UPDATE 2-China's Pinduoduo beats quarterly revenue estimates, shares leap

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Nov 12 (Reuters) – Chinese e-commerce platform Pinduoduo Inc reported better-than-expected quarterly revenue on Thursday, helped by strong demand as the domestic economy recovers from the COVID-19 pandemic.

U.S.-listed shares of the company jumped 17% in premarket trading.

Online retailers have largely benefited from the COVID-19 pandemic, as individuals staying home use e-commerce platforms like Alibaba, Pinduoduo and JD.com to purchase everything from groceries to electric appliances.

The interactive buying platform’s third-quarter net loss attributable to shareholders narrowed to 784.7 million yuan ($118.6 million) from 2.34 billion yuan a year earlier, with the company inching towards breaking even for the first time.

Non-GAAP net profit, reported for the first time since the company’s listing in 2018, was 466.4 million yuan compared with a loss of 1.66 billion yuan a year before.

“This is a milestone,” said Natalie Wu, internet analyst at Haitong International Securities.

Pinduoduo’s revenue surged 89% to 14.21 billion yuan in the third quarter, beating analysts’ estimates of 12.34 billion yuan, according to IBES data from Refinitiv.

The company reported a 12-month gross merchandise volume (GMV) of 1.5 trillion yuan, a metric that indicates sales growth. This was up 73% from last year.

The number of average monthly active users on the platform rose by 50% to 643.4 million during the quarter, while active buyers rose 36% to 731.3 million.

“Annual active buyer (numbers are) further closer to that of Alibaba,” said Wu. Alibaba had 757 million annual active consumers on its China retail marketplaces by the end of September.

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