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Time of India
6 days ago
- Business
- Time of India
Chinese food delivery giant Meituan flags volatility as competition heats up
HighlightsMeituan reported a 46% increase in first-quarter net profit but anticipates potential challenges in the second quarter due to heightened competition in the instant retail sector. The company has pledged 100 billion yuan over three years for supply-side innovation as it faces aggressive competition from Alibaba's and JD Takeaway, both of which have committed substantial subsidies to attract customers. Meituan is expanding its international presence with a $1 billion investment in Brazil and is also focusing on unmanned drone delivery and artificial intelligence technology. China's leading food delivery group Meituan on Monday reported a 46 per cent rise in first-quarter net profit but warned that the second quarter would likely be hit by increased competition in so-called "instant retail". CEO Wang Xing told analysts on a post-earnings call that it was "impossible" to give accurate financial guidance for the rest of the year as competition is ramping up in the sector, which refers to online purchases delivered within 60 minutes. "Nobody should be surprised if there is volatility in short-term financial results," he said. In February, online retailer responded to Meituan's moves to expand beyond meals by moving aggressively into Meituan's core food delivery business. Alibaba , which operates the second-largest food delivery app, has also moved to increase its bets on the instant retail space. Both JD Takeaway and have pledged 10 billion yuan ($1.39 billion) in subsidies to boost sales. "Ten billion here, ten billion there, every internet player wants to chip ten billion into this game," Wang said, as he pledged 100 billion yuan over three years for supply side innovation. Meituan has nearly 70% of the delivery market, Morningstar analysts said. Defending that customer base could prove expensive amid the intensifying competition, squeezing profit margins, they said. Another challenge could come from regulators, with China's State Administration for Market Regulation recently drafting new guidelines about how platforms such as Meituan, and Alibaba should charge fees to merchants. "I believe it's the job of the regulators to stop this irrational and unhealthy subsidy competition, and it's our job to win the fight as long as it goes on and we will do everything we can to win that fight," Wang said. Meituan reported revenue in the three months to March 31 of 86.6 billion yuan, a slightly larger-than-expected 18.1% rise. Fourteen analysts polled by LSEG had expected a 16.5% revenue gain. This month, Meituan announced a $1 billion investment over the next five years as it enters Brazil with its Keeta app. As well as expanding its international business - Keeta also operates in Hong Kong and Saudi Arabia - Meituan has been investing in unmanned drone delivery and has joined the AI race, pledging to invest "billions" of dollars in the technology.
Time of India
6 days ago
- Business
- Time of India
Alibaba's new 'instant commerce' portal passes 40 million daily orders
HighlightsChinese e-commerce giant Alibaba reported that its Taobao Instant Commerce portal has exceeded 40 million daily orders within just one month of its launch. The Taobao Instant Commerce portal integrates merchants from Alibaba's food delivery service into the main Taobao shopping application. This initiative is part of a larger trend among Chinese online platforms that are investing billions of dollars into the development of instant retail services. Chinese ecommerce giant Alibaba said Monday that its Taobao Instant Commerce portal, which delivers items within 60 minutes, has surpassed 40 million daily orders within a month of launching. The portal brings merchants from Alibaba's food delivery arm onto its main domestic shopping app , Taobao, and is part of a broader move among Chinese online platforms in recent months to invest billions in so-called "instant retail".
Time of India
7 days ago
- Business
- Time of India
Chinese food delivery giant Meituan flags volatility as competition heats up
China's leading food delivery group Meituan on Monday reported a 46% rise in first-quarter net profit but warned that the second quarter would likely be hit by increased competition in so-called "instant retail". CEO Wang Xing told analysts on a post-earnings call that it was "impossible" to give accurate financial guidance for the rest of the year as competition is ramping up in the sector, which refers to online purchases delivered within 60 minutes. "Nobody should be surprised if there is volatility in short-term financial results," he said. In February, online retailer responded to Meituan's moves to expand beyond meals by moving aggressively into Meituan's core food delivery business. Alibaba , which operates the second-largest food delivery app, has also moved to increase its bets on the instant retail space. Both JD Takeaway and have pledged 10 billion yuan ($1.39 billion) in subsidies to boost sales. "Ten billion here, ten billion there, every internet player wants to chip ten billion into this game," Wang said, as he pledged 100 billion yuan over three years for supply side innovation. Meituan has nearly 70% of the delivery market, Morningstar analysts said. Defending that customer base could prove expensive amid the intensifying competition, squeezing profit margins, they said. Another challenge could come from regulators, with China's State Administration for Market Regulation recently drafting new guidelines about how platforms such as Meituan, and Alibaba should charge fees to merchants. "I believe it's the job of the regulators to stop this irrational and unhealthy subsidy competition, and it's our job to win the fight as long as it goes on and we will do everything we can to win that fight," Wang said. Meituan reported revenue in the three months to March 31 of 86.6 billion yuan, a slightly larger-than-expected 18.1% rise. Fourteen analysts polled by LSEG had expected a 16.5% revenue gain. This month, Meituan announced a $1 billion investment over the next five years as it enters Brazil with its Keeta app. As well as expanding its international business - Keeta also operates in Hong Kong and Saudi Arabia - Meituan has been investing in unmanned drone delivery and has joined the AI race, pledging to invest "billions" of dollars in the technology.
Time of India
7 days ago
- Business
- Time of India
Alibaba's new 'instant commerce' portal passes 40 million daily orders
Chinese ecommerce giant Alibaba said Monday that its Taobao Instant Commerce portal, which delivers items within 60 minutes, has surpassed 40 million daily orders within a month of launching. The portal brings merchants from Alibaba's food delivery arm onto its main domestic shopping app , Taobao, and is part of a broader move among Chinese online platforms in recent months to invest billions in so-called "instant retail".
Business Times
26-05-2025
- Business
- Business Times
Chinese food delivery giant Meituan net profit up 46.2% in first quarter
[SHANGHAI] China's leading food delivery group Meituan on Monday (May 26) reported net profit for the first quarter of 10.9 billion yuan (S$1.9 billion), up 46.2 per cent from 5.2 billion yuan in the same period a year ago. Meituan – which operates an app providing services as varied as bike-sharing, ticket-booking and maps – reported revenue in the three months to Mar 31 of 86.6 billion yuan, compared to 73.3 billion yuan in the same period a year earlier. That represents a slightly larger-than-expected 18.1 per cent rise as it targeted cost-conscious Chinese consumers with value-for-money products and services. Fourteen analysts polled by LSEG had expected a 16.5 per cent revenue gain. This year has seen e-commerce giants jostle for position in the burgeoning 'instant retail' sector, which refers to online purchases delivered within 60 minutes. In February, online retailer responded to Meituan's moves to expand beyond meals the product categories it delivers within the hour by moving aggressively into Meituan's core food delivery business. Alibaba, which operates the second-largest food delivery app, has also moved to increase its bets on the instant retail space. Meituan has nearly 70 per cent of the delivery market, Morningstar analysts said. Defending that customer base could prove expensive amid the intensifying competition, squeezing profit margins, they said. Another challenge could come from regulators, with China's State Administration for Market Regulation recently drafting new guidelines about how platforms such as Meituan, and Alibaba should charge fees to merchants. Meituan's revenue from core local commerce, which includes food delivery and non-food delivery service Meituan Instashopping, rose 17.8 per cent to 64.3 billion yuan. REUTERS
