2025-05-26 Meituan (MPNGY) Q1 2025 Earnings Call Transcript

Meituan (OTCPK:MPNGY) Q1 2025 Earnings Conference Call May 26, 2025 7:00 AM ET

Company Participants

Scarlett Xu - VP & Head-Capital Markets

Xing Wang - Chairman & CEO

Shaohui Chen - SVP & CFO

Conference Call Participants

Ronald Keung - Goldman Sachs

Ya Jiang - CITIC Securities

Kenneth Fong - UBS

Gary Yu - Morgan Stanley

Alicia Yap - Citigroup

Thomas Chong - Jefferies

Operator

运营人员

Thank you for standing by, and welcome to the Meituan First Quarter 2025 Earnings Conference Call. All participants are in a listen-only mode. There will be a presentation followed by a question-and-answer session. \[Operator Instructions]

感谢各位耐心等待，欢迎参加美团2025年第一季度业绩电话会议。所有参会者目前处于仅收听模式。会议将先进行演示，随后进入问答环节。\[操作员指引]

I would now like to hand the conference over to Scarlett Xu, VP and Head of Capital Market. Please go ahead.

现在我将会议交给美团副总裁兼资本市场负责人Scarlett Xu女士，请开始。

Scarlett Xu

Thank you, operator. Good evening, and good morning everyone. Welcome to our first quarter of 2025 earnings conference call. Joining us today are Mr. Xing Wang, Chairman and CEO; and Mr. Shaohui Chen, Senior Vice President and CFO of Meituan. For today’s call, management will first provide a review of our first quarter of 2025 results and then conduct a Q\&A session.

感谢主持人。各位晚上好、早上好，欢迎参加美团2025年第一季度业绩电话会议。今天与会的有美团董事长兼首席执行官王兴先生，以及高级副总裁兼首席财务官陈少晖先生。本次会议，管理层将首先回顾2025年第一季度业绩表现，随后进入问答环节。

Before we start, we would like to remind you that our presentation contains forward-looking statements, which include a number of risks and uncertainties and may differ from actual results in future. This presentation also contains unaudited non-IFRS accounting standards financial measures that should be considered in addition to and not as a substitute for measures of the company’s financial performance prepared in accordance with IFRS accounting standards. For a detailed discussion of risk factors and IFRS accounting standard measures, please refer to the disclosure document in the IR section of our website.

在会议开始之前，我们提醒各位，本次演示包含前瞻性声明，这些声明涉及多项风险与不确定性，实际结果可能与预期不同。本演示还包含未经审计的非IFRS财务指标，应与按IFRS编制的财务指标共同参考，而非替代。关于风险因素及IFRS财务指标的详细说明，请参阅公司官网投资者关系栏目中的披露文件。

Now I will turn the call over to Mr. Xing Wang. Please go ahead, Xing.

现在我将电话交给王兴先生，请开始。

Xing Wang

王兴

Thank you, Scarlett, and hello everyone. In the first quarter, our business maintained steady growth with revenue increasing by 18.1% year-over-year to RMB 86.6 billion. Both annual transacting users and annual active merchants reached new highs. We are delighted that an increasing number of consumers and merchants choose Meituan as their preferred platform for local services.

感谢Scarlett，大家好。第一季度，我们的业务保持稳健增长，收入同比增长18.1%，达到人民币866亿元。年度交易用户数和年度活跃商家数均创历史新高。我们欣喜地看到，越来越多的消费者和商家选择美团作为首选本地服务平台。

Beyond our ongoing efforts in enhancing products and services to elevate their experience, we have continued to expand our investments in the ecosystem development, actively promote the industry’s healthy growth and unlock greater consumption potential for China’s local services through improved supply and service innovations.

在不断提升产品和服务、优化用户体验的同时，我们持续加大生态建设投入，积极推动行业健康发展，并通过供给与服务创新，进一步激发中国本地生活服务的消费潜力。

Since the launching of our food delivery business more than 11 years ago, we have continuously diversified our product offerings, broadened our price bands and optimized our 30-minute delivery network to bring better services and choices to hundreds of millions of consumers.

自11年前推出外卖业务以来，我们持续丰富产品类型、扩展价格带，并优化30分钟配送网络，为数以亿计的消费者提供更优质的服务与更多选择。

Over the years, we also supported millions of merchants, especially small or medium-sized merchants, to reach out to new customers, achieve business growth and navigate industry cycles. To promote the industry transition into a phase that focuses on healthy development, we aim to further facilitate industry transformation, enhance the online business operation environment and generate greater value for the food service industry.

多年来，我们帮助了数百万商家，尤其是中小商家，触达新客户、实现增长并穿越行业周期。为推动行业进入更加健康的发展阶段，我们将进一步促进行业转型，改善线上经营环境，为餐饮行业创造更大价值。

Through our innovative and refined supply models, we continue to help restaurant merchants uncover new growth opportunities. For example, we actively promoted brand satellite stores \[Foreign Language] that enabled chain restaurants to rapidly expand their geographical presence with a much lower cost compared to traditional dining establishments.

凭借创新且精细化的供给模式，我们持续帮助餐饮商家挖掘新的增长机会。例如，我们积极推广品牌“卫星店”模式，使连锁餐饮企业能以远低于传统门店的成本快速拓展地域覆盖。

By the end of the first quarter, more than 480 brands have successfully launched more than 3,000 high quality branded satellite stores on Meituan. What's more impressive is the average revenue per store is several times that of a typical dining store. And besides branded satellite stores, we also designed and refined other innovative offline business formats -- different formats offering customized growth strategies and operational solutions for chain restaurant merchants.

截至第一季度末，已有超过480个品牌在美团平台成功上线逾3000家高品质品牌卫星店。更令人瞩目的是，单店平均收入是普通餐饮门店的数倍。除了品牌卫星店之外，我们还设计并优化了多种创新的线下业态，为连锁餐饮品牌提供定制化的增长策略与运营解决方案。

Additionally, we introduced our self-operated cloud kitchen tailored for chain restaurant brands. Meanwhile, we fully recognize that small and medium sized merchants are the cornerstone of China's food service industry. These business are also essential to the local employment and community economy.

此外，我们还推出了专为连锁品牌打造的自营云厨房。同时，我们深知中小商家是中国餐饮行业的基石，这些商家对于本地就业和社区经济也至关重要。

We remain steadfastly committed to providing more support to the small and medium sized merchants. Our goal is to ensure that those small and medium sized merchants who operate diligently on our platform, gain visibility and trust from consumers and gradually become consumers' preferred choices.

我们将继续坚定不移地支持中小商家。我们的目标是，帮助那些在平台上踏实经营的中小商户获得更多消费者的关注和信任，并逐步成为消费者的首选。

In Q1, we further implemented a comprehensive range of measures to support high quality small and medium sized merchants. These include providing financial assistance, traffic support, free digital tools and online services. By doing so, we effectively helped this merchant improve supply, elevate service quality and offer broader selections.

在第一季度，我们进一步推出了一系列支持优质中小商家的举措，包括提供资金支持、流量扶持、免费的数字化工具及线上服务等。通过这些方式，我们有效帮助商家改善供给、提升服务质量，并丰富商品选择。

Furthermore, recognizing the importance of food safety and product quality, we have launched Bright Kitchen program [Foreign Language] and other food safety measures to enhance our platform supply quality. We believe higher transparency allows consumer to easily discover high quality restaurants.

此外，鉴于食品安全与品质的重要性，我们推出了“明厨计划”等一系列食品安全举措，进一步提升平台供给质量。我们相信更高的透明度能让消费者更容易发现优质餐厅。

To support micro merchants including family-owned restaurant and community restaurant, we offer them targeted subsidy to cover costs such as hardware procurement, installation expenses. to join our Bright Kitchen program [Foreign Language]. Looking ahead, we plan to invest RMB100 billion over the next three years to drive the whole food service industry to high quality growth. These resources will be used to support merchants across various categories and to boost consumer demand.

为支持家庭餐馆、社区小店等小微商户加入“明厨计划”，我们为其提供有针对性的补贴，用于设备采购和安装等相关成本。展望未来，我们计划在未来三年投入1000亿元人民币，推动整个餐饮行业向高质量发展迈进。这些资源将用于支持各类商户并刺激消费需求。

Couriers are an indispensable part of our ecosystem. Over the past decade, we have consistently enhanced our measures to protect couriers' rights and interest and to improve their working experience. Since July 2022, we have provided over RMB1.5 billion in occupational injury insurance for all couriers on our platform across seven pilot provinces. We plan to roll out occupational injury insurance to more provinces this year and expand nationwide by the end of next year. This April we also launched a new pension pilot program for couriers that will be gradually rolled out nationwide in future.

骑手是我们生态系统中不可或缺的一部分。过去十年，我们不断加强对骑手权益的保障，提升其工作体验。自2022年7月起，我们已为七个试点省份的所有平台骑手提供超过15亿元人民币的职业伤害保险。今年我们计划将职业伤害保险推广到更多省份，并在明年底前实现全国覆盖。今年四月我们还启动了面向骑手的新型养老金试点项目，未来将逐步在全国范围内推广。

Meanwhile, we offer comprehensive talent development program and career promotion path for couriers. Notably, 86% of the management position within our delivery network are filled by couriers promoted from the front line. We also provide couriers on diverse job transfer opportunities within our platform and already sponsored hundreds of couriers to enroll in universities for higher education.

与此同时，我们为骑手提供完善的人才发展计划和职业晋升通道。值得一提的是，我们配送网络中有86%的管理岗位由一线骑手晋升而来。我们还为骑手提供多种转岗机会，并已资助数百位骑手进入大学深造。

Beyond work support, we provide living and health care assistance to couriers and their families. For example, we have allocated more than RMB100 million in critical illness aid for over 6,000 couriers and their families through our Baby Kangaroo Charity Program and that is [Foreign Language]. We have provided tens of millions of RMB medical assistance funds and provides educational support for couriers' children.

在工作支持之外，我们还为骑手及其家庭提供生活和健康保障。例如，通过“小袋鼠公益计划”，我们已为6000多名骑手及其家属提供超1亿元人民币的大病援助。同时，我们还提供了数千万元的医疗援助基金，并为骑手子女提供教育支持。

We also place great emphasis on supporting female couriers. In 2024, the number of female couriers who have received income from our platform exceeded 700,000. This March, we provided female couriers with free one year coverage of critical illness insurance for women [Foreign Language]. Looking ahead, we will collect more feedback and suggestions from our couriers, continue to enhance their welfare and ensure that their hard work is duly recognized and rewarded.

