China's leading food delivery group Meituan reported a bigger-than-expected 25% rise in quarterly revenue as it targeted cost-conscious Chinese consumers with more value-for-money products and services.
A lacklustre economic recovery in China since the COVID-19 pandemic has led to more firms pivoting towards low-cost and discounted products in the world's second largest economy.
"As consumers increasingly favour value-for-money, we have enhanced our pricing competitiveness," Meituan CEO Wang Xing told analysts in a call following the firm's quarterly earnings release. Discounts via livestream were an increasing focus, he said.
Meituan, which operates an app providing services from bike-sharing and ticket-booking to maps, reported revenue in the three months to March 31 of 73.3 billion yuan ($10.11 billion), up from 58.62 billion yuan a year earlier.
That beat the 70.32 billion yuan average estimate of 16 analysts compiled by LSEG. Profit for the quarter hit 5.2 billion yuan, up 59.9% from 3.36 billion yuan a year earlier.
KeeTa
In April, shortly after Wang took control of international business, Meituan began advertising jobs in Riyadh for food delivery platform KeeTa, which had launched a year before in Hong Kong.
Wang stressed that exploration into new markets for KeeTa were still in the "early stages", with Gulf countries, European and Southeast Asian markets all under consideration.
"Global expansion will be very important for the future of Meituan's long-term growth, but from a financial perspective we need to be careful," Wang said.
In the first quarter KeeTa was Hong Kong's top food delivery app by order volume with a 43% market share, data from analytics firm Measurable AI showed.
Meituan is China's biggest delivery platform, with a 69% share of the 1 trillion yuan market, according to data from researcher ChinaIRN.
