same quarter of 2023.

 

●

Operating profit in the quarter was RMB24,292.5 million (US$3,461.6 million), an increase of 46% from RMB16,656.0 million in the same quarter of 2023. Non-GAAP2 operating profit in the quarter was RMB26,770.5 million (US$3,814.8 million), an increase of 48% from RMB18,125.8 million in the same quarter of 2023.

 

●

Net income attributable to ordinary shareholders in the quarter was RMB24,980.7 million (US$3,559.7 million), an increase of 61% from RMB15,537.1 million in the same quarter of 2023. Non-GAAP net income attributable to ordinary shareholders in the quarter was RMB27,458.7 million (US$3,912.8 million), an increase of 61% from RMB17,027.1 million in the same quarter of 2023.

 

“Over the past quarter, our focus remained on driving the high-quality development of the platforms,” said Mr. Lei Chen, Chairman and Co-Chief Executive Officer of PDD Holdings. “We are committed to investing consistently and patiently in our platform ecosystem to deliver impactful results over the long run.”

 

“In the third quarter, we stepped up the investments in our platform ecosystem through merchant support policies and trust and safety updates,” said Mr. Jiazhen Zhao, Executive Director and Co-Chief Executive Officer of PDD Holdings. “High-quality merchants are encouraged to further strengthen their product and service offerings, thereby fostering a virtuous cycle.”

 

“Our topline growth further moderated quarter-on-quarter amid intensified competition and ongoing external challenges,” said Ms. Jun Liu, VP of Finance of PDD Holdings. “In our pursuit of high-quality development, we will continue to invest resolutely in building a healthy and sustainable ecosystem, which will be reflected in our results.”

 

¹ This announcement contains translations of certain Renminbi (“RMB”) amounts into U.S. dollars (“US$”) at a specified rate solely for the convenience of the reader. Unless otherwise noted, the translation of RMB into US$ has been made at RMB7.0176 to US$1.00, the noon buying rate in effect on September 30, 2024 as set forth in the H.10 Statistical Release of the Federal Reserve Board.

² The Company’s non-GAAP financial measures exclude share-based compensation expenses, fair value change of certain investments, and interest expenses related to the convertible bonds’ amortization to face value. See “Reconciliation of Non-GAAP Measures to the Most Directly Comparable GAAP Measures” set forth at the end of this press release.

 

 

Third Quarter 2024 Unaudited Financial Results

 

Total revenues were RMB99,354.4 million (US$14,157.9 million), an increase of 44% from RMB68,840.4 million in the same quarter of 2023. The increase was primarily due to the increase in revenues from online marketing services and transaction services.

 

●

Revenues from online marketing services and others were RMB49,351.0 million (US$7,032.5 million), an increase of 24% from RMB39,687.7 million in the same quarter of 2023.

 

●

Revenues from transaction services were RMB50,003.4 million (US$7,125.4 million), an increase of 72% from RMB29,152.7 million in the same quarter of 2023.

 

Total costs of revenues were RMB39,709.2 million (US$5,658.5 million), an increase of 48% from RMB26,830.2 million in the same quarter of 2023. The increase mainly came from the increased fulfilment fees and payment processing fees.

 

Total operating expenses were RMB35,352.7 million (US$5,037.7 million), an increase of 39% from RMB25,354.1 million in the same quarter of 2023. The increase was primarily due to the increase in sales and marketing expenses.

 

●

Sales and marketing expenses were RMB30,483.8 million (US$4,343.9 million), an increase of 40% from RMB21,748.5 million in the same quarter of 2023, mainly due to the increased spending in promotion and advertising activities.

 

●

General and administrative expenses were RMB1,805.6 million (US$257.3 million), an increase of 138% from RMB758.3 million in the same quarter of 2023, primarily due to the increase in staff related costs.

 

●

Research and development expenses were RMB3,063.4 million (US$436.5 million), compared with RMB2,847.3 million in the same quarter of 2023.

