PDD(US:PDD) Guoxin Securities·2025-03-25 10:24Investment Rating - The investment rating for the company is "Outperform" [6][4]. Core Views - The company has shown better-than-expected profit performance, with a focus on sustainable platform ecosystem development despite lower-than-expected revenue growth. The revenue for the quarter was 110.6 billion yuan, a year-on-year increase of 24%, with advertising revenue at 57 billion yuan (yoy +17%) and payment channel revenue at 53.6 billion yuan (yoy +33%) [2][10]. - The company is actively investing in its platform ecosystem, which is expected to yield long-term benefits. Short-term revenue growth has slowed due to initiatives aimed at high-quality development, including a 10 billion yuan fee reduction plan that has helped over 10 million merchants improve operational efficiency [2][10]. - The company is expanding its international presence through TEMU, which has entered over 60 countries, and is adapting its business model to mitigate overseas policy uncertainties [3][11]. Summary by Sections Financial Performance - The company's non-GAAP net profit for the quarter was 29.9 billion yuan, a year-on-year increase of 14%, with a non-GAAP net profit margin of 25%. The gross margin was 57%, down 4 percentage points year-on-year, primarily due to the company covering shipping costs in western regions and a decline in the proportion of high-margin commissions [3][11]. - The total expenses for the quarter were 34% of revenue, a decrease of 1.7 percentage points year-on-year, with sales expenses down to 28.3% [3][11]. Future Outlook - The company expects growth to improve in the second half of 2025 as the impacts of platform ecosystem investments and national subsidies are digested, alongside a recovery in domestic consumption. Revenue forecasts for 2025-2027 are 480.3 billion, 593.5 billion, and 676.6 billion yuan, representing year-on-year growth of 22%, 24%, and 14% respectively [4][5]. - The projected non-GAAP net profits for the same period are 130.2 billion, 163.2 billion, and 185.7 billion yuan, with corresponding year-on-year growth rates of 7%, 25%, and 14% [4][5].