$MEITUAN-W(03690)$ 25 Earnings Conference Call Transcript Summary: Meituan's 2Q core pressure comes from takeaway subsidy wars, but stabilizes fundamentals through combination of strategies and regulatory compliance strengths, flash sales/lower tier cities as growth highlights, and internationalization (Middle East, Brazil) as long term layout. $MEITUAN-WR(83690)$
Core business performance
Q1: What are the core trends in Core Local Services (CLC) in 2Q25?
A1.
Unit volume: year-on-year growth rate flat with 1Q/4Q24
Revenue: overall CLC growth declined to 9-11% (takeaway +5%), with revenue growth lower than unit volume growth for the first time due to subsidies offsetting delivery revenue
Profit: double-digit year-on-year decline, mainly due to intensified takeaway seasonal competition (5.28 joined the 618 campaign, and the average subsidy per unit reached $10)
Q2: How is takeaway UE (Unit Economic Efficiency) affected?
A2.
User subsidies: more than 1 yuan / single, delivery fee / commodity price subsidies are counted as marketing expenses
Competitive environment: Jingdong, Ali from May irrational subsidies (single average loss of 8-10 yuan), Meituan was forced to follow, but the use of "the main site + spell good meal + sharpshooter" combination of strategies (the peak volume of orders reached 15 million / 10 million orders)
Competition and Regulation
Q3: How to deal with the current competition in the takeaway market?
A3.
Strategy: do not completely follow the low-quality subsidies, through the differentiation of the supply (such as spell good meal low-priced single, sharpshooter in the high-priced single) to retain the user
Regulatory impact: the General Administration talks against "in-rolls", MMT's rate transparency (21 years of splitting technical service fees/delivery fees) is in line with the new regulations, and competing subsidies may face policy risks.
Q4: How is the flash sale business performing in 1Q-2Q25?
A4.
1Q: 30%+ unit volume growth, 1% GTV margin (historical high), 70% 3P unit volume market share
2Q: Slight loss due to 618 investment, but strong growth in high-unit categories (e.g., electrified products)
On-site Travel
Q5: Has the growth of in-store travel been affected by takeaway competition?
A5.
1Q: GTV up 30% (40%+ increase in store visits), revenue up 20% (ad growth lower than commissions)
2Q: Revenue slowed slightly (high teens) as some milk tea demand shifted to online, but growth in lower tier cities quadrupled year-ago.
New business and internationalization
Q6: What are the main causes of new business losses?
A6.
1Q: Loss of $2.3bn (Keeta's overseas expansion partially offsets UE improvement)
2Q: loss widens to 2.5-2.6bn (Keeta unit volume growth but UE improvement)
Brazil plan: target year entry (4.8% of F&B GDP, only 33% online) but limited financial impact
Key risks and outlook
Q7: What is the full-year earnings guidance?
A7.
Uncertainty: duration of subsidy war unknown, government may intervene in irrational competition
Flash sales: scale exceeds expectations, but profit margins are under pressure.
Rider social security: pilot cities in progress, currently low willingness to participate in the insurance, the impact is less than the competition
Q8: What is the impact of the new regulations on Internet platform fees on Meituan?
A8.
Advantage: The rate transparency of Meituan has been first, and the competition may need to adjust the repeated charges and other chaotic phenomena.
Merchant support: Optimizing the business environment through the "$100 billion promotion plan" is consistent with the direction of regulation.
Comments