我们也高度重视对女性骑手的支持。2024年，通过平台获得收入的女性骑手人数已超过70万人。今年3月，我们为女性骑手提供了为期一年的女性专属重大疾病保险保障。展望未来，我们将继续倾听骑手的反馈与建议，不断优化保障体系，确保他们的辛勤付出获得应有的认可与回报。

In Q1, Meituan Instashopping continued to deliver robust growth, underscoring the great potential of on demand retail and its broader consumer recognition. In April, we officially launched our on demand retail brand Meituan Instashopping, [Foreign Language].

在第一季度，美团闪购继续保持强劲增长，充分体现了即时零售的巨大潜力以及日益广泛的消费者认可。今年4月，我们正式发布了即时零售品牌“美团闪购”。

Consumers can easily access the Instashopping page directly from the homepage of the Meituan app to browse and purchase all kinds of daily necessities, at around the clock next generation shopping platform Meituan Instashopping work with millions of retailers, brands and local small and medium sized merchants. We meet the daily shopping needs of more than 300 million consumers across the nation, delivering an unparalleled experience that gets high quality products to consumers hands within 30 minutes.

消费者可以直接从美团App首页进入闪购页面，浏览并购买各类日常用品。作为全天候下一代购物平台，美团闪购与数百万零售商、品牌商及本地中小商家合作，满足全国超过3亿消费者的日常购物需求，提供高品质商品30分钟送达的卓越体验。

This public brand debut is a direct response to the surging popularity of on demand retail. We aim to offer more high quality products along with an enhanced convenience and a more reliable shopping experience for every consumer. We also aim to jointly capitalize on the opportunity for industry transformation and supply chain upgrades with millions of merchants on our platform.

此次品牌正式亮相，是对即时零售热度飙升的直接回应。我们希望为每位消费者提供更高品质的商品、更便利和更可靠的购物体验。同时，我们也希望与平台上的数百万商家共同把握行业转型与供应链升级的机遇。

As an important new sales avenue for retailer and brand owners, Meituan Instashopping will continue to introduce more online tools and support merchants across all categories to expand in Meituan InstaMart, [Foreign Language] and these measures will help drive business growth for the merchant and enhance their online operations.

作为零售商和品牌方的重要新销售通道，美团闪购将持续推出更多线上工具，支持各类商家拓展美团小象超市等渠道，这些举措将助力商家实现业务增长，提升其线上经营能力。

And now let's turn to in-store. Adapted to the demand trends and the new macro environment, we have proactively expanded our product categories and services offerings to cater to the diverse consumer preferences. For example, in response to the evolving consumption trends, we rolled out initiatives like Safe Learning that is [Foreign Language], Safe Training that is [Foreign Language], providing more flexibility for consumers to restore consumer confidence in prepaid services.

现在让我们转向到店业务。为适应消费趋势和新的宏观环境，我们积极拓展了产品品类和服务供给，以满足多元化的消费者偏好。例如，针对消费趋势的变化，我们推出了“安心学”和“安心练”等项目，为消费者提供更多灵活选择，重建其对预付费服务的信心。

Safe Learning has onboarded over 20,000 education institutions across the country, covering extensive education scenarios with causes spanning sports, arts and other fields. Consumers can seamlessly place orders and redeem services installments, request refunds when needed with a single click on our platform.

“安心学”已吸引全国超过2万家教育机构入驻，涵盖体育、艺术等多个教育场景。消费者可以在平台上便捷下单、分期核销服务，并在需要时一键退款，实现无忧消费体验。

Building on this success, we recently launched Safe Training [Foreign Language] which covers fitness training and extending this worry free consumption model to broader in-store categories. Meanwhile, leveraging the efficient user friendly online tools and wide array of marketing programs, we also help merchant reach a larger customer base with enhanced conversion rates, enabling them to benefit from digital transformation and achieve business growth across various consumption scenarios.

在“安心学”的成功基础上，我们近期推出了“安心练”，涵盖健身培训等领域，将这一无忧消费模式拓展至更广泛的到店服务场景。与此同时，借助高效易用的线上工具和丰富的营销方案，我们也帮助商家触达更多消费者、提升转化率，从而受益于数字化转型，在多种消费场景中实现业务增长。

The number of annual active in-store merchants increased by more than 25% year-over-year in Q1 and beyond offline merchants, our platform hosts numerous independent artisans such as photographers, hairstylists and estheticians [Foreign Language]. At the platform connecting artisans, merchants and consumers, we introduced a suite of offerings for the artisans from onboarding process, reviewing management -- review management, content display, operations support to consultation services.

第一季度，我们的年度活跃到店商家同比增长超过25%。除了线下商家外，我们平台还汇聚了大量独立手艺人，如摄影师、美发师、美业技师等。作为连接手艺人、商家和消费者的平台，我们为手艺人提供了一整套支持服务，从入驻流程、评价管理、内容展示、运营支持到咨询服务，助其发展。

These services empower over one million active artisans to develop their personal brand online. We also streamlined collaborations between merchants and artisans while enabling consumers to easily access their preferred artisans with broader selections and high price to value and distinctive service experience.

这些服务帮助超过一百万活跃手艺人在平台上发展个人品牌。我们也简化了商家与手艺人之间的合作流程，使消费者更容易找到心仪的手艺人，获得选择丰富、性价比高且富有特色的服务体验。

Since integrating the medicine -- medical aesthetics and healthcare business into the medical and health division, we have further enhanced cross sells, deepened penetration into the industry supply chain, and delivered comprehensive medical and health solutions to consumers.

自将医美和健康业务整合至医疗健康事业群以来，我们进一步增强了交叉销售能力，加深了对产业链的渗透，为消费者提供更加全面的医疗健康解决方案。

During the peak flu seasons in the first quarter, we collaborated directly with pharmaceutical companies to ensure sufficient drug supplies while solidifying our leadership in the on-demand medicine delivery, we expanded our supply to address the needs of chronic disease medicines and medical equipment and further increase the user purchase frequency.

在第一季度流感高发期，我们直接与药企合作保障药品供应，在巩固即时药品配送领先地位的同时，拓展慢性病用药和医疗器械等品类供给，进一步提升用户购买频次。

Meanwhile, we have extended a partnership with medical aesthetics providers, dental clinics, eye care clinics, specialty clinics and traditional Chinese Medicine hospitals and more. We targeted our existing user base to cross sell more medical and healthcare services. For example, in dental care, we focused on deliberative consumptions such as dental implants and refine the price comparison experience and decision making process for the consumers.

此外，我们已与医美机构、口腔诊所、眼科中心、专科门诊及中医医院等建立更深入的合作，针对既有用户群开展交叉销售，推广更多医疗健康服务。例如，在牙科服务方面，我们聚焦种植牙等高决策型消费项目，优化比价体验与决策流程，提升用户满意度与转化率。

We also introduced Safe Implantation Functioning Zone, a guarantee to mitigate consumers' concerns and risk. For eye care, through expanded supply and targeted marketing campaigns, we capitalized on the on a demand scenario of students renewing their eyeglasses during winter vacations and travelers purchased sunglasses for holiday trips.

我们还推出了“安心种植功能专区”，为消费者提供保障，缓解其疑虑和风险。在眼科方面，我们通过扩大供给与定向营销，抓住学生寒假更换眼镜和游客节假日购买太阳镜的即时需求场景，实现了有效转化。

Looking ahead, we will continue to innovate our products and services to meet the consumers' evolving one stop medical and health care need. And at the end of March, we roll out the Meituan Membership program, [Foreign Language], which encompasses all our business categories. It features Shen Quan as a universal benefit covering every aspect of consumers daily lives. We aim to provide members with a wider array of benefits and elevated experience.

展望未来，我们将持续创新产品与服务，满足用户不断变化的一站式医疗健康需求。今年3月底，我们推出了“美团会员”计划，覆盖我们所有的业务板块，重点打造“神券”这一通用权益，覆盖消费者日常生活的方方面面。我们希望为会员提供更丰富的权益和更优质的体验。

Under this membership framework, users can accumulate growth points, ascend through the membership tiers and unlock additional privileges. Currently, the privilege mainly include the hotel, travel and various other local services categories. Going forward, we will continue to expand member benefits to more categories.

在该会员体系下，用户可以积累成长值，升级会员等级并解锁更多专属权益。目前，会员特权主要涵盖酒店、出行及其他本地服务品类。未来，我们将持续拓展权益覆盖的品类范围。

Additionally, we will introduce tier-specific privileges, such as priority delivery services for food delivery and free complimentary drinks and dishes for in-store and to continuously enhance the user experience of Meituan Membership. And we anticipate to solidify the consumer mindshare in Meituan and as the go-to platform to discover local stores, earn great deals through the new Meituan Membership brand. By providing benefits that span all categories and scenarios, we seek to boost user stickiness, increase transaction frequency and optimize cross sell efficiency.

此外，我们还将推出更多分层特权，例如外卖优先配送、到店餐饮免费饮品或菜品赠送等，持续提升“美团会员”的用户体验。我们希望通过这一新品牌，在消费者心中进一步巩固美团作为发现本地好店、获得优惠的首选平台地位。通过提供覆盖所有品类与场景的权益，我们力求提升用户粘性、提高交易频次，并优化交叉销售效率。

Now let's move on to our new initiative segment. In first quarter, we further refined operations, achieved notable efficiency improvement in grocery retail, software and hardware services on year-over-year basis. Through grocery retail business like Xiaoxiang Supermarket, Meituan Select, [Foreign Language], we started to offer comprehensive support for export enterprises covering marketing, channel expansion and brand partnership and so on to help them distribute high quality export products in domestic markets.

接下来，我们来看看新业务板块。第一季度，我们进一步优化运营，在社区零售、软硬件服务等方面实现了同比效率提升。通过小象超市、美团优选等业务，我们开始为出口企业提供涵盖营销、渠道拓展、品牌合作等全链路支持，帮助其优质出口产品拓展国内市场。

Our overseas business also witnesses a significant breakthrough, in Saudi Arabia, Keeta has very effectively showcased our product capability and technological edge by delivering an enhanced consumer experience in both transactions and deliveries. We have won wide recognition from local consumers, quickly risen as one of the top preferred food delivery apps in the region. And looking ahead to the rest of 2025, we remain steadfast in our commitment to fostering the healthy development of our ecosystem.

