A 100,000-word article: PDD's explosive growth and TEMU's contribution to revenueWith the release of the third-quarter earnings report, PDD's contribution to TEMU's revenue can no longer be hidden. Its astonishing energy has once again received strong reactions from the capital market, pushing PDD's stock price closer to the big brother Alibaba.On the evening of November 28th, after the opening of the US stock market, PDD's stock price soared nearly 20%, closing up about 18% to $139 per share, with a total market value of $184.674 billion, just a step away from Alibaba's total market value of about $195.4 billion.PDD's financial report shows that in the third quarter of this year, PDD's revenue was 68.84 billion yuan, a year-on-year increase of 93.9%, the highest growth rate in nearly 9 quarters, far exceeding Bloomberg's consensus expectation of a 54.6% increase. Net profit attributable to shareholders also continued to grow rapidly, increasing by 47% year-on-year to 15.537 billion yuan.In the current period of weak economic cycle, it is rare for PDD to maintain such rapid growth, especially considering that Alibaba's Taotian Group only has a 4% growth rate, and the growth rate of its international business is relatively impressive, but only about 53%. JD-SWR's growth is even weaker, with a revenue growth rate of only 1.7% in the third quarter.PDD's revenue mainly comes from two business segments, namely online marketing services and transaction services. Among them, the revenue from online marketing services and other businesses is about 39.688 billion yuan, a year-on-year increase of 39%. This revenue growth is mainly attributed to the steady growth of GMV in the domestic e-commerce main station business and the increase in platform advertising monetization sales.It can be seen that in the current wave of consumption downgrading, although platforms such as Alibaba and JD-SWR have gradually begun to emphasize &#34;price power,&#34; PDD, with its solid low-price mindset and supply chain advantages built over the years, still maintains a growth rate higher than the industry average.Compared to domestic e-commerce main stations, PDD's stronger growth comes from the overseas cross-border e-commerce platform TEMU.The financial report shows that PDD's transaction service revenue in the third quarter increased by 315% year-on-year to 29.153 billion yuan, doubling from the 14.4 billion yuan in the second quarter.Many research institutions believe that the doubling of PDD's single-quarter transaction service revenue is mainly due to the incremental revenue contribution brought by the rapid expansion of the TEMU business.A year ago, TEMU, like a catfish, rushed into the blue ocean of cross-border e-commerce, quickly going online in 48 countries and regions around the world, ranking among the top ten in global application downloads, and becoming one of the most downloaded applications in the United States.Morgan Stanley stated in a research report in October that about 15% of US consumers shop on TEMU.The strong momentum of TEMU's development and the performance contribution it has achieved now have made the capital market optimistic about PDD's future growth space, thereby driving a significant increase in stock prices. Some even believe that TEMU has the potential to recreate PDD.The market has started to seriously consider the overall valuation contribution of TEMU to PDD. Haitong International's research report pointed out that the latest TEMU GMV forecast is $12 billion for the full year 2023, doubling to $24 billion next year. If a P/GMV multiple of 1.8 is adopted, it would contribute $43.2 billion in market value, corresponding to a target price of $32.From billion-dollar subsidies to Duo Duo Mai Cai and now TEMU, PDD's strong learning and evolution capabilities are also key factors that make it highly regarded. TF Securities believes that PDD is one of the few internet companies that still have growth potential in their existing businesses and can continue to explore new ones.Against this backdrop, PDD's stock price has performed impressively over the past year, with a cumulative increase of over 150%, making it the &#34;shining star&#34; among many investors in Chinese concept stocks. Before the stock price surged again on the evening of the 28th, PDD's total market value was still a considerable distance from Alibaba, roughly two-thirds of Alibaba's market value.With the strong expansion of TMEU, perhaps after the next quarterly report is released, PDD will directly surpass Alibaba and become the new king of e-commerce.After witnessing the sharp rise of PDD's stock price on the evening of the 28th, some Alibaba employees expressed their surprise on the internal network, saying, &#34;It really startled me. That seemingly insignificant competitor is becoming the big brother.&#34;In response to the internal discussions among employees about PDD's stock price, Alibaba's founder Jack Ma made a rare reply, saying, &#34;Congratulations to PDD for its decisions, execution, and efforts over the past few years. Many people have been great, but it is the organization that is willing to reform for a better future and is willing to pay any price and make sacrifices that deserves respect.&#34;Jack Ma's remarks signal that Alibaba will continue to reform and hopes that employees will provide constructive suggestions and ideas, especially innovative ones. He said that all great companies are born in the winter. The era of AI e-commerce has just begun, and it is an opportunity and a challenge for everyone.Jack Ma firmly believes that Alibaba will change and improve, but he also has to admit that in this industry winter, PDD, a once inconspicuous latecomer, has quietly grown into the strongest competitor.There are no eternal kings in the internet world. PDD, the dark horse that emerged eight years ago, has torn a crack in the e-commerce market dominated by Alibaba and JD.com, and has already achieved a miraculous comeback. On the other hand, ByteDance has surpassed Tencent in terms of revenue in the first half of the year, relying on the strong growth of Douyin's e-commerce.Over the past decade, Tencent and Alibaba, the two Chinese internet giants, have been gradually surpassed by Douyin and PDD in certain dimensions. The winds of change have blown, and a new king has emerged in the internet industry.

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PDD's market value is approaching Alibaba.

Formidable Competitors that Jack Ma Cannot Ignore