Meituan's Financial Leap: Soaring Profits and Shrinking Losses Signal Optimistic Future
1min read Meituan released its third-quarter 2024 financial results on November 29, revealing key financial metrics that reflect robust growth and operational improvements. The company's quarterly revenue reached 93.6 billion yuan, marking a 22.4% year-over-year increase. This impressive growth is accompanied by a significant jump in net profit, which climbed to 12.86 billion yuan, up by an astonishing 307.5% from the same period last year.
One of the standout highlights from the earnings report is the notable reduction in losses for Meituan's new business segments. These losses decreased from 5.1 billion yuan in the third quarter of 2023 to 1 billion yuan in the same period this year. The loss margin for these segments improved substantially, decreasing from 27.2% to 4.2%. The reduction in losses is attributed to enhanced operational efficiencies within the merchandise retail business segment.
The earnings report highlighted Meituan's core local commerce segment, which generated revenues of 69.4 billion yuan in the third quarter, representing a 20.2% increase year-over-year. However, the operating profit for this segment saw a quarterly decline, falling to 14.6 billion yuan from 15.2 billion yuan in the second quarter. This decrease was primarily due to seasonal factors that led to increased rider subsidies and user incentives, as well as higher promotional and advertising expenses.
In terms of order volume, Meituan's platform saw a 14.5% year-over-year increase in instant delivery orders, reaching 7.1 billion orders in the third quarter. Additionally, Meituan Flash Sale's daily order volume surpassed 10 million orders. This surge in order volume demonstrates the platform's continued appeal and growing user base.
As part of its business strategy, Meituan continued to expand initiatives like "Pin Haofan" to increase the sales volume of cost-effective products and attract new customers. Despite the pressure on riders and merchants due to low transaction values, Meituan's efforts to offer competitive pricing have resonated with price-sensitive consumers in the current macroeconomic environment.
Meituan's strategic efforts to reduce losses and improve efficiency in new business areas are starting to pay off, creating optimism about the future profitability of these ventures. The company's proactive approach to enhancing its service offerings and expanding its international footprint underscores its commitment to long-term growth and market leadership.