 

 

Operating profit in the quarter was RMB24,292.5 million (US$3,461.6 million), an increase of 46% from RMB16,656.0 million in the same quarter of 2023. Non-GAAP operating profit in the quarter was RMB26,770.5 million (US$3,814.8 million), an increase of 48% from RMB18,125.8 million in the same quarter of 2023.

 

Net income attributable to ordinary shareholders in the quarter was RMB24,980.7 million (US$3,559.7 million), an increase of 61% from RMB15,537.1 million in the same quarter of 2023. Non-GAAP net income attributable to ordinary shareholders in the quarter was RMB27,458.7 million (US$3,912.8 million), an increase of 61% from RMB17,027.1 million in the same quarter of 2023.

 

Basic earnings per ADS was RMB18.02 (US$2.57) and diluted earnings per ADS was RMB16.91 (US$2.41), compared with basic earnings per ADS of RMB11.38 and diluted earnings per ADS of RMB10.60 in the same quarter of 2023. Non-GAAP diluted earnings per ADS was RMB18.59 (US$2.65), compared with RMB11.61 in the same quarter of 2023.

 

Net cash generated from operating activities was RMB27,522.3 million (US$3,921.9 million), compared with RMB32,537.9 million in the same quarter of 2023.

 

Cash, cash equivalents and short-term investments were RMB308.5 billion (US$44.0 billion) as of September 30, 2024, compared with RMB217.2 billion as of December 31, 2023.

 

Other non-current assets were RMB74.0 billion (US$10.5 billion) as of September 30, 2024, compared with RMB48.0 billion as of December 31, 2023, which mainly included time deposits, held-to-maturity debt securities, and available-for-sale debt securities.

 

 

Conference Call

 

The Company’s management will hold an earnings conference call at 7:30 AM ET on November 21, 2024 (12:30 PM IST and 8:30 PM HKT on the same day).

 

The conference call will be webcast live at https://investor.pddholdings.com/investor-events. The webcast will be available for replay at the same website following the conclusion of the call.

 

Use of Non-GAAP Financial Measures

 

In evaluating the business, the Company considers and uses non-GAAP measures, such as non-GAAP operating profit, non-GAAP net income attributable to ordinary shareholders, non-GAAP diluted earnings per ordinary share, and non-GAAP diluted earnings per ADS, as supplemental measures to review and assess operating performance. The presentation of these non-GAAP financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The Company’s non-GAAP financial measures exclude the impact of share-based compensation expenses, fair value change of certain investments, and interest expenses related to the convertible bonds’ amortization to face value.

 

The Company presents these non-GAAP financial measures because they are used by management to evaluate operating performance and formulate business plans. The Company believes that the non-GAAP financial measures help identify underlying trends in its business by excluding the impact of share-based compensation expenses, fair value change of certain investments, and interest expenses related to the convertible bonds’ amortization to face value, which are non-cash charges. The Company also believes that the non-GAAP financial measures may provide further information about the Company’s results of operations, and enhance the overall understanding of the Company’s past performance and future prospects.

 

The Company’s non-GAAP financial measures are not defined under U.S. GAAP and are not presented in accordance with U.S. GAAP. The non-GAAP financial measures have limitations as analytical tools. These non-GAAP financial measures do not reflect all items of income and expenses that affect the Company’s operations and do not represent the residual cash flow available for discretionary expenditures. Further, these non-GAAP measures may differ from the non-GAAP information used by other companies, including peer companies, and therefore their comparability may be limited. The Company compensates for these limitations by reconciling the non-GAAP financial measures to the nearest U.S. GAAP performance measure, all of which should be considered when evaluating performance. The Company encourages you to review the Company’s financial information in its entirety and not rely on a single financial measure.

 

For more information on the non-GAAP financial measures, please see the table captioned “Reconciliation of Non-GAAP Measures to the Most Directly Comparable GAAP Measures” set forth at the end of this press release.

