China's E-Commerce Titans Wage Brutal Price War, Profits Plunge

As of September 8th, 2025, China's leading e-commerce and food delivery companies have been locked in a brutal price war, flooding consumers with discounts and coupons in a bid to gain market share in the booming one-hour delivery segment. Firms like Alibaba, Meituan, and JD.com have been burning through cash at an alarming rate, with industry-wide cash burn exceeding $4 billion in the second quarter of 2025 alone.

This intense competition has drawn increased scrutiny from regulators, who are worried about a downward price spiral in China, where weak property prices and poor job stability have contributed to persistent consumer malaise. Regulators have repeatedly warned platforms against a "race to the bottom" price competition, leading the major players to pledge to curb their aggressive pricing and subsidies.

However, the companies seem determined to dig in for a long-term battle, with Alibaba projecting the instant retail segment could add 1 trillion yuan in annualized incremental gross merchandise volume over the next three years. Analysts warn of "significant downward revisions" to profits, saying margins are unlikely to recover over the next 12-24 months as the firms continue to prioritize market share over profitability.