JD has replaced three top executives within one year, and Fliggy has rolled out large-scale layoffs. Why do large tech companies always underperform in the travel and hospitality industry?
Recently, the travel and hospitality divisions of major internet giants have all undergone sweeping adjustments, seemingly in a coordinated manner. JD has changed its leadership, Fliggy has been embroiled in layoff rumors, and Meituan has also carried out personnel reshuffles, replacing leaders, restructuring organizational frameworks, deploying AI, and ramping up investments, repeatedly overhauling their travel and hospitality businesses. Oddly enough, despite these increasingly aggressive moves, the results have not been as promising as expected. Why are these well-funded, traffic-rich, and tech-savvy tech giants collectively struggling to make a success of the travel and hospitality sector?
JD Replaces Three Leaders in a Year, Fliggy Mired in Layoff Controversies
Recently, multiple major internet giants have successively announced personnel adjustments within their travel and hospitality divisions.
On June 27, the WeChat public account "Tech Giant Guide" broke the news that a leadership reshuffle took place in JD's travel and hospitality business: former head Deng Jun was transferred to the group's talent reserve program, and Chen Yunhe, a post-90s management trainee of JD Technology, took over full responsibility for the operation of the travel and hospitality business. Meanwhile, JD Retail launched an organizational overhaul, with the travel and hospitality segment becoming one of the business units that underwent the most extensive adjustments, as the entire hotel business was split into four C3-level departments.
Deng Jun was no ordinary professional manager; he was a core executive JD specifically recruited from the OTA industry, yet he only held the position for a few short months. In fact, in less than a year, JD had already gone through three leaders, from the initial Guo Qing (who had a background at Meituan), to Deng Jun (who came from Ctrip), and now to the post-90s Chen Yunhe. What sparked further discussion was that following Deng Jun's reshuffle, his subordinate Gao Ge, the head of the hotel business, also left the company one after another. The public began to speculate whether JD's travel and hospitality division was preparing to readjust its strategy. However, up to now, JD has not made any public statement regarding the leadership changes in its travel and hospitality business.
Since mid-June, rumors of "mass layoffs" at Fliggy first spread on social platforms such as Maimai and Weibo. Various versions of the rumors, including "40% of staff laid off", "entire departments eliminated", and "98% of the company cut", kept escalating, and even spawned internet memes such as "staying inside the pigsty". Many internet employees posted to share layoff information, making Fliggy one of the most hotly discussed topics in professional communities for a time.
Some media reports stated that Fliggy did carry out a round of organizational adjustments in June, involving multiple positions in development, testing, product, and transportation services, but the scope of adjustments varied across different business lines. Some employees revealed that the overall adjustment ratio in the transportation business exceeded 30%, and some R&D teams under the CTO's office saw an adjustment ratio of 40% to 50%; other employees estimated based on changes in DingTalk headcount that the total size of the CTO's office dropped from 1244 to 916 people, representing an adjustment ratio of about 26%, before later rebounding to 929 people.
Facing the growing public outcry, Fliggy issued its first public response on July 17, clarifying that the online rumors of "mass layoffs" and "entire departments being completely eliminated" were untrue. The overall personnel change ratio at the company was less than 10%, which constituted normal business personnel optimization, rather than a downsizing of the travel and hospitality business.
Meituan's personnel adjustments also involved its travel and hospitality business. Citing multiple Meituan employees, media reports said that since May this year, Meituan had launched organizational optimization across multiple business lines, including core departments such as in-store group buying, Meituan Flash Purchase, and commercialization. Among them, the in-store group buying segment is a key department supporting Meituan's travel and hospitality business, which is highly connected to local life services such as hotels, homestays, and scenic spots. At the same time, many netizens who claimed to be Meituan employees left messages on social platforms stating that this round of Meituan layoffs had impacted the travel and hospitality business.
In response, Meituan stated that the actual number of employees who left the company in the past two months was less than 2000, accounting for a low proportion of the total workforce, which constituted normal business optimization.
On an individual basis, whether it is leadership reshuffles or personnel optimization, these are routine practices for internet companies. However, when JD, Fliggy, and Meituan all carried out organizational adjustments to their travel and hospitality-related businesses within almost the same time window, this series of moves deserves the attention of the hotel industry. An industry insider said: "Several internet platforms have almost simultaneously begun to readjust their travel and hospitality organizations. There must be deeper reasons behind these moves than just personnel changes."
Why Do Tech Giants Frequently Overhaul Their Travel and Hospitality Businesses?
If we had to use one word to summarize the state of major internet giants in the travel and hospitality track over the past two years, there would be no better term than "overhauling". The high frequency of their actions makes it seem less like they are fighting a well-structured battle, and more like they are repeatedly testing, adjusting, and never finding a comfortable operational rhythm. What exactly do these overhauls look like?
First, frequent personnel changes, with hiring and layoffs happening simultaneously.