我们的海外业务也取得重大突破。在沙特阿拉伯，Keeta凭借在交易和配送环节带来的优质体验，充分展现了我们的产品实力和技术优势，赢得了当地消费者的广泛认可，迅速成长为该地区备受欢迎的外卖应用之一。展望2025年全年，我们将继续致力于构建健康发展的生态体系。

On the merchant front, we will introduce more support measures, improve the online operational environment and help merchants iterate innovative supply format. Regarding our couriers, we will offer a broader range of measures to safeguard their rights and enhance their benefits while promoting social recognition for their contribution.

在商家端，我们将推出更多支持举措，优化线上经营环境，帮助商家创新供给模式。针对骑手群体，我们将进一步拓展保障措施，提升其福利待遇，并提升社会对其贡献的认同感。

For our consumers, we are devoted to delivering more comprehensive services, products and membership benefits, particularly to those who have been our loyal supporter over time, and by leveraging AI technology, we will continuously refine our user experience and improve merchant operation -- operational efficiency. And furthermore, we are proactively aligned with the national strategies aiming at boosting consumptions and expanding domestic demand.

在消费者端，我们将持续提供更全面的服务、产品及会员权益，尤其是回馈长期支持我们的忠实用户。同时，借助AI技术，我们将不断优化用户体验、提升商户运营效率。此外，我们也积极响应国家促消费、扩内需的战略部署。

By staying attuned to emerging consumption trends and identifying new markets and new opportunities, we will promote consumption growth and industry transformation, contributing to the broader economic landscape.

我们将紧跟新兴消费趋势，挖掘新市场和新机会，推动消费增长和行业转型，为宏观经济的发展贡献力量。

With that, I will turn the call over to Shaohui for an update on our financial results.

接下来，我将电话交给陈少晖先生，为大家介绍财务业绩。

什么都做的超级应用。

Shaohui Chen

陈少晖

Thank you, Xing. Hello everyone. I will now go through our first quarter financial results. During this quarter, our business sustained healthy growth with our total revenue increasing by 18.1% year-over-year to RMB86.6 billion. Cost of revenue ratio decreased 2.3 percentage points year-over-year to 62.6%, primarily due to the improved gross margin of our grocery retail business and strengthened operating leverage, partially offset by the increased cost related to overseas businesses.

谢谢兴，大家好。接下来我将介绍我们第一季度的财务表现。本季度，公司保持健康增长，总收入同比增长18.1%，达到人民币866亿元。营收成本占比同比下降2.3个百分点至62.6%，主要得益于社区零售业务毛利率的提升以及运营杠杆的增强，部分被海外业务相关成本增加所抵消。

Selling and marketing expenses ratio decreased 1 percentage points year-over-year to 18%, thanks to our enhanced marketing efficiency. Both R\&D expenses ratio and the G\&A expenses ratio maintained stable year-over-year at 6.7% and 3% respectively.

销售与市场费用占比同比下降1个百分点至18%，这主要归因于营销效率的提升。研发费用占比和一般行政费用占比分别维持在6.7%和3%，同比基本持平。

Our strategic focus on quality growth and operational efficiency continue to deliver strong results. This quarter, total segment operating profit grew to RMB11.2 billion up from RMB6.9 billion last year, and total segment operating margin increased from 9.5% to 13%. On a consolidated basis, our adjusted net profit increased year-over-year reaching RMB10.9 billion this quarter.

我们对高质量增长与运营效率的战略聚焦持续带来显著成效。本季度，整体分部经营利润达人民币112亿元，较去年同期的69亿元大幅增长，整体经营利润率由9.5%上升至13%。按合并口径计算，经调整净利润同比增长，达人民币109亿元。

Turning to our cash position, as of March 31st, 2025, we maintained our strong net cash position with our cash and cash equivalents and short term treasury investments totalling RMB180.4 billion. Cash generated from operating activities increased meaningfully year-over-year to RMB10.1 billion.

在现金状况方面，截至2025年3月31日，我们保持了强劲的净现金状况，现金及现金等价物加上短期国债投资共计人民币1804亿元。经营活动产生的现金流同比大幅增长至人民币101亿元。

Now let's review our segment results. Starting with Core Local Commerce, we saw sequential recovery in our on demand deliveries year-over-year order volume growth this quarter, for food delivery with the headwinds from warm winter subsidizing. Q1 daily order growth was higher than that of Q4. Medium to high frequency users continue to demonstrate significantly greater engagement. This is a direct result of our focused execution, cross supply side optimization, production iteration and operational enhancement.

下面我们来看各业务分部表现。先说核心本地商业，本季度即时报单量同比实现恢复性增长，尽管外卖业务受到暖冬影响，但日均订单增长高于去年四季度。中高频用户持续展现出显著的参与度。这得益于我们专注执行、供给侧优化、产品迭代与运营提升。

Meantime, we continuously itinerate our new supply formats this quarter. Notably, \[Foreign Language] sustained its strong growth trajectory with core consumers retention rate climbing steadily year-over-year. This quarter, Meituan Instashopping sustained strong growth momentum, numerous consumption categories including beverage, snack foods, safety corn, appliance, beauty and personal care as well as other novel categories are to deliver standout performance.

同时，我们在本季度不断迭代新的供给模式。其中，\[品牌名]保持强劲增长势头，核心用户留存率同比稳步上升。本季度，美团闪购维持高速增长，多个消费品类如饮料、休闲零食、安全玉米、家电、美妆个护等均表现出色。

The Valentine's Day period proved particularly noteworthy with daily order volume nearly doubling year-over-year. Beyond flower gifts, we also observed significant demand expansion in non-food gifting category such as small appliance, jewelry and beauty products, demonstrating our platform's evolving role for more consumers, particularly among the younger generations and formal categories.

情人节期间尤为亮眼，日均订单量同比接近翻倍。除了鲜花礼品，我们还观察到非食品类礼品如小家电、珠宝首饰、美妆产品的需求显著增长，体现出我们平台在年轻群体和仪式型消费品类中的新兴角色。

In addition, Meituan Instamart proves our continued progress on the supply side. The number of Meituan Instamart and its order contribution continue to increase, especially in the lower tier markets. Our Insta business effectively capture heightened consumer spending during key holiday period with order volume increasing by about 50% year-over-year this quarter.

此外，小象超市展现了我们供给侧的持续进步，小象超市门店数量与订单贡献持续增长，尤其在下沉市场表现突出。闪购业务在节假日期间有效捕捉消费热度，本季度订单量同比增长约50%。

We enhanced our Special Deals program. It not only continued to gain traction across high frequency categories like light meals, fast food and beverage, but also catalyzed increased demand for seasonal consumption categories around holidays.

我们强化了“神券秒杀”活动，不仅持续带动轻食、快餐、饮品等高频品类的增长，也有效激发了节日季节性消费品类的需求。

In lower tier markets, we maintain strong momentum with continued growth in merchant coverage, user engagement and the transaction volume during Q1. Importantly, we achieved these results while further improving profitability in lower tier cities. The optimized Shen Quan Membership program has emerged as another powerful growth accelerator for this quarter, effectively helping star hotel travel business, acquire new users, reengage inactive users and increase transaction frequency.

在下沉市场方面，我们保持强劲增长势头，一季度商户覆盖、用户活跃度及交易额持续增长。更重要的是，我们在下沉市场的盈利能力进一步提升。优化后的神券会员体系成为本季度又一强劲增长引擎，帮助高星酒店与旅游业务有效拉新、唤醒沉默用户，并提升交易频次。

Our Core Local Commerce segment continued to deliver strong year-over-year revenue growth of 17.8% reaching RMB64.3 billion. Core Local Commerce segment's operating profit and operating margin both improved on year-over-year basis to RMB13.5 billion and 21% respectively. We drove greater efficiency in operations across our Core Local Commerce business and realized greater operating leverage.

核心本地商业业务继续实现强劲增长，收入同比增长17.8%，达到人民币643亿元。经营利润与利润率也同比改善，分别达人民币135亿元和21%。我们在运营效率提升与运营杠杆释放方面取得明显进展。

Turning to our new initiative segment. During this quarter, revenue in this segment increased by 19.2% year-over-year to RMB22.2 billion, mainly due to the development of our grocery retail business and overseas business. Thanks to our efforts in improving operating and marketing efficiency in our grocery retail business, the segment's operating loss and operating loss ratio both narrowed on year-over-year basis to RMB2.3 billion and 10.2% respectively. The sequential increase in operating loss was mainly due to our increased investment in overseas business.

再来看新业务板块。本季度该板块收入同比增长19.2%，达到人民币222亿元，主要得益于社区零售及海外业务的发展。由于我们在社区零售业务中提升了运营及营销效率，该板块的经营亏损与亏损率同比均有所收窄，分别为人民币23亿元和10.2%。环比亏损扩大则主要由于海外业务投入增加所致。

In closing, I would like to highlight that over the years, our Core Local Commerce business have navigated complex and evolving market conditions with resilient performance. Each challenge has made us stronger, strengthening our competitive edge, driving operational excellence and delivering consistent financial improvement.

最后我想强调，过去几年中，我们的核心本地商业业务在复杂多变的市场环境中展现出强劲的韧性。每一次挑战都让我们更强，进一步巩固了竞争优势，提升了运营水平，并持续实现财务改善。

Looking ahead, we remain confident in the substantial growth potential across all businesses of our Core Local Commerce segment. The increasing synergy will further amplify our advantages. We have full confidence in our ability to sustain healthy quality growth over the long term.

展望未来，我们对核心本地商业板块各项业务的巨大增长潜力充满信心。板块间的协同效应将持续放大我们的竞争优势，我们有信心在长期维度实现健康且高质量的可持续增长。

With that, we are now open for Q\&A.

以上就是我的汇报，接下来进入问答环节。

Question-and-Answer Session

问答环节

Operator

主持人

Thank you. [Operator Instructions] Your first question today comes from Ronald Keung from Goldman Sachs. Please go ahead.

谢谢。[操作员指引] 今天的第一个提问来自高盛的Ronald Keung，请提问。

Ronald Keung

Thank you, Xing, Shaohui, Scarlett. So I want to ask about on the food delivery side, that JD announced RMB10 billion subsidy program into food delivery and made some progress. So has this initiative impacted our order volume growth to date? And how does management assess the shift in the competitive landscape?

