With more than 50 sites worldwide, Temu’s goal this year is 60 billion!

Temu is "growing wildly" around the world, and the performance of its parent company Pinduoduo has also attracted market attention.

Yesterday, Pinduoduo released its financial report for the fourth quarter and full year of 2023, and the company's performance was higher than market expectations. In the fourth quarter of 2023, Pinduoduo's revenue reached 88.9 billion yuan, a year-on-year increase of 123%, and its net profit was 23.3 billion yuan, a year-on-year increase of 146%; its annual revenue was 24.76 billion yuan, a year-on-year increase of 90%; its net profit was 60 billion yuan, a year-on-year increase of 90%.

Data shows that the company's revenue growth is mainly due to the growth of transaction services and online marketing services. Among them, transaction service revenue increased by 241% year-on-year to 94.1 billion yuan; online marketing services and other revenues were 153.5 billion yuan, up 49% year-on-year.

Transaction service revenue mainly includes Temu revenue, Duoduo Maicai commission and part of the commission for 10 billion yuan in subsidies. However, Pinduoduo did not disclose the relevant data of Tmeu separately in its financial report, but included it in the transaction service revenue.

It is well known in the industry that Pinduoduo's cross-border e-commerce platform Temu was officially launched in September 2022. At the company's performance exchange meeting, Chen Lei, chairman and co-CEO of Pinduoduo, mentioned that Temu has entered more than 50 countries and regions. If you count carefully, it has only been a year and a half since Temu went online in the United States. It is reported that among these sites, the number of European sites is the largest, and the US market is the largest.

In fact, Pinduoduo's "ambition" in overseas business can be seen from its actions such as "spending heavily to land in the American Super Bowl for two consecutive years", "investing 2 billion in advertising in the United States", and "successively launching full-hosting and semi-hosting models".

Fortunately, Pinduoduo's investment has paid off. Reuters mentioned in its evaluation of Pinduoduo's third-quarter performance in 2023 that the company's revenue increased by more than 90% year-on-year during the quarter, and Temu became its largest source of incremental revenue. A domestic industry insider also said in an interview in January this year that Temu's performance in 2023 was very outstanding.

Perhaps last year's success gave Pinduoduo confidence. Recently, a source revealed that this year's target for Pinduoduo's overseas business (Temu) is 60 billion yuan, including 20 billion yuan for semi-custody and 40 billion yuan for full-custody.

The source also revealed that Pinduoduo intends to increase the weight of brand merchants going overseas and has set up an office in Nanshan, Shenzhen, to develop Amazon merchants on a large scale. In addition, considering the increasingly complex international environment, Pinduoduo is currently testing whether Temu can still maintain its cost-effectiveness without taking the tax-free route, and whether the Chinese supply chain behind it still has advantages.

It is worth mentioning that Chen Lei also mentioned at the performance meeting that "the company's (Pinduoduo) global business is still in its early stages... and is prepared for long-term investment."

Some institutions have expressed the same view, believing that Temu is still in a growth stage of rapidly expanding the market, and this year it may continue to optimize its investment promotion model, subsidy policy, overseas warehouse layout, etc., in order to gradually optimize its profit model and improve the efficiency of its business model.

Temu

Pinduoduo

Performance Report

Overseas Goals