拼多多 (PDD) 2024 Q3 法說會逐字稿

Ladies and gentlemen, thank you for standing by, and welcome to PDD Holdings Inc. third-quarter 2024 earnings conference call. (Operator Instructions) Please be advised that today's conference is being recorded.

女士們、先生們，感謝大家的支持，歡迎參加拼多多控股公司 2024 年第三季財報電話會議。 （操作員指示）請注意，今天的會議正在錄製中。

I would now like to hand the conference over to your host today. Sir, please begin.

我現在想把今天的會議交給東道主。先生，請開始吧。

Thank you, operator. Hello, everyone, and thank you for joining us today. PDD Holdings' earnings release was distributed earlier and is available on our website at investor.pddholdings.com as well as through the GlobeNewswire services.

謝謝你，接線生。大家好，感謝您今天加入我們。 PDD Holdings 的收益報告已於早些時候發布，可在我們的網站 Investor.pddholdings.com 以及 GlobeNewswire 服務上取得。

Before we begin, I would like to refer you to our Safe Harbor statement in earnings press release, which applies to this call, as well make certain forward-looking statements. Also, this call 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.

在我們開始之前，我想請您參閱我們在收益新聞稿中的安全港聲明（該聲明適用於本次電話會議），並做出某些前瞻性聲明。此外，本次電話會議也討論了某些非公認會計準則財務措施。請參閱我們的收益報告，其中包含非公認會計準則衡量標準與公認會計準則衡量標準的調節表。

Joining us today on the call are Mr. Chen Lei, our Chairman and Co-Chief Executive Officer; Mr. Zhao Jiazhen, our Executive Director and Co-Chief Executive Officer; as well as Mr. Liu Jun, our VP of Finance. Lei and Liu Jun will make some general remarks on our performance for the past quarter and our strategic focus. Jun Liu will then walk us through our financial results for the third quarter ended September 30, 2024.

今天加入我們電話會議的還有我們的董事長兼聯合執行長陳雷先生；趙家楨先生，我們的執行董事兼聯合執行長；以及我們的財務副總裁劉軍先生。雷軍和劉軍將對我們上一季的業績以及我們的戰略重點進行一些總體評價。隨後，劉軍將向我們介紹截至 2024 年 9 月 30 日的第三季財務表現。

During the Q&A session, Lei and Jiazhen will answer questions in Chinese. I will help translate. Please kindly note that the English translation is for reference only. In case of any discrepancy, statements in the original language should prevail.

問答環節，雷和家珍將用中文回答問題。我來幫忙翻譯。請注意，英文翻譯僅供參考。如有差異，以原文為準。

Now it's my pleasure to introduce our Chairman and Co-Chief Executive Officer, Mr. Chen Lei. Lei, please go ahead

現在我很高興向大家介紹我們的董事長兼聯合執行長陳雷先生。雷，請繼續

Thank you. Hello, everyone. Thank you all for joining our earnings call for the third quarter of 2024. In the third quarter, we stepped up our efforts in execution of high-quality development strategy and invest firmly in building a healthy platform ecosystem.

謝謝。大家好。感謝大家參加我們的2024年第三季財報電話會議。

We rolled out several initiatives that expanded our ecosystem upgrade to the whole supply chain, such as RMB10 billion fee reduction program and a high-quality merchant support program. These efforts brought cost savings and efficiency gains to over 10 million merchants. And during the process, encouraged agricultural regions and industrial belts that we serve to embark a new phase of high-quality development.

我們推出了百億降費計畫、優質商家扶持計畫等多項舉措，將生態升級延伸至全供應鏈。這些努力為超過 1000 萬商家節省了成本並提高了效率。在此過程中，推動我們所服務的農業地區和產業帶進入高品質發展的新階段。

This past quarter, we delivered robust results with revenues and net income reaching RMB99.4 billion and RMB25 billion respectively. When compared to the last quarter, we have seen a moderation in revenue growth, and profits have also trended low. This was partly due to intensified competition in the e-commerce sector and environment challenges faced by our business.

上個季度，我們取得了強勁的業績，營收和淨利潤分別達到 994 億元人民幣和 250 億元。與上季相比，我們看到營收成長放緩，利潤也呈現下降趨勢。部分原因是電子商務領域的競爭加劇以及我們的業務面臨的環境挑戰。

At the same time, as noted last quarter, investments in ecosystem development expected impact short-term financial results, and this is within our expectation. Beyond the financial results, we placed greater value on the long-term benefits of ecosystem investments.

同時，如上季所指出的，生態系統開發投資預計會影響短期財務業績，這也在我們的預期之內。除了財務表現之外，我們更重視生態系投資的長期利益。

Over the past quarter, our initiatives in fee reductions and merchants bond policies have received positive feedback from merchants, manufacturers as well as from the consumers. In mid-August, we first launched the RMB10 billion fee reduction program, which included several measures such as service fee refunds, fee reduction for buy now pay later services, lower security deposits, and an easier from withdrawal process.

過去一個季度，我們在降費和商家保證政策方面的舉措得到了商家、製造商和消費者的正面回饋。 8月中旬，我們首次推出百億元降費計劃，包括服務費退還、先買後付服務費減免、保證金降低、提現便利等多項措施。

In addition, we also upgraded after sales service support for merchants which brings further cost savings while improving service quality. These efforts injected flash energy into our ecosystem and creating opportunities for growth and transformation that benefits both our merchants and the industry they serve.

此外，我們還升級了對商家的售後服務支持，在提高服務品質的同時進一步節省成本。這些努力為我們的生態系統注入了閃光能量，並創造了成長和轉型的機會，使我們的商家及其所服務的產業受益。

On the first amount e-commerce platform, we also adopted logistic support matters to promote e-commerce services in remote regions across Western China. Last quarter, we eliminated the transshipment fees for orders to these regions with all such costs covered by the platform. This innovation marks the first upgrade to our fulfillment experience that builds on our early initiatives that provide the free shipping to some villages in Western China.