谢谢王兴、少晖、Scarlett。我想请教关于外卖业务的问题。京东近期宣布推出100亿元的外卖补贴计划，并取得了一些进展。这个举措目前对我们订单增长是否产生了影响？管理层如何评估当前竞争格局的变化？

So meanwhile, given Ele.me also announced a similar RMB10 billion subsidy program, so will we be making any corresponding adjustments to our subsidy strategy to sustain competitiveness? And what specific measures will we adopt to respond to this new competitive environment? And how might these market changes influence Meituan's overall profit growth for the current year? Apologies for the long question. Thank you.

另外，饿了么也宣布了类似规模的补贴计划，那我们是否会对补贴策略做出相应调整，以维持竞争力？在面对这一新的竞争环境下，我们将采取哪些具体应对措施？这类市场变化是否会影响美团今年的整体利润增长？问题较长，抱歉，谢谢。

Xing Wang

王兴

Okay. Thank you, Ronald. I think that's a very important question. So the short answer is that we are going to take whatever measure it takes to win the game. Now, the longer version. So it seems kind of funny. So RMB10 billion here, RMB10 billion there. It seems every Internet player wants to chip in their RMB10 billion in the game. So that means the winner is going to be really valuable and we plan to be the winner.

谢谢你，Ronald。这是一个非常重要的问题。简短的回答是：我们会采取一切必要措施赢得这场竞争。稍微展开一点讲——现在看起来似乎很有意思：这里一个100亿，那里一个100亿，似乎每个互联网公司都想拿出100亿参与这场博弈。这也意味着，最后的胜者价值将非常可观，而我们计划成为那个胜者。

Currently, we are the largest player in this business and we have been doing this for more than 10 years and we have endured several rounds very fierce competition in the past 10 years.

目前，我们是这个行业中最大的参与者，深耕超过10年，过去这些年我们经历了多轮激烈竞争的考验。

So now I think we are better positioned to win again this time. So I would like to elaborate on that. So first I want to highlight that we welcome the new entrants to this food delivery and on-demand retail market. The movement of the new entrants underscore the significant growth potential that exists within the food delivery and a broader on-demand retail sector.

因此，我们相信这一次我们同样处于更有利的位置再次赢得胜利。首先，我想强调，我们欢迎新的参与者加入外卖和即时零售市场。新玩家的进入，也反映出外卖以及更广义的即时零售行业存在巨大增长潜力。

We believe our competition will drive the development of the whole industry with a particular upside for on-demand retail where our Meituan Instashopping deals.

我们认为竞争将推动整个行业的发展，尤其是对美团闪购所在的即时零售领域将带来额外利好。

However, I have to say that the current industry kind of irrational subsidy competition characterized by low quality and low price is probably not sustainable in longer term. So eventually competition should realign with the business fundamentals.

但我必须指出，目前行业内的这类“低价低质”的非理性补贴竞争模式，从长期来看是不可持续的。最终竞争将回归商业本质。

Only the platform that can effectively activate the three pillar flywheel of consumers, merchants and delivery network will achieve sustainable growth.

只有真正能激活消费者、商家与配送网络三位一体飞轮的平台，才能实现可持续增长。

We maintain full confidence in our scale advantage and competitive mode of our location based on demand delivery network.

我们对我们按需配送网络的规模优势和竞争模式充满信心。

We remain confident about the future growth potential of both our food delivery and our broader Meituan Instashopping business.

我们依然看好外卖业务以及更广义的美团闪购业务未来的增长潜力。

And to be more specific, on food delivery, the recent very heavy subsidy in the industry have effectively catalyzed more demand, particularly for the very elastic consumption categories such as milk, tea or coffee beverages.

具体来说，在外卖方面，行业近期的大额补贴确实有效刺激了需求，尤其是奶茶、咖啡等价格弹性较大的消费品类。

And our platform also experienced very robust growth in the beverage category in April and May, and other food categories also maintained steady growth.

我们平台在4月和5月的饮品类订单实现强劲增长，其他食品类目也保持稳定增长。

And we also observed that more mid frequency users increased their order frequency and it became higher frequency users. The retention rate of these core users maintained very high.

我们也观察到越来越多的中频用户提升了使用频率，转化为高频用户，这些核心用户的留存率也保持在较高水平。

And because of the intensified competition, consumer experience on other platforms compromise in areas such as system outage and delayed delivery and a very high refund rate.

由于竞争加剧，其他平台的用户体验在系统稳定性、配送时效、退款率等方面出现了问题。

But our platforms has consistently delivered a stable experience through our very reliable delivery network and advanced system because we have been operating for more than 11 years.

而我们的平台则凭借稳定可靠的配送网络与成熟系统，始终如一地提供高质量的服务体验——这正是我们11年来深耕积累的结果。

So we have built a high sophisticated service capability that can meet the consumers daily demands across broad price bands and different consumption scenarios.

我们已经构建了一套高度成熟的服务能力，能够覆盖多价格带、多个消费场景的日常需求。

And our platform hosts a large number of high quality small and medium sized merchants who serve not only at the cornerstone of our food delivery supply, but also at the vital backbone of China's food service industry.

我们的平台聚集了大量优质中小商户，他们不仅是我们外卖供给的基石，更是中国餐饮行业的重要支撑力量。

Through continuous product and service iterations, we assist a small and medium sized merchants in customer acquisition and revenue growth.

通过不断的产品和服务迭代，我们帮助中小商家获客和提升营收。

Meanwhile, we help branded restaurant to innovate their supply model including the branded satellite stores, [Foreign Language] and community dining stores.

同时，我们也助力连锁品牌餐饮商家创新供给模式，比如品牌卫星店和社区餐厅等。

These innovative offerings like [Foreign Language] not only address consumer demand for value for money options, but also help merchants boost order volumes increase revenues.

这些创新供给形式既满足了消费者对高性价比的需求，也有效帮助商家提升订单量与营收。

These collective efforts have diversified and elevated the quality of our supply.

所有这些努力，共同丰富了平台的供给结构，并提升了整体服务品质。

Coupled with our industry leading delivery network and continuous operational enhancement, we are well positioned to deliver more predictable services and richer consumption experience for our consumers. And we are confident that as the industry irrational subsidy phase out and consumer will choose the platform that offers the broadest selection, the best experience and more reliable services. So we are prepared to confront the competition, so in near term, we will make necessary investment to solidify consumer mindshare. And we are confident in our ability to maintain our long term leadership in the industry.

结合我们行业领先的配送网络与持续的运营优化能力，我们有能力为用户提供更加可预期的服务与更加丰富的消费体验。我们相信，随着行业非理性补贴逐步退出，消费者将更加倾向选择品类最丰富、体验最优、服务最可靠的平台。因此，我们已经做好准备迎接竞争，并将在短期内进行必要投入，强化用户心智。我们对自身长期保持行业领导地位充满信心。

Meanwhile, we will prioritize the healthy and sustainable development of the whole industry and the ecosystem. We believe that China's food delivery industry should enter a new phase of development. Neither platforms nor merchants should go back to the previous competition model driven by very aggressive subsidies. And increasing number of merchants are now actively embracing new supply format, seeking growth by enhancing product quality and service offerings. And they are also facing up to the industry challenges such as excessive marketing promotions and food safety issues.

同时，我们将始终坚持推动整个行业与生态的健康可持续发展。我们认为，中国外卖行业应迈入全新发展阶段，平台和商家都不应回到依赖激进补贴的旧式竞争模式。如今，越来越多的商家正主动拥抱新的供给模式，努力通过提升产品质量与服务水平实现增长，同时也在正视行业面临的营销过度、食品安全等挑战。

We recognize that these industry wide issues are profound and require immediate attention. Therefore, in order to directly addressing competition, we will active drive innovation on the supply side and tap into new growth opportunities this year. We will also take proactive steps to improve the overall quality of the industry, optimize the online business environment for merchants. We are also actively advocating against unnecessary and excessive competition within the industry.

我们意识到这些行业性问题具有深远影响，亟待解决。因此，为了应对竞争，我们今年将更加积极推动供给端创新，挖掘新的增长机会。同时，我们也将主动改善行业整体质量，优化商家的线上经营环境，并积极倡导抵制行业内无意义的、过度的竞争。

We will continue to help merchants streamline their marketing efforts and reduce the operational burdens. At the same time, we will focus on enhancing our marketing efficiency and boost the purchase frequency and user stickiness of our core users. And we remain committed to creating tangible values for all stakeholders including merchants, couriers and consumers and thereby guiding the industry toward a more rational and quality service driven growth trajectory.

我们会继续帮助商家精简营销动作，降低运营负担；同时，我们将进一步提升自身营销效率，增强核心用户的购买频次和黏性。我们始终致力于为包括商家、骑手、消费者在内的所有生态参与者创造真实价值，引导行业走向更理性、以服务质量驱动的增长轨道。

Financially, and due to the intensified competition, we expect volatility. So I think nobody should be surprised that there will be volatility in short term financial results. Recently, other players are still maintaining a very high subsidy ratio. Under these circumstances, we will continue -- we will increase our investment while adhering to principle of a fair and orderly competition. And our overall investment philosophy is to drive the industry healthy growth and defend our market position.

在财务层面，由于竞争加剧，我们预计短期财务业绩将存在一定波动，因此大家对此也无需感到意外。近期，行业内其他参与者仍在维持高额补贴。在这种情况下，我们会继续并适度增加投入，同时坚持公平、有序竞争的原则。我们的整体投资理念，是以推动行业健康发展为前提，守住我们的市场地位。

We will also increase investment in the ecosystem as committed. And as a large portion of our investment we will counter revenue. We expect the year-over-year growth rate for our Core Local Commerce revenue in Q2 will decelerate from that of Q1 and operating profit for Core Local Commerce in Q2 will decrease significantly year-over-year. We do not know how long the irrational competition from the new entrants of the market will continue.

我们也将继续按照既定承诺，加大对生态系统的投入。由于其中很大一部分投入会计入收入成本，我们预计第二季度核心本地商业的收入同比增速将低于第一季度，且其经营利润同比将出现显著下降。对于市场中新增参与者引发的非理性竞争会持续多久，我们目前也无法预判。

So it's impossible to give accurate financial guidance at this point for Q2 or the rest of the year. But we will continue to defend our market share. We are very confident we can solidify our market leadership. We have been instrumental in growing the industry in China in the last decade and now we are best positioned to continue to create value for all stakeholders. And we hope all stakeholders can see through short term fluctuation and focus on our long term competitive strength sustainable growth potential.