On June 18, 2025, JD released an open letter to all hotel operators, playing the "up to three years of 0 commission" card and making a high-profile announcement of its entry into the travel and hospitality market. At the same time, JD began to aggressively recruit talent. Back then, there were widespread rumors in the industry that JD was poaching people from platforms like Fliggy, Tongcheng, and Ctrip by offering triple their original salaries, and many job postings even explicitly stated "Ctrip and Meituan employees are preferred".
However, not long after the excitement peaked, the situation took a turn. According to reports from hotel industry media, in less than a year, JD's travel and hospitality division had already gone through two or three rounds of layoffs: one round before the Spring Festival, and another before the May Day holiday. The entire team was downsized from hundreds of people to just dozens. It is said that there will be another round of layoffs in October, but no public information has confirmed this yet. The management also saw intensive leadership changes, with three different heads appointed within a single year.
Fliggy's situation is somewhat similar: while embroiled in layoff rumors, it also publicly stated that the company is continuing to hire new employees, and the number of new recruits is roughly equal to the number of employees who left. A check on recruitment platforms shows that Fliggy is still hiring for positions such as chain hotel BD, luxury hotel store operation specialists, OTA business managers, and luxury hotel BD.
Although Meituan has not changed its leadership as frequently as JD, its management adjustments have never stopped. From Guo Qing being transferred to head the two-wheeled vehicle business unit, to internally cultivated managers such as He Xiao, Liu Yanxiang, and Feng Weihe taking over, to former pharmaceutical business head Li Jinfei being put in charge of the hotel and travel business.
Second, continuously ramping up investments to clarify the core status of the travel and hospitality business.
In April 2026, Douyin Local Life completed a major organizational restructuring, elevating the travel and hospitality segment from a subcategory under local life services to an independent business with dedicated operational logic, on par with the KA and self-service divisions.
In June 2025, Alibaba merged Fliggy and Ele.me into the China E-Commerce Business Group, with Fliggy CEO Zhuang Zhuoran reporting to Jiang Fan. Wu Yongming made the positioning clear in an internal email, stating that this was a key step for Alibaba to "evolve from an e-commerce platform to a large consumer platform". In essence, the goal was to leverage high-frequency entry points such as Taobao and Alipay to guide more users into the low-frequency travel consumption scenarios.
Subsequently, Fliggy continued to invest in the hotel ecosystem. At the hotel merchant summit held at the end of 2025, Fliggy announced the upgrades of the Official Hotel Brand Flagship Store 2.0 and the "Fzhu Alliance" 2.0, providing free access to a suite of AI operation tools, while investing 1 billion yuan in cash subsidies, tens of billions of traffic, and tens of billions of exposure to support hotel merchants. Zhuang Zhuoran put it plainly at the time: "Now is the best time for hotel merchants to deeply engage with Fliggy."
JD followed the same path. In September 2025, it signed a strategic cooperation agreement with Jin Jiang Hotels to collaborate on catering innovation, travel and hospitality services, and supply chain coordination. In early 2026, it established the wholly-owned Beijing JD Cultural Tourism Development Co., Ltd. to further expand its footprint in the travel and hospitality track. Then in July 2026, JD Retail launched an organizational overhaul, cutting two levels of management, and splitting the travel and hospitality business into four C3-level departments.
Third, all platforms are "unanimously" focusing on the technology track and prioritizing AI development.
JD launched the "7Fresh Mini Kitchen" initiative, aiming to integrate AI robot kitchens, supply chains, and hotel catering spaces to explore new travel and hospitality consumption scenarios. Fliggy established its CTO office at the end of last year, and this year's organizational adjustments are also primarily focused on the R&D system. The industry generally believes that this means Fliggy is strengthening its technical foundation to prepare for AI applications.
Embracing the AI trend, at the recent Meituan general meeting of shareholders, Wang Xing stated that AI will have a significant impact and transformation on Meituan's workflows, and this is a necessary transformation. Meituan is also actively experimenting with AI in its products, such as the "Xiaotuan" assistant. In June this year, Meituan established the AI Transformation department, led by Mu Yao, who reports directly to Wang Puzhong. The industry generally believes that the hotel and travel business is expected to become a key test field for AI to transform the supply side and operation side.
It is evident that the travel and hospitality divisions of major tech giants have been almost constantly overhauling their operations. However, the more they adjust, the more obvious a question becomes: Why are almost all major giants modifying, testing, and ramping up investments in this business, yet still failing to find the true "optimal solution" for the travel and hospitality sector?
After Rounds of Overhauls, the Results Remain Underwhelming
If we only look at the actions taken, the travel and hospitality businesses of major tech giants have been bustling with activity over the past two years. But the capital market ultimately values results over actions. Looking at actual business performance, this travel and hospitality battle still falls short of the initially envisioned outcomes.
JD is the most typical example. When it made a high-profile announcement to enter the travel and hospitality sector in 2025, Liu Qiangdong's remarks about "up to three years of 0 commission" and "the 60% gross margin of the travel and hospitality industry is too high, JD can operate with 20%" immediately raised the industry's expectations to a peak. Within 48 hours, JD announced that nearly 50,000 hotels had applied to join the platform. The industry once believed that the OTA market was about to welcome a new disruptor.
