Zhao Jiazhen assumes the role of Co-CEO of Pinduoduo with his first major initiative: "New Pinduoduo" allocates 15 billion yuan in the initial phase, aiming to recreate Pinduoduo in three years!

What Long-term Value is Hidden Behind Pinduoduo’s Profit Decline?

On March 25, Pinduoduo released its financial report for the fourth quarter and the entire year of 2025, coinciding with significant personnel adjustments and core strategic deployments: Zhao Jiazhen, who took office as co-chairman and co-CEO at the end of last year, launched the “New Pinduoduo” strategy right from the start, announcing a three-year investment of 100 billion to heavily invest in the supply chain, with the determination to “recreate a Pinduoduo in three years,” directly targeting the high-quality transformation of domestic self-operated brands and driving the upgrading and value leap of the Chinese supply chain. During his first appearance at the earnings call, he further clarified this strategic intent: stabilizing revenue while laying out long-term solutions, promoting Pinduoduo’s strategic transformation from scale expansion to deep value cultivation, and from a platform e-commerce model to a brand self-operation model.

However, it is noteworthy that this year’s financial report presents a stark contrast: Pinduoduo’s total revenue for the entire year of 2025 was 431.8 billion yuan, a year-on-year increase of 10%; the fourth-quarter revenue was 123.912 billion yuan, a year-on-year increase of 12%, both exceeding market expectations. In contrast, the annual net profit declined by 12% year-on-year to 99.4 billion yuan, and the net profit in the fourth quarter, calculated under non-GAAP, also saw a year-on-year decrease of 12%.

From the perspective of Pinduoduo’s management, this contradiction of “increased revenue without increased profits” does not indicate weak growth but rather a proactive choice to firmly execute heavy investments, strengthen supply chain strategies, and actively reduce costs for the industry, which also lays a solid ecological foundation for the implementation of the “New Pinduoduo” core strategy.

Steady Revenue Growth with Strong Confidence, Focusing on Strategic Anchoring of the Supply Chain Core

Against the backdrop of increasingly fierce competition in the e-commerce sector and a gradual slowdown in industry growth, Pinduoduo’s annual revenue still maintained double-digit growth, driven primarily by the “non-diversification, more focused” development approach proposed by Zhao Jiazhen, along with the ongoing “100 billion support” plan that heavily invests across the entire supply chain.

After taking office as co-leader, Zhao Jiazhen clearly stated that Pinduoduo has been in operation for over ten years, with continuous accumulation of business, technology, and services, reaching most countries worldwide. In the next stage, the company will not pursue diversified expansion but will concentrate on the high-quality development of the supply chain, using this as a key to achieve platform reconstruction and drive the value leap of the ecological system.

Since the launch of the “100 billion support” plan in April 2024, Pinduoduo has consistently focused on this core idea, allocating resources towards specialty products, new quality supply, and e-commerce expansion, breaking down supply and demand barriers in agricultural production areas and manufacturing industry belts, and promoting the supply chain system’s rapid transition from scale-driven to value-driven, thus facilitating the continued positive development of the platform ecosystem.

Several cases reflect the direct effectiveness of this investment, such as small and medium-sized businesses in the home appliance industry belt of Cixi, Zhejiang, breaking away from reliance on OEM to create bestsellers, the significant increase in transaction volume in the clothing industry belt of Tianmen, Hubei, which has created jobs for over 100,000 people in ten years, and over a hundred industrial clusters such as Yiwu cosmetics and Shenzhen electronics achieving both product and sales growth. The vitality of these industries ultimately translates into steady revenue growth for the platform, confirming the foresight of Zhao Jiazhen’s focus on supply chain strategies.

Short-term Profit Under Active Pressure, Strengthening the Long-term Development Foundation

The decline in net profit, in stark contrast to revenue growth, is a direct manifestation of Pinduoduo’s strategy of “sacrificing short-term profits for long-term value.” Zhao Jiazhen emphasized that 2026 will mark a critical window for the transformation and upgrading of domestic supply chains, and Pinduoduo will mobilize the entire group to fully support the upgrade of the supply chain. During the earnings call, Pinduoduo also clarified that the decline in net profit is mainly due to the ongoing investments from the “100 billion support” strategy on both supply and demand sides, with the company allocating substantial funds for subsidies to merchants, upgrading supply chain infrastructure, and supporting the development of industry belts, rather than pursuing short-term profit maximization, demonstrating the platform’s firm commitment to deeply cultivating the supply chain.

