Meituan (美团) posts 23.4 billion yuan net loss as CEO vows to curb “involution” and cut spending on low‑quality delivery orders

Big loss, bigger pivot

It has been reported that Meituan (美团) posted a net loss of 23.4 billion yuan in its latest results, underscoring pressure on China’s dominant local‑services “super app.” Short and stark: the company that built its scale on heavy subsidies and rapid expansion is now signaling a course correction. Wang Xing (王兴), Meituan’s founder and CEO, reportedly said he opposes “involution” (内卷) — the Chinese shorthand for wasteful, zero‑sum competition — and plans to cut spending on low‑quality food delivery orders.

What “involution” means for food delivery

“Involution” here refers to subsidy wars, steep discounts and promotion tactics that drove volume but eroded margins across the sector. Meituan’s move to trim support for low‑quality, low‑margin orders aims to stop a race to the bottom and lift profitability. It has been reported that the company will prioritize higher‑quality orders and more sustainable commission and subsidy structures rather than chasing sheer order growth at any cost.

Context: a tougher environment for China’s platform giants

For Western readers: Meituan is one of China’s largest consumer internet firms, offering food delivery, in‑store services, hotel bookings and more. The shift toward profitability follows years of heavy investment and a tougher regulatory climate in China, where anti‑monopoly scrutiny and consumer‑protection rules since 2020 have constrained rapid, low‑cost growth models. Geopolitical headwinds and global supply tensions have also pushed Chinese tech firms to focus more on resilience and margins.

What’s next?

Cutting low‑quality subsidies could help Meituan stabilize finances but also risks higher prices for consumers and thinner order volumes for small merchants. Can Meituan restore profit without reigniting the very “involution” it criticizes? Investors and industry players will be watching whether the company can balance healthier unit economics with the fierce competition that still defines China’s on‑demand services market.