在首個金額電商平台上，我們也透過物流保障事宜，推動西部邊遠地區的電商服務。上季度，我們取消了運往這些地區的訂單的轉運費用，所有此類費用均由平台承擔。這項創新標誌著我們的履行體驗的首次升級，該體驗建立在我們為中國西部一些村莊提供免費送貨的早期舉措的基礎上。

Programs like this not only benefit local consumers, but also enable merchants to enter these underserved markets, which further strengthens the economic link between the different regions. In addition to fee reductions, we also launched the high-quality merchant support program, which aims to empower merchants and brands that demonstrate job product and technology innovation capabilities.

此類計畫不僅使當地消費者受益，也使商家能夠進入這些服務不足的市場，從而進一步加強不同地區之間的經濟聯繫。除了費用減免之外，我們還推出了優質商家扶持計劃，旨在為展示崗位產品和技術創新能力的商家和品牌賦能。

Leveraging our digital capabilities, we offer comprehensive support in product development, marketing, operations, and supply chain management. The examples set by these quality merchants and brands also serve as a driving force behind the growth and transformation of agricultural production regions and industrial belts in the future.

利用我們的數位化能力，我們在產品開發、行銷、營運和供應鏈管理方面提供全面的支援。這些優質商家和品牌的榜樣，也將成為未來農業主產區和產業帶成長轉型的動力。

At the moment, the RMB10 billion fee reduction program covers all product categories on the platform with over RMB10 billion in fee reductions planned for the coming year. The logistic support measures continue to benefit consumers from remote areas, driving significant order volume growth from these regions compared to the last quarter. Meanwhile, the high-quality merchant support program has already implemented in terms of agriculture regions and industrial zones, enriching the platform supply chain for high-quality products.

目前，百億元降費計畫已涵蓋平台所有品類，明年計畫降費超百億元。物流支援措施持續惠及偏遠地區消費者，帶動這些地區的訂單量較上季大幅成長。同時，優質商家扶持計畫已在農區、工業區落地，豐富了優質產品的平台供應鏈。

On demand side, consumers are experiencing a shift in their preferences with greater focus on quality and personalization. This has posed new demand on supply chain innovation. At the same time, our initiatives in fee reductions and merchant support policies are encouraging more merchants to innovate, which enables them to better meet the consumer demand for more quality products, thereby creating a positive cycle. This reaffirms our commitment to make investments that drive impactful results over the long run.

在需求方面，消費者的偏好正在轉變，更加重視品質和個人化。這對供應鏈創新提出了新的要求。同時，我們在費用減免和商家扶持政策方面的舉措正在鼓勵更多商家創新，使他們能夠更好地滿足消費者對更多優質產品的需求，從而形成良性循環。這重申了我們致力於進行長期投資以帶來有影響力的成果的承諾。

We will continue to firmly execute our high-quality development strategy as we nurture a healthy platform and supply chain ecosystem which brings sustained benefits to consumers, merchants, and manufacturers.

我們將繼續堅定實施高品質發展策略，培育健康的平台和供應鏈生態系統，為消費者、商家、製造商帶來持續利益。

For platform rooted in agriculture, we continue to make our own contributions in this field with a particular focus on advancing research and technology innovation. On September 20, we hosted the final round of fourth smart agriculture competition where six finalist teams explored cutting-edge technologies in agriculture digitization and experimented with real-world applications.

對於紮根農業的平台，我們繼續在該領域做出自己的貢獻，特別注重推進研究和技術創新。 9月20日，我們舉辦了第四屆智慧農業大賽決賽，六支入圍隊伍探索農業數位化尖端技術並進行實際應用實驗。

On September 26, we hosted a global agri challenge 2024 in collaboration with leading research institutes. Batches of young entrepreneurs from around the world represented innovative digital solutions to tackle agricultural challenges faced by farmers around the world.

9 月 26 日，我們與領先研究機構合作主辦了 2024 年全球農業挑戰賽。來自世界各地的一批批年輕企業家代表了創新的數位解決方案，以應對世界各地農民面臨的農業挑戰。

As mentioned last quarter, as a global company in the new era, we are committed to driving innovation and adapting to trend. We are also prepared to do more to give back to the society to support agriculture and other industry sectors and to take on greater responsibilities in the region across the globe.

如同上季所提到的，作為新時代的全球化公司，我們致力於推動創新、順應趨勢。我們也準備更多回饋社會，支持農業等工業領域，在全球範圍內承擔更大的責任。

And now I'll turn it over to our co-CEO, Zhao Jiazhen, to talk in more details about our development plan.

現在我將把它交給我們的聯合執行長趙家臻，詳細談談我們的發展計畫。

(interpreted) Thank you, Lei. Hello, everyone. This is Zhao Jiazhen. Thank you all for joining our earnings call for the third quarter of 2024.

（翻譯）謝謝你，雷。大家好。這是趙家珍。感謝大家參加我們 2024 年第三季的財報電話會議。

(interpreted) In the third quarter, thanks to the steady recovery of macro consumption, our business performance remained robust. As we continue to firmly execute our high-quality development strategy, as Lei just mentioned, we have been actively optimizing the platform ecosystem. This includes a series of fee reductions and initiatives to support our merchants or aim to ensuring benefits for both the supply and demand side. Let me now take a moment to share some of our efforts in supporting merchants.

（解讀）三季度，得益於宏觀消費穩步回升，我們的經營業績依然保持強勁。在我們繼續堅定地實施高品質發展策略的同時，正如雷軍剛才所提到的，我們一直在積極優化平台生態。這包括一系列費用減免和舉措，以支持我們的商家或旨在確保供需雙方的利益。現在讓我花點時間分享我們在支持商家方面所做的一些努力。

(interpreted) As we discussed last quarter, our investment in platform ecosystem focused on two key areas. First, we have reduced transaction fees for high-quality merchants. On the other hand, we have committed billions of resources to empower merchants and emerging industrial clusters with strong product and technology innovation capabilities.