At this pace, JD's travel and hospitality business should have grown very rapidly. However, media reports indicate that JD Travel currently has an average monthly room night volume of about 200,000. On average, each hotel contributes less than 2 room nights per month. Compared to the high-profile entry momentum, this business performance clearly has much room for improvement. Up to now, JD has never disclosed core operating indicators such as travel and hospitality GMV and order volume to the public.
Fliggy is in the same situation. Before being merged into Taobao, it was gradually marginalized in the domestic market, with its market share continuously declining. Over the past year, after Fliggy was merged into the China E-Commerce Business Group, Alibaba began to reopen its traffic resources to Fliggy. During the National Day holiday last year, Fliggy's GMV increased by 48% year-on-year. Adjusted for the number of holiday days in the previous year, the average daily growth rate also exceeded 40%, and the business returned to growth. But behind this growth, the pressure on Fliggy has not disappeared.
On one hand, Ctrip firmly occupies the mid-to-high-end business travel market, while Meituan continues to deepen its presence in the local accommodation consumption market. Caught in between, Fliggy has long faced pressure on its market share. On the other hand, the flagship store and pre-sale models that Fliggy relied on for its initial success are increasingly converging with the standard OTA real-time booking model, and its once-proud differentiated advantages are weakening.
More critically, Fliggy is still not free from losses. Public information shows that Fliggy remained unprofitable in the 2025 fiscal year, while during the same period, Ctrip and Meituan's travel and hospitality businesses had both achieved profitability. The CTO office, which was just established at the end of last year, underwent personnel adjustments of about a quarter of its size this year. The fact that a technical team established less than half a year ago began to downsize also indicates that the technology-driven new growth path has not yet delivered the expected results, at least for now.
Meituan has also begun to feel new pressures. Ahead, Ctrip firmly guards the high-star hotel and business travel market; behind, Douyin and AutoNavi are continuously siphoning off local travel and hospitality traffic. In particular, Douyin, leveraging lower prices and more flexible voucher-based consumption models, is continuously capturing price-sensitive users.
This competition has already begun to be reflected in business performance. Previously, Meituan's core local commerce revenue once recorded a year-on-year decline. The industry generally believes that the in-store business, including hotels, is facing continuous diversion from platforms such as Douyin. In addition, for the full year 2025, Meituan's revenue reached 364.9 billion yuan, but its net profit turned from positive to negative — with a full-year net loss of 23.4 billion yuan and an operating loss of 17 billion yuan. The once most profitable core local commerce segment directly shifted from an annual profit of 52.4 billion yuan to an operating loss of 6.9 billion yuan. Even Wang Xing, who rarely publicly reflects on business performance, admitted at this year's general meeting of shareholders: "The company's stock price has not performed well in the past few years, and I take full responsibility for that." However, at Meituan's annual general meeting on June 26, Meituan CFO Chen Shaohui stated that the in-store travel and hospitality segment still maintains a profit margin between 20% and 30%.
Looking at all these platforms together, we can see that none of them have truly met the expectations they set when they first entered the travel and hospitality sector. In this context, the frequent leadership changes, layoffs, and organizational adjustments over the past year are not difficult to understand. Internet companies will never sustain long-term investments in a business that only exists to tell a good story. When investments fail to translate into growth as expected, and growth cannot be converted into profits, adjusting the organizational structure and optimizing personnel is almost inevitable.
There Are No Shortcuts in the Travel and Hospitality Business
"Space Insight" believes that the real lesson these tech giants need to learn for their travel and hospitality businesses is perhaps not AI, nor organizational restructuring, but a renewed understanding of the travel and hospitality business itself. The biggest miscalculation is the assumption that internet logic can be used to solve the unique challenges of the hotel industry.
Let's first look at the flaws in their business models and shortcomings in services. The biggest advantage of internet platforms is their ability to rapidly replicate models. However, travel and hospitality is inherently a "service-heavy" business. For example, from hotel contracting and price maintenance, to customer service, after-sales support, and complaint handling, to member operation and merchant services, every link requires long-term accumulation.
A service system, by its nature, requires manpower, time, and continuous investment to build. A domestic and international service network covering pre-sales, in-sales, and after-sales cannot be established within three to five years. This capability cannot be built through a single organizational adjustment or a single externally recruited executive.
Why can't JD and Fliggy build a strong service system? The numbers simply don't add up. A low-star hotel room costs just over 100 yuan, and the commission margin is already thin. Where would the profits come from to support a customer service team of thousands of people? Ctrip has a higher average order value, and the gross margin from luxury hotel orders is sufficient to cover service costs, which is why Ctrip can afford to invest heavily in services. This is not a difference in philosophy, but a structural gap. A low-margin business cannot sustain high-standard services. Without resolving this contradiction, stable user experience will be hard to achieve.
There is another point: the internet's traffic-driven strategy does not work in the travel and hospitality industry. The logic of e-commerce is "capture users first, then figure out the