Young people want to grow, and Big Brother wants to make money.

Editor’s note: This article href=””> “Capital detective” from the micro-channel public number , Author: Hong key.

On May 22, before the US stock market, Pinduoduo and Alibaba successively released financial reports. At this point, the three major domestic e-commerce giants (Alibaba, and Pinduoduo) have all handed in the first quarter report cards affected by the epidemic. ’s performance in the first quarter, which released its earnings earlier, has been discussed many times: revenue exceeded expectations, active users increased significantly, and the logistics system became a key support for in a special period. Correspondingly, because the number of Alibaba and Pinduoduo is very different from that of, it has been affected by the epidemic situation and what kind of response it has received has attracted considerable market attention.

According to analysts ’previous estimates, Alibaba ’s Q1 revenue is expected to reach 107.038 billion yuan (all units are RMB unless otherwise specified), a year-on-year increase of 14.5%; adjusted net profit is 16.08 billion yuan, a year-on-year decline 28.5%.

For Pinduoduo, market expectations are more conservative. Analysts expect Pinduoduo ’s Q1 revenue to be 4.969 billion yuan, up 9.3% year-on-year, or a new low growth rate; adjusted net loss of 2.670 billion yuan, an increase of 93.6 over the same period last year %.

From the final results, Alibaba and Pinduoduo exceeded market expectations to varying degrees.

The key financial indicators of Alibaba are as follows:

  • Alibaba ’s fourth fiscal quarter of 2020 (Q1 in 2020) achieved revenue of 114.31 billion yuan, a year-on-year increase of 22%, higher than market expectations;

  • The net profit attributable to common stock shareholders was 3.162 billion yuan, a year-on-year decrease of 88%. The reason was that the decline in the price of equity securities invested led to investment losses, while similar investments in the same period in 2019 achieved net income; p>

  • Adjusted net profit was 22.287 billion yuan, an increase of 11% year-on-year.

    The key financial indicators of Pinduoduo are as follows:

    • Pin moreMore revenue in the first quarter of 2020 was 6.541 billion yuan, a year-on-year increase of 44%, exceeding market expectations;

    • The net loss attributable to shareholders of ordinary shares was 4.12 billion yuan, an increase of 119% year-on-year;

    • Under non-GAAP, the net loss attributable to shareholders of ordinary shares was 3.17 billion yuan, an increase of 130% year-on-year.

      Due to different development stages and their own advantages, the three e-commerce giants have adopted different coping strategies in the face of the impact of the epidemic. The financial performance in the first quarter is a clear reflection of the differences between the three.

      The three giants have their own ways

      In terms of revenue, still ranks first among the three, which is related to ’s business model is mainly self-operated e-commerce, which mainly earns direct sales revenue of goods, while Taobao, Tmall, Pinduoduo earns more from platform advertising fees and service fees, so’s revenue tends to be higher than Alibaba, but its profits are not as good as the latter.

      According to the situation in this quarter, has distanced itself from Alibaba in terms of revenue, and Pinduoduo, as an e-commerce upstart, has much room for revenue growth compared to the first two.

      In terms of revenue growth, the three have slowed down to varying degrees, with Pinduoduo and Alibaba being more obvious. Under the impact of the epidemic, although Pinduoduo’s revenue exceeded expectations, the growth has dropped significantly compared with the previous level of nearly doubling, and Alibaba has experienced a similar situation.

      Compared with and Pinduoduo, Alibaba’s income structure is more complicated. Since the competition between the three is mainly concentrated in domestic retail business, the Chinese retail business in Alibaba’s core business is a key detail indicator for comparison. The financial report shows that the business’ revenue in the fourth fiscal quarter of 2020 was 70.905 billion yuan, accounting for 62% of the total revenue, an increase of 21% year-on-year, slightly lower than the total revenue growth rate of 22.3%.

      Among the various revenues of Alibaba, the growth of Alibaba Cloud and the innovation business segment are more prominent.

      Alibaba Cloud achieved revenue of RMB 12.217 billion this quarter,A year-on-year increase of 58% and the proportion of total revenue increased from 8% to 11%, which is one of the key forces driving growth; the innovative business segment composed of Gaode Maps, AliOS, Dingding, Tmall Genie, etc. realized revenue 2.288 billion yuan, an increase of 90% year-on-year, but the proportion of total revenue has not changed much, still 2%.

