21st Century Business Herald reporter Tao Li Zheng Zhiwen reported in Shanghai

On May 27, Pinduoduo released its financial report for the first quarter of 2022. During the reporting period, Pinduoduo's revenue was 23.8 billion yuan, an increase of 7% from 22.2 billion yuan in the same period in 2021, operating profit under US GAAP was 2.2 billion yuan, and net profit attributable to common shareholders was 2.6 billion yuan, mainly due to the growth of online marketing services revenue and transaction services revenue.

According to the financial report, in the 12 months ended March 31, 2022, the number of annual active buyers of Pinduoduo reached 881.9 million. This is an increase of 58.1 million, or 7%, compared to the same period in 2021. In the first quarter, the average number of monthly active users was 751.3 million, an increase of 4% year-on-year.  

"The increase in revenue in the quarter was mainly due to the growth of merchant activity and transaction volume on the platform." Liu Jun, vice president of finance of Pinduoduo, said that under the premise of slowing user growth, the platform has paid more attention to the field of technology in the past few quarters, providing consumers and merchants with more diversified services with technological innovation, and greatly improving the production efficiency of the platform.

By reducing marketing and reinvesting in R&D and agriculture, Pinduoduo is gradually moving towards more robust and sustainable growth.

R&D expenses are at record highs

For more than a year, under the helm of Chen Lei, chairman and CEO of Pinduoduo, the platform has continued to reduce marketing and increase investment in research and development. In the first quarter, GAAP marketing expenses decreased by 14% compared to the same period in 2021, and marketing expenses as a proportion of revenue also further decreased to 47%, compared with 59% in the same period in 2021.

At the same time, due to the growth of the number of employees and the recruitment of more senior R&D personnel, Pinduoduo's research and development expenses in the first quarter also hit a new high, up 20% year-on-year to 2.7 billion yuan.

"Over the past few quarters, we have chosen to devote more resources and energy to areas such as digital technology, agricultural technology and agricultural logistics." Chen Lei said that at present, heavy warehouse technology and agriculture have gradually achieved results, which also makes us more determined to devote our long-term commitment to agricultural digitalization.

The strategy of re-investing in agriculture is gradually paying off

Under the leadership of Chen Lei, Pinduoduo has gradually completed the strategic transformation from heavy marketing to heavy research and development, continued to reinvest in the agricultural field, and continuously invested tens of billions of profits to set up a "10 billion agricultural research" special project. At present, this long-term strategy has begun to bear fruit.

Not long before that, the final of the second "Duoduo Agricultural Research And Technology Competition" came to an end, and the "Tomato Fast Growing" team stood out from the four final teams and won the championship with a yield and quality far exceeding that of traditional cultivation. It is understood that this team adopts the algorithm strategy of "human-machine integration intelligence" to convert advanced planting experience into algorithms, and assist growers to grow high-yield, nutritious fruits.

In October last year, the finalists in Beijing, Shanghai, Zhejiang, the Netherlands and other places, through software remote control of the intelligent greenhouse located in the Kunming competition base in Yunnan Province, combined with precision agriculture technologies such as nutrition, computer vision and deep learning, to grow tomatoes.

"In the meantime, although we can't see these crops every day, the human-machine fusion algorithm helps us in real time to constantly revise the planting strategy."  Xu Dan, captain of the champion team "Tomato Fast Growth", said that this also verifies the future commercial value of the algorithm, that is, to help growers improve efficiency, reduce error rates, and break the limitations of time and space.  

As an e-commerce platform that started from agricultural products, Pinduoduo has also further increased investment in infrastructure such as transportation, logistics and warehousing of agricultural products in the past few quarters, greatly improving the scale and efficiency of agricultural products. Benefiting from this, as of March 31, 2022, nearly 40,000 high-quality agricultural goods have been launched on the 10 billion subsidy channel.

"In the past year, we have paid more attention to cultivating our own internal strengths and achieved initial results in the fields of digital technology, agricultural technology and agricultural product logistics." Chen Lei said that this also strengthens our long-term commitment to agricultural digitalization, and we believe in the opportunities and efficiencies released by agricultural digitalization.

(Author: Tao Li, Zheng Zhiwen Editor: Zhang Weixian)