Wed, 28 May 2025

Wed, 28 May 2025 Temu's Chinese owner sees profits plunge as trade war bites

US-listed shares of PDD Holdings fell over 13% on Tuesday as the firm reported a near 50% drop in profit.
PDD Holdings, the owner of online shopping platform Temu, reported a 47% drop in profit for the first quarter of this year due to trade policies and a price war with rivals. The company's US-listed shares fell by over 13%. The profit drop was attributed to the Trump administration's decision to end the "de minimis" exemption on parcels worth less than $800 entering the US without import duties. PDD Holdings' chairman, Chen Lei, stated that this policy change, along with the ongoing trade war and weak consumer spending in China, have created significant pressure for the company's merchants. To cope with these challenges, Temu stopped selling goods directly to US customers from China but resumed shipments after a 50% reduction in tariffs was announced. The company is also facing issues in Europe, where the EU proposed a flat fee on small parcels sent directly to people's homes, and in the UK, where the government plans to review customs treatment for low-value products entering the country.
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