HONG KONG, Nov. 28, 2023 /PRNewswire/ -- Meituan (HKG: 3690) (the "Company"), a leading technology-driven retail company in China, today announced the unaudited consolidated results of the Company for the three months ended September 30, 2023.
Company Financial Highlights
During the third quarter of 2023, our revenues increased by 22.1% to RMB76.5 billion from RMB62.6 billion for the same period of 2022. Our adjusted EBITDA and adjusted net profit increased on a year-over-year basis to RMB6.2 billion and RMB5.7 billion for this quarter, increasing by 28.9% and 62.4% respectively. We also achieved operating cash inflow of RMB11.2 billion for the third quarter of 2023. We held cash and cash equivalents of RMB25.1 billion and short-term treasury investments of RMB108.5 billion as of September 30, 2023.
"We continued to innovate by introducing the Everything Now lifestyle to consumers and further facilitated industrial digital transformation. We have expanded the service scope that consumers can enjoy on our platform and further diversified our product formats," said Meituan Founder and CEO Xing Wang. "We intend to play an active role in enhancing the industry ecosystem, create more job opportunities, and help stimulate consumption. Looking ahead, we will continue to focus on our 'Retail + Technology' corporate strategy and 'Help people eat better, live better'," added Mr. Wang.
Meituan CFO Shaohui Chen said, "During the quarter, our businesses delivered resilient growth, setting new records across multiple performance metrics. Our confidence in the long-term potential of our core business remains intact. These businesses have proven their resilience and strong adaptability over the past decade, and we believe our experiences and strong execution capabilities will equip us to confront challenges, strengthen our competitive moats and capitalize on new opportunities in the future. Meanwhile, we will continue to pursue high-growth strategies for our new initiatives and continuously improve operating efficiency."
Company Business Highlights
Core Local Commerce
For the third quarter of 2023, segment revenue increased by 24.5% year over year to RMB57.7 billion. Operating profit increased by 8.3% year over year to RMB10.1 billion with operating margin stood at 17.5%. The solid growth of food delivery operating profit was partially offset by the decline of in-store, hotel & travel operating profit on year-over-year basis.
During the third quarter, the number of On-demand Delivery transactions increased by 23.0% year over year. Food delivery maintained strong growth momentum with peak daily order volume reaching a new record of 78 million, doubled from three years ago. We enhanced our understanding of consumer needs while also empowered merchants with digital operations, which further unlocked consumption potential. The scale of medium- and high-frequency user base as well as their purchase frequency continued to grow rapidly. We iterated our membership program and offered different sizes of coupon packages to boost transaction frequency. We continued to strengthen consumer mindshare across scenarios. For instance, we achieved over 21 million milk tea orders during this year's milk tea marketing campaign, demonstrating the vast potential of the afternoon tea category. We also witnessed strong growth in late-night snacks leveraging our marketing and subsidy strategies during the summer. In addition, "Pin Hao Fan" onboarded more high-quality supply at affordable price to better satisfy consumer demand for low-price meals. Our campaigns to promote mega-hit products, such as "Shen Qiang Shou", not only cultivated consumer behavior to watch live streaming and transact on Meituan, but also helped merchants accumulate customers and enhance brand image. For Time-honored Brands, we launched dedicated live streaming sessions to unlock their growth potentials. For the broader merchants, we also introduced new customer management tools that help them grow customer base and revenue. Through these efforts, we further expanded the diversity and improved the quality of our platform's supply. Moreover, as the population of flexible employment grows, we provide job opportunities for more couriers and continue to enhance their welfare and work experience.
During the third quarter, Meituan Instashopping demonstrated another stellar growth with order volume, merchant base and user base all increasing notably. In August, Meituan Instashopping's daily order volume peaked at over 13 million. This development was supported by the growing number of users across city tiers, especially in the lower-tier cities. Purchase frequency growth from core users also accelerated. Consumers now use our service in a wider range of timeframes and consumption scenarios. On the merchant side, we facilitated the digitization of small- and medium-sized merchants, and partnered with nearly 400 brands. As a result, annual Active Merchants grew by 30% year over year in the third quarter. Retailers increasingly diversified their SKU offerings to better fit the on-demand retail channel, expanding the LBS products on our platform. Meituan InstaMarts, now surpassing 5,000, effectively supplements traditional offline supply. During the third quarter, non-food categories such as electronics, home appliances, and beauty products continued to lead the growth. We believe that on-demand retail will continue to drive consumption expansion and empower offline merchants, and we remain confident in the growth potential and our leading position of Meituan Instashopping.
The in-store, hotel & travel business continued to grow robustly, with GTV increasing by over 90% year over year in the third quarter. Quarterly Active Merchants grew by over 50% year over year, and quarterly Transacting Users also increased substantially. We solidified our competitive advantage in the shelf-based model, and leveraged short-form videos and live streaming to promote mega-hit products.
