China’s Q4 spending reinforced platform consolidation, as advertisers concentrated budgets on large platforms with data, scale, and commerce integration.

The heat on Temu parent PDD Holdings is growing, at home and abroad. The company is being investigated by China’s State Administration for Market Regulation (SAMR) over reports of fraudulent deliveries, per Bloomberg, while Temu’s Dublin headquarters were raided last week by the EU over concerns that the company breached foreign subsidy rules. PDD is losing goodwill in many of the markets it operates in—including in China, its most important. Employees reportedly got into fistfights with SAMR investigators at the company’s Shanghai offices, leading to multiple arrests. Such confrontations are highly unlikely to endear PDD to the powerful regulator, which has the ability to instigate sweeping probes into the company’s business practices.

Baidu posted its sharpest revenue decline on record, with ad revenues falling 18% as AI-generated answers replace traditional search clicks. Ernie Bot now powers responses on most Baidu queries, improving user experience but suppressing monetizable activity—a trend management says will weigh on results into Q4. Competitors like Tencent, ByteDance, and PDD are still growing 20% to 30% YoY, suggesting Baidu’s weakness is structural. While the US market is more diversified, Baidu offers a stress test: AI can reshape search faster than monetization evolves. For advertisers, it’s a reminder that even Google and Microsoft must balance innovation with economic stability.

Global ecommerce is tightening as major markets close de minimis loopholes and China increases tax scrutiny, putting fresh pressure on platforms like PDD and its international arm Temu. Nearly 1 in 5 US consumers say shifting trade policies may discourage them from buying internationally, adding to the company’s challenges amid uneven spending in China. PDD delivered mixed Q3 results, with earnings beating expectations but revenue slightly missing. The overall picture suggests the company must transition from relying on duty-free advantages to strengthening marketplace fundamentals, even as improving user trends signal early signs of resilience

Global ad spending has steadied after a turbulent year, setting the stage for modest acceleration in 2026. Digital is still the main engine, but traditional media’s rebound will add lift as markets stabilize.

Temu parent PDD posted its slowest revenue growth in Q2 since the end of 2021, as it struggles to navigate a weak consumer environment in China and regulatory challenges in the US and other key markets. While PDD’s Q2 results beat expectations, they show how the company’s primary strategy of undercutting competitors with cheaper prices is becoming untenable in the current political and macroeconomic landscape.

The outlook for retail media ad spending remains bright throughout most of the world, even as ad budgets are increasingly constrained in the face of economic storm clouds.

A series of major milestones are on tap for total media and digital media ad spending around the world in 2025, although growth will be uneven across countries and regions.

US consumers shop frequently with Temu and Shein, despite trust issues: Both Chinese retailers are winning more repeat customers than established players like eBay and Etsy.

After the self-inflicted stagnation of 2022, China’s retail and ecommerce sales growth is somewhat back on track. At the company level, Douyin has burst onto the scene as a major retailer, and Pinduoduo’s ascent continues.

Challenging macroeconomic conditions have ushered in an era of more modest spending growth in China. But the outlook remains positive in spaces that are capturing consumer interest and demand—like live commerce and digital groceries.

Three of the four largest ecommerce companies in the world are based in China—Alibaba, JD.com, and Pinduoduo (PDD)—and they are all still delivering impressive annual sales increases.

China continues to lead the world in all things ecommerce, including innovation. Social commerce livestreaming is just one of many new stories for 2021 and beyond.