China's Food-Delivery Price War Costs Meituan, Alibaba, and JD.com $14 Billion
Intense subsidy spending in China's competitive food-delivery sector has resulted in combined costs exceeding 100 billion yuan ($14 billion) for tech giants Meituan, Alibaba, and JD.com across the second and third quarters of 2025. Meituan reported a staggering 19.8 billion yuan ($2.7 billion) operating loss in the third quarter, marking its largest deficit since going public. Similarly, Alibaba saw its operating profit plummet from 35.2 billion yuan to 5.4 billion yuan ($4.9 billion to $0.75 billion) during the same period. JD.com also recorded a significant 10.5 billion yuan ($1.4 billion) operating loss after adjusting its expenditure strategies. Despite Meituan's sales expenses surpassing those of rival Pinduoduo, even with lower transaction volumes, Alibaba's Taobao Instant Commerce managed to capture a 40 percent share of the restaurant delivery gross merchandise value under a two-player market definition. This financial strain highlights the severe impact of aggressive pricing strategies and subsidy wars among major Chinese e-commerce and delivery platforms, significantly affecting their quarterly profitability and operational stability.
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China's Food-Delivery Price War Costs Meituan, Alibaba, and JD.com $14 Billion
Intense subsidy spending in China's competitive food-delivery sector has resulted in combined costs exceeding 100 billion yuan ($14 billion) for tech giants Meituan, Alibaba, and JD.com across the second and third quarters of 2025. Meituan reported a staggering 19.8 billion yuan ($2.7 billion) operating loss in the third quarter, marking its largest deficit since going public. Similarly, Alibaba saw its operating profit plummet from 35.2 billion yuan to 5.4 billion yuan ($4.9 billion to $0.75 billion) during the same period. JD.com also recorded a significant 10.5 billion yuan ($1.4 billion) operating loss after adjusting its expenditure strategies. Despite Meituan's sales expenses surpassing those of rival Pinduoduo, even with lower transaction volumes, Alibaba's Taobao Instant Commerce managed to capture a 40 percent share of the restaurant delivery gross merchandise value under a two-player market definition. This financial strain highlights the severe impact of aggressive pricing strategies and subsidy wars among major Chinese e-commerce and delivery platforms, significantly affecting their quarterly profitability and operational stability.
TechNode