The decision is significant for the Nasdaq-listed company, which posted a profit for the first time as a public company in the June quarter.
Pinduoduo has never paid a dividend since it listed three years ago. But its stock has more than tripled, delivering handsome returns to shareholders.
The company’s stock soared 22% in New York on Tuesday after earnings.
That phrase — “common prosperity” — is a historically significant one in China, and was used recently by President Xi Jinping as he promised a new push to redistribute wealth in the country. His mention of the term in the context of wealth redistribution echoed its use by Chairman Mao Zedong in the middle of the last century. The former Communist leader advocated “common prosperity” back then to mobilize poor peasants and take power away from the rural elites — rich landlords and farmers.
Founded in 2015 by Colin Huang, Pinduoduo has quickly grown into a formidable e-commerce company.
But the company has edged out its biggest competitor in at least one important way: It had 850 million active users in the twelve months through June, surpassing Alibaba’s 828 million.