PDD Holdings presents a net profit of 14.3 billion euros in 2024

The Chinese group PDD Holdings, owner of Temu, reported in a statement that its net profit was 112.435 billion yuan (around 14.343 billion euros) in 2024, an increase of 87.3% compared to the previous year's profits.

Revenue—which does not break down Temu's evolution—reached 393.836 billion yuan (about 50.241 billion euros), a growth of 59% compared to 2023. Turnover grew by 28.9% in online marketing services to 197. 934 million yuan (about 25.25 billion euros), and in transaction services, it rose by 108.2%, to 195.902 billion yuan (about 24.991 billion euros).

Meanwhile, the Chinese group's total expenditure rose to 285.413 billion yuan (around 36.41 billion euros), up 51.1%.

In the fourth quarter, the multinational made a profit of 27.447 billion yuan (around 3.501 billion euros) and a turnover of 110.610 billion yuan (around 14.110 billion euros), 17.9% and 24.4% higher in year-on-year terms, respectively.

“In 2024, we maintained our commitment to driving sustainable growth both in the platform ecosystem and for the supply chain in general,” said Lei Chen, chairman and co-CEO of PDD Holdings. “Leveraging our digital capabilities, we continue to serve consumers, support our business partners, and build an inclusive ecosystem that creates value for all its participants,” said Jiazhen Zhao, executive director and co-CEO.

PDD Holdings and its ‘Temu vs Amazon’ Strategy 

In this context, advertising is also gaining prominence as part of Temu's strategy to challenge big players like Amazon and protect itself from measures such as tariffs on Chinese imports. These would end the exception—known in the United States as 'de minimis'—that allows e-commerce platforms to send their products to Europe without paying tariffs, as long as the package does not exceed a specific value.

Recently, the media outlet The Information published that Temu would be conducting trials with paid search ads for sellers looking to increase the visibility of their products within the platform. Under a pilot program, sellers can pay to improve the ranking of their products in search results and display ads within the marketplace. At the moment, Temu has not yet revealed an official date for the full launch of its advertising service. 

While Temu is a newcomer to the advertising sector, PDD Holdings has considerable experience. In fact, in the quarter above, the company generated 57.011 billion yuan (about 7.251 billion euros) through advertising and other services, an increase of 17% over the same quarter of 2023.

PPD Holdings' recent legal issues  

​PDD Holdings, the parent company of e-commerce platforms Pinduoduo and Temu, has encountered several legal challenges in recent years:​

• Malware Allegations: In 2023, Google suspended Pinduoduo's app from the Play Store after cybersecurity researchers identified versions containing malware designed to access user data without consent, including reading private text messages. ​
  
• Forced Labor Concerns: The company has faced scrutiny over allegations that it lacks effective systems to prevent the sale of goods produced using forced labor on its platforms, particularly on Temu. ​
  
• Regulatory Investigations: In October 2024, the European Union initiated an investigation into Temu for allegedly failing to prevent the sale of illegal products, including counterfeit items and unsafe goods, potentially breaching the Digital Services Act. ​
  
• Class Action Lawsuits: Several class action lawsuits have been filed against PDD Holdings, accusing the company of making false or misleading statements regarding the safety of its applications and its oversight of products sold on its platforms.
  

These issues have drawn significant attention from regulatory bodies and consumers, impacting the company's reputation and operations in various markets.