因此，我们目前无法对第二季度或全年给出准确的财务指引。但我们将坚定捍卫我们的市场份额，并对巩固我们的市场领导地位充满信心。过去十年我们是中国本地服务行业发展的重要推动者，如今我们也具备最强实力继续为所有利益相关方创造价值。我们希望所有相关方能够透过短期波动，关注我们长期的竞争优势与可持续增长潜力。

In the longer run, whole local commerce has room to unlock revenue and cost synergies among different businesses. And as our business further scale up, economies of scale will become more evident. We also anticipate that after this phase of intense competition, the food delivery industry will return to a more rational or sustainable growth path leading to a healthier ecosystem.

从长期看，整个本地生活业务板块仍具备释放业务间收入协同与成本协同的空间。随着业务进一步扩大，规模效应将日益明显。我们也预计，在经历当前这一轮激烈竞争后，外卖行业将回归更加理性、可持续的增长轨道，形成更健康的生态体系。

And then we are confident the GDV profit margin of Core Local Commerce will steadily improve to a reasonable value. And also I think the regulators is also working on this. But because we have been doing business in the Internet sector in China for more than 10 years. So I believe it's the job of the regulator to stop the irrational and unhealthy subsidy competition. And our job is to win the fight as long as it's allowed to go on. So we are going -- we are ready, we are prepared to do whatever it takes to win the fight and solidify our market leadership. Thank you.

我们有信心，核心本地商业的交易总额利润率将在未来稳步提升至合理水平。同时，我们也认为监管层正在着手关注这一问题。我们在中国互联网行业已有十余年经验，我认为，制止不理性、不健康的补贴竞争，是监管部门的职责。而我们的职责是：只要这场战斗仍在进行，我们就要全力以赴赢下它，巩固市场领导地位。我们已经准备好了，并将不惜一切代价赢得这场竞争。谢谢大家。

巴菲特对平台一统天下的战略不感兴趣，他对贝尔的评论，以及对微软的预见都说明同一个问题，巴菲特更喜欢细分领域的垄断行为，而不是横向的平台，参考：《1997-08-17 Warren Buffett and Jeff Raikes discuss Microsoft investment》。

Ronald Keung

Thank you, Xing Wang.

谢谢您，王兴。

Operator

主持人

Thank you. Your next question comes from Ya Jiang from CITIC Securities. Please go ahead.

谢谢。下一个问题来自中信证券的Ya Jiang，请提问。

Ya Jiang

Okay. Thank you, management. We can see that on demand retail has become a lifestyle for more and more young people. And with our rebranding of Meituan Instashopping, what are our strategy in expanding to more category selections? And how is the progress of our Instamart? Also, where are we moving up to higher ticket size items like consumer electronics and appliance? Thank you.

谢谢管理层。我们注意到，即时零售已经成为越来越多年轻人的一种生活方式。请问，在美团闪购品牌焕新之后，我们在扩展品类方面的策略是什么？Instamart的推进情况如何？此外，我们是否会向更高客单价的品类拓展，比如消费电子和家电？谢谢。

Shaohui Chen

陈少晖

Thank you for the question. Yes, I'm glad you asked the question about Meituan Instashopping which we launched in 2018 and since then it's seen -- it's expanding to many categories and covering almost all the aspect of daily life category like flowers, fruits, fresh food are naturally well suited to the on demand retail model. For this category, by integrating the innovative product formats, we are able to incentivize new consumers demand and redefine the boundaries of the on demand retail industry.

谢谢你的提问。我很高兴你关注到美团闪购。我们从2018年就开始布局这个业务，并不断拓展品类，现在几乎涵盖了所有日常生活类商品。像鲜花、水果、生鲜这些天然契合即时零售模式的品类，我们通过创新的产品形式不断激发新的用户需求，并重新定义了即时零售的边界。

But at the same time, more importantly, Meituan Instashopping has maintained a robust growth trajectory in non-food category as well, such as the 3C home appliance, beauty and personal care, mom and child, pet care, daily necessity and apparels. These categories, though often perceived as low frequency due to their non urgent nature, have also witnessed remarkable growth. With our continuous efforts to broaden product coverage and elevate quality standards, the order growth for non-food category exceeded 60% in the first quarter.

但更值得关注的是，美团闪购在非食品类目也保持了强劲的增长势头，涵盖了3C家电、美妆个护、母婴、宠物、日用品、服饰等品类。虽然这些品类通常被认为是低频次消费，因为它们并非刚需，但我们观察到它们的订单增长也非常可观。在持续拓展商品覆盖和提升商品质量的基础上，第一季度非食品类订单同比增长超过60%。

Our extensive assortment of daily necessities and long tail products effectively address consumers urgent needs. Categories such as beauty and personal care, toys and video games, pet care, mom and child products also fulfill consumers aspiration for a quality lifestyle and emotional satisfaction. The growth of 3C products and home appliances is also striking. Portable small home appliances, kitchen appliances, camera equipment, smart devices and gaming equipment all achieve substantial growth on our platform.

我们丰富的日用品与长尾商品结构能够有效满足消费者的即时需求。同时，美妆个护、玩具与游戏、宠物用品、母婴产品等也承载着消费者对高品质生活方式与情绪价值的期待。3C类商品和家电品类的增长也非常亮眼——便携小家电、厨房电器、摄影设备、智能设备、游戏硬件等在我们平台上都实现了显著增长。

Notably, some consumers have even purchased large home appliances like refrigerator and laundry machines through our on demand retail platform. Additionally, the apparel order volume from young consumers have far exceeded our initial expectations. These developments indicate that on demand retail has become an important channel for meeting diverse consumer needs and a trusted lifestyle choice for the younger generation.

值得一提的是，甚至已有用户通过我们的平台购买了冰箱、洗衣机等大件家电。同时，年轻消费者在服饰类订单的增长也远超我们的预期。这些变化都表明，即时零售已成为满足多样化消费需求的重要渠道，并且越来越被年轻一代所信任，成为他们生活方式的重要组成部分。

Meituan InstaMarts represents our innovative supply model. Currently, we have more than 30,000 Meituan InstaMarts with over 10,000 of them being convenience stores. The remaining InstaMarts cover almost all the categories previously mentioned. We are constantly enhancing the coverage density of convenience store InstaMart for categories like fruits, pet care and beauty products. Their InstaMart network have reached significant scale and are in the midst of rapid expansion.

美团小象超市代表了我们的创新供给模式。目前，我们已拥有超过30,000家小象超市，其中逾10,000家为便利店。其余小象门店覆盖了此前提及的几乎所有品类。我们正在不断提升便利店型小象门店在水果、宠物、美妆等品类的覆盖密度，该网络已具备相当规模，正处于快速扩张阶段。

Excuse me. Meanwhile, categories such as trendy beverage, food has entered an accelerated growth phase after initial expiration. Furthermore, an increasing number of leading brands from sectors including supermarket, convenience stores, small home appliance and daily necessities are accelerating their embracement of Meituan InstaMarts.

与此同时，新潮饮品、食品等品类在初步探索后已进入加速增长阶段。来自超市、便利店、小家电及日用品等领域的越来越多头部品牌也正在加速拥抱美团小象超市模式。

We remain committed to instill a series of merchant support. As for Q1, total transaction user of Meituan Instashopping has exceeded 500 million, with young consumers born after 1990s accounting for two thirds of this figure. User stickiness and purchase frequency also increased. We officially launched our on demand retail brand called Meituan Instashopping to build on this solid foundation, Meituan Shangou.

我们持续推进对商家的多项扶持举措。2025年第一季度，美团闪购的交易用户已超过5亿，其中90后消费者占比近三分之二。用户粘性与购买频率双双提升。在此坚实基础上，我们正式推出“美团闪购”即时零售品牌，进一步夯实“美团闪购”（美团闪购品牌焕新名称：美团闪购）定位。

We are trying to deliver everything to your doorstep within 30 minutes [Foreign Language]. During the initial phase of the brand launch, our strategic marketing campaigns drove the peak daily active user of Instashopping to nearly 6.5 million, with young users born after 1995 accounting for more than half of its total.

我们的目标是“30分钟把万物送到你家门口”。在品牌焕新初期，我们开展了一系列战略营销活动，推动闪购日活用户峰值接近650万，其中95后用户占比超过一半。

In May, we launched the first service assurance plan [Foreign Language] that covers the whole process of on demand retail in this industry. Partnering with hundreds of well-known brands and a wide range of local merchants, we upgrade our service experience, fulfillment and after sales services. Our goal is to promote on demand retail as the most superior shopping experience in terms of service and guarantee.

今年5月，我们推出了业内首个覆盖即时零售全流程的服务保障计划，与数百家知名品牌及大量本地商家展开合作，从履约、售后到体验全面升级。我们的目标是将即时零售打造成服务与保障体验最优的消费方式。

For example, we collaborate with home appliance brands to provide half day delivery and installation service for home appliance, offer exclusive delivery and customer service for high value merchandise and enable 30 minutes delivery of products under the trade in program from hundreds of thousands of local stores. We also offer seven day return guarantee services for millions of stores and launched guaranteed reimbursement for fruits and fresh produce that are damaged or for bills of beverages that are not chilled as promised.

例如，我们与家电品牌合作，提供半日达与上门安装服务；为高价值商品提供专属配送及客户服务；支持数十万家门店参与的“以旧换新”商品实现30分钟送达。同时，我们还为数百万家门店上线“七天无理由退货”保障，并推出针对水果、生鲜损坏以及饮品未达冰饮承诺的赔付保障服务。

We firmly believe that Meituan Instashopping will emerge as a leading consumption platform for more consumers, particularly among the younger generation. We expect that with the updated brand name and service assurance plan, we will take an increasing share in the high AOV categories and work more closely with an increasing number of brands.

我们坚信，美团闪购将成为更多消费者，特别是年轻一代首选的消费平台。借助品牌焕新与服务保障计划的推出，我们预计将进一步提升在高客单价品类中的市场份额，并与越来越多的品牌建立更紧密的合作关系。

For example, in Q1, we successfully onboarded five prominent brands such as Super Midea (ph), Philips to set up InstaMarts on our platform. This collaboration not only provides consumers with high quality electronic products, but also generates substantial incremental revenue for brand owners, effectively fostering a win-win ecosystem.

例如，第一季度我们成功引入包括“超级美的”（音）和飞利浦在内的五大知名品牌，在平台上开设了小象门店。这类合作不仅为消费者提供了优质的电子产品，也为品牌方带来了可观的增量收入，真正实现了双赢生态的打造。

In addition to better satisfy consumers' strong demand for on demand retail, our food delivery business as well as Meituan Instashopping will launch June 18 marketing event from May 28, [Foreign Language]. We will collaborate with restaurant and retail brands to provide consumers with more cost effective products and services. In conclusion, we are extremely confident in the huge potential of Meituan Instashopping for long term. Thank you.