（解釋）正如我們上季度所討論的，我們對平台生態系統的投資主要集中在兩個關鍵領域。一是降低優質商家交易手續費。另一方面，我們投入數十億資源，為商家和新興產業群聚賦能強大的產品和技術創新能力。

(interpreted) In the third quarter, our RMB10 billion fee reduction program introduced a series of measures which plays a key role in helping merchants lower costs and improve efficiency through substantial fee reductions and rebounds.

（解讀）三季度，我們的百億元降費計畫推出了一系列舉措，透過大幅降費和反彈，對幫助商家降本增效發揮了關鍵作用。

Many merchants, especially agriculture and national goods, saved hundreds of thousands RMB a year, largely reducing their operating costs. This allows them to free up more resources for product development and technology upgrades, driving the industry towards a new phase of high-quality growth.

許多商家，特別是農產品和國貨，一年節省了數十萬元，很大程度降低了經營成本。這使得他們能夠騰出更多資源用於產品研發和技術升級，推動產業邁向高品質發展的新階段。

(interpreted) Additionally, we have enhanced the after-sales service system for merchants. We introduced a green channel alongside a dedicated app sales service team to fully support merchants with abnormal orders, complaints, and customer dissatisfaction.

（解讀）此外，我們也完善了商戶售後服務體系。我們推出綠色通道和專門的應用程式銷售服務團隊，全力支援商家處理訂單異常、投訴和客戶不滿意等議題。

Once the merchants' appeal is approved, the platform compensates for the relevant orders. This improves not only the merchant experience, but also the overall business environments on the platform.

一旦商家申訴獲得批准，平台將對相關訂單進行補償。這不僅改善了商家體驗，也改善了平台的整體商業環境。

(interpreted) As part of our logistics support initiative, we cover all transshipment fees across Western China. This substantially reduces delivery cost for orders in these regions. For categories like agricultural products and daily essentials, delivery fees were cut by up to 70%, greatly encouraging merchants to enter these markets.

（解釋）作為我們物流支援計劃的一部分，我們承擔中國西部地區的所有轉運費用。這大大降低了這些地區訂單的配送成本。對於農產品、生活必需品等類別，運費下調幅度高達70%，大大鼓勵了商家進入這些市場。

Quality products from across the country are now reaching Western China, promoting further infrastructure development in e-commerce and logistics. It also opens new opportunities for the region's abundant resources to access national markets.

全國優質產品正運抵西部地區，推動電商物流基礎建設進一步發展。它也為該地區豐富的資源進入全國市場提供了新的機會。

(interpreted) For our RMB10 billion fee reduction program, we also launched the high-quality merchant support program. For example, during the harvest festival in early September, we have allocated RMB1 billion in subsidies and RMB2 billion in online traffic resources to support high-quality agricultural merchants from various regions. This effort helped seasonal agricultural products reach urban markets, boosting yields and income in agricultural communities.

(解讀)百億降費計畫中，我們也推出了優質商家扶持計畫。例如，9月初的豐收節期間，我們安排了10億元補貼和20億元網路流量資源，支援各地優質農民商戶。這項努力幫助季節性農產品進入城市市場，提高了農業社區的產量和收入。

(interpreted) Beyond agricultural regions, the high-quality merchant support program also extended to other industrial communities, leveraging the platform's digital capabilities. We're collaborating with manufacturers to explore full supply chain models. This helps them advance manufacturing process, strengthen brand recognition, and drive industries towards high-quality developments.

（解讀）除農業地區外，優質商家支援計畫還利用平台的數位化能力延伸到其他工業社區。我們正在與製造商合作探索完整的供應鏈模式。這有助於提升製造工藝，增強品牌知名度，並推動產業高品質發展。

(interpreted) In the recently concluded Double 11 Shopping Festival, our RMB10 billion program partnered with numerous national brands to launch customized high-quality products. This initiative led to impressive growth with sales of national brands both new and established, rising more than tenfold quarter on quarter.

【解讀】剛結束的雙11，百億計畫與眾多民族品牌合作，推出客製化優質產品。這項舉措帶來了令人印象深刻的成長，新舊品牌的銷售額較上季成長了十倍以上。

In the coming quarters, we will further broaden our support for high-quality merchants, covering more agricultural and industrial regions to drive industry transformation and advancement.

未來幾季，我們將進一步加強對優質商家的支持力度，涵蓋更多農業和工業區域，帶動產業轉型升級。

(interpreted) Our firm investment team on the supply side has enabled us to provide consumers with a more diverse selection of high-quality products aligning their evolving preferences. In response to shifting consumption trends, we have expanded offerings of new smartphones, top brand cosmetics, and healthy food users in first and second-tier cities, addressing the personalized amounts of urban professionals in younger generations. For those in third and fourth tier cities and rural areas, we have focused on offering more premium home appliances maternity and baby products and fresh produce, driving a wave of consumption upgrades.

（解讀）我們堅定的供給面投資團隊使我們能夠為消費者提供更加多樣化的優質產品選擇，滿足他們不斷變化的偏好。針對消費趨勢的變化，我們擴大了一二線城市的新型智慧型手機、名牌化妝品、健康食品使用者的品類，滿足年輕一代城市職場人士的個人化消費需求。針對三、四線城市和農村地區，我們重點提供更多優質家電母嬰、生鮮產品，帶動消費升級浪潮。

(interpreted) As Lei noted, over the next few quarters, we will stay committed to our high-quality development strategy. We will carry on with the fee reductions and merchant support initiatives, further enhance our ecosystem and keep improving our capabilities to navigate the challenges ahead.

