(Reuters) – China’s Pinduoduo Inc beat first-quarter revenue estimates on Friday as more people shopped on its e-commerce platform during coronavirus lockdowns that have shut most brick-and-mortar outlets.
FILE PHOTO: A display at the Nasdaq Market Site shows a message after Chinese online group discounter Pinduoduo Inc. (PDD) was listed on the Nasdaq exchange in Times Square in New York City, New York, U.S., July 26, 2018. REUTERS/Mike Segar
Stay-at-home orders have boosted demand for online shopping as people stock up on groceries and food items from home and sellers too turn to online platforms to run down inventories.
The growth rate of active buyers in the 12 months ended March remained robust, reaching 628 million, representing an increase of 42% year on year. It took PDD only five years to raise the number above 600 million, further narrowing the gap with competitor Alibaba Group that reported on Friday that annual active consumers reached 726 million by end of March.
The company said its average daily orders since May are close to 65 million, compared with around 50 million before the pandemic outbreak.
Its net loss widened to 4.12 billion yuan in the quarter ended March 31, from 1.88 billion yuan a year earlier.
The e-commerce company known for its deep discounts, said revenue rose 44% to 6.54 billion yuan ($916.63 million), beating estimates of 4.97 billion yuan, according to IBES data by Refinitiv.
However, quarterly revenue dropped sharply from 10.79 billion yuan it reported for the fourth quarter last year.
Pinduoduo Vice President David Liu said the sequential fall in revenue was due to the company’s efforts in helping farmers and vendors on its marketplace get through difficult times.
“Pinduoduo supported small and medium-sized companies by offering the lower effective advertising rates, directed traffic that we could have otherwise monetized to dedicated channels for medical supplies,” Liu said.
Excluding items, the company lost 2.73 yuan per American depository share compared with estimates of loss of 1.97 yuan per ADS.
Pinduoduo’s shares were up 4% before the start of trading.
Reporting by Neha Malara in Bengaluru and Sophie Yu in Beijing; Editing by Shinjini Ganguli and David Evans