PDD Holdings shares are powering higher. Why is PDD stock up today?
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Operator
Ladies and gentlemen, thank you for standing by and welcome to PDD Holdings Inc. Fourth quarter and fiscal year 2025 earnings conference call. At this time, all participants are in listen only mode. There will be a presentation followed by a question and answer session at which time if you wish to ask a question, you will need to press Star one on your telephone. Please be advised that today’s conference call is being recorded. I would now like to hand the conference over to your host today. Sir, please go ahead.
Cheng Peng (Head Of Investor Relations)
Thank you operator and hello everyone and thank you for joining us today. PDD holdings earnings release was distributed earlier and is available on our [email protected] as well as through the Globe Newswire services. Before we begin, I would like to refer you to our Safe harbor statement in earnings press release which applies to this call as we will make certain forward looking statements. This call also includes discussions of certain non GAAP financial measures. Please refer to our earnings release which contains a reconciliation of non GAAP measures to GAAP measures. Joining us today are Mr. Chen Le, our co Chairman and Co Chief Executive Officer and Mr. Zhao Jiajen, our co Chairman and Co Chief Executive Officer. Our VP of Finance, Ms. Liu Jin is unfortunately on medical leave. Delivering the prepared remarks today will be Mr. Li Zhong, our Finance Director. Jiajing and Li will make some general remarks on our performance for the past quarter and our strategic focus. Jerome will then walk us through our financial Results for the fourth quarter and fiscal year ended December 31, 2025. During the Q and A session, Li and Jiajing will answer questions in Chinese and will help translate. Please kindly know that English translation is for reference only. In case of any discrepancy, statements in the original language should prevail. Now it’s my pleasure to introduce our co Chairman and Co Chief Executive Officer. Please go ahead. Hello everyone and thank you for joining our earnings call for the fourth quarter and fiscal year of 2025. In 2025, we celebrated the 10th anniversary of the company’s founding and it is also the year in which we made our largest investment in high quality development. For the first time in the E commerce industry, we launched a 100 billion support program to support merchants. The entire company joined efforts in stepping up our support to farmers and merchants. And during the shareholders meeting at the end of last year, we improved our corporate governance structure by introducing the co chair structure and further sharpened our strategic focus to investing deeply in the supply chain and concentrating on high quality brand oriented growth to drive the entire supply ecosystem to move up the value chain. In the past year we delivered steady results. This quarter the Group’s revenue reached 123.9 billion RMB, growing 12% year on year while full year revenue reached 431.8 billion RMB, up 10% year on year. Both this quarter’s and the annual net income decreased year on year, which primarily reflects our sustained investments on both the supply side and demand side. As we have communicated in the past, we prioritize long term value generation by nurturing our ecosystem rather than short term financial results. Benefiting from long term investments on both supply and demand sides. Through initiatives like the 100 Billion Support Program, the Platform and supply chain ecosystem have been moving steadily in the right direction. Key participants of the supply chain such as agricultural regions and the Industrial belt have become core pillars supporting the platform and ecosystem while also bringing consumers more affordable high quality products. With the continued investment under the 100 billion support program, dedicated projects such as Douduo Local Specialties, new quality supply and logistics support for remote regions have gradually broadened our support from top merchants and SMEs to every segment of the supply chain, helping businesses across all categories pursue differentiated growth. This has enabled the transition from merely supplying products to pursuing quality and to brand building, greatly improving supply chain efficiency and overall industrial capabilities while at the same time creating room for profit and innovation for agricultural regions and industrial belts. In the fourth quarter, the Douduo Local Specialties team visited agricultural regions such as any lemons, Fuera coffee, Wuhan seeds, Major Pomelo, Wenchan blueberries, Fuzhou abalone and Luengan seaweed to customize wine product wine plant support programs. The team addressed issues such as the lack of product standardization and low value add. These efforts guided farmers and growers to adopt standardized planting, premiumization and deep processing, effectively increasing the added value of agricultural products and retaining more profits in their places of origin thereby enable sustainable growth in specialty agriculture industries. In industrial Belt. We accelerated execution of new quality supply program by doubling down on our support efforts. Our dedicated teams visited manufacturing clusters such as Yiwu Accessories, Ping Hu Dan jackets, Hunan Spati Snacks, Angui Roasted Seeds, Tianjin Potato Chips, Zhongshan small appliances and Shanghai Chocolate and delved deep into every segment of the supply chain from raw materials to components. Through a combination of fee reduction and support, we helped unlock the potential in the supply chain, driving an overall upgrade in supply chain operations and helping industrial belt transition from commoditized competition to brand building. So ji. , While stepping up our investments in the supply chain, we also unlocked the consumption potential in remote regions through our logistics support program, driving new growth opportunities for merchants in the fourth quarter. Building on the success of this campaign, we continue to tackle the last mile of parcel delivery into villages across multiple provinces and cities, extending the benefits of new e commerce from western provinces to vast rural areas. To date, we have deployed and built end to end delivery networks including country level transfer warehouses and village level pickup points in over 10 provinces and municipalities. We also cover the transshipping fees for orders delivered to villages, bringing more remote rural areas into the free shipping zones In terms of trust and safety, we continue to improve the business environment and further enhance the service levels for both consumers and merchants. During the Spring festival, we rolled out a series of food safety measures including compliance checks on business qualifications, reviews of food advertisements, controls on food live streaming, protection of miners, IP protection and the development of a food database, all to safeguard the food safety for consumers during the festivities. Quote. In our global business, despite the drastic changes in external environment, we delivered steady growth over the past year, mainly reflecting the competitive advantages built through our long term focus on the supply chain. At the last shareholders meeting we announced our all out efforts in investing in the transformation of the supply chain and in building another Pinduoduo. This remains our duty and primary focus. Over the past few months, the three year strategy we committed to during the annual general meeting has been translated into concrete actions and fundamental changes are taking place within the business and our organizations. In the next phase of our journey, our strategic priority will not be business diversification but rather concentrating on a high quality development of the supply chain. Leveraging our strength in the supply chain accumulated over the years, we will reinvent the platform and propel the ecosystem up the value chain. 2026 marks PDD’s 11th year and a new starting point. As we head into our next decade, we are starting afresh and moving forward with an all in attitude and a persistent focus on execution. We will dedicate more talent and resources to deepen our investments in the supply chain, accelerating its upgrade and transformation. We believe that in the next three years we will have the opportunity to build another Pinduoduo. Now I’ll hand it over to Chenle for further remarks.
Lei Chen (Chief Executive Officer)
Thanks Jansen and hello everyone. 2025 marked our 10th anniversary. Jansen just mentioned we took on greater risk of possibilities this past year and launched the 100 billion support program to give back to the merchant ecosystem. We also established a co chair structure to further improve our governance and firmly anchored our company’s strategic focus on a high quality relevant of supply chain. Through these efforts we continue to create long term value for consumers, for merchants, the industry and society. It has has been nearly a year since we launched the 100 million support program. During this time we continue to reinvest in our ecosystem through measures such as fee reductions, merchant support, trust and safety initiatives. Our dedicated teams have gone deep into agricultural regions and manufacturing heart to have hundreds of regions establish standardized production systems and to explore differentiated and brand oriented growth models. This effort has significantly improved the efficiency and quality of supply chain operations driving a supply chain transformation from scale driven to value driven. This also brings more high quality affordable products to our consumers. Our consistent investment in the supply chain has unlocked strong consumer demand on Pindodo ...