(解讀)雷軍表示，未來幾個季度，我們將堅定不移實施高品質發展策略。我們將繼續實施費用減免和商家支援舉措，進一步增強我們的生態系統，並持續提高我們應對未來挑戰的能力。

Next, I will hand over to Jun. She will provide an update on our financial performance for the third quarter.

接下來，我將把工作交給 Jun。

Thank you, Jiazhen. Hello, everyone. Let me walk you through our financial performance for the third quarter ended September 30, 2024. In terms of shop income statements, in the third quarter, our total revenues increased 44% year-over-year to RMB99.4 billion. This was mainly driven by an increase in revenues from online marketing services and transaction services. Revenues from online marketing services and orders were RMB49.4 billion this quarter, up 24% from the same quarter of 2023.

謝謝你，家珍。大家好。讓我向您介紹我們截至2024年9月30日的第三季的財務業績。這主要是由於線上行銷服務和交易服務收入的成長所致。本季網路行銷服務和訂單收入為人民幣494億元，較2023年同季成長24%。

Revenues from transaction services were RMB50 billion, up 72% from the same quarter last year. In Q3, our top line growth has further moderated in comparison to the last few quarters made intensified competition and external challenges. [indiscernible] cost and expenses, our total cash revenues increased 48% from RMB26.8 billion in Q3 2023 to RMB39.7 billion this quarter, mainly due to increase in fulfillment fees and payment perception fees. On a GAAP basis, total operating expenses this quarter increased 39% to RMB 35.4billion from RMB25.4 billion in the same quarter of 2023. On a non-GAAP basis, total operating expenses increased to RMB32.9 billion this quarter from RMB23.9 billion in Q3 2023.

交易服務收入為人民幣500億元，較去年同季成長72%。在第三季度，與過去幾個季度相比，由於競爭和外部挑戰加劇，我們的收入成長進一步放緩。 [音頻不清晰]成本和費用，我們的現金總收入從2023 年第三季度的人民幣268 億元增長到本季度的人民幣397 億元，增長了48%，主要是由於履行費用和支付感知費用的增加。以美國通用會計準則計算，本季總營運費用從2023 年同季的人民幣254 億元增加39% 至人民幣354 億元。至人民幣329 億元。

In Q3, we further increased our investments to promote high call development of a sustainable platform ecosystem. Our total non-GAAP operating expenses as a percentage of total revenues this quarter were 33% compared to 35% in the same quarter last year.

第三季度，我們進一步加大投入，推動永續平台生態的高調發展。本季我們的非 GAAP 總營運費用佔總收入的百分比為 33%，而去年同期為 35%。

Looking to specific expense items, our non-GAAP sales and marketing expenses this quarter were RMB29.8 million, up 40% versus the same quarter last year. Throughout Q3, we remain focused on giving back consumers throughout promotional campaigns and continue to invest in marketing to promote our platforms. On a non-GAAP basis, our sales and marketing expenses as a percentage of our revenues this quarter was 30% versus 31% for the same quarter last year. Our non-GAAP general and administrative expenses were RMB647 million versus RMB403 million in the second quarter of 2023. Our research and development expenses were RMB2.4 billion this quarter on a non-GAAP basis, up 10% year-over-year, and RMB3.1 billion on a GAAP basis.

從具體費用項目來看，本季我們的非公認會計準則銷售和行銷費用為 2,980 萬元，比去年同期成長 40%。在整個第三季度，我們仍然專注於透過促銷活動回饋消費者，並繼續投資行銷來推廣我們的平台。以非公認會計原則計算，本季我們的銷售和行銷費用佔收入的百分比為 30%，而去年同期為 31%。我們的非 GAAP 一般和管理費用為人民幣 6.47 億元，而 2023 年第二季度為人民幣 4.03 億元。會計準則計算人民幣31 億元。

Our R&D expenses reached a new high this quarter, reflecting our focus on strengthening the core technology capabilities of our platform. As a foundation for our supply chain innovation and the trust [indiscernible] shopping environment, we are committed to further increasing our investment in R&D. On a GAAP basis, Operating profit for the quarter was RMB24.3 billion versus RMB16.7 billion in the same quarter last year.

本季我們的研發費用再創新高，反映了我們對加強平台核心技術能力的重視。作為我們供應鏈創新與信任[音訊不清晰]購物環境的基礎，我們致力於進一步增加研發投入。以公認會計原則計算，本季營業利潤為人民幣 243 億元，而去年同期為 167 億元。

Non-GAAP operating profit was RMB26.8 billion versus RMB18.1 billion in the same quarter last year. Non-GAAP operating profit margin was 27% this quarter compared to -- compared with 26% for the same quarter last year.

非 GAAP 營業利潤為 268 億元，去年同期為 181 億元。本季非 GAAP 營業利益率為 27%，去年同期為 26%。

Net income attributable to ordinary shareholders was RMB25 billion for the quarter compared to RMB15.5 billion in the same quarter last year. Base earnings per ADS was RMB 18.02 and diluted earnings per ADS was RMB16.91 versus base gains per ADS of RMB11.38 and diluted earnings per ADS of RMB10.66 in the same quarter of 2023.

本季歸屬於普通股股東的淨利為人民幣 250 億元，去年同期為 155 億元。每份美國存託股基本收益為人民幣18.02 元，稀釋後每份美國存託股收益為人民幣16.91 元，而2023 年同季每份美國存託股基本收益為人民幣11.38 元，稀釋後每份美國存託股收益為人民幣10.66 元。

Non-GAAP net income attributable to ordinary shareholders was RMB27.5 billion versus RMB17 billion in the same quarter last year. Non-GAAP diluted earnings per ADS was RMB18.59 versus RMB11.61 in the same quarter of 2023.

