Didi’s Revenue Falls After Beijing’s Crackdown Hurts Its China Business

Didi’s Revenue Falls After Beijing’s Crackdown Hurts Its China Business


Didi in early December said it is planning to delist from the U.S. and pursue a listing in Hong Kong.



Photo:

SUN YILEI/REUTERS

Didi Global Inc.

DIDI -8.18%

said Wednesday its third-quarter revenues dropped 11.5% from the preceding three months, after Chinese regulators launched a cybersecurity probe into the ride-hailing firm and forced many of its apps to be taken down.

Beijing-headquartered Didi also said

Daniel Zhang,

the chairman and chief executive of Alibaba Group Holding Ltd., has resigned from its board. He has been succeeded by

Yi Zhang,

a senior legal director at the Chinese e-commerce giant who has previously worked at several international law firms.

Didi reported the equivalent of $6.7 billion in revenues for the three months ended Sept. 30 at current exchange rates, versus $7.6 billion in the three months ended June 30. Its China mobility business—which includes its core ride-hailing operations—was the main cause of the decline. The company also posted a net loss equivalent to $4.8 billion for the third quarter.

Didi went public on the New York Stock Exchange on June 30 after raising $4.4 billion in the largest U.S. initial public offering by a Chinese technology company since Alibaba’s blockbuster listing in 2014.

Shortly after its listing, China’s cyberspace regulator said it was investigating Didi’s cybersecurity, and many of Didi’s apps were taken down from domestic app stores.

Prices of Didi’s American depositary receipts have plunged and hit fresh record lows this week after a 180-day post-IPO lockup period expired, allowing its early shareholders to pare their stakes. On Wednesday, the New York-listed shares closed at $4.94, around 65% below their IPO price of $14.

Didi in early December said it is planning to delist from the U.S. and pursue a listing in Hong Kong. The company is looking to go public in Hong Kong via a “listing by introduction,” the Journal previously reported. That route enables companies whose shares already trade on other exchanges to go public in the Asian financial hub without raising new money or issuing new shares.

For the nine months ended Sept. 30, Didi posted revenues equivalent to $20.9 billion, up 40% from the same period a year ago, showing how much growth momentum it had earlier in the year. The company’s September quarter revenues were slightly lower than in the third quarter of 2020.

Write to Serena Ng at [email protected]

Copyright ©2021 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

Appeared in the December 30, 2021, print edition as ‘Didi Global Posts Revenue Decline After China Probe.’



Source link

Share:

Share on facebook
Facebook
Share on twitter
Twitter
Share on pinterest
Pinterest
Share on linkedin
LinkedIn
Rachel Meadows

Rachel Meadows

Trending topics news writer who enjoys cooking, walking her dog and travel.

Related Posts

Enter our 

Las Vegas!

Luxury Resort Stay Giveaway