      Picture source: Alibaba financial report

      In terms of, its first-quarter product sales revenue was 130.09 billion yuan, accounting for 89% of total revenue, a year-on-year increase of 19.7%, slightly lower than 20.7% of total revenue growth; service revenue was 16.11 billion Yuan, an increase of 29.6% year-on-year, of which logistics and other services revenue was 6.6 billion yuan, an increase of 53.6% year-on-year, which was the most prominent growth among the subdivided businesses.

      Picture source: Jingdong Financial Report

      Pinduoduo ’s revenue structure consists of only online marketing service income and commission income. Its online marketing service income in the first quarter was 5.492 billion yuan, an increase of 39.1% year-on-year; commission income was 1.049 billion yuan, an increase of 76% year-on-year.

      It is worth noting that Pinduoduo ’s commission revenue accounted for 11% of the previous income, and the proportion of this income rose to 16% in the first quarter.

      That is to say, 44% of the total revenue growth is largely driven by the increase in commission income.

      Picture source: Pinduoduo financial report

      In terms of active users, Alibaba, and Pinduoduo’s annual active users are 726 million (China’s retail market), 387 million and 628 million. While Pinduoduo achieved 600 million active users, the distance to Alibaba has narrowed to less than 100 million.

      In terms of annual active user growth, the only one showing a slowdown in growth is Alibaba. Due to its outstanding logistics performance during the epidemic,’s return of old users accelerated, sleepy users were awakened, and new users’ active access and active shopping also increased. Its annual active users increased by 24.6% year-on-year, hitting the highest level in recent quarters; Pinduoduo slightly improved on the basis of maintaining the original high-speed growth.

      For the breakthrough in the number of active buyers, Huang Zheng, chairman and CEO of Pinduoduo, said that the monthly / annual buyer index of Pinduoduo increased from 65.4% in the first quarter of 19 77.6%, which means that users prefer Pinduoduo’s products, and Pinduoduo also has a stronger ability to meet the needs of users’ diversity.

      It is also worth noting that the per capita consumption level of Pinduoduo users for the 12 months ended March 31 this year increased from 1257.3 yuan in the same period last year to 1842.4 yuan. In other words, users spend more money on Pinduoduo.

      The number of active users continues to grow and the per capita consumption level rises. Pinduoduo has shown huge growth potential.

      However, Pinduoduo ’s revenue and user growth is not without cost. The financial report shows that its sales and marketing expenses in the first quarter reached 7.297 billion yuan, and the rate was as high as 111.6%. The financial report shows that the reason for the increase in this fee is that Pinduoduo’s investment in advertising, promotion and subsidies continues to increase.

      In other words, Pinduoduo ’s growth in the first quarter was largely a result of burning money. At the same time, the general and administrative expenses and R & D expenses of Pinduoduo also increased by 43.3% and 120.8% year-on-year. The operating expense ratio was as high as 139.2%, so that the operating loss reached 4.397 billion yuan.

      Picture source: Pinduoduo financial report

      It seems to be responding to the “burning money” behavior of Pinduoduo. On the earnings call, Alibaba ’s chief executiveFinance Officer Wu Wei said that Alibaba does not agree with the practice of burning money to seek transaction volume growth, “we will not do it.” Wu Wei also said that Alibaba hopes that any investment will be sustainable and efficient.

      According to the financial report data, as a “big brother”, compared with more fights, and Alibaba have shown much restraint in their investment.

      Although JD ’s compliance costs have increased significantly, its effective control of market costs offset the corresponding impact. The overall operating expense ratio was 13.8%, which was lower than 14.1% in the same period last year and 14.2% in the previous quarter. Alibaba’s market expense ratio for the quarter was 10.7%, which was an increase from the previous period. Its operating expense ratio was 26.8%, compared with 27.7% and 21.2% in the same period last year and the previous quarter.

      The difference in fees affects the profitability of the three. Under non-GAAP, Alibaba,, Pinduoduo ’s net profits attributable to ordinary shareholders are 25.1 billion yuan, 2.97 billion yuan, and -3.17 billion yuan, respectively. yuan. Alibaba’s profitability is still far ahead, maintained profitability during the epidemic, and more losses intensified.