非美國通用會計準則歸屬於普通股股東的淨利為人民幣 275 億元，去年同期為 170 億元。非 GAAP 稀釋後每股美國存託股收益為 18.59 元，而 2023 年同季為 11.61 元。

As noted last quarter, our profitability may gradually trend lower over the long run as we continue to invest to support high-quality merchants and promote a sustainable platform ecosystem. Further, we will remain committed to long-term investments to build a healthy platform ecosystem, bringing sustained benefits to consumers, merchants and other ecosystem partners.

正如上季所指出的，隨著我們繼續投資支持優質商家並促進永續的平台生態系統，從長遠來看，我們的獲利能力可能會逐漸下降。此外，我們將持續致力於長期投資，打造健康的平台生態系統，為消費者、商家和其他生態系統合作夥伴帶來持續的利益。

That completes the income statements. Now let me move on to cash flow. Our net cash generated from operating activities was RMB27.5 billion compared with RMB32.5 billion in the same quarter last year. As of September 30, 2024, we have RMB308.5 billion in cash, cash equivalents, and short-term investments.

這樣就完成損益表了。現在讓我繼續討論現金流。經營活動產生的現金淨額為 275 億元，去年同期為 325 億元。截至2024年9月30日，我們擁有現金、現金等價物及短期投資人民幣3,085億元。

Thank you. This concludes my prepared remarks.

謝謝。我準備好的發言到此結束。

Thank you, Jun. Next, we will move on to the Q&A session. In today's Q&A session, Lai, Jiazhen, and Jun will take questions from analysts on the line. We could take a maximum of two questions from each analyst. Lei and Jiazhen will answer questions in Chinese, and we'll help translate for convenience purpose.

謝謝Jun。在今天的問答環節中，賴家珍、Jun將在線上回答分析師的提問。我們最多可以向每位分析師提出兩個問題。雷和家珍會用中文回答問題，為了方便我們會幫忙翻譯。

Operator, we are now open for questions.

接線員，我們現在可以提問。

(Operator Instructions) Kenneth Fong, UBS.

（操作員指令）Kenneth Fong，UBS。

(interpreted) Last quarter, management place great emphasis on your commitment to invest in the merchant ecosystem. And we have also seen the company implementing a series of merchant support initiatives since then. Can management share the current progress of this initiative and elaborate on the plans moving forward?

（解釋）上個季度，管理階層非常重視您對商業生態系統投資的承諾。從那時起，我們也看到該公司實施了一系列商家支援措施。管理層能否分享該計劃的當前進展並詳細說明未來的計劃？

And my second question is, we are seeing that the company is still actively exploring new markets in this global business. But at the same time, we also noted that external environment is evolving, and we are hearing different views on the business from external stakeholder. Could management share your thoughts on this and also provide an update on the future plans for the global business?

我的第二個問題是，我們看到該公司仍在積極探索這項全球業務的新市場。但同時我們也注意到外部環境正在發生變化，我們正在聽到外部利害關係人對業務的不同看法。管理層能否分享您對此的看法，並提供全球業務未來計劃的最新資訊？

(interpreted) Hi. This is Zhao Jiazhen. Let me take your question on our merchant support initiative. As we have always emphasized, it's crucial for us along with all our ecosystem partners to collaborate closely encouraging values for consumers. Merchants as essential partners in serving consumers are vital in this effort.

（解釋）嗨。這是趙家珍。讓我回答您有關我們的商家支援計劃的問題。正如我們一直強調的那樣，我們與所有生態系統合作夥伴密切合作，鼓勵消費者價值至關重要。商家作為服務消費者的重要合作夥伴，在這項努力中至關重要。

The healthy and sustainable merchant ecosystem is therefore fundamental to our high quality development.

健康可持續的商戶生態是我們高品質發展的基礎。

(interpreted) To this end, we have made substantial investments in the merchant ecosystem this quarter, giving strong support to high-quality merchants through the RMB10 billion fee reduction program. As Jeff mentioned, we have implemented several policies, including service fee with bonds, lower security deposits within transhipment fees for audit from remote regions and enhancing aftersales support for our merchants.

（解讀）為此，我們本季對商家生態進行了大量投資，透過百億降費計畫對優質商家給予大力支持。正如Jeff所提到的，我們實施了多項政策，包括保證金服務費、降低偏遠地區審核轉運費用中的保證金以及加強對商家的售後支援。

(interpreted) We aim to guide high-quality merchants towards sustainable growth through consistent implementation of this policy over the long term. For instance, the fee reduction efforts, such as service fee refunds and deposit reduction, not only lower merchants' operational costs, but also improve their efficiency. This, in turn, empowers merchants to invest more in improving their products and services over time.

（解讀）我們旨在透過長期堅持執行這項政策，引導優質商家實現永續發展。例如，退服務費、減押金等降費舉措，不僅降低了商家的營運成本，也提高了商家的效率。隨著時間的推移，這反過來又使商家能夠投入更多資金來改進他們的產品和服務。

(interpreted) In the third quarter, we also made substantial progress in logistics. With our logistics fee reduction policy, merchants are no longer charged for transshipment fees for all orders shipped in Western regions. This enables merchants to reach a broader customer base at lower costs. It also furthers our strategy to extend logistics services across Western China, encouraging the distribution of high-quality groups to their regions.

(解讀)第三季度，我們在物流方面也取得了實質進展。物流降費政策實施後，所有發往西部地區的訂單不再向商家收取轉運費用。這使得商家能夠以更低的成本覆蓋更廣泛的客戶群。這也進一步推動了我們將物流服務延伸至中國西部地區的策略，鼓勵優質團隊向其區域分佈。

(interpreted) These policies have received notable positive feedback from merchants. Moving forward, we are committed to making more meaningful long-term investments in this direction. By fostering a stronger merchant ecosystem, we aim to establish a more robust supply chain and deliver better products and services to consumers together with our merchants.

