Kuaishou Shares Plummet Amid Food Delivery Market Concerns.

Kuaishou Technology's stock plunged 10% on Tuesday, marking its steepest decline in four months, amid concerns over its entry into China's highly competitive food delivery market. The live-streaming giant introduced a food delivery service, sparking investor worries about its ability to compete with established players.

Kuaishou Technology's stock tumbled 10% on Tuesday, marking its steepest decline in four months, amid investor worries over the company's foray into China's highly competitive food delivery market. The Hong Kong-listed stock slumped after the live-streaming giant introduced a food delivery service on its app, allowing users to access Meituan's services. This move has sparked concerns about Kuaishou's ability to compete with established players like Meituan, Alibaba, and JD.com.

The introduction of the food delivery feature on Kuaishou's app has raised eyebrows among investors. The feature redirects users to Meituan's mini-program to complete orders, with delivery handled by Meituan riders. This integration has led to a significant selloff in Kuaishou's stock, with the company's shares falling as much as 10% on Tuesday. This was the worst performance on the Hang Seng Tech Index, while Alibaba and Meituan shares also experienced a decline.

Kenny Ng, a strategist at China Everbright Securities International, noted that the news about Kuaishou entering the food delivery business via Meituan has sparked concerns among investors. He added that traders remain worried about competition in the sector, which has seen aggressive pricing and promotions that have threatened to erode margins [1].

Some market watchers, however, believe that Kuaishou's stock selloff is overdone. Steven Leung, executive director at UOB Kay Hian Hong Kong Ltd., stated that investors are "overreacting to what’s essentially just an added app feature." He noted that Kuaishou is not likely to burn cash chasing market share like JD.com, especially with regulators already warning against irrational competition [1].

The food delivery market in China is highly competitive, with major players like Meituan, Alibaba, and JD.com already established. Kuaishou's entry into this market comes at a time when regulators are warning against disorderly competition and price-based rivalry. The new feature on Kuaishou's app, which offers products such as burgers and coffee, is a significant step for the company but may face challenges in gaining market share.

Prosus's recent acquisition of Just Eat Takeaway.com (JET) highlights the broader trend of consolidation in the food delivery sector. The EU's conditional approval of this deal, requiring Prosus to divest its Delivery Hero stake and cede board control, underscores the regulatory complexity in the market. Prosus aims to integrate JET's 18-country network with AI-optimized logistics from iFood/Swiggy, targeting €10 billion in revenue by 2030 [2].

Investors should consider the long-term implications of these developments. Companies that leverage AI for logistics and personalization, and those that align with regulatory norms, will likely outperform. Geographic diversification into underpenetrated markets also offers growth potential.

In conclusion, Kuaishou Technology's stock decline reflects investor concerns over its entry into the highly competitive food delivery market. While the company's new feature is a significant step, it faces substantial competition. The broader trend of consolidation and AI-driven efficiency in the food delivery sector suggests that companies that adapt to these changes will have a competitive edge.

References:
[1] https://www.bloomberg.com/news/articles/2025-08-12/kuaishou-stock-drops-most-in-four-months-on-food-delivery-worry
[2] https://www.ainvest.com/news/prosus-eu-approved-eat-takeaway-deal-strategic-play-global-food-delivery-dominance-2508/
[3] https://seekingalpha.com/news/4483647-kuaishou-shares-plunge-amid-concerns-over-food-delivery-push