People pass a Meituan logo during the World Artificial Intelligence Conference in Shanghai, China on July 8, 2021. REUTERS/Yilei Sun
BEIJING (Reuters), March 25th, 2008 – Chinese food delivery company Meituan (3690. HK). reported Friday a higher-than-expected 30% increase in fourth-quarter revenue. However, investment in new initiatives caused losses and increased costs.
Meituan’s services include restaurant reviews and bike-sharing. In the last three months of 2021, Meituan reported that revenue rose to 49.52 Billion Yuan ($7.78 Billion).
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According to Refinitiv data, analysts expected 49.20 billion Yuan from Consensus, according to Refinitiv data.
Meituan continued investing in initiatives, including Meituan Select, its community e-commerce unit. The quarterly loss increased to 5.34 billion Yuan from 2.24 billion yuan one year earlier.
CEO Wang Xing stated that Meituan anticipates that its operating loss due to new initiatives will be reduced in 2022.
Last year, Chinese regulators ordered food delivery companies in China to offer workers insurance and pay more than the minimum wage.
Meituan was also targeted along with other tech giants like Alibaba Group (9988. HK) and Tencent Holdings (0700. HK) as Beijing enforced rules in a sector that had been largely unregulated.
In the past 12 months, its Hong Kong-listed shares lost half of their value.
Friday’s results revealed that Meituan’s food-delivery-related costs, which include paying delivery riders and other expenses, rose by 38.3% to 68.18 Billion Yuan in the third quarter.