（解讀）這些政策得到了商家的正面回饋。展望未來，我們致力於在這個方向上進行更有意義的長期投資。透過培育更強大的商家生態系統，我們的目標是建立更強大的供應鏈，與商家一起為消費者提供更好的產品和服務。

(interpreted) Hi, Kenneth. This is Chen Lei. Let me take your question on the global business.

（翻譯）嗨，肯尼斯。這是陳雷。讓我回答你關於全球業務的問題。

(interpreted) Our goal in the global business has always been to deliver our unique value to consumers across the different countries. This commitment remains unchanged. To achieve this goal, we will continue to strengthen our capabilities to improve our supply chain and upgrade our services.

（解釋）我們在全球業務中的目標始終是向不同國家的消費者提供我們獨特的價值。這項承諾保持不變。為了實現這一目標，我們將繼續加強供應鏈完善和服務升級的能力。

(interpreted) As our business continues to grow, consumers and external stakeholders have placed higher requirements on us. In response to this, we have always maintained a proactive and open attitude. And over the past few months, we are actively engaging with external stakeholders in the markets where we operate.

（解讀）隨著我們業務的不斷發展，消費者和外部利害關係人對我們提出了更高的要求。對此，我們始終保持積極、開放的態度。在過去的幾個月裡，我們正在與經營所在市場的外部利害關係人積極互動。

We carefully listen to their feedback and suggestions, and we promptly incorporated their suggestions into our daily operations. In this way, we were able to continuously enhance our service standards and compliance posture.

我們認真聽取他們的回饋和建議，並及時將他們的建議融入我們的日常營運中。透過這種方式，我們能夠持續提高我們的服務標準和合規狀況。

(interpreted) At the moment, we are already seeing some initial results from these communication efforts, and we are bringing our operations to higher standards in various markets. As a global business growth, we will continue to strengthen our capability in this regard to deliver high-quality services that meet the preferences and expectations of the consumers in each market.

（解釋）目前，我們已經看到這些溝通工作的一些初步成果，並且我們正在使我們在各個市場的運作達到更高的標準。隨著全球業務的成長，我們將繼續加強這方面的能力，提供滿足每個市場消費者的喜好和期望的高品質服務。

(interpreted) At the same time, as mentioned last quarter, the impact of the intensifying competition in the global market and the complex external environment combined will bring ups and downs to our business. This is inevitable. However, this will not deter us from exploring a way forward. Challenges from the outside and external expectations motivate us to continue to strengthen our capabilities to deliver a safer and better shopping experience for global consumers. Thank you.

（解讀）同時，如同上季所提到的，全球市場競爭加劇和複雜的外部環境共同影響，將為我們的業務帶來起伏。這是不可避免的。但這並不妨礙我們探索前進的道路。來自外部的挑戰和外部期望激勵我們繼續增強我們的能力，為全球消費者提供更安全、更好的購物體驗。謝謝。

Operator, we can move on to the next analyst on the line.

接線員，我們可以轉到線路上的下一位分析師。

Charlene Liu, HSBC.

劉夏琳，匯豐銀行。

(interpreter) From your prepared remarks and from public information, we noticed that the company recently paid a lot of attention to compliance and platform into system, and we also saw some new initiatives being launched. Can management share some detailed measures you've taken and what goals you expect to achieve in this area going forward?

（翻譯）從你準備的發言和公開的訊息中，我們注意到公司最近非常重視合規和平台化製度，也看到一些新的舉措正在推出。管理層能否分享您已採取的一些詳細措施以及您希望在該領域未來實現哪些目標？

The second question is that we noticed that this quarter's profit and profitability saw a slight decline Q on Q. Can management kindly share your thoughts on this? And how does this align with the trend discussed by the management on last quarter's earnings call? And looking ahead, how does management think about longer-term profitability trends?

第二個問題是，我們注意到本季的利潤和獲利能力Q比Q略有下降。這與管理階層在上個季度財報電話會議上討論的趨勢如何一致？展望未來，管理階層如何看待長期獲利趨勢？

(interpreted) Hi, this is Zhao Jiazhen. Let me take your question on compliance.

（譯）嗨，我是趙家珍。讓我回答你關於合規性的問題。

(interpreted) Our business growth, coupled with regulatory trends in various markets, has placed higher demands on our compliance capabilities. We believe that providing a safe and reliable shopping environment is the duty of any e-commerce platform. Therefore, we see compliance in a high-quality ecosystem as key components of our tight quality development strategy.

（解讀）我們的業務成長，加上各市場的監管趨勢，對我們的合規能力提出了更高的要求。我們認為，提供安全可靠的購物環境是任何電商平台的責任。因此，我們將高品質生態系統的合規性視為我們嚴格的品質發展策略的關鍵組成部分。

(interpreted) To this end, we have taken further steps to scale up the execution of a robust set of trust and safety initiatives all designed to fortify our compliance systems.

（解釋）為此，我們採取了進一步措施，擴大執行一系列強有力的信任和安全措施，所有這些舉措都是為了加強我們的合規體系。

(interpreted) In terms of compliance management, we invested heavily in building a strong expert compliance team to closely track regulatory changes and industry trends across our markets. This allows us to translate insights into actionable compliance items. At the same time, we have evolved comprehensive educational materials for our merchants to enhance their compliance capabilities and foster the high-quality development of the supply chain.

（解讀）在合規管理方面，我們投入巨資打造了一支強大的合規專家團隊，密切追蹤各市場的監管變化和產業趨勢。這使我們能夠將見解轉化為可操作的合規項目。同時，我們為商家製定了完善的教材，提升商家合規能力，促進供應鏈高品質發展。

(interpreted) Leveraging technology, we have further streamlined our merchant on-boarding and product listing processes. We have invested substantial resources to proactive product quality checks and combining technology and many screening to properly detect and address potential product safety risks.

