Didi Global’s Revenue Sustains Growth Prior to Renewed IPO Bid

Didi Global Inc.’s net loss grew in the March quarter، after climbing marketing costs and losses on its stake in electric vehicle-maker XPeng Inc. outweighed a revenue boost.

China’s leading ride-hailing provider’s net loss grew to 1.35 billion yuan ($186 million) in the first three months of the year، reversing two straight quarters of profitability despite a 15% rise in sales. Didi’s net loss was 1.16 billion yuan a year ago.

Driver operation fees in China rose in the March quarter، while higher consumer incentives also ate into the Beijing-based company’s bottom line. It also recorded an investment loss of 1.8 billion yuan in the period، primarily from its equity stake in XPeng.

Didi’s results come as the company undergoes a major transition at the top، with co-founder Jean Liu giving up her roles as president and board director after almost a decade. Liu، known for helping the company secure the backing of tech giants including Tencent Holdings Ltd. and Uber Technologies Inc.، has become a permanent partner and will continue to report to Chief Executive Officer Will Cheng.

Liu was replaced on the board by Alan Yue Zhuo، who served as the company’s chief financial officer since 2021.

National champion

Once feted as the national champion that drove Uber out of China، Didi has been trying to revive growth after Beijing’s campaign to rein in the country’s powerful internet industry. The company was forced to de-list in New York after moving ahead with a $4.4 billion initial public offering against Beijing’s objections، and was subsequently fined $1.2 billion in 2022 for data security violations. Its main apps returned to Chinese app stores early last year، allowing it to resume growth in the home market it still dominates.

The company plans to list on Hong Kong’s stock exchange this year and could benefit from China’s recent supportive measures for overseas listings، Bloomberg News reported. Its shares، now traded only over-the-counter in New York، rose some 17% this year to $4.61، but it’s still well shy of its IPO price of $14 in 2021.

Last August، Didi sold its smart-car development arm to XPeng in a retreat from the car-making business. That HK$5.84 billion deal also handed Didi a 3.25% stake in the EV maker.

The company said it had repurchased and canceled shares worth $152.4 million under a previously-announced $1 billion buyback program. Its subsidiary، City Puzzle Holdings Ltd.، also plans to repurchase shares worth $408 million.