 

 

Safe Harbor Statements

 

This announcement contains forward-looking statements. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as “will,” “expects,” “anticipates,” “aims,” “future,” “intends,” “plans,” “believes,” “estimates,” “confident,” “potential,” “continue” or other similar expressions. Among other things, the business outlook and quotations from management in this announcement, as well as the Company’s strategic and operational plans, contain forward-looking statements. The Company may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission (the “SEC”), in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including but not limited to statements about the Company’s beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: the Company’s growth strategies; its future business development, results of operations and financial condition; its ability to understand buyer needs and provide products and services to attract and retain buyers; its ability to maintain and enhance the recognition and reputation of its brand; its ability to rely on merchants and third-party logistics service providers to provide delivery services to buyers; its ability to maintain and improve quality control policies and measures; its ability to establish and maintain relationships with merchants; trends and competition in the e-commerce markets globally and in the countries or regions where the Company has operations; changes in its revenues and certain cost or expense items; the expected growth of e-commerce markets globally and in the countries or regions where the Company has operations; developments in the relevant governmental policies and regulations relating to the Company’s industry; and general economic and business conditions globally and in the countries or regions where the Company has operations; and assumptions underlying or related to any of the foregoing. Further information regarding these and other risks is included in the Company’s filings with the SEC. All information provided in this press release and in the attachments is as of the date of this press release, and the Company undertakes no obligation to update any forward-looking statement, except as required under applicable law.

 

 

About PDD Holdings

 

PDD Holdings is a multinational commerce group that owns and operates a portfolio of businesses. PDD Holdings aims to bring more businesses and people into the digital economy so that local communities and small businesses can benefit from the increased productivity and new opportunities.

 

For investor and media inquiries, please contact:

 

investor@pddholdings.com

media@pddholdings.com

 

 

PDD HOLDINGS INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Amounts in thousands of Renminbi (“RMB”) and U.S. dollars (“US$”))

 

		As of
		December 31, 2023				September 30, 2024
		RMB				RMB				US$
						(Unaudited)				(Unaudited)
ASSETS
Current assets
Cash and cash equivalents			59,794,469				65,295,431				9,304,524
Restricted cash			61,985,436				60,393,064				8,605,943
Receivables from online payment platforms			3,914,117				4,633,683				660,295
Short-term investments			157,415,365				243,166,321				34,650,924
Amounts due from related parties			7,428,070				9,288,981				1,323,669
Prepayments and other current assets			4,213,015				4,053,807				577,662
Total current assets			294,750,472				386,831,287				55,123,017
Non-current assets
Property, equipment and software, net			979,597				875,513				124,760
Intangible assets			21,148				20,088				2,863
Right-of-use assets			4,104,889				4,820,181				686,870
Deferred tax assets			270,738				272,699				38,859
Other non-current assets			47,951,276				73,974,101				10,541,225
Total non-current assets			53,327,648				79,962,582				11,394,577
Total Assets			348,078,120				466,793,869				66,517,594

 

 

PDD HOLDINGS INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Amounts in thousands of Renminbi (“RMB”) and U.S. dollars (“US$”))

 

		As of
		December 31, 2023				September 30, 2024
		RMB				RMB				US$
						(Unaudited)				(Unaudited)
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities
Amounts due to related parties			1,238,776				1,075,858				153,309
Customer advances and deferred revenues			2,144,610				2,951,591				420,598
Payable to merchants			74,997,252				82,780,215				11,796,086
Accrued expenses and other liabilities			55,351,399				74,404,296				10,602,527
Merchant deposits			16,878,746				16,769,864				2,389,687
Convertible bonds, current portion			648,570				-				-
Lease liabilities			1,641,548				2,015,098				287,149
Total current liabilities			152,900,901				179,996,922				25,649,356
Non-current liabilities
Convertible bonds			5,231,523				5,175,904				737,560
Lease liabilities			2,644,260				3,045,829				434,027
Deferred tax liabilities			59,829				70,294				10,017
Total non-current liabilities			7,935,612				8,292,027				1,181,604
Total Liabilities			160,836,513				188,288,949				26,830,960
Shareholders’ equity
Ordinary shares			177				179				26
Additional paid-in capital			107,293,091				115,424,865				16,447,912
Statutory reserves			105,982				105,982				15,102
Accumulated other comprehensive income			4,723,760				2,867,422				408,604
Retained earnings			75,118,597				160,106,472				22,814,990
Total Shareholders’ Equity			187,241,607				278,504,920				39,686,634
Total Liabilities and Shareholders’ Equity			348,078,120				466,793,869				66,517,594

