In the second quarter, Alibaba, JD.com, and Meituan competed fiercely in the food delivery market. Behind this "three-way battle" lies a scorched earth scenario, with all three parties paying hefty prices for market share.

On August 29, with Alibaba releasing its first-quarter fiscal 2026 results (covering March-June of the natural year), all three giants participating in this round of food delivery warfare - JD.com, Meituan, and Alibaba - have submitted their interim "report cards." This food delivery war, which ignited in the second quarter of this year, has left deep marks on each company's financial statements: JD.com's net profit dropped 50.8% year-over-year; Meituan fell 89%; while Alibaba saw slight revenue growth with profits mainly supported by investment "side businesses."

An even more shocking figure is the marketing expenses of these "food delivery trio" in the second quarter: JD.com's marketing expenditure surged to 270 billion yuan, up a staggering 127.6% year-over-year; Meituan spent 225 billion yuan, up 51.8%; Alibaba invested 531.78 billion yuan, up 62.6%.

This means that in the second quarter alone, the three companies' total marketing spending exceeded the trillion-yuan threshold. To cope with this brutal "food delivery war," their additional marketing investments compared to the same period last year surged by over 430 billion yuan, equivalent to approximately 4.7 billion yuan per day.

Under this capital torrent calculated in trillions, there are no real winners in the food delivery "three-way battle."

**JD.com and Meituan's Net Profits Halved, Alibaba Struggles with "Side Businesses"**

In the second quarter, JD.com, Meituan, and Alibaba all paid hefty prices for market share.

On August 16, JD.com released its second quarter and interim results for 2025, being the first to disclose performance data. On one hand, its core retail business performed strongly, with revenue growth even reaching a three-year high; on the other hand, its high-profile entry into food delivery and other new businesses brought massive losses, dragging down the group's overall profitability.

The financial report shows JD.com's second-quarter revenue reached 356.7 billion yuan, up 22.4% year-over-year, marking the highest growth rate in nearly three years. However, net income attributable to ordinary shareholders was only 6.2 billion yuan, down significantly by 50.8% year-over-year. More critically, under non-GAAP measures, the group's overall operating profit shifted from a 10.5 billion yuan profit in the same period last year to a 900 million yuan loss, with operating margin plummeting from 3.6% to -0.2%.

JD.com's food delivery service announced "10 billion yuan subsidies," initially igniting the war. However, based on its latest second-quarter report, the actual cash investment has far exceeded 10 billion yuan. In a sense, it has "over-achieved" its "burning targets."

After JD.com's results disclosure, the market discovered that food delivery and other new businesses could "consume" tens of billions in profits. The high cost of the food delivery war caused stock prices of Alibaba, Meituan, and even Kuaishou to drop over 2% after this financial report was released.

On August 27, Meituan released its second-quarter financial report. The report shows Meituan's second-quarter revenue was 91.84 billion yuan, up 11.7% year-over-year. Adjusted net profit was 1.49 billion yuan, compared to an estimated 9.85 billion yuan, down 89% year-over-year. Meituan attributed the profit decline to "irrational competition that began this quarter."

Once upon a time, Meituan's local commercial segment was its most stable "cash cow," with food delivery and in-store services contributing nearly 70% of revenue and carrying almost all profits, forming the foundation supporting Meituan's high valuation. However, all this came to an abrupt halt in the second quarter of 2025.

In the second quarter, Meituan's core local commercial operating profit decreased from 15.2 billion yuan in Q2 2024 to 3.7 billion yuan in the same period of 2025, with operating margin dropping from 25.1% to 5.7% year-over-year. Following the earnings release, Meituan's ADR dropped over 14% in after-hours US trading.

On August 29, Alibaba released its second-quarter financial report, with performance also falling short of expectations. Alibaba's total revenue for the June 2025 quarter reached 247.652 billion yuan, up only 2% year-over-year. However, excluding divested RT-Mart and Intime businesses, comparable growth reached 10%.

Notably, Alibaba's net profit surged 76% this quarter to 42.382 billion yuan. While this figure appears impressive, it mainly relies on equity investment gains of 17.376 billion yuan (compared to a net loss of 1.478 billion yuan in the same period of 2024) and gains from the sale of Trendyol business. In reality, Alibaba's core operating profit was 34.988 billion yuan, down 3% year-over-year, with adjusted EBITA down 14% year-over-year, mainly due to increased investments in Taobao Flash Delivery, user experience, and technology.

**Marketing Expenses Skyrocket, "Burning" 43 Billion in Three Months?**

How much money-burning is involved in this spectacular "food delivery three-way battle"?

JD.com's food delivery falls under its new business segment, which mainly includes JD Property Development, food delivery, Jingxi, overseas operations, and other businesses. In the second quarter of this year, JD.com's new business segment revenue surged from 4.6 billion yuan in the same period last year to 13.9 billion yuan. Correspondingly, operating losses increased from 700 million yuan in the same period last year to 14.8 billion yuan, directly leading to JD.com's overall operating performance being "unsatisfactory."

Additionally, JD.com's cash flow situation has tightened. During the reporting period, its free cash flow was approximately 22 billion yuan, down 55% from nearly 49.6 billion yuan in the same period last year. JPMorgan disclosed in its latest research report that JD.com's investment losses in food delivery business reached 13 billion yuan in the second quarter, exceeding the previously expected 10 billion yuan.

Meituan's food delivery business data is generally not listed separately in financial reports but is consolidated into core local commercial business data. Meituan's core local commercial segment revenue grew 7.7% year-over-year to 65.3 billion yuan in the second quarter.

From financial report data, Meituan's profit decline mainly stems from its core local commercial business, with operating profit decreasing from 15.2 billion yuan in Q2 2024 to 3.7 billion yuan in the same period of 2025, down 75.6% year-over-year, earning 11.5 billion yuan less than the same period last year; operating margin also dropped from 25.1% to 5.7%.

