Meituan, a leading food delivery service in China, recently announced it expects to face a significant loss of up to 24.3 billion yuan (about $3.5 billion) in 2025. This is a stark contrast to 2024, when it reported a profit of 35.8 billion yuan. The tough competition in the market has played a major role in this downturn, particularly a fierce price war involving Meituan, Alibaba, and JD.com.
In 2024, Meituan’s e-commerce business thrived, bringing in an operating profit of around 52.42 billion yuan. However, last year, that number dropped dramatically, and the company now anticipates an operating loss between 6.8 billion and 7 billion yuan.
Meituan attributes these losses to several factors. To stay competitive, the company has invested heavily in marketing and incentives for delivery workers. As prices dropped to attract customers, profitability took a hit.
Experts note that this kind of intense competition is not new in the tech and delivery sectors. Similar battles in the past have often led to temporary losses but can strengthen companies in the long run. According to a recent report by Statista, the Chinese food delivery market is expected to grow at a compound annual growth rate (CAGR) of 12.7% until 2026. This suggests that while Meituan faces challenges now, the overall market still has potential for recovery.
User reactions on social media have been mixed. Some customers express concern over potential delays in service quality due to cutbacks, while others appreciate the lower prices.
In conclusion, Meituan’s current situation highlights the volatility in the tech and food delivery industries. As companies adjust to fierce competition, it will be interesting to see how they adapt and what new strategies emerge. For further insights on market trends, you can check Statista’s report on the food delivery market.
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e-commerce, JD.com, price wars, Brazil, Meituan, China, Keeta, Alibaba Group Holding, Hong Kong stock exchange, food delivery, South China Morning Post, Saudi Arabia, Beijing
