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Tencent-Backed Meituan's Losses Balloon in Duel With Alibaba

  • The internet giant is spending to contain its rivals’ forays
  • Meituan gross margin thinned due to subsidy spending
Bloomberg business news
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Meituan Dianping is reaping the benefits of scale in its core food delivery division as it feels the pain of competition from arch-foe Alibaba Group Holding Ltd. in smaller businesses such as hotel bookings.

While revenue almost doubled in the December quarter, its net loss widened 57 percent to 3.4 billion yuan ($508 million) as profitability shrank in travel and bike-sharing. To keep a lid on swelling costs, Meituan said it’s kicked off a restructuring that will see loss-making bike-rental subsidiary Mobike pull out from most of its overseas markets.