Home » Meituan Reports Strong Q2 Growth with Record Revenue and High EBITDA

Meituan Reports Strong Q2 Growth with Record Revenue and High EBITDA

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Meituan Reports Strong Revenue Growth in Q2 2023, Driven by Recovery of Offline Traffic

On August 24, Meituan (03690.HK), the Chinese e-commerce platform, released its second quarter and half-year performance report for 2023, showcasing impressive results. The company attributed its success to the recovery of offline traffic, which led to significant revenue growth.

In the second quarter of this year, Meituan achieved a revenue of 68 billion yuan, a year-on-year increase of 33.4%. Adjusted EBITDA reached a record high of 7.7 billion yuan, and operating profit amounted to 4.7 billion yuan, showing a year-on-year loss.

Meituan has been focusing on its “retail + technology” strategy, further promoting it during the second quarter. The company increased its investment in the Chinese consumer market, with research and development expenditures rising to 5.4 billion yuan year-on-year.

Meituan’s local life sector, encompassing “food, accommodation, travel, shopping, and entertainment,” performed well in the second quarter. The core local business revenue increased by 39.2% year-on-year to 51.2 billion yuan. Operating profit also grew by 34.8% year-on-year to RMB 11.1 billion. The operating profit margin remained relatively flat at 21.8% compared to the same period in 2022.

The demand for food delivery continued to be strong, leading to Meituan’s instant delivery orders increasing by 31.6% year-on-year to 5.4 billion orders in the second quarter. Meituan focused on strengthening supply and optimizing subsidy strategies to better meet consumers’ diverse needs in different price bands. Notably, the monthly order volume of Meituan food delivery reached a record high in August.

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Meituan also prioritized aiding restaurants in resuming operations and transitioning to digital operations. The company expanded its merchant base and improved the quality of supply. With an increase in the number of users and the frequency of purchases, Meituan’s flash sales maintained strong growth momentum, with peak daily order volume exceeding 11 million.

Meituan’s new business segment saw reduced losses in the second quarter. Revenue increased by 18.4% year-on-year to 16.8 billion yuan, and the operating loss narrowed by 23.5% year-on-year to 5.2 billion yuan. The operating loss rate improved to 31.0% quarter-on-quarter. Meituan’s new businesses include Meituan Best Choice, Meituan Grocery Shopping, catering supply chain (Kuailu), online car-hailing, and shared bicycles.

The company remains optimistic about the potential of its new businesses, including Meituan Youhao, Meituan Maicai, and Meituan Optimal. Although Meituan Youhao is facing difficulties in optimizing its business model in the short term, Meituan believes in the long-term potential of online groceries. Meituan Maicai experienced steady year-on-year growth in the second quarter, with a rise in the supply of standard products and Meituan’s own brand.

To support merchants, Meituan continued to optimize its platform supply and expand merchant services. The transaction volume of Meituan’s in-store hotel and travel business increased by over 120% compared to the same period last year. The company aims to provide small and medium merchants with the benefits of online operations at a lower cost by lowering the threshold for subscription services.

Meituan upgraded its marketing strategies, offering merchants more tools to expand their traffic acquisition channels. The company optimized “special offer group purchase” and live broadcast features. Meituan also released the “2023 must-eat list” and “must-eat list packages” to enhance online promotions and provide more recommendations and discounts to consumers.

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Overall, Meituan’s CEO, Wang Xing, expressed satisfaction with the company’s performance in the second quarter. He emphasized the company’s commitment to the “retail + technology” strategy, aiming to meet diverse consumer needs and improve the efficiency of local commodity and service retail through technology.

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