(Yicai Global) Nov. 29 -- Pinduoduo’s shares surged after the leading Chinese group-buying platform logged a more than six-fold gain in net profit in the third quarter.

Pinduoduo’s share price [NASDAQ: PDD] closed up 12.6 percent at USD74.05 in New York yesterday, after climbing by as much as 16.1 percent earlier in the day. That brought the stock’s gain so far this year to 27 percent.

Net profit was CNY10.6 billion (USD1.5 billion) in the three months ended Sept. 30, versus CNY1.6 billion (USD 222.9 million) a year earlier, according to the Shanghai-based company’s earnings report released yesterday. Revenue rose 65 percent to CNY35.5 million.

“During the past few months, many product categories such as agriculture, consumer electronics, beauty and cosmetics all enjoyed positive consumer feedback,” Chen Lei, chairman and chief executive officer of Pinduoduo, said on the firm’s earnings conference call.

Most of Pinduoduo’s revenue in the period came from online marketing and transaction services, which increased 58 percent and 102 percent to CNY28.4 billion and CNY7 billion, respectively. Revenue from merchandise sales fell 31 percent to CNY56.4 million.

Operating expenses jumped 38 percent to CNY17.7 billion, while research and development costs rose 11 percent to CNY2.7 billion because of a higher headcount and the need for more experienced personnel.

“We need to continue to deepen our value creation, increase our R&D investment to help further improve the supply chain efficiency, support upgrade of the price side and facilitate agricultural digital inclusion,” Chen said.

In September, Pinduoduo launched the cross-border e-commerce platform Temu in the United States, the first step in the company’s overseas expansion.

“We are still in the early stages of exploration, and we have many areas to improve in terms of the services we provide,” Chen noted regarding Pinduoduo’s international business. “We need to learn and optimize. The experience that we gain along the way will be very valuable to our company and also for our team.”

Editor: Martin Kadiev