PDD(US:PDD) Guohai Securities·2025-08-28 14:53Investment Rating - The report maintains a "Buy" rating for the company [1] Core Insights - The company reported Q2 2025 revenue of 104 billion RMB, a year-over-year increase of 7% and a quarter-over-quarter increase of 9%. The net profit was 30.8 billion RMB, down 4% year-over-year but up 109% quarter-over-quarter [5][13] - The report highlights that effective cost control and strong investment income contributed to profits exceeding expectations, although management plans to increase merchant investments to support long-term high-quality development, which may lead to profit fluctuations [9][12] - The advertising revenue showed steady growth, while transaction commission revenue growth slowed due to domestic merchant discounts and overseas business disruptions from policy changes [9] Financial Performance Overview - For Q2 2025, the company achieved a gross profit of 58.1 billion RMB (YoY -8%, QoQ +7%), operating profit of 25.8 billion RMB (YoY -21%, QoQ +60%), and Non-GAAP net profit of 32.7 billion RMB (YoY -5%, QoQ +93%) [5][13] - The gross margin was reported at 55.9%, with an operating margin of 24.8% and a net margin of 29.6% [19] Revenue and Profit Forecast - The revenue forecast for 2025-2027 is adjusted to 434.2 billion RMB, 507.9 billion RMB, and 609.3 billion RMB respectively, with Non-GAAP net profits projected at 99.5 billion RMB, 126.8 billion RMB, and 149.5 billion RMB [12][21] - The target market capitalization for 2025 is set at 1,346.3 billion RMB, corresponding to a target price of 132 USD per ADS [12][24] Market Performance - The company's stock has outperformed the Nasdaq index over the past 12 months, with a 28% increase compared to the Nasdaq's 21% [7]