By Tracy Qu
Meituan reported a narrower-than-expected loss and faster revenue growth as China's top food-delivery company continued to deal with a bruising price war in the world's second-largest consumer market.
The results, though better than feared, mark the third consecutive quarter of net losses for the Chinese shopping-and-delivery platform. Meituan remains locked in a battle with Alibaba Group and JD.com to defend its market leadership in food delivery. All three have thrown billions of dollars into aggressive discounts and heavy marketing to win over customers, drawing repeated warnings from authorities.
Beijing-based Meituan on Monday said its net loss was 6.83 billion yuan, equivalent to $1.01 billion, for the first three months of the year. That was smaller than the 15.14 billion yuan loss it recorded in the final quarter of 2025 and compared with net profit of 10.06 billion yuan in the year-ago period.
Revenue climbed to 91.04 billion yuan for the first quarter, with year-over-year growth accelerating to 5.6% from 4.1% the previous quarter.
Analysts had projected a net loss of 8.51 billion yuan on revenue of 90.76 billion yuan, according to a FactSet consensus estimate. Following the stronger-than-expected results, Citi said it expects Meituan to further narrow losses at its core local commerce segment in the second quarter and the rest of 2026.
For the latest quarter, revenue for the core local commerce segment was flat, while revenue from the new initiatives division, which includes overseas businesses, rose 21% from a year earlier.
Shares in Meituan gained 6.5% on Monday ahead of the results. The Hong Kong-listed stock remains down by nearly a quarter this year, however, weighed by concerns about its near-term earnings outlook.
Nomura had previously said that the Chinese food-delivery platform's underperformance relative to the Hang Seng Tech Index appeared flow- and sentiment-driven rather than tied to fundamentals.
Analysts have also signaled a bumpy recovery for Meituan as competition gradually eases, though several have indicated that improved profitability is within reach.
With rival Alibaba expected to prioritize investments in artificial intelligence over quick commerce, given it won't likely be able to sustain high spending for both, Meituan's quick-commerce segment stands to benefit, Morningstar's Chelsey Tam wrote in a note. That could mean more clarity on the timing of its earnings recovery, she said.
In April, China's market regulator fined PDD Holdings, Meituan, JD.com and several other platforms a total of 3.6 billion yuan over their failure to properly verify online food vendor's licenses and take necessary measures to protect consumers.
Write to Tracy Qu at tracy.qu@wsj.com
(END) Dow Jones Newswires
June 01, 2026 07:00 ET (11:00 GMT)
Copyright (c) 2026 Dow Jones & Company, Inc.
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