Consumer Staples Author：Sasha Chen Mar 22, 2022 12:03 AM (GMT+8)

On March 21, China’s largest e-commerce company Pinduoduo Inc. (NASDAQ: PDD) (拼多多) announced its the its unaudited financials for fourth quarter and fiscal year ended December 31, 2021.

Pinduoduo

Some major takeaways from Pinduoduo's unaudited financial results include an operating income of over CNY 27,000 million (USD 4,273 million) in Q4 2021, an increase of 3% year-on year while achieving a net profit of CNY 6.6 billion. This platform also gathered over 868 million of active users, accounting for an increase of 10% over the same period of last year.

However, the downside of the company's Q4 results reflected a slower growth rate in revenue. Pinduoduo has three major revenue streams, including technical services, transaction trades, and merchandise sales.

In Q4 2021, the company's technical services had a boosted sales of 19% compared to the previous year, amounting to CNY 22.4 billion. Similarly, the transaction trades achieved a 108% year-on-year growth to CNY 4,724 billion. But the merchandise sales dropped 98% compared the fourth quarter in 2020.

Last year, Pinduoduo has initiated a revolutionary project of adopting digital technology in agricultural platform. The company has connected over 16 million farmers to its over 868 million buyers in China to increase agricultural orders.

"We hope to do our part in sowing the seeds of innovation by increasing market opportunities, encouraging youth participation in agriculture and advocating the adoption of agricultural technology," said Chairman and CEO of Pinduoduo Chen Lei.

Ranging from agriculture to technology, Pinduoduo has changed its business strategy from marketing to research and development process. In Q4 2021, the company's marketing cost was CNY14.7 billion, a decrease of 23% year-on-year. On the other hand, its R&D expenses jumped 4% to CNY 2,022 million over the same period of the previous year.