China’s Didi swings to profit in fourth quarter

By Thomson Reuters Mar 23, 2024 | 12:09 AM

(Reuters) -Didi Global, China’s largest ride-hailing company, on Saturday reported a fourth-quarter profit, indicating that the Chinese ride-hailing leader has gradually recovered from difficulties after prolonged regulatory scrutiny.

Didi Global reported net income attributable to shareholders of 818 million yuan ($113.15 million) in the three months ending Dec. 31, compared with a loss of 953 million yuan a year ago. Revenues jumped 55.4% to 49.4 billion yuan for the quarter.

In 2021, Didi found itself in the spotlight of China’s cyberspace regulator over its pursuit of a U.S. initial public offering without obtaining approval, prompting an inquiry that prohibited it adding new users and resulted in many of Didi’s apps being removed from major app stores.

The company was penalized with a $1.2 billion fine in July 2022 over data security violations. The company began recovering from its regulatory challenges in early 2023 when it received permission to relaunch its apps.

Didi’s net profit in Q4 2023 was also affected by a substantial one-time expenditure in November, which was associated with compensating users for a glitch that disrupted its ride-hailing app.

As part of an apology for the malfunction, which that lasted for hours, the company provided millions of customers with coupons valued at 10 yuan ($1.40) each.

($1 = 7.2293 Chinese yuan renminbi)

(Reporting by Jyoti Narayan in Bengaluru. Editing by Gerry Doyle)