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Temu could keep expanding, but the public evidence cited here does not show that its growth is profitable or sustainable over the long term. PDD Holdings’ consolidated revenue rose in 2025, while its consolidated sales and marketing expenses also increased. PDD warns that Temu may need substantial resources for a prolonged period, and the European Commission announced a €200 million fine against the platform in May 2026. None of PDD’s consolidated figures, by themselves, reveals Temu’s standalone revenue, costs or profit.
What PDD’s financials say—and what they don’t
Temu is a global e-commerce platform launched by PDD Holdings in September 2022. The financial figures available in PDD’s filings are for the parent company’s consolidated business, not Temu alone. They show that PDD grew overall, but cannot establish Temu’s own growth rate or contribution to that result. PDD Holdings’ 2025 Form 20-F reports the following amounts for the years ended December 31:
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| Measure | 2024 | 2025 | What it measures |
|---|---|---|---|
| Revenue | RMB 393,836.1 million | RMB 431,801.6 million | PDD Holdings consolidated revenue, not Temu-only revenue |
| Sales and marketing expenses | RMB 111,300.5 million | RMB 125,287.9 million | PDD Holdings consolidated expense, not Temu-only spending |
The filing attributes the increase in sales and marketing expense chiefly to advertising, promotion and coupon expenses across PDD’s business. It does not allocate those amounts to Temu, so they are evidence of rising investment at the parent-company level—not a measurement of what it costs to acquire Temu customers or promote Temu.
Why the investment burden matters
PDD’s 2025 Form 20-F says Temu has demanded substantial financial, personnel and other resources and may continue to do so over a prolonged period. It also warns that Temu may not attract or retain enough users, or otherwise perform as expected. This is PDD’s own risk disclosure: it signals the company’s view of the execution challenge, but is not a Temu-specific cost figure or an independent forecast. Read the filing.
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A platform can add users or sales without demonstrating durable economics. For sustainability, the important question is whether the revenue associated with Temu can cover the costs of attracting and retaining customers and operating the marketplace over time. The cited filings do not supply the standalone numbers needed to answer that question.
Is Temu profitable, and how does it make money?
The cited public filings do not establish whether Temu is profitable. PDD’s 2024 annual report and 2025 Form 20-F report results for the consolidated company rather than a separate Temu revenue or profit series. They therefore do not provide a reliable Temu-only growth rate, customer acquisition cost, contribution margin, user-retention measure or profitability trend. PDD Holdings’ 2024 Form 20-F.
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That lack of disclosure is not proof that Temu is losing money. It means the available figures cannot answer whether Temu’s own sales cover its acquisition, retention and operating costs. PDD’s consolidated revenue should not be treated as Temu revenue, and consolidated marketing expense should not be treated as Temu’s customer-acquisition bill.
What the EU enforcement action adds to the picture
On 28 May 2026, the European Commission announced a €200 million fine against Temu under the Digital Services Act. The Commission said Temu had not diligently identified, analysed and assessed systemic risks from illegal products and resulting consumer harm. Its announcement described a mystery-shopping exercise in which selected chargers failed basic safety tests and selected baby toys presented safety risks; those findings concern the selected sample, not every item sold on Temu. European Commission announcement, 28 May 2026.
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For growth to endure, a marketplace must also manage the risks and obligations that come with operating at scale. The decision could require compliance work, stronger marketplace controls or remediation, and could affect trust; those are plausible business consequences, not quantified outcomes established by the Commission’s announcement. The announcement establishes that the Commission issued the fine on that date; it does not, on its own, establish any later appeal or remedy status.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.What would demonstrate sustainable growth?
A clearer assessment would require Temu-specific financial and operating disclosures over time—not just growth at PDD Holdings overall. In particular, readers would need evidence about:
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- Temu’s own revenue trend and its share of PDD’s consolidated results.
- Costs attributable to Temu, including marketing and marketplace operations.
- Whether customer acquisition and retention costs are supported by durable customer activity.
- Temu’s contribution margin or operating profitability, alongside how those measures change as the platform grows.
- How regulatory compliance and product-risk controls affect operating costs and marketplace performance.
Without those measures, PDD’s results support a conclusion about the parent company’s expansion and investment—not a confident verdict on Temu’s standalone economics.
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