为了更好地满足消费者对即时零售的强劲需求，我们的外卖业务与美团闪购将于5月28日启动“6·18大促”活动。我们将联动餐饮与零售品牌，为消费者提供更加高性价比的商品与服务。总之，我们对美团闪购的长期发展潜力充满信心。谢谢大家。

Ya Jiang

Thank you.

谢谢。

Operator

主持人

Thank you. Your next question comes from Kenneth Fong from UBS. Please go ahead.

谢谢。接下来的提问来自瑞银的Kenneth Fong，请开始。

Kenneth Fong

Hi. Good evening, management. Thanks for taking my question. Could management elaborate on the recently announced RMB100 billion food subsidy promotion plan for the next three years? Meanwhile, Meituan has also launched a pilot program for the couriers pension insurance. Could you share some colors on the latest progress as well as the expansion plan and then the pace for the rest of the year? Thank you.

您好，管理层晚上好。感谢解答我的问题。请问，能否详细介绍一下最近公布的未来三年1000亿元餐饮扶持计划？另外，美团也启动了骑手养老金的试点计划，请问目前的进展如何？接下来在推广节奏和覆盖范围方面有哪些安排？谢谢。

Shaohui Chen

陈少晖

Thank you for paying attention to our announcement. Yes, it's correct that we have announced an RMB100 billion investment plan to drive industry growth for the next three years. Our goal is to help industry find new growth opportunities, improve their supply quality and cultivate a more favorable business environment for restaurant merchants through our sustained investments.

感谢你关注我们的公告。是的，正如所说，我们已宣布一项总金额达1000亿元人民币的三年投资计划，旨在推动餐饮行业发展。我们的目标是通过持续投入，帮助行业挖掘新的增长机会，提升供给质量，并为餐饮商家营造更加友好的经营环境。

This plan caters around four key areas. First, empowering merchants. Last year we launched our first RMB1 billion Merchant Support Fund [Foreign Language] by the end of April this year, the program has benefited over 180,000 merchants covering small and medium sized merchants community Keeta BRICS (ph) first shops, high quality brands venturing into new supply formats in lower tier markets, and also renowned time owner brands. Merchants have utilized our support funds for online operation improvement, product innovation and equipment upgrades.

这一计划聚焦四大核心方向。第一，是“助力商家”。去年我们推出了首期10亿元的“商家扶持基金”，截至今年4月底，已有超过18万家商户受益，覆盖中小商家、社区店、小象首店、拓展下沉市场新供给模式的优质品牌，以及知名老字号商户。商家们利用这笔扶持资金进行了线上经营能力提升、产品创新和设备升级等方面的投入。

The second focus area is elevating supply quality. The branded satellite stores [Foreign Language] we introduced last year has helped over 480 brands open 3,000 high quality satellite stores. Leveraging AI driven services such as location selection, product curation and targeted traffic support, these branded satellite stores have achieved an average revenue 2 to 3 times that of traditional stores.

第二个重点是“提升供给质量”。我们去年推出的品牌卫星店项目，已帮助超过480个品牌落地3000家高品质门店。借助AI驱动的选址、商品组合、流量扶持等服务，品牌卫星店的平均收入是传统门店的2到3倍。

In addition to expanding the branded satellite stores, we also allocate resources to high performing merchants, including Shen Qiang Shou merchants, while providing various special subsidies to other quality merchants.

除了持续拓展品牌卫星店外，我们还将资源倾斜至“神抢手”等高表现商家，同时对其他优质商家提供多种专项补贴。

Certainly, we will continue to promote the Bright Kitchen program [Foreign Language] these initiatives aim to encourage more high quality food delivery merchants to set up high standard kitchens, thereby strengthening the industry food safety infrastructure. With increased hardware subsidy and traffic support, we anticipate that the number of participating merchants will exceed 100,000 by the end of this year.

我们也会大力推广“明厨计划”，这一举措旨在鼓励更多优质外卖商家建立高标准厨房，从而提升整个行业的食品安全基础设施。通过加大设备补贴和流量扶持，我们预计今年年底加入“明厨计划”的商家数量将超过10万家。

We will invite more food delivery merchants to join our Bright Kitchen program because it allows consumers to observe the food preparation process in real time. This transparency is key to enhancing public confidence in food safety.

我们也将持续邀请更多外卖商家加入“明厨计划”，让消费者可以实时查看后厨制作过程，这种透明化对于提升公众对食品安全的信心至关重要。

Fourthly, stimulating consumption, we will leverage diversified products such as Meituan Membership Shen Quan to incentivize users. We aim to invigorate food delivery consumption, enabling merchants to boost order volumes and expand their business. Regarding the pension for couriers, on April 3, we launched a new pension pilot program in Nantong and Quanzhou covering all couriers in these two cities.

第四项是“刺激消费”。我们将通过如美团会员神券等多样化产品，激励用户消费，活跃外卖消费市场，帮助商家提升订单量、拓展经营规模。关于骑手养老金问题，我们于4月3日在南通和泉州两个城市启动了新的养老金试点计划，覆盖当地所有骑手。

Over the years, we have maintained regular communication with relative authorities continuously deepen our understanding of Social Security policy guidance for flexible workers and gain more insights into the needs of couriers. This has enabled us to proactively explore effective solutions for enhancing the rights and interests of flexible workers.

多年来，我们与相关主管部门保持常态化沟通，不断加深对灵活就业人员社保政策导向的理解，同时深入了解骑手群体的真实需求，从而主动探索更加有效的灵活就业权益保障解决方案。

Previously, we implement the Occupational Injury Insurance Pilot Program, which has provided RMB1.5 billion insurance coverage to about 7 million couriers in seven pilot provinces. The newly launched Pension Insurance Pilot program is designed in line with the national policies for flexible employment Social Security. It offers subsidies specifically tailored to the unique nature of couriers job.

此前，我们已实施职业伤害保障试点项目，在七个试点省份为约700万骑手提供了总计15亿元人民币的保障额度。此次新推出的养老金试点计划，是基于国家灵活就业社保政策精神设计的，并结合骑手工作的特殊性设立了专门的补贴方案。

Here's the detailed scheme, for couriers whose monthly income reach the lowest threshold of the local contribution base for Social Security in three out of the past six months, Meituan will subsidize 50%. This plan fully respects the flexibility inherent the new economy, allowing couriers to freely determine their work schedules and workloads. By lowering the participation barriers, it can cover broader couriers with no precondition requirements, no limits in where couriers register their Social Security, no requirements regarding working hours or delivery volume, no distinction based on delivery types.

具体方案如下：对过去六个月中有三个月月收入达到当地社保缴费基数下限的骑手，美团将给予50%的补贴。该计划充分尊重新就业形态的灵活性，允许骑手自由安排工作时间与工作量；通过降低参与门槛，实现更广泛的覆盖，不设参保前置条件、不限制社保注册地、不要求固定工时或配送量，也不区分配送类型。

In early May, the first batch of couriers enrolled in our Patient Insurance Pilot program received our cash subsidies. We are pleased to see the program has been positively received by the Human Resources and Social Security Bureau in the pilot cities. Going forward, we will continue to address couriers' enquiries about the pension insurance plan, enhance policy promotion and encourage couriers to participate in the program.

在5月初，首批参与养老金试点的骑手已领取美团发放的现金补贴。我们也欣喜地看到，该计划在试点城市得到了人社部门的积极肯定。接下来我们将继续回应骑手关于养老金计划的疑问，加强政策宣传，鼓励更多骑手参与。

We plan to expand the pilot program to more cities this year, continue to refine it during the implementation. At the same time, we are confident that the efficiency and order density increase in our network will be able to provide cost savings that can offset the incremental cost from this insurance. Thank you.

我们计划在今年将该试点项目拓展到更多城市，并在实施过程中不断完善机制。同时，我们有信心通过提升网络效率和订单密度，实现一定的成本节省，从而对冲这项保障制度所带来的新增成本。谢谢大家。

Kenneth Fong

Thank you. Shaohui.

谢谢你，少晖。

Operator

主持人

Thank you. Your next question comes from Gary Yu from Morgan Stanley. Please go ahead.

谢谢。下一位提问来自摩根士丹利的Gary Yu，请开始提问。

Gary Yu

Hi. Thank you, management for the opportunity. Could management share the latest progress of Keeta in both Hong Kong and Saudi Arabia? What are the company's core competitive advantages in these regions? The company had previously mentioned to focus on Middle East in the short term but recently announced to enter food delivery market in Brazil.

你好，感谢管理层提供机会。请问Keeta在香港和沙特的最新进展如何？公司在这些地区的核心竞争优势是什么？此前公司曾表示短期内聚焦中东市场，但最近又宣布进军巴西外卖市场，请问为何提前选择进入中东之外的区域？

Why is the company preparing to enter regions other than the Middle East ahead of schedule? What are Keeta's regional expansion plan and criteria for selecting new markets? And since the overseas market is not as large as the Chinese market, could management share its overall plan and long term goals for these overseas business? Thank you.

Keeta在区域扩张方面的计划和选择新市场的标准是什么？另外，鉴于海外市场总体体量不如中国市场，请问管理层如何定位海外业务的整体战略与长期目标？谢谢。

Xing Wang

王兴

Thank you, Gary. So Keeta has been making good progress in both Hong Kong and Saudi Arabia. So last week we celebrated the second anniversary of Keeta in Hong Kong. So it was officially launched on May '22, two years ago. So in the past two years, we have been able to become the largest food delivery player in Hong Kong. And also we are continuing to grow in terms of both order volumes and average order value and also the market share and also the number of restaurant and number of couriers. That's for Hong Kong.

谢谢Gary。Keeta在香港和沙特两个市场的进展都非常不错。上周我们刚刚庆祝了Keeta在香港上线两周年。Keeta于2022年5月正式上线，过去两年里我们已成为香港最大的外卖平台。在订单量、平均客单价、市场份额、餐厅数量和骑手数量等多个维度，我们都在持续增长。这是关于香港市场的情况。

In Saudi Arabia, we launched in last September, so we are slightly more than half a year old to them. But now Keeta has been operating in all nine cities. So that's about every Saudi Arabian city with a population of more than 1 million. And so that's the current -- our market and we plan to expand to more Saudi Arabian cities.

