Gross merchandise volume (GMV), which measures the total value of all orders placed on the platform, is another important metric to note. Last quarter, GMV increased 171% from the previous year. Last month, Pinduoduo’s founder and chairman Colin Huang said the company’s GMV has surpassed that of competitor JD.com (NASDAQ: JD), although the actual numbers were not disclosed.
Pinduoduo’s low-price business model is another advantage that will help fuel growth. Although the company is still delivering losses, analysts estimate Pinduoduo will achieve profitability in 2020. Last month, the stock gained significantly on reports that the trade tensions between the US and China were slowly easing.
In the second quarter of 2019, Pinduoduo reported an increase in revenue and a narrower-than-expected loss. Revenues jumped 169% to $1.062 billion while adjusted loss was $0.04 per share. Average monthly active users increased 88%.
Pinduoduo’s shares have gained 91% year-to-date and 30% in the past one month. The majority of analysts have rated the stock as Buy and the average price target is $39.62.