PDD Holdings Inc.

Thank you for standing by. Welcome to PDD's third quarter 2022 earnings conference call. At this time, all participants are in the listen-only mode. There will be a presentation followed by a question and answer session, at which time, if you wish to ask a question, you will need to press star 1 on your telephone. I must advise you that this conference call is being recorded today. I would now like to hand the conference over to your host today, Mr. Cheng Pen. Sir, please go ahead.

Thank you, operator. Hello, everyone, and thank you for joining us today. My name is Cheng, and I will help host the earnings call. PDD earnings release was distributed earlier and is available on our website at investor.com. pddholdings.com, as well as through Global Newswire Services. Before we begin, I would like to refer you to our safe harbor statement in earnings press release, which applies to this call, as we will make certain forward-looking statements. Also, this call includes discussions of certain non-GAAP financial measures. So please refer to our earnings release which contains a reconciliation of the non-GAAP measures to GAAP measures. Joining us today on the call are Chen Lei, our Chairman and Chief Executive Officer, Liu Jun, our VP of Finance. Lei will make some general remarks on our performance for the past quarter and our strategic focus. Jun will then take us through our financial results for the third quarter ended September 30, 2022. During the Q&A session, Lei will answer questions in Chinese, and I will help translate. Please kindly note that all translations provided are for reference purpose only. In case of any discrepancy between the original remarks and the translated version, statements in the original language should prevail. Now, it is my pleasure to introduce our chairman and chief executive officer, Chen Lei. Lei, please go ahead.

Thank you, Chen, and hello, everyone. Thank you all for joining our 3Q 2022 earnings call. Let me start by giving a brief overview of our third quarter results. Our total revenue for this quarter with RMB 35.5 billion. This represents a year-on-year increase of 65%. Over the past quarter, we worked closely with our immersion partners to serve our customers. We continue to provide our users with an enjoyable and affordable shopping experience to meet their growing demand for high-quality and a value for money product. During the past few months, many product categories, such as agriculture, consumer electronics, beauty and cosmetics, they all enjoyed positive consumer feedback. Many brands joined Pinduoduo and extended our consumers their best deals. We are happy to keep creating value for our consumers. But meanwhile, we still have many areas to improve, and the color industry competition remains intact. We need to continue to deepen our value creation, increase our R&D investment to help further improve the supply chain's efficiency, support upgrades of the supply side, and facilitate agricultural digital inclusion. We celebrated our seventh anniversary last month, and we are extremely grateful for the support and chat from our consumers, merchants, farmers, and society. And we will continue to uphold our core values of putting people first, benefiting all, and being more open so that we can create lasting value for all the stakeholders. Technology is at the heart of our value creation. From the very beginning, we committed to introducing technology to improve the efficiency of supply chain and create value for all the parties through digitalization. In the past year or so, we increased our investment in technology and the focus on driving innovation through research and development. We have built a young, energetic, innovative team with strong technology background. And we are encouraged to see that our investment in technology is creating positive impacts to society. In agriculture, we keep promoting our holistic approach to digitalize the agricultural sector so that more and more people can benefit from advances in science and technology. Our approach in agriculture is a holistic way of creating inclusive growth. By leveraging the resources of Qingduoduo, we hope that more farmers will adopt agricultural technology to improve their productivity and put their farming practices in a more sustainable footing. The Harvest Festival last quarter is a good example of this approach. In September, Pinduoduo launched a dedicated Harvest Pavilion on the platform to support the annual Harvest Festival with its exclusive e-commerce platform partners. Lasting three months, the Harvest Pavilion features over half a million types of agricultural products across the country. We widen the market for farmers by bringing them into digital economy. The millions of consumers also make it more feasible to implement agricultural technology. Farmers are more willing to plant improved crops if they have confidence that consumers will buy them. Festival, we worked with CCTV and several professors from the Chinese Academy of Agricultural Sciences and the China Agricultural University to promote agricultural technology. For example, we introduced a new variety of sweet potatoes that are less prone to disease developed by research institutes. The Pinduoduo platform helped these new sweet potatoes to reach more consumers nationally. And this crop is now grown in many parts of China and is available year-round. Its success has helped many farmers to prosper. This is a good example of how market demand can bring more science out of the lab and into the field. We are committed to using the Pinduoduo platform for consumers to discover new agricultural treasures so that they can enjoy healthier and more nutritious food. In the harvest festival, we also showcase a series of new and improved wheat varieties cultivated by China Agricultural University with the support of our 10 billion agriculture initiative. These wheat varieties have higher yield, higher quality, and are more resistant to disease. In addition, we continue to support various events to promote the adoption of agricultural technology. Our flagship smart agriculture competition is currently underway in Shanghai. And this is an annual precision farming contest aimed at encouraging researchers to develop practical technology. We are partnering with China Agricultural University and Dejiang University for this competition with technical support from FAO China and the Shanghai Academy of Agricultural Sciences. The theme of the competition this year is vertical farming. Participating teams will compete to produce letters in shipping containers using lightning, cross-modeling, and algorithms to control input variables. Several participating teams from the first two editions have already implemented their technology in the working farms, as well as a large scale pilot to scale a solution. We hope that this initiative can inspire more young researchers, bring more research findings to the market, and support the development of smart agriculture. In a certain way, we are improving agricultural digitalization. We are helping to upgrade real economy enterprises and manufacturers by connecting them directly with the end consumers. Our pioneering team purchase model can quickly and directly connect demand and supply to gathering consumer demand. We have elaborated digital technology to shorten the product development cycle and help manufacturers create products that closely match market needs. This can help manufacturers to build their brand. And in the past seven years, we have helped incubate nearly 1,000 manufacturing brands through technology. And since the beginning of this year, we have launched several activities to support the manufacturing industry. For example, this year, we launched a new craftsman campaign to help local craftsmen and their manufacturers find a bigger market for their products through e-commerce. And we have allocated dedicated resources to support high-quality local products and help small enterprises upgrade their branding. The new craftsman program is now in many regions across the country, helping local manufacturers to build their brand. We hope to use the Pinduoduo platform to help more of these undiscovered manufacturers reach more potential buyers. The increased demand and exposure also benefit the local communities through more income and more job opportunities. As we enter our eighth year of operation, we remain passionate and excited about the future. We are a young company with a team full of drive and energy, and we will constantly explore areas to create positive value through technology. And with that, Jun will take us through the financial.