（解釋）利用技術，我們進一步簡化了商家入職和產品上市流程。我們投入了大量資源主動進行產品品質檢查，並結合技術和多種篩檢來正確檢測和解決潛在的產品安全風險。

At the same time, we worked closely with external stakeholders to meet their requirements, striving to set industry-leading compliance standards.

同時，我們與外部利害關係人密切合作，滿足他們的要求，努力製定行業領先的合規標準。

(interpreted) Through this investment in component and our support for high-quality merchants, we aim to achieve further upgrades in the supply chain by removing bad actors and empowering top merchants. We are fostering a healthier and more sustainable merchant ecosystem. These efforts will ultimately lead to more valuable products and services for our consumers. Thank you.

（解讀）透過對組件的投入以及對優質商家的支持，我們旨在透過剔除不良行為者並為頂級商家賦能，實現供應鏈的進一步升級。我們正在培育一個更健康、更永續的商業生態系統。這些努力最終將為我們的消費者帶來更有價值的產品和服務。謝謝。

This is Jun. Thanks for your question. We'll take your second question about the profitability. Well, last quarter, we communicated that our revenue growth may see some moderation as a result of competition and external factors. And in addition, as we invest firmly to drive healthy and sustainable platform ecosystem, our profitability may gradually trend lower in the long run.

我是 Jun，謝謝你的提問。我們將回答你關於獲利能力的第二個問題。上個季度，我們表示，由於競爭和外部因素，我們的營收成長可能會放緩。此外，隨著我們堅定地投資以推動健康和永續的平台生態系統，從長遠來看，我們的獲利能力可能會逐漸下降。

Beyond the financials, we are already seeing good initial results from our investments in platform ecosystem. We are encouraged by the positive feedback from merchants on our merchant support initiatives. We believe investment in the merchant ecosystem lay the foundation for the platform's healthy and sustainable development.

除了財務方面之外，我們對平台生態系統的投資已經看到了良好的初步成果。商家對我們的商家支援計劃的正面回饋令我們感到鼓舞。我們相信對商戶生態系統的投資為平台的健康永續發展奠定了基礎。

In the long run, these assets will benefit the merchants, consumers as well as platforms, creating more value to consumers by enabling supply chain upgrades. And I think this is a long journey. And moving forward, we will continue to explore more investment in this direction to drive impactful results. Thanks.

從長遠來看，這些資產將惠及商家、消費者和平台，透過賦能供應鏈升級為消費者創造更多價值。我認為這是一個漫長的旅程。展望未來，我們將繼續在這個方向探索更多投資，以取得有影響力的成果。謝謝。

All right. Operator, let's move on to the next analyst on the line.

好的。接線員，讓我們轉到線路中的下一位分析師。

Joyce Ju, Bank of America.

喬伊斯·朱，美國銀行。

(interpreted) I want to translate myself. I have two questions. My first question is can management share with us some new consumption trends that you have observed during this year's Double 11 Shopping Festival? How does management rate PDD's performance in this promotion? What are the new initiatives that Dodo experimented during this event? And does management are satisfied with the results?

（翻譯）我想自己翻譯。我有兩個問題。我的第一個問題是，管理階層能否跟我們分享您在今年雙11期間觀察到的一些新的消費趨勢？管理階層如何評價拼多多在此次促銷活動中的表現？ Dodo在本次活動中嘗試了哪些新措施？管理階層對結果滿意嗎？

My second question is actually regarding competition. From what we observed during this year's Double 11, the competition remain intense in China's e-commerce market, and total growth rate also slightly slowed down during this quarter. Could management help us understand your sorts on domestic competition pressure? And will there be any adjustment in your strategy going forward?

我的第二個問題其實是關於競爭的。從今年雙11觀察來看，中國電商市場競爭依然激烈，本季整體成長速度也略有放緩。管理階層能否幫助我們了解您對國內競爭壓力的看法？未來的策略是否會有所調整？

(interpreted) Hi, this is Zhao Jiazhen. Let me take your question on domestic consumption and shopping festivals.

（譯）嗨，我是趙家珍。我來回答關於國內消費和購物節的問題。

(interpreted) We have seen an overall recovery in consumer spending and a strong growth in online consumption during the second half of this year. Recently driven by the shopping festivals, we have also seen increasing consumer activities on our platform.

（解讀）今年下半年，我們看到消費支出整體回升，網路消費強勁成長。最近在購物節的推動下，我們平台上的消費者活動也有所增加。

(interpreted) We have observed more diverse choices of consumers in today's interconnecting world and great movement across platforms. In response, it's essential to stay firmly focused on the consumers and to deepen their trust on our platform. To achieve this, we have consistently invested significant resources on both the consumption and supply side delivering real benefits and reinforce the trust in our platform.

（解讀）我們觀察到，在當今互聯的世界中，消費者的選擇更加多樣化，跨平台發生了巨大的變化。為此，必須牢牢關註消費者並加深他們對我們平台的信任。為了實現這一目標，我們持續在消費和供應方面投入大量資源，帶來真正的利益並增強對我們平台的信任。

(interpreted) During this year's Double 11 Shopping Festival, we introduced the 10 billion voucher campaign for the first time, offering consumers direct benefits. The response was extremely positive with strong sales growth across several product categories, notably agricultural products, small home appliances, and daily necessities saw remarkable surges. This success demonstrates how our platform, in collaboration with merchants, has effectively fulfilled consumers' demand for valuable and cost-effective products.

