(Yicai) March 25 -- Shares in Meituan soared as much as 9.6 percent today after the Chinese on-demand services giant said that it made money last year, driven by its Instashopping service, which helps small retailers digitize, as well as its hotel and travel businesses, and as losses from its new initiatives narrow.

Meituan’s share price [HKG:3690] was trading up 7.4 percent at HKD94.80 (USD12.12) as of 2 p.m. Earlier in the day it hit HKD96.80.

Meituan raked in profit of CNY13.9 billion (USD1.9 billion) last year, compared with losses of CNY6.7 billion in 2022, according to the Beijing-based firm’s latest financial report released on March 22 after markets closed. Revenue surged 25.8 percent to CNY276.7 billion (USD38.4 billion).

Profit from its core local businesses, which include food delivery, Instashopping as well as hotel and travel bookings, surged 31.2 percent to CNY38.7 billion (USD5.3 billion) last year, thanks to a 40 percent jump in Instashopping orders and a doubling of its hotel and travel turnover. This pushed revenue for this sector up 28.7 percent to CNY206.9 billion.

Meanwhile, its new initiatives, which include group-buying unit Meituan Select and supermarket chain Little Elephant Supermarket, contributed CNY206.9 billion (USD28.7 billion) and CNY69.8 billion in revenue respectively. This was a year-on-year increase of 18 percent, and helped narrow the losses from new initiatives by 28.9 percent to CNY20.2 billion (USD2.8 billion).

The takeout sector has been highly competitive for many years, but Meituan is confident that it will remain a leader in the industry, founder and Chairman Wang Xing said at the earnings call. Meituan will make a deep dive into the intricacies of on-demand delivery this year, and it is firmly committed to implementing the “Retail + Technology” strategy.

In the fourth quarter last year, Meituan’s profit contracted 38.9 percent from a year earlier to CNY2.2 billion (USD305 million) on revenue of CNY73.7 billion.

Editor: Kim Taylor