在沙特，我们是在去年9月上线，目前上线运营的时间略多于半年。目前，Keeta已在沙特9个城市开展业务，覆盖了沙特所有人口超过百万的城市。接下来，我们计划进一步拓展到更多沙特城市。

And also you are correct that we announced a plan to enter Brazil and we are committed to investing $1 billion in the next five years.

正如你提到的，我们也宣布将进军巴西市场，并承诺未来五年将在该市场投入10亿美元。

So I will explain why and how we plan to win the game. So we got into the food delivery business in late 2016 and over the past decade we have invested a lot to build global leading food delivery business. So currently we are handling more than 20 million orders on a daily basis.

我来解释一下为什么现在进入巴西，以及我们打算如何赢得这场战斗。我们从2016年底开始进入外卖行业，在过去将近十年里，我们进行了大量投入，打造全球领先的外卖体系。目前我们每天处理的订单超过2000万单。

And in the process of building this food delivery business, we have developed a world leading system. And that takes a lot of software engineering skill to build. And it takes a lot of machine learning to optimize the order dispatch system.

在构建这套体系的过程中，我们开发出一套世界领先的系统。这背后需要非常强的软件工程能力，同时也需要通过大量机器学习手段来优化订单调度系统。

So it's quite easy to build a primitive online order, online food app. But when it grows in scale and when you need to meet the demand of more and more users, more and more restaurants, and more and more couriers, you have to use machine learning to optimize system. Otherwise you will not be able to cope with the increasing demand.

开发一个简单的线上点餐APP并不难，但当平台规模扩大，用户越来越多、商家越来越多、骑手数量也越来越多时，必须依赖机器学习去优化系统调度，否则将难以支撑快速增长的需求。

软件是现代企业的特征。

So through Meituan we have built that system. We are confident we have one of the best systems and we plan to apply all the knowledge and all the operational know-how through Keeta. And we want to bring these core competencies to other markets. We are competent by leveraging our competitive products, services and operational know-how, we are well positioned to offer consumers, restaurants and tourists in other markets with a very fast delivery, very good user experience. And also I think in that process, we are going to help create a lot of employment opportunities in those markets.

通过美团，我们已经建立了一整套系统，我们有信心这套系统是全球最优秀的之一。我们计划通过Keeta将我们的技术能力和运营经验带到其他市场，输出这些核心竞争力。凭借我们的产品、服务和运营的竞争优势，我们有能力为其他市场的消费者、餐厅和游客提供极速配送与优质体验。同时，这一过程中也将为当地创造大量就业机会。

So I think well, in a few years, Keeta will become a top choice food delivery platform in a growing number of overseas markets. About the pace of our plan. So I think as we have stated in the past, Meituan is destined to become a global company in the longer term. We are in no hurry. So we will evaluate every opportunity very carefully. And the decision to enter a new market is made through a comprehensive analysis that takes into account many factors that include current size and the potential size of the market.

我相信，再过几年，Keeta会在越来越多的海外市场成为首选的外卖平台。关于我们拓展节奏，我们曾多次提到，美团在长期维度上注定是一家全球化公司。但我们并不急躁，会非常审慎地评估每一次机会。进入一个新市场的决策，是基于综合分析多种因素而作出的，包括该市场当前规模及潜在空间。

Also the growth potential and also the market structure is very important because when you enter market, you want to make sure you can become either number one or number two, otherwise it doesn't make much sense. So the market size and market structure and also because we need to work with a lot of local partners, so we pay a lot of attention to the regulatory framework and the overall business environment in Insta market.

我们也非常重视增长潜力和市场结构，因为一旦进入新市场，我们的目标必须是做到第一或第二，否则就缺乏意义。因此，我们评估的要素包括市场规模、结构，同时还会重点关注监管框架和整体营商环境，因为我们必须与众多本地合作伙伴打交道。

So regarding Brazil, I think it's very important that we see that enduring strategic partnership between these two countries. President Xi visited Brazil last year and President Lula visited Beijing earlier this month. So I think that shows the strength of the strategic partnership between two countries. And also we believe that investment of a Chinese company in Brazil will be well received by both Brazilian consumers and local merchants.

关于巴西，我认为一个重要因素是中巴之间长期稳定的战略伙伴关系。去年习近平主席访问巴西，而卢拉总统本月初也访问了北京。这反映了两国间战略合作的紧密程度。同时我们相信，中国企业在巴西的投资将受到巴西消费者与本地商户的积极欢迎。

Yeah, I've been to Brazil earlier this year, so I see a very vibrant economy with a very big population. So I think Brazil is a country with a lot of potential. So it's one of the largest countries. In terms of territories, Brazil is number five. In terms of total population, Brazil is number seven. In terms of GDP, Brazil is probably around number nine. But in terms of food delivery, Brazil is actually among top five. So that shows the current size and the potential of the Brazilian food delivery market.

我年初去过巴西，那里经济非常有活力、人口众多。我认为巴西是一个极具潜力的国家。按国土面积算，巴西排世界第五；按人口排第七；GDP大约在第九左右。但在外卖市场方面，巴西实际上已排入全球前五，这充分说明其市场当前体量和未来潜力。

Also I think it's not entirely fair to say that other markets are not as big as China. Of course, the two largest market globally is China and the United States. And nobody should be surprised, but there are many other countries. If you put them together, they will be bigger than either China or the United States. But because there's many countries and each country is going to be different, so we need to evaluate the opportunity more by individual countries.

我认为，说其他市场都不如中国大也不完全准确。确实，中国和美国是全球两个最大市场，这毫无疑问。但如果把其他国家合在一起，其总量会超过任何一个单一国家。当然，每个国家都有其差异性，因此我们会按国家逐一评估机会。

So our current plan is to work on both Saudi Arabia and prepare for the launch of Keeta in Brazil. So yeah, we are very excited about this. Keeta is doing well in Hong Kong and Saudi Arabia and Brazil is a very good opportunity in the longer term. And also I have huge confidence in the growth potential in global food delivery or in even more broader term, not only restaurant food delivery, but also the on demand delivery in general.

我们目前的计划是在深耕沙特的同时，为Keeta在巴西的上线做准备。我们对此感到非常兴奋。Keeta在香港和沙特的表现都很好，而巴西则是一个极具中长期潜力的机会。同时，我对全球外卖业务的增长潜力抱有极大信心，甚至可以更广义地说——不仅是餐饮外卖，也包括整个即时配送领域。

So right now in many markets, food delivery is only an occasional convenience for selected populations. But I think over time it will become -- the penetration will become higher and the frequency will become higher. We have a witnessed that in China. I think it's going to take place in many different countries and given our know-how and our world leading software system, I think we should be able to bring that to that market and create values for all stakeholders there. So that's our plan and I think it will have some impact on our short term profitability. But I think in longer term, the global expansion represent very good and very promising growth opportunity for us. I think that's the plan. Thank you.

目前，在许多国家，外卖仍然只是部分人群的偶发便利选择。但我认为，随着时间推移，其渗透率和使用频率都会显著提高。我们已经在中国市场见证了这一过程，我相信这一趋势将在更多国家发生。考虑到我们的技术积累和全球领先的软件系统，我们有能力将这些能力带到其他市场，并为当地各方创造价值。这是我们的战略方向。我认为这可能会对我们短期利润率产生一定影响，但从长期看，全球扩张将为我们带来极具吸引力的增长机会。这就是我们的计划，谢谢。

AMEX涉足餐饮的方式远不如美团。

Operator

主持人

Thank you. Your next question comes from Alicia Yap from Citigroup. Please go ahead.

谢谢。下一位提问来自花旗集团的Alicia Yap，请开始提问。

Alicia Yap

Hi. Thank you. Good evening management. Thanks for taking my questions. Congrats on the solid results. My question is related to investment and capital allocation. So given the company's significant increase investment in the overseas expansion and also face domestic food delivery competition, will the company modify business strategy and investment scale of Meituan Select to balance your overall profitability and cash flow? What are the company's capital allocation priorities and strategies? So will the share repurchase program be suspended because of the higher overseas investment? Thank you.

你好，感谢管理层，晚安，恭喜业绩稳健。我想请教有关投资与资本分配的问题。考虑到公司正在大力增加海外扩张投资，同时又面临国内外卖业务的竞争压力，公司是否会调整美团优选的战略与投资规模，以更好地平衡整体利润率与现金流？此外，公司当前的资本分配优先级和策略是什么？是否会因为海外投资增加而暂停现有的股票回购计划？谢谢。

Shaohui Chen

陈少晖

Thank you, Alicia. Yes. We constantly conduct a comprehensive review of our capital allocation strategy and always try to balance the Core Local Commerce cash flow, the priority and resource requirement of new initiatives as well as shareholder returns to come up with an optimal capital deployment strategy for each year.

谢谢你，Alicia。是的，我们会持续审慎地评估和优化资本配置策略，始终在核心本地商业的现金流、新业务的优先级和资源需求、以及股东回报之间寻求平衡，从而制定每年最优的资本使用方案。

As for the competition, we have consistently confronted competition and emerged stronger through them since day one.

至于竞争，从创立起我们就面对过各种竞争挑战，也都在历次竞争中不断强化自身。

We believe that healthy competition serves as a catalyst invigorating industry and fostering its long term development. Despite short term profit fluctuation due to competition, we are confident that our Core Local Commerce segment will continue to generate robust cash flows providing a solid financial foundation for our own expansion and our grocery retail business.

我们相信，健康的竞争对行业是一种正向推动，有利于长期发展。尽管竞争可能带来短期利润波动，但我们有信心核心本地商业板块将持续产生强劲现金流，为我们的新业务拓展和零售业务提供坚实的财务基础。

Our new initiatives are at very wide growth stage. We have tailored distinct KPIs for each business unit and we are carefully assessing the performance of each business and dynamically adjust our strategy.

我们的新业务处于不同的发展阶段。我们为每个业务单元设定了专属的考核指标，正在根据业务表现动态调整策略。

As for Meituan Select, it's part of our broader grocery strategy. We maintain a very committed approach to capture the grocery opportunity in China. We believe the industry has huge potential in being digitized and provide better user experience and to provide better infrastructure to improve the efficiency of the whole industry.

