Meituan Dianping to focus on food as losses widened in Q4 2018
CGTN

Data released by Chinese services platform Meituan Dianping on Monday showed losses widen by 144 percent to more than 10 million yuan per day, despite an 89 percent uptick in revenue in the last three months of 2018.

Meituan Dianping, which provides services ranging from food delivery and transport to theater tickets and restaurant reviews, saw its operating loss increase to 3.7 billion yuan (551 million U.S. dollars) in the final quarter, with significant losses made by its bike-sharing business Mobike.

Net losses hit 3.4 billion yuan in the final quarter, even though year-on-year revenue almost doubled to 19.8 billion yuan (2.95 billion U.S. dollars).

On Tuesday morning, shares in Meituan Dianping fell by almost 9.70 percent, as investors reacted negatively to the losses.

Bike-sharing firm Mobike was bought by Meituan Dianping in April 2018. /VCG Photo

Bike-sharing firm Mobike was bought by Meituan Dianping in April 2018. /VCG Photo

An earnings call on Monday saw founder Wang Xing confirm that Meituan will focus on its food business in 2019, scaling down its bike-sharing and ride-hailing services.

That will see Meituan put an end to Mobike's Asia Pacific services, with TechCrunch reporting last week that staff in Singapore, Malaysia, Thailand, India and Australia have all been let go.

A 2.7 billion U.S. dollar deal for Mobike last April came after years of overseas expansion and overspending put an end to bike-sharing rival ofo.

Despite scaling back on its operations overseas, Mobike continued to make big losses after Meituan's takeover, bleeding 4.6 billion yuan (685 million U.S. dollars) since the takeover – more than triple its revenue.

The company announced last September that it would not look to expand its ride-hailing services, after safety concerns with Didi Chuxing.

Tencent-backed Meituan Dianping raised 4.2 billion U.S. dollars in an initial public offering in Hong Kong last September, making it the biggest tech IPO in around four years.