"Forecast" Brokers expect Meituan's adjusted profit in the third quarter to turn into a loss of over 16.1 billion RMB, focusing on takeaway subsidies and unit economic guidance

AASTOCKS
2025.11.24 03:43

Meituan-W (03690.HK) will announce its third-quarter results for this year this Friday (28th). Due to intense competition in the mainland's "takeaway war," the profit of its core local business has been dragged down, and the revenue from new businesses continues to suffer losses due to overseas expansion. According to a comprehensive forecast from six brokerages, Meituan's adjusted non-GAAP loss for the third quarter of 2025 is expected to be between RMB 14.625 billion and RMB 17.762 billion, compared to a net profit of RMB 12.829 billion recorded in the third quarter of 2024, with a median adjusted loss of RMB 16.13 billion.

Based on forecasts from four brokerages, Meituan's loss for the third quarter of 2025 is expected to be between RMB 15.936 billion and RMB 17.772 billion, compared to a profit of RMB 12.864 billion recorded in the third quarter of 2024, with a median loss of RMB 16.961 billion. According to forecasts from eight brokerages, Meituan's revenue for the third quarter of 2025 is expected to be between RMB 93.933 billion and RMB 98.7 billion, compared to revenue of RMB 93.577 billion in the third quarter of 2024, representing a year-on-year increase of 0.4% to 5.5%, with a median of RMB 97.533 billion, a year-on-year increase of 4.2%. Investors will focus on Meituan's management's guidance on the growth of takeaway and instant retail revenue, the competitive landscape, in-store business revenue and profit margin trends, including management's guidance on quarterly losses in instant retail and future profitability recovery (delivery subsidies, rider costs, user subsidies, etc.), and the pace of Keeta's overseas expansion (in Kuwait, Qatar, the UAE, and Brazil).

【Intense Takeaway Competition Focuses on New Guidance】

Due to fierce industry competition, increased rider costs, and consumer subsidies, brokerages generally have a pessimistic outlook on Meituan's third-quarter performance. Citi expects Meituan's third-quarter revenue to be RMB 96.966 billion, a year-on-year increase of 3.6%, with core local business revenue expected to be RMB 68.481 billion, a year-on-year decrease of 1.3% (up 4.8% quarter-on-quarter), and new business revenue expected to be RMB 28.485 billion, a year-on-year increase of 17.7% (up 7.5% quarter-on-quarter). Total EBIT is estimated to record a loss of RMB 16.301 billion (compared to an EBIT of RMB 14.582 billion in the third quarter of 2024), with core local business EBIT expected to record a loss of RMB 13.951 billion (compared to an EBIT of RMB 13.556 billion in the third quarter of 2024). The adjusted non-GAAP loss for the third quarter is expected to be RMB 14.625 billion (compared to an adjusted net profit of RMB 12.829 billion in the third quarter of 2024).

Citi expects that the amount of takeaway subsidies for Meituan in the third quarter will peak under intense competition, with operating losses for core local business and instant delivery expected to be RMB 15 billion and RMB 20 billion, respectively, while new businesses are expected to maintain a loss of RMB 2.37 billion. The group's adjusted operating and EBITDA loss forecasts are RMB 17.3 billion and RMB 16 billion, respectively. The bank expects that the anticipated unit economic improvement trend for Meituan's competitors in October is more driven by increased order density and operational efficiency rather than significant reductions in subsidies Due to the fourth quarter being a low season, it is expected that the pressure from subsidies will slightly ease, but the overall competitive landscape remains intense. The bank estimates that Meituan's total revenue in the fourth quarter will grow by 4.4% year-on-year to 92.4 billion RMB, predicting an adjusted net loss of 10.005 billion RMB, with a net profit margin of -10.8%.

