Shares of JD.com, which are listed in Hong Kong under the ticker HK:9618, dropped sharply on Tuesday following comments from the CEO of Meituan, Wang Xing.

Wang highlighted that competition between these two companies in China's instant retail market is intensifying.

JD.com's stock fell by as much as 6.6% in early trading but was trading about 3.6% lower at HK$125 by 02:01 GMT.

Meituan’s shares, trading under HK:3690, also showed volatility, dropping nearly 5% during the day before recovering somewhat.

Despite this, Meituan reported its quarterly revenue rose by 18.1%, which was better than what analysts expected.

In an earnings call, Meituan’s CEO expressed strong commitment to maintaining their lead in the market but warned that the tough competition might cause short-term ups and downs in their financial results.

This fierce battle comes because JD.com is pushing hard to grow its food delivery service called JD Takeaway, aiming to compete directly with Meituan, which has been the dominant player.

JD.com has been spending a lot on subsidies—basically money offered to customers or delivery drivers to attract them—and hiring more people to grow its network.

Meanwhile, the larger Hang Seng index, which tracks many Hong Kong-listed stocks, was relatively steady, rising by 0.2%.

To explain some terms: 'subsidies' here are financial incentives companies use to encourage users to choose their services, like discounts or pay bonuses for delivery workers.

'Volatility' means the stock prices were changing up and down quite a bit within the trading day.

This competition reflects how fast China's online food delivery market is growing and how companies are battling to win customers.

From what I see, this kind of rivalry is definitely good for consumers since companies usually offer better deals, but it can mean short-term profits might be less stable for these firms.

For those of us watching the stock market, sudden price drops like this often reflect investors reacting to news about competition risks, which makes sense because investors want companies to keep making money steadily.

It’s interesting to keep an eye on these two companies because their moves can show how the tech and retail sectors evolve, especially in huge markets like China.