Benjamin Godfrey is a blockchain enthusiast and journalists who relish writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desires to educate people about cryptocurrencies inspires his contributions to renowned blockchain based media and sites. Benjamin Godfrey is a lover of sports and agriculture.
After Asian trading hours, the shares of the company 1.66% to 136.60 HKD. Hopefully, the company’s shares will rebound when investors soak in the positive financials shared in the coming weeks
Chinese shopping platform for locally found consumer products and retail services, Meituan (HKG: 3690) has recorded a better-than-expected third quarter as evident in its financials. The company published its Q3 results for the quarter that ended September 30, showing revenue of approximately 62.6 billion yuan ($8.74 billion).
This third quarter revenue compares to the 48.82 billion yuan reported by the same period last year, accounting for a 28.2% surge within the time under review. Meituan was one of the major companies that faced a tough time in China with the advent of the COVID-19 pandemic. In what comes off as a breakthrough for many delivery firms, the curbs on the pandemic as instituted by the Chinese government had significant headwinds on the company’s operations across the board.
The latest Q3 results and revenue, however, showcase a recovery for Meituan, further underscoring Beijing’s efforts to bring back good health to the market as a whole. In the published financials, the company said it saw unique growth across key aspects of its business.
“Our Core local commerce segment achieved an operating profit of RMB9.3 billion for the third quarter of 2022, up from RMB4.2 billion for the same period of 2021, while the operating loss for our New initiatives segment continuously narrowed to RMB6.8 billion for the third quarter of 2022,” the company said in the report filing, adding that its “adjusted EBITDA and adjusted net profit were RMB4.8 billion and RMB3.5 billion for this quarter respectively, turning from loss positions to profit on a year-over-year basis and having remarkable increases on a quarter-overquarter basis.”
The company said that as of the end of the quarter under review, it “held cash and cash equivalents of RMB23.3 billion and short-term treasury investments of RMB88.3 billion.”
Meituan and the Basis for Revenue Growth
Meituan occupies a very pivotal position in the Chinese retail and digital ecosystem, coming off as one of the most used tech service providers in the country. Besides providing core local retail services catering to food delivery requests, Meituan also comes off as a Super App.
Through the Meituan platform, users can access such offerings including entertainment, dining, delivery, and travels amongst others. The company currently has over 90,000 employees on its payroll, coming off as a big employer of labor in the Asian continent.
The Xi Jinping-led government’s crackdown on tech stocks in a bid to control monopolies also affected Meituan. In all, the latest recovery signs shown by the company are evident the firm has adjusted its business model and surmounted the negative regulatory and economic headwinds to continually deliver value to its dedicated customers.
After Asian trading hours, the shares of the company 1.66% to 136.60 HKD. Hopefully, the company’s shares will rebound when investors soak in the positive financials shared in the coming weeks.