Alibaba's instant retail business belongs to Alibaba China E-commerce Group. In the second quarter, Alibaba's instant retail revenue was 14.784 billion yuan, up 12% year-over-year, mainly benefiting from order volume growth brought by Taobao Flash Delivery launched at the end of April. Regarding profit conditions of instant retail business, Alibaba's financial report did not disclose separately, only announcing that Alibaba China E-commerce Group's adjusted EBITA decreased 21% year-over-year, down 10.364 billion yuan.

Beyond this, multiple financial report indicators reflect Alibaba's fierce "money-burning" in food delivery business. During the reporting period, Alibaba's free cash flow showed a net outflow of 18.815 billion yuan, compared to a net inflow of 17.372 billion yuan in the same period of 2024, creating a difference of 36.187 billion yuan. The report states that the decline in free cash flow was mainly due to increased cloud infrastructure spending and investments in Taobao Flash Delivery.

A more shocking set of figures is the marketing expenditure of the "food delivery trio" in the second quarter.

JD.com's marketing expenditure in the second quarter of 2025 reached 27 billion yuan, up 16.5 billion yuan from the previous quarter and 15.1 billion yuan from Q2 2024's 11.9 billion yuan, surging 127.6%, with marketing expense ratio rising from 4.1% in the same period last year to 7.6%. JD.com stated that this increase was mainly due to increased spending on new business promotional activities, meaning the vast majority was directed toward food delivery subsidies.

Meituan's sales and marketing expenses in the second quarter increased 51.8% from 14.8 billion yuan in Q2 2024 to 22.5 billion yuan in the same period of 2025. The increase was mainly due to business development and continuously adjusted business strategies to address fierce competition in food delivery and instant retail businesses, leading to increased spending on promotion, advertising, and user incentives.

In sales and marketing expenses, Alibaba spent 53.178 billion yuan this quarter, representing 21.5% of revenue, up from 32.696 billion yuan in the same period of 2024 by 20.485 billion yuan, a 62.6% year-over-year increase. Alibaba explained this was mainly due to investments in "Taobao Flash Delivery" and user experience and user acquisition for Alibaba China E-commerce Group.

This means that in the second quarter alone, the three companies' total marketing spending exceeded the trillion-yuan threshold. To cope with this brutal "food delivery war," their additional marketing investments compared to the same period last year surged by over 43 billion yuan.

**Bottomless Attrition War**

This "food delivery war" that burned from spring to midsummer appears on the surface to be about boosting order volumes, crazy subsidies, and competing for user mindshare, but it's actually a comprehensive game of platform paradigms, cash flexibility, and strategic endurance.

Despite the significant costs of deploying food delivery businesses, the three giants have achieved their expected results.

During the reporting period, JD.com's daily food delivery orders exceeded 25 million, covering 350 cities nationwide with over 1.5 million merchants onboard. JD.com Group CEO Xu Ran revealed during the earnings call that JD.com platform's user traffic, quarterly active users (MAU), and purchase frequency all improved significantly in the second quarter, with quarterly active users and shopping frequency both growing over 40% year-over-year, and quarterly active users achieving double-digit growth for seven consecutive quarters.

Meituan emphasized in its financial report that despite increasingly fierce competition, its instant delivery business consolidated its market position in the second quarter. Meituan App's monthly active users exceeded 500 million in the second quarter. Meanwhile, users' annual transaction frequency reached a new historical high. In July, Meituan's instant retail daily order volume peak exceeded 150 million orders.

Alibaba stated that through large-scale investments in instant retail, the first three weeks of August saw Taobao App monthly active consumers grow 25% year-over-year. China E-commerce Group's monthly active consumers and daily order volumes continued reaching new highs. During the fiscal 2026 Q1 earnings analyst call, Alibaba management disclosed that Taobao Flash Delivery's daily order peak reached 120 million orders, with August weekly average daily orders reaching 80 million.

Additionally, this "food delivery war" that began in April with JD.com announcing "10 billion subsidies" and peaked in July with fierce battles between Meituan and Taobao Flash Delivery now seems to be reaching a turning point.

JD.com CEO Xu Ran stated during the second-quarter earnings call that since July, industry competition has intensified. JD.com believes these excessive competitive behaviors have not produced model innovations nor brought incremental value to the industry, but rather disrupted industry pricing systems to some extent, causing much trouble for merchants, making them unsustainable.

During Meituan's earnings call, CEO Wang Xing stated, "First, let me be clear: we firmly oppose internal competition." However, he also indicated that current food delivery market competition continues intensifying, and Meituan will continue defending its market position. "Meituan grew up in competition; we achieved today's leading position through continuous competition."

Alibaba CEO Wu Yongming emphasized: "Alibaba's deployment in instant retail is not focused on competition in a single consumer category, but on meeting the one-stop needs of 1 billion consumers, shaping the commercial form of large consumption platforms in the AI era." Alibaba's long-term goal in the large consumption field is to meet the shopping and lifestyle consumption needs of 1 billion consumers across all scenarios, creating a large consumption platform with optimal experience, the most consumers, and highest consumption frequency, leading the future 30 trillion yuan large consumption market.

According to Chen Liteng, a digital lifestyle analyst at the E-commerce Research Center, the essence of this competition is platforms' fight for high-frequency user entry points, but short-term growth brought by subsidies is difficult to convert into lasting barriers. Future regulatory intervention or market rationalization will be key turning points. Whether subsidies can be converted into user stickiness and merchant ecosystems, rather than falling into bottomless attrition warfare, will determine the ultimate winners and losers of these giants in this "protracted war."