08:36 AM EDT, 05/22/2024 (MT Newswires) -- PDD Holdings ( PDD ) reported sharp increases in first-quarter results on Wednesday as the Chinese e-commerce platform benefited from improving consumer sentiment and demand.

Adjusted earnings came in at 20.72 renminbi ($2.86) per American depositary share for the March quarter, jumping from 6.92 renminbi a year earlier and beating the Capital IQ-polled consensus of 10.38 renminbi. Revenue soared 131% to 86.81 billion renminbi, surpassing the Street's view for 76.56 billion renminbi.

The company's Nasdaq-listed American depositary receipts climbed 5.6% in premarket activity. PDD owns the Pinduoduo social commerce platform in China and an e-commerce marketplace in North America, Temu.

"The consumer market in the first quarter has made a good start," Co-Chief Executive Jiazhen Zhao said during an earnings call, according to a Capital IQ transcript. "Driven by both macro environment and our effective promotional events, we achieved solid growth in the first quarter."

Revenue from online marketing services climbed 56% to 42.46 billion renminbi. Transaction services revenue surged to 44.36 billion renminbi from 10.39 billion renminbi in the prior-year quarter. Total operating expenses widened 44% to 28.14 billion renminbi, due to higher sales and marketing, general and administrative and research and development costs.

PDD is operating in a "constantly evolving industry" with competition and opportunities both emerging at a rapid pace, Co-CEO Lei Chen said on the call. The company expects intense competition to increase expenses and impact "some organic growth," according to Chen.

"Looking ahead, we will continue to work on the fundamentals of our business through our investments in supporting high-quality consumption, broadening high-quality supply and promoting high-quality ecosystem," Chen told analysts.

Last week, Chinese e-commerce giant Alibaba Group (BABA) reported fiscal fourth-quarter earnings below Wall Street's expectations, despite revenue gains in its e-commerce, cloud and logistics businesses. Fellow Chinese e-commerce firm JD.com (JD) disclosed stronger-than-forecast first-quarter results this month, as volumes picked up in its supermarket category.

Price: 154.48, Change: +9.03, Percent Change: +6.21