Huatai Securities estimates that Meituan's revenue in the third quarter will be 97.8 billion RMB, an increase of 4.5% year-on-year; it expects an operating loss of 18.5 billion RMB in the third quarter and an adjusted net loss of 15.9 billion RMB, compared to the previous quarter, which was the most intense quarter of the current round of delivery subsidy competition, likely leading to significant pressure on Meituan's revenue growth and profits in the short term. However, the bank maintains that irrational subsidies are unsustainable. It expects Meituan's instant delivery order volume to increase by 17% year-on-year in the third quarter, and the takeout order volume to increase by 14.3% year-on-year, mainly due to increased platform subsidies, resulting in a significant expansion of the instant delivery market. However, since the third quarter is the most intense quarter of the current round of delivery subsidy competition, irrational subsidies have significantly pressured Meituan's unit economics. The bank expects Meituan's takeout unit economics to decline to -2.8 RMB in the third quarter of this year (compared to 1.48 RMB in the third quarter of last year and -0.21 RMB in the second quarter of this year). However, the bank believes that irrational subsidies in the industry are unsustainable, and as it enters the fourth quarter, platforms will gradually return to rational operations, with expectations that the competition for takeout subsidies may continue to ease.

Regarding market concerns about competition in the takeout industry, JP Morgan's report in mid-month cited experts estimating that the average daily order volume in the mainland's takeout market in September was 151 million orders, with Meituan (03690.HK) averaging 75 million orders per day (market share of 50%), compared to Alibaba's average daily orders of 63 million (market share of 41.7%) and JD's (09618.HK) average daily orders of 13 million (market share of 8.6%). The report cited experts estimating that Meituan's loss per order in September was 1.8 RMB (compared to Alibaba's loss of 3.5 RMB per order), and estimated that Meituan's loss per order in October and November would be 1.4 RMB and 1.2 RMB respectively (compared to Alibaba's estimated losses of 3 RMB and 2.7 RMB per order in October and November). JP Morgan cited experts estimating that Meituan will reach breakeven by mid-2026 and will be profitable in the second half of 2026, at which point the unit economic benefit per order will reach 0.4 to 0.5 RMB.

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According to a comprehensive forecast from six brokerages, Meituan's adjusted non-GAAP loss in the third quarter of 2025 is expected to be between 14.625 billion and 17.762 billion RMB, compared to a net profit of 12.829 billion RMB recorded in the third quarter of 2024, with a median adjusted loss of 16.13 billion RMB Brokerage Firms | 2025 Q3 Non-IFRS Adjusted Profit Forecast (RMB)

Citi | Loss of 14.625 billion

Morgan Stanley | Loss of 15.529 billion

Goldman Sachs | Loss of 16.26 billion

Bank of America Securities | Loss of 16 billion

JP Morgan | Loss of 17 billion

Goldman Sachs | Loss of 17.762 billion

Based on Meituan's 2024 Q3 Non-IFRS Adjusted Net Profit of 12.829 billion RMB

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According to the forecasts of 4 brokerages, Meituan's loss in 2025 Q3 is expected to be between 15.936 billion and 17.772 billion RMB, compared to a profit of 12.864 billion RMB in 2024 Q3, with a median loss of 16.961 billion RMB.

Brokerage Firms | 2025 Q3 Profit Forecast (RMB)

Huatai Securities | Loss of 15.936 billion

Citi | Loss of 16.422 billion

Bank of America Securities | Loss of 17.5 billion

Morgan Stanley | Loss of 17.772 billion

Based on Meituan's 2024 Q3 Profit of 12.864 billion RMB

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According to the forecasts of 8 brokerages, Meituan's revenue in 2025 Q3 is expected to be between 93.933 billion and 98.7 billion RMB, compared to 93.577 billion RMB in 2024 Q3, representing a year-on-year increase of 0.4% to 5.5%, with a median of 97.533 billion RMB, a year-on-year increase of 4.2%.

Brokerage Firms | 2025 Q3 Revenue Forecast (RMB) | Year-on-Year Change

Bank of America Securities | 98.7 billion | +5.5%

JP Morgan | 98.3 billion | +5%

Morgan Stanley | 98.027 billion | +4.8%

Huatai Securities | 97.813 billion | +4.5%

Citi | 97.253 billion | +3.9%

Citi | 96.966 billion | +3.6%

China Merchants International | 96.372 billion | +3%

Goldman Sachs | 93.933 billion | +0.4%

Based on Meituan's 2024 Q3 Revenue of 93.577 billion RMB

Meituan earnings , understand it at a glance!
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