Beyond ecological win - win, Meituan's technology narrative
At the end of last year, both the Central Economic Work Conference and the Government Work Report this year listed "vigorously boosting consumption, improving investment efficiency, and comprehensively expanding domestic demand" as the top priority among this year's key tasks. On March 16, the "Special Action Plan for Boosting Consumption" issued by the General Office of the Communist Party of China Central Committee and the General Office of the State Council clearly stated that it will implement actions to improve the quality of service consumption and benefit the people, promote consumption of living services, and expand consumption in culture, sports, and tourism.
This means that whether from a policy perspective or an industry's spontaneous trend, the growth momentum of service consumption will be very strong. According to data released by the National Bureau of Statistics, in 2024, China's service retail sales increased by 6.2% compared with the previous year, with a growth rate 3 percentage points higher than that of commodity retail sales during the same period. With policy support in 2025, the growth is likely to accelerate further.
Not long ago, Meituan also announced that it would officially rename its original In-Store Comprehensive Business Unit (In-Store Comprehensive BU) as the Service Retail Business Unit. In fact, Meituan's core business is an important participant in service retail and one of the biggest beneficiaries of promoting service consumption.
On March 21, Meituan released its full - year and fourth - quarter financial reports for 2024. In terms of data, in 2024, Meituan achieved an operating income of 337.592 billion yuan, a year - on - year increase of 22%. In the single quarter of 2024, Meituan achieved an operating income of 88.487 billion yuan, meeting the expectations of the capital market.
Meituan achieved steady growth in 2024, mainly due to two factors. First, the synergy effect of the company's internal businesses was significantly enhanced under the organizational structure adjustment. Second, the entire retail business ecosystem, including merchants, users, riders, and the platform, showed relative advantages in the industry.
01
Results of Business Synergy Appear
Since 2024, Meituan has carried out several organizational structure adjustments, with the keyword being "integration". For example, it integrated the Home Delivery Business Group, the In - Store Business Group, the Meituan Platform, and the Basic R & D Platform into the Core Local Commerce, canceling the independent business group structure. It also merged businesses such as Meituan SaaS, cycling, and power banks into "Software and Hardware Services", and combined businesses such as Kuailv, Xiaoxiang, and Youxuan into "Grocery Retail".
Generally speaking, when enterprises integrate their organizational structures, they often do so to avoid redundant consumption of functional resources, strengthen collaboration between businesses, and unify strategic goals. Meituan is no exception.
In the past, under the Internet's traffic dividend, Meituan adopted a vertical organizational structure mainly composed of various business groups, aiming to maximize the enjoyment of the industry's growth dividend through focused vertical businesses. As the traffic dividend fades, the core driving factor for business growth will gradually shift from the growth of user quantity to the growth of user stickiness. At the same time, users' demands for consumption scenarios and merchants' demands for business scenarios are becoming increasingly diverse, which prompts Meituan to strengthen the collaboration and integration between businesses.
For example, in recent years, consumers' demand for instant retail has increased significantly, which has changed the consumption scenario of some commodities from in - store consumption to home delivery consumption, corresponding to Meituan Flash Shopping. In addition, in - store catering merchants also have the demand to expand their take - out business and can also use the word - of - mouth of in - store and take - out consumption to attract customers to each other, corresponding to the brand satellite stores. This means that for both consumers and merchants, the barriers between home delivery and in - store consumption scenarios are gradually disappearing, and the platform naturally needs to break down business barriers in a timely manner, enhance the synergy between home delivery and in - store businesses, and reduce redundant consumption of resources, which is also one of the core reasons for Meituan's several organizational structure adjustments.
Based on the organizational structure adjustment, specifically for the realization of business synergy, Meituan first took the expansion of the "Super Member" as the main starting point.
This is mainly due to two reasons. First, Meituan needs a traffic entrance that covers both in - store and home delivery businesses to achieve the mutual conversion of in - store and home delivery users. Second, Meituan needs a landmark brand asset to enhance user awareness. The Super Member system, which has been successfully implemented in the in - store business before, naturally became the best choice.
