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05 Oct, Wednesday
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Bull Trader USA

The Wall Street Journal: Didi’s revenue slumps after crackdown by Chinese government

Didi Global Inc. 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 DIDI, -8.18% also said Daniel Zhang, the chairman and chief executive of Alibaba Group Holding Ltd. BABA, -2.36%, 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.

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.

An expanded version of this report appears on WSJ.com.

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