Melody Chen

China's delivery service giant Meituan's (3690) first-quarter profit jumped 60 percent to 5.37 billion yuan (HK$5.79 billion) from a year ago, as the number of on-demand delivery transactions posted strong growth.

Revenue from the core local commercial segment in the first quarter increased by 27.4 percent from last year to 54.6 billion yuan.

The increase in revenue from delivery services and commissions was primarily due to higher transaction volumes, while the growth in revenue from online marketing services was mainly driven by an increase in the number of online marketing merchants and their average income.

But the operating margin dropped, for which Meituan mainly blamed the lower average order value of food delivery and its Instashopping businesses.

Revenue in its new initiatives segment increased by 18.5 percent to 18.7 billion yuan, and operating loss decreased by 45.2 percent to 2.8 billion yuan, benefiting from its Meituan Select business focusing on operational enhancement and high-quality growth.

The group reported an operating cash inflow of 6 billion yuan for the first three months, with cash and cash equivalents of 50.8 billion yuan and short-term investments of 87.8 billion yuan.

Meituan closed yesterday up 0.09 percent at HK$112.70.

Meanwhile, short video platform Kuaishou Technology (1024) launched its self-developed video generation model, Keling, aiming to compete with OpenAI's AI Sora.

Keling can generate videos with resolutions of up to 1080p, lasting a maximum of two minutes with a frame rate of 30 frames per second, and supports flexible aspect ratios, according to mainland media.

Its shares fell 1.55 percent to HK$54.05.

In other news, e-commerce giant JD.com (9618) announced that it will assist the Saudi Electricity Company in intelligent logistics and digital supply chain solutions in the Middle East and North Africa.

The group said its logistics unit, JD Logistics (2618), will help SEC develop intelligent warehouse management systems and smart replenishment forecasting systems, as well as construct a warehouse and transportation network covering the entire nation.

JD.com closed down 1.68 percent at HK$117.4, and JD Logistics fell 0.81 percent to HK$8.59 yesterday.

Meituan’s revenue also surged over the first quarter. Reuters

Meituan's profit soars 60pc to 5.3b yuan in Q1