【解讀】今年雙11期間，我們首次推出百億優惠券活動，讓消費者直接受益。反應非常積極，多個產品類別的銷售成長強勁，特別是農產品、小型家電和日用品的銷售量大幅成長。這項成功證明了我們的平台如何與商家合作，有效滿足了消費者對有價值且高性價比產品的需求。

At the same time, our Super Double discount event supported a group of high-quality merchants with innovative products and technology. Many national brands leveraged our platform to launch new premium products, quickly gaining recognition during the shopping festival. The growth of this quality offerings enrich the selection available to consumers. This in turn strengthened consumer trusting our platform and benefit both demand and supply side.

同時，我們的超級雙折活動以創新的產品和技術支持了一群優質商家。眾多國民品牌利用我們的平台推出優質新品，在購物節期間迅速獲得認可。這些優質產品的成長豐富了消費者的選擇。這反過來又增強了消費者對我們平台的信任，使供需雙方受益。

(interpreted) Guided by the consumer-first mindset, we have invested patiently and strategically over the long term, gradually earning the trust and preference of our users. Moving forward, we're confident that by maintaining high-quality long-term investments in consumption, supply chain, and ecosystem will further enhance consumer confidence in us. This forms the foundation of our long-term healthy development.

（解讀）我們以消費者至上的理念為指導，長期耐心、策略性投入，逐漸贏得了使用者的信任與愛。展望未來，我們有信心透過在消費、供應鏈、生態系統方面保持高品質的長期投資，將進一步增強消費者對我們的信心。這是我們長期健康發展的基礎。

(interpreted) Regarding your second question on competition.

（解釋）關於你提到的第二個問題，即競爭問題。

(interpreted) As we have mentioned on several occasions, the overall competition in e-commerce remains intense and our business is no exception. Additionally, as with any business, our growth won't follow a linear path over the long term. Given that, the slowdown in our revenue growth, we believe, is inevitable.

（解讀）正如我們多次提到的，電子商務整體競爭依然激烈，我們的業務也不例外。此外，與任何企業一樣，從長遠來看，我們的成長不會遵循線性路徑。有鑑於此，我們認為營收成長放緩是不可避免的。

(interpreted) Since Q3, the release of additional macroeconomic Board policies has opened up new opportunities while also presenting challenges. The Chinese domestic market is highly dynamic, which is characterized by constant changes, diverse business model, and intensifying competition.

（解讀）第三季以來，央行宏觀政策陸續出台，帶來了新的機遇，也帶來了挑戰。中國國內市場充滿活力，變化不斷，商業模式多樣，競爭加劇。

However, our team's gradual aging and lack of capabilities might cause us to miss out on some macro opportunities, especially when facing new or evolving situations.

然而，我們團隊的逐漸老化和能力的缺乏可能會導致我們錯過一些宏觀機會，特別是在面對新的或不斷變化的情況時。

(interpreted) For instance, multiple macro policies introduced this year have brought significant support to industries and fueled consumer demand. However, our team was unable to fully leverage this macroeconomic shift due to the limitations in our operation experience solely as a third-party platform. Consequently, to stay competitive with similar products, we had to incur much higher cost than peers, which inevitably affects our profitability now and in the near future.

（解讀）例如，今年推出的多項宏觀政策為產業帶來了巨大支持，刺激了消費需求。然而，由於我們單純作為第三方平台的營運經驗有限，我們的團隊無法充分利用這一宏觀經濟轉變。因此，為了保持與同類產品的競爭力，我們必須承擔比同行更高的成本，這不可避免地影響我們現在和不久的將來的獲利能力。

(interpreted) With the ongoing expansion of consumption boosting policies, we're excited to increase changes ahead and tap into new opportunities to better serve our consumers. However, due to the limitations imposed by our platform business model and operational merchant shaped by our previous experience, along with shortfalls in our capabilities, we may continue to experience disadvantages relative to our peers for some time. This could further increase the financial impacts, presenting a challenge for us.

（解讀）隨著消費刺激政策的不斷擴大，我們很高興能夠加強未來的變革力度，抓住新的機遇，更好地服務消費者。然而，由於我們先前的經驗所形成的平台業務模式和經營商家的限制，以及我們能力的不足，我們可能會在一段時間內繼續處於相對於同行的劣勢。這可能會進一步增加財務影響，為我們帶來挑戰。

(interpreted) In response to the current competitive environment, we are committed to maintaining high standards and enhancing our core capabilities. We will continue to explore impactful opportunities and make long-term high-quality investments in our supply chain and ecosystem, ensuring these initiatives translate into more valuable products and better services for consumers.

（解讀）針對當前的競爭環境，我們致力於維持高標準，提升核心能力。我們將繼續探索有影響力的機會，並對我們的供應鏈和生態系統進行長期高品質投資，確保這些措施轉化為為消費者提供更有價值的產品和更好的服務。

(interpreted) We believe that the high-quality development of the ecosystem and supply chain is the fundamental for the platform's long-term success and allow us to create long-term value for consumers. This is a long journey requiring patience. We're fully prepared for it, and we will not be distracted by the moving competitive environment. Thank you, all.

（解讀）我們相信，生態系統和供應鏈的高品質發展是平台長期成功的根本，讓我們能夠為消費者創造長期價值。這是一個漫長的旅程，需要耐心。我們已經做好了充分的準備，不會因為競爭環境的改變而分心。謝謝大家。

Thank you, Jiazhen, and thank you all for joining us today. It's about time. We look forward to speaking with you again next quarter. Thank you.

謝謝家珍，也謝謝大家今天加入我們。是時候了。我們期待下個季度再次與您交談。謝謝。

Ladies and gentlemen, that does conclude our conference for today. Thank you for your participation. You may all now disconnect.

女士們、先生們，今天的會議到此結束。感謝您的參與。你們現在可以斷開連結了。

Portions of this transcript that are marked (interpreted) were spoken by an interpreter present on the live call. The interpreter was provided by the company sponsoring this event.

此文字記錄中標記（翻譯）的部分是由現場通話中的口譯員說出的。口譯員由贊助本次活動的公司提供。