<div id="readability-page-1"><div><div><p><strong>PDD Holdings Inc.</strong> <span>PDD</span> faces mounting challenges as its <strong>Temu</strong> platform struggles with significant user losses following major U.S. trade policy shifts that eliminated key cost advantages for Chinese e-commerce platforms.</p><p><strong>What Happened:</strong> Daily U.S. users of Temu fell 58% in May, according to market intelligence firm Sensor Tower, reported Reuters. The decline followed the White House’s May 2 decision to end the “de minimis” provision, which previously allowed Chinese companies to ship packages valued under $800 to the U.S. tariff-free.</p><p>Temu responded by slashing U.S. advertising spending and shifting its fulfillment strategy. The platform now displays only products shipped from U.S.-based warehouses, with China-shipped items labeled “out of stock.” </p><p>Previously, Temu operated by giving merchants responsibility for ordering and supplying products while managing logistics, pricing and marketing from China.</p><p>PDD’s first-quarter earnings reflected these pressures. Revenue grew just 10% year-over-year to $13.18 billion, missing analyst estimates of $14.17 billion. Adjusted operating profit declined 36% to $2.52 billion, with margins falling from 32.9% to 19.1%.</p><p><strong>Why It Matters: </strong>The tariff changes fundamentally disrupted Temu’s business model, which relied on direct shipments from Chinese suppliers to maintain ultra-low prices. </p><p><strong>Latest Startup Investment Opportunities</strong>:</p><div><div><div><div><div><div><ul><li><div><div><p><span><img src="https://imageproxy.pbkrs.com/https://cdnwp-s3.benzinga.com/wp-content/uploads/2025/01/06125138/IMG_5682-edited.jpeg/query-YXV0bz13ZWJwJmF1dG89d2VicCZkcHI9MSZkcHI9MiZvcHRpbWl6ZT1tZWRpdW0md2lkdGg9MTA4MD9vcHRpbWl6ZT1tZWRpdW0md2lkdGg9Mzg0MA?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" width="1000" height="563" original-src="https://imageproxy.pbkrs.com/https://cdnwp-s3.benzinga.com/wp-content/uploads/2025/01/06125138/IMG_5682-edited.jpeg/query-YXV0bz13ZWJwJmF1dG89d2VicCZkcHI9MSZkcHI9MiZvcHRpbWl6ZT1tZWRpdW0md2lkdGg9MTA4MD9vcHRpbWl6ZT1tZWRpdW0md2lkdGg9Mzg0MA"/></span></p></div><div><div><p><span></span></p><div><div><div><p><span>Min. Investment</span><span>$1,000</span></p><p><span>Industry</span><span>AI</span></p></div></div></div>Get Offer <p></p></div></div></div></li><li><div><div><p><span><img src="https://imageproxy.pbkrs.com/https://cdnwp-s3.benzinga.com/wp-content/uploads/2025/01/12011752/Screenshot-2025-01-11-at-10.17.30%E2%80%AFPM.jpg/query-YXV0bz13ZWJwJmRwcj0yJm9wdGltaXplPW1lZGl1bSZ3aWR0aD0zODQw?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" width="7680" height="4130" original-src="https://imageproxy.pbkrs.com/https://cdnwp-s3.benzinga.com/wp-content/uploads/2025/01/12011752/Screenshot-2025-01-11-at-10.17.30%E2%80%AFPM.jpg/query-YXV0bz13ZWJwJmRwcj0yJm9wdGltaXplPW1lZGl1bSZ3aWR0aD0zODQw"/></span></p></div><div><div><p><span></span></p><div><div><div><p><span>Min. Investment</span><span>$974</span></p><p><span>Industry</span><span>Tech</span></p></div></div></div>Get Offer <p></p></div></div></div></li></ul></div></div></div></div></div></div><p>The new regime imposes 90% duties or $75 per item on Chinese imports, scheduled to increase to $150 per item by June. While competitor Shein has managed to increase per-customer spending despite similar challenges, Temu has struggled to adapt.</p><p><strong>Price Action</strong>: PDD stock closed at $96.44 on Monday, down 0.07%. In pre-market trading on Tuesday, the stock rose 0.62% to $97.04. Year to date, PDD shares are down 0.46%.</p><p>PDD's Temu platform competes with <strong>Amazon.com Inc.</strong> <span>AMZN</span>. According to <strong>Benzinga Edge Stock Ranking</strong>s, PDD has a stronger valuation than Amazon but lacks momentum. The stock also shows a negative price trend across short to long term. Click here to see the full stock breakdown.</p><ul> <li><strong>Forget Dollars: Willy Woo Says Bitcoin Will Be Priced Against Global GDP — ‘Gold Used To Be That Money, BTC Is The Challenger’</strong></li> </ul><p><em>Image Via Shutterstock</em></p></div></div></div>

<p>PDD Holdings' Temu platform has seen a 58% drop in daily U.S. users due to the end of the tariff loophole that previously allowed Chinese e-commerce to ship goods tariff-free. This policy change has disrupted Temu's business model, leading to a 10% revenue growth in Q1, missing analyst expectations. The company is now adjusting its strategy by reducing U.S. advertising and focusing on U.S.-based product fulfillment. PDD's stock has shown a slight increase in pre-market trading but remains down year-to-date.</p>

- PDD Holdings Inc. faces challenges as its Temu platform experiences a 58% drop in daily U.S. users due to changes in U.S. trade policy that removed cost advantages for Chinese e-commerce.  
- The White House's decision to end the “de minimis” provision has disrupted Temu's business model, leading to a shift in fulfillment strategy and a decline in first-quarter revenue and profit margins.  
- As a result, PDD's stock has shown a negative price trend, despite a slight increase in pre-market trading.

Amazon's Chinese Rival Temu Loses 58% Of US Users As End Of Tariff Loophole Hits Business Model