China has a new No. 1 in online shopping, a company that has beaten Alibaba

China has something new online shopping huge. According to a CNBC report, quote Goldman SachsPDD, the company behind the popularity Pinduoduo shopping app, long gone Alibaba become China’s most valuable e-commerce company. This change has come about thanks to PDD’s focus on value for money and the rapid expansion of Temu’s international market. Incidentally, Temu was the most downloaded shopping app in the US in 2023.
Moreover, this is not the first time that PDPP has surpassed Alibaba. However, this comes after a brief period in which Alibaba regained the top spot. PDD’s strong financial performance, with net income tripling year-over-year, coupled with Alibaba’s difficulties, cemented this shift.
Propelled by strong first-quarter results, PDD’s market capitalization reached $208 billion, surpassing Alibaba’s $196 billion. PDD’s share price has also doubled in the past year. Analysts point to several factors behind PDD’s success:
Profitability Back: The new business model with lower logistics costs is expected to increase Temu’s profitability faster than expected.
Strong brand image: Consumers view PDD as a credible source of deals, putting it ahead of competitors like JD.com and Alibaba in a recent study.
International expansion Ago: The platform’s popularity, fueled by its “shop like a billionaire” marketing campaign, is driving growth in the US, Europe and Australia.
Goldman Sachs analysts upgraded PDD’s recommendation to “buy”, citing the company’s advertising potential and Temu’s untapped value. They believe the market has already taken into account concerns about competition and political tensions. Meanwhile, Alibaba’s net profit saw a drastic decline compared to the previous year. This highlights the changing landscape of China’s e-commerce market, where PDD’s values-based approach is resonating with consumers.