The sale of PPD shares takes $14 billion from the founder’s fortune

A slide on Monday in shares of PDD Holdings Inc., the parent company of e-commerce giant Temu, saw Huang’s fortune drop by $14.1 billion, the biggest one-day loss so far. Huang is now China’s fourth-richest person, with a net worth of $35.2 billion, according to the Bloomberg Billionaires Index.

It’s a dramatic fall for the PDD founder, who on Aug. 8 became the first tech tycoon to top China’s wealth list in more than three years, replacing bottled water billionaire Zhong Shanshan. Zhong regained the No. 1 spot on Monday with a fortune of $50 billion.

PDD reported quarterly revenue that missed analysts’ estimates and warned that sales growth would slow. Chief Executive Chen Lei repeatedly told analysts on a call after the earnings release that the company’s current trajectory was not sustainable at a time when competitors such as ByteDance’s TikTok and Alibaba Group Holding Ltd. are vying for buyers pay attention to the budget. Shares in the US-listed company fell 29%, the most so far.

Management also played down expectations for potential dividend payouts and share buybacks over the next few years.

“We face intense competition on various fronts and also uncertainties from external factors,” Chen said. “Therefore, our management team and we unanimously believe that this is not an appropriate time for share buybacks or dividends. And in the foreseeable years ahead, we don’t see such a need either.”

Huang founded PDD in 2015 after launching several gaming and e-commerce projects. The former Google engineer quickly climbed the ranks of the world’s richest people, with his net worth reaching $71.5 billion in early 2021. He stepped down as PDD’s chief executive in 2020 and left the board as president in 2021, when Beijing began cracking down. China’s tech giants.

The e-commerce platform is known for selling cheap products with massive promotions that have attracted budget-conscious consumers as global inflation has risen. It expanded outside of China under the brand name Temu and quickly became one of the most downloaded apps in the US after a spectacular debut in 2022. It has since begun to challenge fellow Chinese online shopping giant Shein and even Amazon.com Inc. in certain segments.

But the company faced frustration from suppliers, employees and governments. Hundreds of small traders rallied at PDD’s offices in southern China this summer to protest what they called unfair penalties by the company. Meanwhile, the European Union is working on a proposal to close an import tax loophole for cheap goods bought online, while US lobbyists are pushing for a $10 threshold for duty-free shipments, down from $800 at present.