According to Meituan's disclosure, the Super Member covered all categories of the Core Local Commerce in July 2024 and was further extended to categories such as group tours and scenic spot tickets in the fourth quarter. Currently, the proportion of in - store hotel and tourism merchants participating in the "Super Member" has exceeded 70%, and the proportion of orders placed using Super Coupons has continuously increased to more than 40% of the total orders in the Core Local Commerce, with a higher increase in GTV contribution. At the same time, Meituan also further disclosed in the earnings conference call that in the future, the Super Member will be further upgraded to the Meituan Member to further strengthen user awareness.
From the financial data, a series of measures taken by Meituan in organizational structure adjustment and business synergy have also achieved obvious results.
First, the revenue continued to grow steadily. In 2024, the Core Local Commerce of Meituan achieved a revenue of 250.247 billion yuan, a year - on - year increase of 20.9%.
Second, the gross profit margin rebounded year - on - year, and the expense ratios of various items decreased significantly. Looking at each quarter, Meituan's gross profit margin in each quarter of 2024 was higher than that in the same period of 2023. At the same time, the company's sales expense ratio also declined year - on - year starting from the second quarter of 2024, with a year - on - year decline of about 3 percentage points from Q2 2024 to Q4 2024. This is partly due to the reduction of losses in the Youxuan business and partly due to the improvement of operational efficiency after business synergy.
Source: Data of Meituan's quarterly gross profit margin, sales expense ratio, and management expense ratio. Compiled by Wind and 36Kr.
02
Concept of Ecosystem Win - win Further Implemented
Meituan's steady growth in performance not only benefits from the internal driving force brought by business synergy but also stems from its long - term adherence to the ecosystem win - win strategy, that is, based on the positive interaction of the entire ecosystem including users, merchants, riders, and the platform, it conducts business expansion and planning.
The logic behind Meituan's insistence on building a win - win ecosystem is not difficult to understand. While deeply understanding and meeting users' needs, it is essentially creating business growth for merchants and riders. On the other hand, while helping merchants improve operational efficiency and protecting riders' rights and interests, Meituan is actually creating high - quality and stable supply for users. Specifically, Meituan has taken the following main measures for its business ecosystem:
For users, Meituan mainly enriches high - quality supply to meet users' diverse needs.
After observing users' growing demand for instant retail, Meituan, based on Flash Shopping, continuously expands the supply of high - quality categories, providing consumers with a shopping experience of "everything delivered to home in 30 minutes". As of the end of 2024, Meituan Flash Shopping had reached cooperation with more than 5,600 large - scale chain retailers, 410,000 local small merchants, and more than 570 brand owners. In addition, in response to users' demand for high - quality take - out, Meituan also jointly launched "brand satellite stores" with branded catering to provide users with high - quality and cost - effective take - out.
At the same time, Meituan is also actively promoting the construction of the food safety system, recently launched a "Transparent Kitchen" section, and vigorously promoted the "Sunshine Kitchen" across the country. It also provides support such as hardware equipment, subsidies, and platform traffic tilt to participating merchants.
For merchants, Meituan mainly simplifies marketing and combats involution to create a healthy business environment for merchants.
In December 2024, Meituan officially launched the Merchant Support Plan, investing 1 billion yuan in real money to support high - quality merchants in exploring innovation. Currently, the plan has completed three batches of cash payments, and a total of 38,000 high - quality merchants have received cash support. In addition, Meituan also creates more customized, diversified, and efficient marketing tools for merchants through special - price group buying, live - streaming activities, and theme marketing. It also provides tool services such as consumer insight, review management, and list ranking to help merchants optimize their operations and accumulate digital assets.
For riders, Meituan is committed to improving riders' rights and interests protection and welfare care, with improving welfare benefits and work experience as the top priority.
In 2024, Meituan implemented a series of measures, including the access solution for the "Rider - Friendly Community", the launch of the "Rider's Home" function, and the pilot of the rider fatigue management mechanism. At the same time, Meituan also implemented a series of care measures, such as the launch of an anti - fatigue function on the system side, special care configuration for deaf and mute riders, and assistance for riders' family members who have suffered from major diseases or need educational assistance.