 

 

PDD HOLDINGS INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Amounts in thousands of RMB and US$)

 

		For the three months ended September 30,												For the nine months ended September 30,
		2023				2024								2023				2024
		RMB				RMB				US$				RMB				RMB				US$
		(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)
Revenues			68,840,371				99,354,401				14,157,889				158,758,169				283,225,991				40,359,381
Costs of revenues			(26,830,233	)			(39,709,214	)			(5,658,518	)			(56,645,305	)			(106,101,998	)			(15,119,414	)
Sales and marketing expenses			(21,748,449	)			(30,483,800	)			(4,343,907	)			(55,550,346	)			(79,943,592	)			(11,391,871	)
General and administrative expenses			(758,345	)			(1,805,576	)			(257,293	)			(2,170,780	)			(5,467,571	)			(779,123	)
Research and development expenses			(2,847,323	)			(3,063,353	)			(436,524	)			(8,087,944	)			(8,882,183	)			(1,265,701	)
Total operating expenses			(25,354,117	)			(35,352,729	)			(5,037,724	)			(65,809,070	)			(94,293,346	)			(13,436,695	)
Operating profit			16,656,021				24,292,458				3,461,647				36,303,794				82,830,647				11,803,272
Interest and investment income, net			2,127,356				5,416,080				771,785				5,878,696				15,320,261				2,183,120
Interest expenses			(12,208	)			-				-				(35,832	)			-				-
Foreign exchange gain/(loss)			94,860				(547,343	)			(77,996	)			234,540				(272,660	)			(38,854	)
Other income, net			290,384				18,606				2,651				2,624,375				2,393,112				341,016
Profit before income tax and share of results of equity investees			19,156,413				29,179,801				4,158,087				45,005,573				100,271,360				14,288,554
Share of results of equity investees			(105,811	)			2,513				358				10,359				(99,500	)			(14,179	)
Income tax expenses			(3,513,480	)			(4,201,620	)			(598,726	)			(8,269,697	)			(15,183,985	)			(2,163,701	)
Net income			15,537,122				24,980,694				3,559,719				36,746,235				84,987,875				12,110,674

 

 

PDD HOLDINGS INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Amounts in thousands of RMB and US$, except for per share data)

 

		For the three months ended September 30,												For the nine months ended September 30,
		2023				2024								2023				2024
		RMB				RMB				US$				RMB				RMB				US$
		(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)
Net income			15,537,122				24,980,694				3,559,719				36,746,235				84,987,875				12,110,674
Net income attributable to ordinary shareholders			15,537,122				24,980,694				3,559,719				36,746,235				84,987,875				12,110,674
Earnings per ordinary share:
-Basic			2.84				4.51				0.64				6.81				15.37				2.19
-Diluted			2.65				4.23				0.60				6.28				14.37				2.05
Earnings per ADS (4 ordinary shares equals 1 ADS):
-Basic			11.38				18.02				2.57				27.24				61.48				8.76
-Diluted			10.60				16.91				2.41				25.13				57.49				8.19
Weighted-average number of outstanding ordinary shares (in thousands):
-Basic			5,462,542				5,543,633				5,543,633				5,395,211				5,529,090				5,529,090
-Diluted			5,865,102				5,909,793				5,909,793				5,853,748				5,913,666				5,913,666

 

 

PDD HOLDINGS INC.

NOTES TO FINANCIAL INFORMATION

(Amounts in thousands of RMB and US$)

 

		For the three months ended September 30,												For the nine months ended September 30,
		2023				2024								2023				2024
		RMB				RMB				US$				RMB				RMB				US$
		(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)
Revenues
- Online marketing services and others			39,687,678				49,351,022				7,032,465				104,864,935				140,923,131				20,081,386
- Transaction services			29,152,693				50,003,379				7,125,424				53,893,234				142,302,860				20,277,995
Total			68,840,371				99,354,401				14,157,889				158,758,169				283,225,991				40,359,381

 

 

PDD HOLDINGS INC.