      Although Alibaba is relatively restrained in terms of expenses, the net interest rate is still seriously affected by the epidemic. Under non-GAAP, its net profit attributable to ordinary shareholders in the first quarter was 22%, compared with the previous The quarterly decline was obvious; ’s net profit margin was 2%, compared with 2.7% and 0.5% in the same period last year and the previous quarter, respectively; Pinduoduo ’s loss rate expanded to -48.5%.

      Special situations are just episodes of competition

      It can be seen that compared with the restraint of industry veteran giants Alibaba and, they are still in the growth period and fight more, and continue to focus on “grabbing the ground” under the impact of the epidemic. This has led to an increase in revenue and active users, but the loss range is also staggering.

      It is worth noting that the official Weibo of Pinduoduo announced after the financial report that its 10 billion subsidy project will continue to increase. In other words, Pinduoduo still insists on the strategy of burning money for growth.

      According to various indicators, has benefited from the “heavy asset” model of self-built logistics, and it performed the most stable in the first quarter affected by the epidemic. However, the two opponents are also continuing to make efforts in the logistics field:

      • Alibaba continues to add rookie network logistics services. The business achieved revenue of 4.951 billion yuan in the first quarter, a year-on-year increase of 28%, which is higher than the total revenue growth rate.

      • At the same time as investing in “Four Links and One Access”, Alibaba has also invested heavily in the land distribution business in first- and second-tier cities to optimize the logistics experience.

      • Pinduoduo has access to Jitu Express in logistics. Although both parties deny that Jitudu is a “Pinduoduo Express”, because both may be inextricably linked to Duan Yongping, the outside world is generally It is believed that the ambiguous relationship with Pinduoduo is a sign of the former’s efforts to logistics.

      • In April of this year, after Pinduoduo joined hands with Gome, Anxun Logistics, a subsidiary of Gome, will connect to Pinduoduo platform to provide Pinduoduo platform merchants with large parts logistics, warehouse integration, installation and delivery links Directional services.

        Another important significance of Pinduoduo’s joint effort with Gome is that the former officially cuts into the category of 3C home appliances with higher unit prices. Although Gome is not as good as and Tmall in terms of market share in the home appliance market, Gome may challenge and Tmall by virtue of the traffic advantage of “600 million people are using more and more.”

        “2019 China Household Appliances Market Report”

        China Electronic Information Industry Development Institute

        Pinduoduo tried to cut into the 3C home appliance category to continue its strategy of “rural surrounding cities”, while Alibaba and are also invading Pinduoduo’s basic market.

        Alibaba said in its financial report that more than 70% of its new annual active consumers in fiscal 2020 are from underdeveloped regions; also said in the financial report telephone conference that if you look at the user’s shipping address , Jingdong’s third to sixth line users accounted for more than 60%, GMV accounted for more than half.

        That is, the short soldiers meetIt is happening, and the smell of gunpowder will become stronger.

        As the epidemic is brought under control, the business activities of all walks of life are gradually recovering. After coming out of the shadow of the epidemic, Alibaba, and Pinduoduo also ushered in a new stage of competition.

        During the epidemic, due to the suspension of offline activities, merchants realized the importance of going online, and live broadcast e-commerce continued to heat up. Driven by preferential policies, the number of newly added live broadcast rooms on Taobao Live has doubled year-on-year. The financial report shows that during the three months ended March 31, 2020, the number of daily active merchants using live broadcast on Taobao live broadcast increased by 88% year-on-year; as of the fiscal year ended March 2020, the GMV brought by Taobao live broadcast increased by more than 100 %.

        That is to say, after the merchants regain their vitality, how the live broadcast will drive Taobao Tmall’s revenue growth will be a highlight of Alibaba’s next quarter performance. and Pinduoduo are also exploring how to catch the express train.

        For, after the epidemic has eased, how to continuously amplify its logistics advantages, seek growth, and maintain profitability is a long-term test; while Pinduoduo still has to face the old problems of increasing user loyalty and customer unit price.

        Fengshui turns, the dominant position will not always exist, and pressure may also cause a rebound. Alibaba, and Pinduoduo will have a long-standing three-pronged position in the e-commerce field. This special first quarter will magnify the differences between the three major platforms, but the competition has shown that you are among me, and you are among you. On the way, the fight between the three major e-commerce platforms will only become more intense.