To The Moon

$Meituan(03690)$  Meituan posted results for the third quarter. Here is what we watched for:

NET PROFIT: Meituan swung to a net profit of 1.22 billion yuan (US$170.6 million) in the third quarter from a loss of CNY9.99 billion a year earlier. That beat analysts' estimates for a loss of CNY997 million for the period, according to a FactSet poll.

REVENUE: The Chinese food delivery company's revenue rose 28% to CNY62.62 billion, also beating the FactSet estimate.

WHAT WE WATCHED:

-- COST SAVING: Meituan aggressively cut costs during the quarter. It joined a host of Chinese internet giants that have shifted their focus to margin protection amid prevailing growth headwind due to China's tight Covid curbs and a slowing economy. Meituan's operating profit more than doubled in the quarter, as it dialed back spending for both its core food delivery business and new initiatives, such as grocery deliveries.

-- PANDEMIC IMPACT: While Meituan maintained decent revenue growth in the quarter, the company still pointed to "negative impacts from the pandemic." In particular, it noted "challenges to our hotel and travel business, especially in September, during which, some tourist cities were heavily impacted by the outbreaks."