3q25业绩超预期；盈利转为正增长

positive growth 3Q25 results beat;earnings swung topositive Target PriceUS$154.30(Previous TPUS$146.30)Up/Downside29.0%Current PriceUS$119.58 PDD Holdings (PDD) announced (18Nov)3Q25 results: revenue was up9.0%YoY (2Q25:7.1%) to RMB108.3bn,1% better than Bloomberg consensusestimates.Thiswas driven by a7%beat intransaction services fees, but offsetby the4% miss inonline marketing services and othersthat we attributed to theimpact fromRMB100bn support program to enhance platform ecosystem.During the period, operatingprofit/non-GAAP NPincreasedby3.0/14.3% YoYto RMB25.0bn/31.4bnandwas10/25% better than consensus, driven bymoreoptimizedthan expected operating expense and RMB8.6bn interest andinvestment income.The timing ofswingingto positive earningsgrowthwasahead of our previous expectation in 4Q25. Our 2025-2027E revenue forecastfor PDD remains largely unchanged, while we lift2025E-2027non-GAAP NP China Internet Saiyi HE, CFA(852) 3916 1739hesaiyi@cmbi.com.hk Ye TAO, CFAfranktao@cmbi.com.hk Wentao LU, CFAluwentao@cmbi.com.hk Joanna Ma(852) 3761 8838joannama@cmbi.com.hk Support policy dragged on marketing revenue growth but shouldbenefitin long term.In3Q25, PDD’s online marketing services and othersrevenue rose by8.1%YoY (3Q24:24.3% YoY;2Q25:13.4% YoY) toRMB53.3bn,4%short of consensus. Transaction services revenue for3Q25 grew by 9.9%YoY(3Q24:71.5%YoY;2Q25:0.7%YoY)toRMB51.4bn,7% ahead of consensus. PDD has launched the RMB100bnsupport program in April 2025 to enhance its platform ecosystem, which in Better-than-expected savings on S&M expensesagainled to a beat onOPM.PDD’s GPM shrank to56.7%in3Q25(3Q24:60.0%), and wasinlinewithconsensus.However, thebetter-than-expectedcost savings from salesandmarketing expenses in 3Q25 drove a beat on OPM.Sales andmarketingexpenses reached RMB30.3bn,down1% YoY (3Q24:+40.2%YoY; 2Q25: +4.5% YoY),whichaccounted for28.0% of total revenue, and Lift SOTP-based TPto US$154.3; maintain BUY.Ournew TPconsistsof,per ADS: 1) US$100.7for the main app based onunchanged 12.5x2025EPE(was US$94.0);2)US$1.9 for Duoduo Grocery(unchanged);3)US$20.7for Temubased onunchanged 1.0x 2025E PS(was US$20.5);and 4) US$31.0for net cash (was US$29.8). Source: FactSet Risks 1) Slower-than-expected global business expansion; 2) geopolitical issues impactingbusiness development; and 3) slower-than-expected margin expansion. Disclosures& Disclaimers Analyst Certification The research analyst who is primary responsible for the content of this research report, inwhole or in part, certifies that with respect to the securities or issuerthat the analyst covered in this report: (1) all of the views expressed accurately reflect his or her personal views about the subject securities or issuer; and (2)no part of his or her compensation was, is, or will be, directly or indirectly, related to the specific views expressed by that analyst in this report.Besides, the analyst confirms that neither the analyst nor his/her associates (as defined in the code of conduct issuedby The Hong Kong Securities and Futures Commission) (1) have dealt in or traded in the stock(s) covered in this research report within 30 calendar days prior to thedate of issue of this report; (2) willdeal in or trade in the stock(s) covered in this research report 3 business days after the date of issue of this report; (3) serve as an officer of any of the HongKong listed companies covered in this report; and (4) have any financial interests in the Hong Kong listed companies coveredin this report. CMBIGM RatingsBUY : Stock with potential return of over 15% over next 12 monthsHOLD: Stock with potential return of +15% to-10% over next 12 monthsSELL: Stock with potential loss of over 10% over next 12 monthsNOT RATED: Stock is not rated byCMBIGM :Industry expected to outperform the relevant broad market benchmark over next 12 months:Industry expected to perform in-line with the relevant broad market benchmark over next 12 months:Industry expected to underperform the relevant broad market benchmark over next 12 months CMB InternationalGlobal MarketsLimited Address: 45/F, Champion Tower, 3 Garden Road, Hong Kong, Tel: (852)3900 0888 Fax: (852) 3900 0800CMB InternationalGlobal MarketsLimited (“CMBIGM”) is a wholly owned subsidiary of CMB International Capital Corporation Limited (a wholly ownedsubsidiary of China Merchants Bank) Important Disclosures There are risks involved in transacting in any securities. The information contained in this report may not be suitable forthe purposes of all investors.CMBIGMdoes not provide individually tailored investment advice. This report has been prepared without regard to the individual investment objectives, financial positionor special requirements. Past performance has no indication of future performance, and actual events may differ materially from that which is contained in thereport.The value of, and returns from, any investments are uncertain and are not guaranteed and may fluctuate as a res