A 28.5 percent plunge on Monday that wiped $55 billion off the value of PDD Holdings, owner of shopping apps Temu and Pinduoduo, reflected “shattered investor confidence” in the company’s future after top management stunned investors by downplaying its earnings outlook, analysts said.

Nasdaq-listed PDD, a global e-commerce rival of Alibaba Group Holdings, suffered its biggest intraday drop since its listing in 2015, knocking an estimated $14 billion off the net worth of little-known founder Colin Huang – who was briefly China’s richest man. Alibaba owns the South China Morning Post.

The loss came after management said it would sacrifice short-term profits for long-term growth and forego share buybacks or dividends in the coming years after PDD’s second-quarter results fell just short of analysts’ expectations.

According to Li Chengdong, founder and chief analyst at e-commerce consultancy Dolphin, investors were unsettled after management gave weak forecasts for future growth and shared its views on share buyback programs and dividend participation in the face of increasing competition and market uncertainty.

PDD Holdings Chairman and Co-CEO Chen Lei said in an earnings release that the company is “committed to transitioning to high-quality development and promoting a sustainable ecosystem” and will “invest heavily in platform trust and security and support high-quality merchants.”

“We are willing to accept short-term sacrifices and a possible decline in profitability,” Chen said in a warning tone that could dampen investor confidence, according to Wang Xiaoyan, a senior analyst at 86Research.

In a note to clients, UBS analysts wrote that PDD’s outlook was “confusing.” “Investors seem unsure whether PDD is seeing something we are not seeing or whether they are simply being too conservative given the uncertain macroeconomic environment,” UBS wrote.

The Chinese e-commerce market is currently undergoing a transformation due to the weakening economy and falling consumer spending.

PDD reported a record 97 billion yuan ($13.6 billion) for the quarter ended June, up 86 percent from a year earlier but below analysts’ consensus forecast of 99.9 billion yuan compiled by Bloomberg.

Pinduoduo’s biggest competitors Alibaba and JD.com have focused on cheaper goods without compromising on service, logistics and quality assessment, thus outdoing the low-cost shopping platform on its advantages front, says Mark Tanner, managing director of China Skinny, a market research company based in Shanghai.

Tanner said live-streaming e-commerce platforms like Douyin, run by TikTok owner ByteDance, are cannibalizing traditional online shopping sites.

While Pinduoduo, which has been outpaced by its competitors, said it aims to “vigorously support high-quality merchants and resolutely tackle low-quality merchants,” some analysts sounded a cautionary note about the initiative.

Not only would this move require significant investment to change systems, workflows and consumer perceptions, it would also likely undermine Pinduoduo’s key market advantage – its low-cost structure and agility, Tanner added.

“If the platforms have little differentiation, I think the appeal of Alibaba, JD and Douyin will be stronger,” Tanner said.

Benjamin Cavender, managing director of consultancy China Market Research Group, said the country’s weak economy has forced major e-commerce players to compete aggressively with each other.

“The reality is that even if Pinduoduo were to crack down on product quality, it is still operating in a very difficult economic environment that is likely to be even more competitive as major players also try to mitigate the impact of low consumer confidence,” Cavender said.