Regarding the issue of riders' social security, which the market is more concerned about, after in - depth research and under the guidance of relevant departments, Meituan has initially formulated a pilot plan for riders' social security and will start implementing it in some cities in the second quarter of this year. In addition, since July 2022, under the guidance of the Ministry of Human Resources and Social Security, Meituan took the lead in launching a pilot project for occupational injury insurance for new forms of employment. It has invested 1.4 billion yuan to pay occupational injury insurance premiums for more than 6 million riders in 7 pilot provinces and cities.
According to the disclosure, in 2024, Meituan's annual transaction users exceeded 770 million, the number of annual active merchants increased to 14.5 million, and the average annual transaction frequency of users also reached a record high. The growth of operating data largely stems from Meituan's long - term adherence to the ecosystem win - win strategy. Of course, this will ultimately be translated into the company's financial performance.
03
New Growth Curves are Emerging
In recent years, going global, AI, and robots have become hot words in the capital market. The progress of enterprises going global and their AI layout have become key factors in boosting their valuations. Meituan has also made breakthrough progress in these two directions.
First, in terms of going global, in September 2024, Meituan's overseas food delivery platform, Keeta, entered the Saudi market for the first time. Currently, it has launched operations in all major cities in Saudi Arabia, and the number of users and orders has increased rapidly.
Tianfeng Securities estimates that under a neutral scenario, the total scale of the food delivery market in Saudi Arabia is expected to reach 110.4 billion yuan, and the total scale of the food delivery market in the six Gulf countries is expected to reach 156.6 billion yuan. Meituan's market share in China is higher than 70%. Considering that Meituan has relatively rich experience in food delivery operations and successful experience in going global, assuming that Meituan's penetration rate fluctuates between 50% and 80%, in the medium - term, the overseas business is expected to bring considerable profits to Meituan.
In terms of AI, Meituan also disclosed its current progress and future plans in the earnings conference call. Currently, Meituan has made three - level layouts in AI: the first level is to integrate artificial intelligence into employees' daily work; the second level is to use artificial intelligence to upgrade existing products and services for enterprises and consumers; the third level is to build an internal large - language model.
Meituan disclosed that in 2024, the company had invested billions of yuan in GPU resources, and in 2025, it plans to further increase its investment in this key area. At the same time, in terms of R & D investment, Meituan's cumulative R & D investment in 2024 was 21.1 billion yuan.
The explosion of the AI industry has also brought new development opportunities to the robot industry. As early as 2016, Meituan began to explore automatic delivery and started research and development on drones in 2017. As of the end of 2024, Meituan's drones had opened 53 routes, with a cumulative delivery of more than 450,000 orders. The automatic delivery vehicles had a cumulative delivery of nearly 5 million orders, meeting the delivery needs of hundreds of communities, with the proportion of autonomous driving mileage reaching 99%. In addition to the upcoming opening of delivery routes in Hong Kong, Meituan's drones recently started commercial operations in Dubai.
The significance of AI and robots for Meituan lies in that in food delivery, there are many delivery scenarios that are difficult to complete manually, such as extreme weather, complex road conditions, special terrains, and closed scenarios such as scenic spots and parks, which make road delivery difficult. Drones can supplement the delivery capacity through technological capabilities, and even cross mountains and seas.
For example, recently, Meituan's drones completed the first delivery in Hong Kong, providing a new solution to the delivery problem of crossing mountains and seas.
The straight - line distance from Ma On Shan Park in Hong Kong to Pak Shek Kok Promenade in the Hong Kong Science Park is only 1.8 kilometers, but due to the factors of crossing the sea and the park's terrain, the cycling distance reaches 7.8 kilometers, taking about 40 minutes. However, if it is completed by drones, they can fly in a straight line, greatly shortening the delivery time and improving the consumer experience.
Therefore, as Meituan's two growth curves of going global and AI gradually become clear, it will undoubtedly reshape Meituan's valuation logic and open up new imagination space for the market regarding Meituan.