For the in-store business, monthly GTV grew robustly to a new high in August. We expanded our cost-effective product offerings and offered more engaging contents. We leverage our in-depth understanding of consumer demand, LBS features, and product capabilities to incentivize online transactions. Our live streaming sessions also effectively attract nearby consumers with specific consumption needs. We expanded our geographical coverage of Meituan Platform live streaming to over 200 cities, featuring more merchants and products during holiday seasons. The number of live streaming sessions increased substantially, contributing to a larger GTV mix. We also enhanced our service offerings and AI tools to reduce entry barriers for merchants to do live streaming on our platform. In addition, transaction volumes of Special Deals continued to grow as more merchants participated and offered high-quality, cost-effective products. We further optimized traffic allocation for Special Deals and reinforced consumer mindshare in seeking value-for-money purchases on Meituan. During the summer holidays and the National Day Golden Week, we proactively launched a variety of marketing events, such as "Online Beauty Expo" and "Must-Eat Festival". These events helped promote mega-hit products across broad categories and sparked significant consumer interests and consumption. For example, during the "Must-Eat Festival", we encouraged merchants to offer "Must-Eat Set Meals", and hosted offline events to boost in-store dining consumption at nearby shopping centers.
Our hotel and travel business maintained robust growth trajectory in the third quarter. GTV and room nights grew significantly compared to the same period of both 2022 and 2019. During the summer peak season, we closely followed consumption trends, diversified our product offerings, and enhanced our pricing competitiveness, to effectively satisfy the evolving demand. After launching the "Stay For More" brand last quarter, we further enriched our "Hotel + X" packaged deals in the third quarter. In August, we released the latest "Must-Stay List", featuring a selection of over 900 hotels. We expanded our promotional efforts through live streaming and joint-marketing collaborations with high-star hotel chains, while for small- and medium-sized hotels, we helped them with traffic acquisition, room renovation, and marketing promotions. For alternative accommodations, room nights also grew robustly. During this quarter, we improved our platform's self-service capabilities, to help consumers make better-informed decision and enhance hosts' operating efficiency.
New Initiatives
For the third quarter of 2023, revenues from the New initiatives segment increased by 15.3% year over year to RMB18.8 billion. Operating loss for the segment decreased by 24.5% year over year to RMB5.1 billion, and operating margin improved sequentially to negative 27.2%.
For Meituan Select, macro headwind and consumption behavior changes continued to weigh on its growth, and the business incurred significant operating losses in the third quarter. However, operating loss margin further narrowed both on year-over-year and quarter-over-quarter basis. We maintained our market position, strengthened our product and pricing capabilities, and provided more cost-effective selections for consumers. We also enhanced our delivery efficiency, thanks to an optimization in logistics network and an increase in high-quality pick-up stations. By September-end, we had accumulated 490 million Meituan Select transacting users, allowing us to cross-sell other products and services. In addition to business development, we are committed to creating more social value. For example, we help farmers increase income, facilitate the circulation of agricultural products, and help millions of small business owners earn higher income.
Meituan Grocery delivered strong GTV growth this quarter. It has now become the preferred choice for many consumers, as user base, purchase frequency, and average order value all increased steadily. We solidified our pricing advantage, optimized logistics network and improved supply chain efficiency. We also diversified our product offerings and leveraged holiday promotions to satisfy broader demand from consumers. Moreover, our continuous improvement in private labels ensured that our consumers can access more high-quality items with guaranteed supply.
The consumption environment continued to recover steadily since the beginning of this year, as a series of macro policies that aim to facilitate economic growth were introduced. We are dedicated to providing consumers with better and more diverse products, helping merchants improve efficiency and generate more income, creating job opportunities for millions of couriers, enhancing the industry ecosystem, and helping incentivize consumption. Looking ahead, we will continue to focus on our "Retail + Technology" corporate strategy and empower the retail industry by using technological innovations, and "Help people eat better, live better".
For the full announcement of Meituan for the three months ended September 30, 2023, please visit: http://media-meituan.todayir.com/20231128164002589810981797_en.pdf
About Meituan
Meituan (HKG: 3690) (the "Company") is a leading technology-driven retail company in China. With the mission of "We help people eat better, live better," the Company uses technology to connect consumers and merchants. Service offerings on its platform address people's daily needs for food and retail goods and extend further to broad lifestyle and travel services. Meituan is the world's leading on-demand food delivery service provider and China's leading e-commerce platform for in-store dining services. Meituan helps consumers discover merchant information, make informed decisions, complete online and offline transactions and enjoy on-demand delivery. The Company currently owns several household brands in China, including Meituan, China's leading online marketplace for services, Dianping, China's leading online destination for discovering local services, Meituan Waimai for on-demand delivery services, and Meituan Bikes for bike-sharing services. The Company operates in over 2,800 cities and counties in China.
Forward-Looking Statements
This press release contains forward-looking statements relating to the business outlook, forecast business plans and growth strategies of the Company. These forward-looking statements are based on information currently available to the Company and are stated herein on the basis of the outlook at the time of this press release. They are based on certain expectations, assumptions and premises, some of which are subjective or beyond our control. These forward-looking statements may prove to be incorrect and may not be realized in future. Underlying the forward-looking statements is a large number of risks and uncertainties. Further information regarding these risks and uncertainties is included in our other public disclosure documents on our corporate website.
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