Revenue growth driven by transaction services
PDD Holdings reported second-quarter 2026 revenue of RMB112.4 billion (US$16.6 billion), up 8% from the prior-year quarter, according to the company's unaudited financial results. Transaction services revenue rose 13% to RMB54.7 billion, while online marketing services and others contributed RMB57.6 billion, slightly above the prior-year quarter. The combined performance drove the top-line expansion even as profitability weakened.
Net income declines as costs and operating expenses climb
Net income attributable to ordinary shareholders fell 12% year over year to RMB27.2 billion, and non-GAAP net income dropped 13% to RMB28.5 billion. Basic earnings per ADS came in at RMB19.32, down from RMB22.01 a year earlier. Total costs of revenues were RMB48.0 billion, and operating expenses rose 13% to RMB36.6 billion, driven primarily by higher sales and marketing, general and administrative, and research and development spending.
Operating profit and cash generation
Operating profit increased 8% to RMB27.8 billion, with non-GAAP operating profit up 5% to RMB29.1 billion. Net cash from operating activities reached RMB25.7 billion, up from RMB21.6 billion in the prior-year quarter. Cash, cash equivalents and short-term investments grew to RMB456.4 billion as of June 30, 2026, from RMB422.3 billion at year-end 2025. Total shareholders' equity rose to RMB447.8 billion from RMB413.4 billion over the same period.
Analyst expectations and estimate comparisons
Yahoo Finance reported that the 12% year-over-year decline in net income to US$4 billion still beat analyst expectations, which had projected a steeper drop. The earnings beat came alongside continued scrutiny of margin pressure from rising costs and competitive dynamics, though specific guidance or management commentary on Temu's international strategy was not detailed in the available reporting.
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