关于美团优选，它是我们社区零售整体战略中的一部分。我们依然坚定地看好并投入于中国生鲜零售的机会，认为该行业在数字化升级、用户体验优化和基础设施建设方面具备巨大潜力，能够显著提升行业整体效率。

At the same time, we realize China is very big and the grocery industry is very fragmented. We need different solutions for different markets. For example, in higher tier markets we operate Xiaoxiang Supermarkets leveraging the front end warehouse model and it is performing very good. We also have the marketplace model called Meituan Instashopping, to building a platform for local retailers to connect with local consumers. These two business have been instrumental in establishing our brand image in grocery retail.

同时我们也意识到，中国市场广阔且生鲜零售极为分散，因地制宜是关键。例如，在高线城市，我们运营“小象超市”并采用前置仓模式，当前运营表现非常良好；我们还通过美团闪购建设本地零售市场平台，连接本地商户与消费者。这两个业务形态对我们在零售领域的品牌建设起到了重要作用。

For lower tier markets and for more daily consumption, we believe they all should be using different models in service a very challenging and fragmented market and Meituan Select is what we are using to testing the potential of this market and to validate the business model in those markets. While it turned out to be much more challenging than we have expected, we continue to believe in the potential in improved supply chain capability and provide better experience for these lower TST demands.

对于低线市场以及更高频的日常消费场景，我们认为应采用不同的业务模型来服务这一复杂且高度分散的市场，而美团优选正是我们用来测试这一市场潜力、验证商业模式的工具。尽管实际挑战远超我们最初的预期，但我们仍相信，通过提升供应链能力，有望为低线市场的消费者提供更好的体验。

We will continue to focus on testing Meituan Select model and validating its unit economics rather than expanding its scale. So the total loss from Meituan Select is under control. Despite this, we also have seen continued improvement in its business operation since last quarter. Specifically, we have enhanced the efficiency and service quality of pick up stations, upgrade product quality and improve the delivery timeliness. This year we will continue to fortify our core competence and improve our operation efficiency.

我们未来将继续聚焦于美团优选模式的验证与单点经济模型的优化，而不是盲目扩张规模。因此，其整体亏损是可控的。尽管如此，自上季度以来我们也观察到了持续的运营改善，尤其是在提升自提点效率与服务质量、改善商品品质、提高配送时效方面都取得了积极进展。今年我们将继续强化核心能力，并持续提升运营效率。

As the question for shareholder returns, we will continue to assess our cash reserve and potential net inflows and make flexible arrangement. We will maintain share repurchase program as the main channel for shareholder returns. Our fundamental goal is to offset the share dilution caused by our ESOP program each year as the starting point. Beyond this, we will also look for appropriate market window to further reduce the number of outstanding shares when we feel the time is right. Thank you.

关于股东回报问题，我们将继续动态评估现金储备与潜在净流入，灵活安排资本分配。我们将维持股票回购作为主要的股东回报手段。我们的基本目标是，每年优先通过回购来对冲员工股权激励计划所造成的股份稀释。在此基础上，我们也会在认为合适的市场窗口期进一步减少流通股数量。谢谢。

Alicia Yap

Thank you.

谢谢。

Operator

Thank you. Your next question comes from Thomas Chong from Jefferies. Please go ahead.

感谢。下一位提问者是来自杰富瑞的Thomas Chong，请提问。

Thomas Chong

Good evening. Thanks management for taking my question. Could management update us about the progress of company's AI large language model as well as the R&D expenses and timeline of the relevant applications? Thank you.

晚上好。感谢管理层接受我的提问。请问公司在AI大语言模型方面的进展如何？相关应用的研发支出和时间安排可以分享一下吗？谢谢。

Xing Wang

Thank you, Thomas. Yeah. Of course, no earnings call is complete without a question on AI. So this quarter while we continue to strengthen our capabilities in all three layers, when we talk about AI, I think there are at least three layers, the AI infrastructure and the AI in products and AI at work. So that's how we view AI. And this quarter, we iterate our foundation large language model. We have launched a new AI application and services for external users.

谢谢你，Thomas。当然了，没有关于AI的问题的财报电话会议是不完整的。本季度我们持续强化了三个层面的能力，我们认为AI至少包括三层：AI基础设施、产品中的AI以及工作中的AI，这是我们对AI的整体理解。本季度我们对自研基础大语言模型进行了迭代，并推出了面向外部用户的新AI应用和服务。

At the same time, we also enhanced the suite of employee productivity tools to boost our own efficiency and improve the work experience. So it's fair to say we have made good progress on all three fronts.

同时，我们也增强了内部员工效率工具，以提升公司整体运转效率和员工体验。可以说，我们在这三方面都取得了良好进展。

So first on AI infrastructure, we continue to increase our investment for large language model and allocating resources not only to infrastructure CapEx but also to recruiting top tier AI talents and to ensure our foundation language model is among the best tier in China.

首先在AI基础设施方面，我们持续加大对大语言模型的投入，不仅在基础设施资本开支方面加大资源分配，也在引进顶尖AI人才方面发力，确保我们的基础模型位居中国一流阵营。

And during this quarter we made continuous upgrade to our LongCat large language model. The enhanced model can now seamless switch between reasoning and non-reasoning modes with the performance in both modes reaching the caliber of China's leading models, we have also updated our end-to-end voice interaction model LongCat F.

本季度我们持续升级自研的大语言模型“LongCat”，新版本已可在推理模式与非推理模式之间无缝切换，两种模式下的性能均已达到中国领先水平。同时我们也更新了端到端语音交互模型“LongCat F”。

So this updated model demonstrates advanced capabilities in understanding nuanced information including the emotion or contextual environments and engaging in natural voice conversation.

这个新版本的模型具备更先进的能力，能理解复杂的语义信息，包括情绪与语境，并能够进行更自然的语音对话。

So it performs closely approach that of GPT 4.0 and the value of AI extend beyond efficiency improvement. It can also serve as a powerful tool to empower merchants on our platform.

它的表现已经接近GPT-4.0的水准，而且AI的价值不仅限于提升效率，它还可以成为赋能平台商家的有力工具。

So by leveraging AI we can better help merchants accelerate the digital transformation and optimize the cost and on May the 18, the Meituan Restaurant Advisory Committee hosted an AI Evolution in Food Service Symposium in Shanghai and drawing from feedback in committee discussions.

借助AI，我们能够更好地帮助商家加速数字化转型、优化成本。5月18日，美团餐饮顾问委员会在上海召开了“AI引领餐饮变革”研讨会，并结合会上商家的反馈意见，

Next month in June, we plan to launch [Foreign Language] it will be an AI powered business decision assistant for the food service industry. It will act as an intelligent operational assistant for food service merchants and industry professionals covering four key scenarios, the cuisine dish selection and the new store location selection, menu development and store operations.

我们计划于6月推出一款面向餐饮行业的AI业务决策助手【名字为外文】，它将成为餐饮商家与行业从业者的智能运营助手，覆盖四大核心场景：菜品选择、新店选址、菜单设计与门店运营。

This innovation marks a shift in the industry decision making from experience driven to AI plus data. That is a new process and it will effectively mitigate operational risk for merchants while viewing business growth.

这项创新标志着餐饮行业的决策模式正在从经验驱动向“AI+数据”驱动转变。这一新的决策流程将有效帮助商家降低经营风险、实现业务增长。

And the third one I think is actually the most exciting one for the past quarter. So we believe developing internal AI Tools as AI at work, we want to use AI to enhance employee productivity and the workplace experience that remains a key priority in our AI initiative. So in the last quarter, we continue to improve the AI coding capabilities for engineers and actively promote internal adoption of AI coding. So currently about 52% of new code in our company is generated by AI.

第三方面我认为是上个季度最令人兴奋的部分。我们相信，“AI at work”即开发内部AI工具，是我们AI战略中的关键优先事项，我们希望通过AI来提升员工的工作效率与办公体验。在上个季度，我们持续提升AI在工程师编码中的能力，并积极推动AI编程工具的内部应用。目前，公司约52%的新代码是由AI生成的。

And in some R&D teams over 90% of the team members use AI coding tools extensively and our goal is to gradually achieve 100% adoption across all engineers and we have our own No Code platform and it's for all employees and it has been widely adopted internally. The No Code platform allows user to quickly generate applications through natural language dialogue without requiring prior coding experience.

在部分研发团队中，超过90%的成员已经广泛使用AI编程工具，我们的目标是逐步实现所有工程师100%使用AI工具的覆盖率。我们还自研了一款面向全体员工的“无代码平台”，目前在公司内部已被广泛采用。该平台通过自然语言对话方式让用户快速生成应用，无需任何编程经验。

And No Code is now used by all professional roles within our company including product managers, user experience designers, business analysts, HR and finance staff. They leverage No Code for creating product prototypes, interactive pages and efficiency tools. With 62% of product managers, 28% of business analysts using the No Code platform internally. And last week we launched the No Code platform for public users free of charge and the URL is nocode.cn. Users can bring various creative ideas to life without any coding skill.

目前，产品经理、用户体验设计师、业务分析师、人力资源及财务等多种职能角色都在使用无代码平台，用于创建产品原型、交互页面及效率工具。其中，62%的产品经理、28%的业务分析师已在内部活跃使用。上周我们还正式向公众免费开放了该平台，网址是 nocode.cn。用户无需任何编程技能即可将各种创意想法变为现实。

We believe this application will support digital transformation for small or medium sized merchants in this AI era. On nocode.cn, users have created 9,410 applications with more than 1,600 of them published and in active use. So in longer term, we believe Meituan's unique advantage lies in our diverse consumption scenarios. We have abundant offline services offerings and we have very strong fulfillment capabilities. So we will continue to build our AI capability in foundation R&D and application and leveraging AI to help people eat better, live better in the physical world. Thank you.

我们相信，这一平台将在AI时代支持中小商户的数字化转型。在nocode.cn平台上，用户已创建了9,410个应用，其中超过1,600个已发布并被实际使用。从长期来看，我们认为美团的独特优势在于拥有丰富多样的消费场景、线下服务供给能力和强大的履约能力。因此我们会继续在基础研发与应用层面不断增强AI能力，借助AI帮助人们在真实世界中吃得更好、生活更好。谢谢大家。

Operator

There are no further questions at this time. I'll now hand back to Scarlett for any closing remarks.

目前没有更多问题。我们将时间交还给Scarlett，请做最后总结。

Scarlett Xu

Okay. Thank you for joining our call. We look forward to speaking with everyone next quarter.

好的，感谢大家参加本次电话会议，期待下季度再与各位交流。

Operator

That does conclude our conference for today. Thank you for participating. You may now disconnect.

今天的会议到此结束，感谢各位参与。现在可以结束连接。

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