PDDNEUTRAL

PDD Gross Margin Analysis

55.9%

Higher than 85% of Consumer Cyclical sector peers

Updated 264h ago·SEC filings & market data

Key Takeaway

PDD's gross margin of 55.9% represents the percentage of revenue the company keeps after paying the direct costs of producing its goods, so a higher figure generally indicates stronger pricing power or cost control.

Sector Performance

85th percentile

PDD

55.9%

Sector Median

36.5%

Sector Avg

30.1%

Prior Period

55.5%(May 2026)

→ Stable

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Deep Analysis

It sits well above the Consumer Cyclical sector median of 36.3%, placing the company in the 85th percentile among its peers, which signals an advantage relative to the typical competitor. The year-over-year change is not available, but the quarter-over-quarter change is +0.7%, moving from 55.5% to 55.9% — a slight uptick based on the two available periods. The combination of a high-level margin with a small positive quarterly shift suggests stable profitability with no immediate deterioration, though the lack of longer trend data limits the ability to assess risk or opportunity confidently. This metric supports the overall NEUTRAL verdict: the strong gross margin is a positive, but without a clear directional history, it does not justify upgrading the rating.

Frequently Asked Questions

What does the Gross Margin tell investors about PDD?

Gross margin reveals pricing power and cost structure. Software companies often sustain 70–80%; manufacturers typically 30–50%. Expansion is a bullish signal.

How is the Gross Margin calculated?

Gross Margin is calculated as: Gross Profit / Revenue.

How does PDD's Gross Margin compare to its sector?

PDD's Gross Margin of 55.9% compares to a Consumer Cyclical sector median of 36.5%, placing it in the 85th percentile.

Who are PDD's closest peers by Gross Margin?

The closest Consumer Cyclical peers by Gross Margin include: URBN (36.6%), QSR (33.7%), CAVA (25.4%), BBY (23.5%), CZR (50.3%).

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Learn More About Gross Margin

Gross Margin vs Net Margin: Why the Gap Between Them Tells You Everything

Gross margin vs net margin: learn what the spread between them reveals about operating leverage, cost structure, and early warning signs in any stock.

The Formula

Gross Profit / Revenue

Why It Matters

Gross margin reveals pricing power and cost structure. Software companies often sustain 70–80%; manufacturers typically 30–50%. Expansion is a bullish signal.