(Yicai Global) Aug. 15 -- Luckin Coffee's shares plunged after China's biggest rival to Starbucks reported that its net loss widened nearly twofold in the second quarter as the firm burns through money in a push to become the country's largest coffee chain by year-end.

Luckin Coffee's [NASDAQ:LK] stock price tumbled 16.7 percent to close at USD20.40 yesterday. Its market cap shrank to USD4.8 billion amid a widespread drop in US stock. 

Luckin Coffee's revenue soared more than seven times to CNY909.1 million (USD129.3 million) in the three months ended June 30, the Xiamen-based firm said in an earnings report released yesterday. Its operating expenses more than tripled to CNY1.6 billion, mainly caused by increased advertising and delivery costs. 

The company's goal of becoming China's biggest coffee chain before the end of 2019 remains unchanged, Chief Executive Qian Zhiya said in the report. In January, Qian said that the firm will more than double its number of stores to 4,500 this year, surpassing that of Starbucks outlets on China's mainland by a margin of 900. 

Luckin Coffee expects to boost its third-quarter revenue to between CNY1.35 billion and CNY1.45 billion by improving operational efficiency and sales, Qian added. In the meantime, the firm, founded in 2017, expects store operations to break even.

By the end of the second quarter, Luckin Coffee had nearly 3,000 cafes, which was almost five times as many as a year earlier. During the period, its average monthly sales volume climbed nearly seven times to 27.6 million products with a total of 22.8 million users, up by 5.9 million. 

Editor: Emmi Laine