For a long time, many manufacturing industry belts and agricultural production areas in China have been trapped in the value valley of the global supply chain “smile curve,” primarily relying on OEM and wholesale, lacking independent brands and high-value-added products. Under Zhao Jiazhen’s strategic deployment, Pinduoduo continues to provide benefits through substantial investments, reducing merchants’ operating costs and helping industry belts upgrade production technologies and create quality products, thereby restructuring the profit distribution pattern of the industrial chain. From building local specialty brands in the seaweed industry of Lianyungang to enhancing the added value of Yunnan’s specialty agricultural products through the platform, Pinduoduo’s initiatives not only benefit all participants in the supply chain but also significantly enhance the entire industrial chain’s risk resistance, laying a solid foundation for future globalization and branding strategies while clearing obstacles for the advancement of the “New Pinduoduo” strategy.

The Major Launch of “New Pinduoduo,” with 100 Billion Investment Aiming to Recreate a New Pinduoduo in Three Years

In Zhao Jiazhen’s strategic blueprint, establishing “New Pinduoduo” and investing 100 billion over three years is a core measure to achieve the goal of “recreating a Pinduoduo in three years,” as well as a key initiative to promote the transformation and upgrading of China’s supply chain and value leap. Currently, “New Pinduoduo” has been established in Shanghai, with an initial cash injection of 15 billion yuan, and the 100 billion investment over the next three years will comprehensively cover domestic industry belts, launching three core measures to promote high-quality, brand-oriented overseas expansion for merchants in industry belts.

Zhao Jiazhen pointed out that over the past three years, Temu has rooted itself in the Chinese supply chain, expanding its business to over 90 countries globally, achieving in three years what would take ten years for domestic e-commerce. In the next stage, based on the platform operation of Temu, the “New Pinduoduo” will initiate a brand self-operation model, heavily investing in the Chinese supply chain, establishing higher manufacturing standards, and nurturing a batch of internationally influential brands, driving Chinese manufacturing towards high-quality and branding pathways.

According to the plan, “New Pinduoduo” will establish a specialized company to launch customized manufacturing plans to cultivate diverse self-operated brands; assemble specialized teams to delve into industry belts, providing integrated solutions for products, technology, and marketing, promoting upgrades in manufacturing standards; and introduce comprehensive brand overseas expansion solutions covering warehousing logistics, intellectual property services, legal assistance, etc., to safeguard the overseas expansion of industry belts.

This strategy reflects Pinduoduo’s years of deep cultivation in the supply chain and Zhao Jiazhen’s precise control over the development direction of the group after his new appointment. Through the self-operation model of “New Pinduoduo,” Pinduoduo will directly control all aspects of product development, production, quality control, and sales, promoting Chinese manufacturing to meet international high standards and helping unique industry belts such as Yiwu cosmetics, Shaodong bags, and Weihai fishing tackle bypass intermediaries to connect directly with global consumers, achieving a leap from “OEM production” to “brand creation.” This is not only a strategic upgrade for Pinduoduo itself but also a significant opportunity for the Chinese supply chain to advance towards high-quality development and realize a value leap.

From Zhao Jiazhen’s establishment of the three-year recreation goal to Pinduoduo’s steady revenue growth and the active pressure on short-term profits, to the substantial launch of “New Pinduoduo” with a capital of 100 billion, Pinduoduo has consistently focused on the core of the supply chain, practicing the development philosophy of long-termism. As Zhao Jiazhen’s strategy of “focus and reinvest in the supply chain” continues to advance, with the “100 billion support” and “New Pinduoduo” initiatives deeply implemented, Pinduoduo will further facilitate the dual circulation of domestic and international markets, helping the Chinese supply chain achieve a global value ascent and opening a new cycle of high-quality growth for itself, steadily moving towards the goal of recreating a Pinduoduo in three years.