After the announcement of Pinduoduo's performance yesterday, its stock price surged to a new high of over two years. Pinduoduo's market value has significantly increased, with a difference of only over 10 billion US dollars from Alibaba's total market value.
Jack Ma replied to a post from Alibaba employees regarding the market value of Pinduoduo, asking everyone to provide constructive opinions and suggestions. Especially innovative ideas. I believe today's Alibaba people are all watching and listening. I firmly believe that Alibaba will change, and Alibaba will change. All great companies were born in winter. The era of AI e-commerce has just begun, and it is both an opportunity and a challenge for everyone.
Jack Ma said, "Congratulations to PDD on their decisions, execution, and efforts over the past few years. Everyone has done well, but only those who can reform for tomorrow's Tianniu and are willing to pay any price or sacrifice are respected. Returning to our mission and vision, Alibaba people, come on!"
Pinduoduo's Market Value Approaches Alibaba
Pinduoduo released its performance report for the third quarter of 2023 as of September 30 on November 28. Data shows that Pinduoduo's revenue for the quarter was 68.84 billion yuan, a year-on-year increase of 93.9%. Among them, online marketing services and other revenue was 39.69 billion yuan, a year-on-year increase of 39%; The transaction service revenue was 29.15 billion yuan, a year-on-year increase of 315%. Meanwhile, Pinduoduo achieved a net profit of 15.54 billion yuan under the US GAAP standard, with a net profit margin of 22.6%.
Boosted by performance reports, as of the close of the US stock market on the same day, Pinduoduo rose 18%, with a market value of $184.7 billion, approaching Alibaba's $195.4 billion market value.
For its impressive performance, Pinduoduo stated that this is mainly due to the accelerated recovery of the consumer market and the company's fully implemented "high-quality development" strategy since the beginning of this year.
Chen Lei, Chairman and Co CEO of Pinduoduo Group, also stated, "With the implementation of a series of consumer promotion policies, the demand for consumer upgrading is becoming increasingly strong. At the same time, we can see from user behavior that consumer upgrading is not only related to quality, but also to price. It is the optimization of the 'quality to price ratio' and the ultimate pursuit of consumers for affordable goods."
The solid promotion of cross-border e-commerce business may be one of the important reasons for Pinduoduo's rapid revenue growth in the third quarter. It is understood that in the third quarter of this year, Pinduoduo accelerated the improvement of its cross-border business models, and advanced the layout of overseas consumption nodes such as Halloween, Christmas, and Black Friday, helping more than 10000 factories in over 100 industrial belts in Guangdong, Zhejiang, and other regions accelerate their overseas expansion.
"Since the third quarter of last year, Duoduo Cross border has been launched for over a year, reaching more than 40 countries and regions worldwide." Chen Lei said, "We hope to use the supply chain foundation accumulated over the past years to provide consumers from different regions of the world with a direct channel to purchase from factories, a more flexible and personalized supply chain, and a more cost-effective comprehensive shopping experience."
Jack Ma firmly believes in Alibaba
Previously, the US Stock Exchange released a long-term equity plan application disclosed by Jack Ma Family Trust, which began on November 21st. The application was set to have the option to sell Alibaba stocks under certain preconditions - the news sparked market discussions.
In response, a lawyer from Jack Ma's office stated, "The disclosed sale plan is a long-term plan. There has been no actual reduction in holdings of the plan at present. Jack Ma firmly believes in Alibaba, and the current stock price is far below its actual value. He will still firmly hold onto Alibaba's stocks."
Alibaba Group Partner and Chief Talent Officer Jiang Fang also posted on the Alibaba intranet in response to the "Jack Ma Family Trust's reduction of holdings in Alibaba," stating that "Jack Ma has not sold a single share.".
Jiang Fang mentioned in the post: "In order to invest in agricultural technology and public welfare projects both domestically and internationally, Teacher Ma's office signed a reduction contract with a stock broker earlier this year in accordance with the US SEC 10b5-1 regulations. According to regulations, this conditional future reduction plan will be announced to the public in mid November. The selling price set in August was much higher than the current stock price, so Teacher Ma did not sell a single share!"
Alibaba Group Chairman Cai Chongxin also left a message in response to the post, saying, "I have been in the company for almost 25 years. Alibaba has been facing various doubts and challenges from the beginning to the present. But we continue to persist and have overcome one difficulty after another in these doubts and challenges. Because Alibaba's genes are to believe that the future will be better."
Cai Chongxin stated that the rapid iteration of global technology and business models today is a challenge for everyone, but it is also an excellent opportunity. "As long as we have an open mindset and innovative thinking, we have the opportunity to create another unique Alibaba."
The performance announcement for the second quarter of fiscal year 2024 (i.e. the three months ending September 30, 2023) released by Alibaba Group on November 16 shows that the revenue for the quarter was 224.79 billion yuan, a year-on-year increase of 9%; The operating profit was 33.584 billion yuan, a year-on-year increase of 34%; Adjusted EBITDA of RMB 49.24 billion, a year-on-year increase of 14%; The adjusted net profit was 40.19 billion yuan, a year-on-year increase of 19%.
At the same time as releasing its financial report, Alibaba's board of directors has approved the distribution of cash dividends for the fiscal year 2023, with a total dividend amount of approximately $2.5 billion.