NOTES TO FINANCIAL INFORMATION

(Amounts in thousands of RMB and US$)

 

		For the three months ended September 30,												For the nine months ended September 30,
		2023				2024								2023				2024
		RMB				RMB				US$				RMB				RMB				US$
		(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)
Share-based compensation expenses included in:
Costs of revenues			20,422				44,725				6,373				86,066				99,945				14,242
Sales and marketing expenses			464,950				650,106				92,639				1,943,049				1,960,478				279,366
General and administrative expenses			355,053				1,158,615				165,102				1,058,914				3,655,344				520,882
Research and development expenses			629,394				624,559				88,999				1,805,821				1,763,542				251,303
Total			1,469,819				2,478,005				353,113				4,893,850				7,479,309				1,065,793

 

 

PDD HOLDINGS INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Amounts in thousands of RMB and US$)

 

		For the three months ended September 30,												For the nine months ended September 30,
		2023				2024								2023				2024
		RMB				RMB				US$				RMB				RMB				US$
		(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)
Net cash generated from operating activities			32,537,857				27,522,313				3,921,898				57,271,860				92,382,132				13,164,348
Net cash used in investing activities			(4,820,500	)			(16,898,558	)			(2,408,025	)			(38,960,607	)			(87,810,779	)			(12,512,936	)
Net cash generated from financing activities			385				132				19				7,671				890				127
Effect of exchange rate changes on cash, cash equivalents and restricted cash			201,058				(1,052,321	)			(149,955	)			733,918				(663,653	)			(94,570	)
Increase in cash, cash equivalents and restricted cash			27,918,800				9,571,566				1,363,937				19,052,842				3,908,590				556,969
Cash, cash equivalents and restricted cash at beginning of period			83,434,459				116,116,929				16,546,530				92,300,417				121,779,905				17,353,498
Cash, cash equivalents and restricted cash at end of period			111,353,259				125,688,495				17,910,467				111,353,259				125,688,495				17,910,467

 

 

PDD HOLDINGS INC.

RECONCILIATION OF NON-GAAP MEASURES TO THE MOST DIRECTLY COMPARABLE GAAP MEASURES

(Amounts in thousands of RMB and US$, except for per share data)

 

		For the three months ended September 30,												For the nine months ended September 30,
		2023				2024								2023				2024
		RMB				RMB				US$				RMB				RMB				US$
		(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)
Operating profit			16,656,021				24,292,458				3,461,647				36,303,794				82,830,647				11,803,272
Add: Share-based compensation expenses			1,469,819				2,478,005				353,113				4,893,850				7,479,309				1,065,793
Non-GAAP operating profit			18,125,840				26,770,463				3,814,760				41,197,644				90,309,956				12,869,065
Net income attributable to ordinary shareholders			15,537,122				24,980,694				3,559,719				36,746,235				84,987,875				12,110,674
Add: Share-based compensation expenses			1,469,819				2,478,005				353,113				4,893,850				7,479,309				1,065,793
Add: Interest expenses related to convertible bonds’ amortization to face value			12,208				-				-				35,832				-				-
Add: Loss from fair value change of certain investments			7,935				2				-				746,915				25,456				3,627
Non-GAAP net income attributable to ordinary shareholders			17,027,084				27,458,701				3,912,832				42,422,832				92,492,640				13,180,094
Non-GAAP diluted weighted-average number of ordinary shares outstanding (in thousands)			5,865,102				5,909,793				5,909,793				5,853,748				5,913,666				5,913,666
Diluted earnings per ordinary share			2.65				4.23				0.60				6.28				14.37				2.05
Add: Non-GAAP adjustments to earnings per ordinary share			0.25				0.42				0.06				0.97				1.27				0.18
Non-GAAP diluted earnings per ordinary share			2.90				4.65				0.66				7.25				15.64				2.23
Non-GAAP diluted earnings per ADS			11.61				18.59				2.65				28.99				62.56				8.92

 

 

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