China’s leading food delivery group Meituan on Thursday reported a bigger-than-expected 25% rise in quarterly revenue, defying a slowing Chinese economy.
Meituan, which operates an app providing services as varied as bike-sharing, ticket-booking and maps, reported revenue in the three months to March 31 of 73.3 billion yuan ($10.11 billion), against 58.62 billion yuan in the same period a year earlier.
The result compared with the 70.32 billion yuan average estimate of 16 analysts compiled by LSEG.
Its profit for the quarter hit 5.2 billion yuan, increasing 59.9% from 3.36 billion yuan a year earlier.
Lacklustre economic recovery since the COVID-19 pandemic has led to low-cost and discounted products becoming the focus for shoppers and platforms alike, squeezing profit margins.
Meituan’s revenue from core local commerce, which includes food delivery and non-food delivery service Meituan Instashopping, jumped 27.4% to 54.6 billion yuan.
Sales from new initiatives grew 18.5% to 18.7 billion yuan.
Meituan’s board authorised up to $1 billion in share buybacks beginning Dec. 1, and CEO Wang Xing has said future buybacks would be regularly evaluated, depending on investment opportunities and the firm’s financial position.
In April, Meituan began advertising jobs in Riyadh for food delivery platform KeeTa. That followed CEO Wang taking control of international business and came a year after Meituan launched KeeTa in Hong Kong.
In the first quarter, KeeTa was Hong Kong’s top food delivery app by volume of orders, with a 43% market share, showed data from analytics firm Measurable AI.
Meituan is China’s biggest delivery platform, with a 69% share of the 1 trillion yuan market, data from researcher ChinaIRN showed.
Reuters