Meituan serves cold warning on Chinese consumers

2 minute read

A Meituan delivery worker wearing a face mask is seen on a street following an outbreak of the coronavirus disease (COVID-19) in Shanghai, China January 13, 2021. REUTERS/Aly Song

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HONG KONG, Nov 29 (Reuters Breakingviews) - Investors searching for clues about Chinese consumers should track their snack habits. Food-delivery company Meituan (3690.HK)reported a solid 38% year-on-year jump in revenue for the three months to September, and even nodded to the popularity of spicy crayfish as late-night fare on its app over the summer. Even more impressive was the 12 million orders of milk tea received in a single day - a new record for the $200 billion outfit.

Those afternoon teas and midnight snack parties may be coming to an end. Boss Wang Xing flagged that strict Covid-19 lockdowns and slowing consumer demand will have a "meaningful negative impact" on delivery volumes over the next few quarters. Jittery shareholders promptly wiped out over $14 billion in market value on Monday morning.

Meituan's gloomy outlook on China's economy follows similar warnings read more from e-commerce giants Alibaba (9988.HK) and Pinduoduo (PDD.O). The latter's third-quarter revenue missed read more analysts' expectations by nearly a fifth, per Refinitiv. Meituan’s insights into Chinese eating habits may be the most unsavory so far. (By Robyn Mak)

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Editing by Antony Currie and Katrina Hamlin

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