Despite the drag of its Mobike business, Chinese food delivery giant Meituan has a good quarter with a 70.1% year-on-year revenue growth in the first quarter of 2019, its latest corporate filing shows.
Meituan booked RMB 19.17 billion (USD 2.77 billion) in revenue and RMB 5.07 billion in gross profit in the first quarter of 2019, up 70.1% and 57.8% respectively from the same period last year. Its quarterly operating loss, however, also increased 24.5% annually, from RMB 1.05 billion to RMB 1.30 billion.
The company said its food delivery business has “sustained its strong growth momentum,” with the number of transaction orders increased from 1.2 billion in the first quarter of 2018 to 1.7 billion in the same period this year, up 35.8%. Gross profit from the business grew by 187.9%, from RMB 535.1 million in the three months ended March 31, 2018 to RMB 1.5 billion in the same period of 2019.
Meituan said it was “disciplined” on capital allocation for its new business initiatives, such as closing Ella supermarkets in lower-tier cities, restructuring Mobike’s overseas operations and cutting back subsidies for its ride-hailing business.
Meanwhile, the Beijing-based tech giant expanded its ride-hailing services to 15 new cities, including Shenzhen, Guangzhou, Hangzhou, and Chengdu. It plans to further roll out ride-hailing services in more cities in 2019, according to the filing.