MEITUAN(US:MPNGY)2020-08-21 18:02Financial Data and Key Metrics Changes - Total revenue increased by 8.9% year-over-year and 47.6% quarter-over-quarter to RMB 24.7 billion in Q2 2020 [7][48] - Adjusted EBITDA rose by 12% year-over-year to RMB 2.6 billion, with adjusted profit improving by 82% year-over-year to RMB 2.7 billion [8][56] - Operating cash flow turned positive at RMB 5.6 billion, up from negative RMB 5 billion in the previous quarter [77] Business Segment Performance Food Delivery - Gross transaction value increased by 16.9% year-over-year to RMB 108.8 billion, with daily average transactions rising by 6.9% to 24.5 million [11][60] - Revenue from food delivery increased by 13.2% year-over-year to RMB 14.5 billion [64] - Operating profit for food delivery turned positive at RMB 1.3 billion, with an operating margin of 8.6% [66] In-store, Hotel & Travel - Revenue declined by 13.4% year-over-year but increased by 46.8% quarter-over-quarter [27] - Operating profit was RMB 1.9 billion, representing a decrease of 11.9% year-over-year but an increase of 178.1% quarter-over-quarter [72] New Initiatives - Revenue from new initiatives grew by 22.1% year-over-year and 35.2% quarter-over-quarter to RMB 5.6 billion [36][74] - Meituan Grocery achieved revenue growth of over four times compared to the prior year [75] Market Data and Key Metrics Changes - Annual transacting users increased to 457.3 million, up by 8.2% year-over-year, while annual active merchants rose to 6.3 million, up by 6.7% year-over-year [8] - Daily peak food delivery orders exceeded 40 million in August, a record high [106] Company Strategy and Development Direction - The company aims to assist over one million merchants in digital transformation over the next three years [16] - Focus on enhancing the competitive advantage of core businesses and expanding the ecosystem [10] - Plans to invest in grocery retail and e-bikes to capture market opportunities [80] Management's Comments on Operating Environment and Future Outlook - Management noted the resilience of the business despite COVID-19 impacts and emphasized the importance of supporting merchants [9][45] - Future profitability is not the short-term focus; the company remains committed to long-term growth and investment in the ecosystem [79] Other Important Information - The company has built a delivery network covering over 2,800 cities with more than one million daily active delivery riders [23] - The government has recognized delivery riders as a new profession, reflecting the evolving labor market [24] Q&A Session Summary Question: Contribution from a decrease in delivery rider costs - Management confirmed that delivery cost per order decreased, contributing to improved operating profit, with operational capabilities further strengthened [84][86] Question: Trend of Average Order Value (AOV) in food delivery - AOV decreased due to the reopening of smaller restaurants, but overall trends are expected to normalize with higher quality suppliers [92][93] Question: Growth trend in food delivery business - Management expects continued growth momentum in Q3, with potential uncertainties in Q4 due to COVID-19 [106][108] Question: Recovery of in-store business - Advertising revenue has nearly returned to last year's levels, but transaction-based products still need time to recover [118][123] Question: Status of hotel business recovery - Intra-city hotel bookings have bounced back, while long-distance bookings are slower to recover due to hygiene concerns [130][131]