September 23, 2019
Zheng Huang
Chief Executive Officer
Pinduoduo Inc.
28/F, No. 533 Loushanguan Road, Changning District
Shanghai, 200051
People's Republic of China
Re: Pinduoduo Inc.
Form 20-F for Fiscal Year Ended December 31, 2018
Filed April 24, 2019
File No. 001-38591
Dear Mr. Huang:
We have reviewed your filing and have the following comments. In some of
our
comments, we may ask you to provide us with information so we may better
understand your
disclosure.
Please respond to these comments within ten business days by providing
the requested
information or advise us as soon as possible when you will respond. If you do
not believe our
comments apply to your facts and circumstances, please tell us why in your
response.
After reviewing your response to these comments, we may have additional
comments.
Form 20-F for Fiscal Year Ended December 31, 2018
Introduction, page 8
1. With a view toward improving your disclosure in future filings, please
help us understand
your definition that GMV represents the total value of all orders for
products and services
on your platform, "regardless of whether the products and services are
actually sold..."
If GMV is generated when products are placed in the shopping cart even if
they're never
sold, we believe disclosure to this effect is important to an
understanding of the metric.
We also believe a discussion is warranted regarding whether you believe
group or team
purchasing might cause more orders to fail, or never be consummated after
items are
placed in the shopping cart, relative to other e-commerce platforms
reporting GMV.
Finally, each place you disclose GMV, we believe you should disclose the
limitations of
using this measure as a key performance indicator, including the
potential lack of
comparability to GMV as calculated by other companies.
Zheng Huang
Pinduoduo Inc.
September 23, 2019
Page 2
Item 5.A. Operating Results
Year Ended December 31, 2018 Compared to Year Ended December 31, 2017
Cost of Revenues, page 80
2. Where you describe the various factors that caused an increase in cost
of revenues in 2018
please quantify the increase in staff costs as well as the increase in
call center and
merchant support service costs. Refer to Item 303(a)(3)(i) of
Regulation S-K.
Operating Expenses, page 81
3. Given the substantial increase in sales and marketing expense as an
absolute amount and
as a percentage of revenue, please tell us your consideration of
discussing in more detail
the nature of these expenses and the extent to which these expenses
relate to coupons,
credits and discounts offered to consumers versus other online and
offline advertising
campaigns. Tell us your consideration of also discussing whether the
cost of the coupons,
credits and discounts offered to customers can or does typically
exceed the merchant
revenue associated with a particular transaction.
We remind you that the company and its management are responsible for
the accuracy
and adequacy of their disclosures, notwithstanding any review, comments, action
or absence of
action by the staff.
You may contact Robyn Manuel, Staff Accountant, at 202-551-3823 or Bill
Thompson,
Branch Chief, at 202-551-3344 if you have any questions.
FirstName LastNameZheng Huang Sincerely,
Comapany NamePinduoduo Inc.
Division of
Corporation Finance
September 23, 2019 Page 2 Office of
Consumer Products
FirstName LastName