1. Temu's US daily users dropped 58% in May due to new tariffs. 2. Temu cut US advertising and changed fulfillment strategy after tariff changes. 3. PDD's Q1 earnings missed estimates, indicating pressure from tariffs. 4. Non-US user growth surged, making up 90% of Temu's active users. 5. Temu struggles with customer growth compared to competitors like Shein.
The large drop in daily users and pressure from tariffs indicate weakened demand, similarly observed in other sectors during tariffs imposition. Historical examples show that significant user drop-offs often correlate with stock price declines in e-commerce companies, as seen with eBay post-tariff changes.
The article discusses significant challenges faced by Temu under PDD, affecting user engagement and overall market performance. With TeMu's user base crucial for PDD's revenue, the issues highlighted are likely to have a considerable impact on the stock.
Immediate pressures from tariffs and user engagement drops are likely to affect PDD's stock in the near term. Given the nature of e-commerce, rapid changes in consumer behavior can substantially impact quarterly results.