On 29 April, Didi, China’s top ride hailing platform, released its first annual report after delisting from the US capital market. The company, which went through intensive turmoil since its US listing, has finally had some of the restrictions (including those of new user registrations) lifted by the Chinese government this year.  


For those who are not fully familiar, DiDi provides a wide variety of services in China, as well as international markets, through various mobile apps:
Here are some of our key takeaways from DiDi’s latest annual report:

  1. DiDi saw a drop in its GTV for its China Mobility segment from 233,845 million RMB in 2021 to 186,174 million RMB in 2022. The company also saw a drop in its revenue from 160,521 million RMB in 2021 to 125,931 million RMB in 2022. One of the reasons for this decline was the COVID-19 restrictions that limited people’s travel in 2022.

    Additionally, from 2021 DiDi app downloads were suspended in China amidst crackdown over data security concerns. Assuming customers churn at a natural rate, DiDi’s inability to replace lost or acquire new customers due to the suspension certainly led to a steady decline in users (and GMV).

  2. Amidst DiDi’s suspension, its competitor, Alibaba-owned Gaode, benefited. Gaode offers an aggregator of multiple ride-hailing services based on top of its mapping app (a good consumer entry point). Its numbers are not reported in Alibaba’s financials, but after DiDi was restricted, Gaode announced a record high of over 200 million daily active users on October 1, 2021, the first day of the week-long National Day holiday in China.Four Momentum Works colleagues were in China for different trips over the last four weeks – and everyone noticed the uptick of Gaode’s usage compared to before the pandemic.

    Under Alibaba’s recently announced restructuring, Gaode will belong to the Local Services Group, together with food delivery service Ele.me which competes against Meituan (not that greatly). Maybe as Local Services Group gets carved out (potentially for separate listing), we will get more clarity on Gaode’s ride hailing business. They should have a good idea because Alipay is integrated.

    You can also read our full thoughts on Alibaba’s restructuring here.

  3. Didi’s China mobility business had a positive adjusted EBITDA in 2021 but it turned negative in 2022. The company attributed the loss mainly to fines imposed by the Cyberspace Administration of China.

    Most tech platform companies report adjusted EBITDA – although the details of adjustments can be quite different for each platform company, overall the differences are actually quite insignificant. If you are not familiar with how exactly ‘adjusted EBITDA” entails, you can read section 5 of Momentum Academy’s recent report Apples to Apples 2.0: Benchmarking major tech platforms updated with Q4 and FY 2022 results.

  4. On a positive note, in 2023 DiDi’s China mobility business began to recover after DiDi was allowed to relaunch its app acquiring new/churned customers. The company said it also saw an uptake in customers using the service as the Covid restrictions eased. Momentum Works colleagues reported that although Gaode gained significant market share, DiDi was still the preferred ride hailing app by most.
  5. Our personal observation – car quality for premium services of DiDi in a few cities that Momentum Works colleagues frequent has dropped, probably a reflection of the cost pressure. On the other hand, there are now many more options of cars, some from third party services.
  6. DiDi has also been aggressively advertising its financial services (mainly consumer credit i.e. lending) to users. From the report we are yet to see how the business is contributing to the overall group performance. However, under the regulatory landscape for fintech lending in China for the preceding years, it is probably a good call to be cautious.
  7. DiDi’s revenue for its international segment increased by 61.9% from RMB3.6 billion in 2021 to RMB5.9 billion in 2022. However, DiDi’s international business is still very small, with its revenue in 2022 only making up 4.16% of DiDi’s total revenue.Some media have reported that DiDi’s international expansion is on hold. The reality is, aside from Latin America where it has a relatively more solid footing (mainly through acquisition of 99), DiDi has been trying different ways with different international markets – Egypt, Europe, Australia etc.

    This is not an easy undertaking, as we have used multiple case studies to highlight in the book Seeing the unseen: behind Chinese tech giants’ global venturing, the challenges are in leadership, people, organisation, and product – and in that order.

  8. DiDi has a relatively poorer cash position in 2022, with only 21,676 million RMB in cash, cash equivalents and restricted cash at the end of the period, compared to 2021 where the company ended the period with 43,981 million RMB in cash, cash equivalents and restricted cash.

    Despite this, its cash balance is still healthy. Based on the burn rate of 2022, DiDi can sustain for 2 years without raising external money.  This should enable DiDi to weather the current economic climate as its main revenue driver – China mobility – recovers from the after effects of the pandemic.

  9. DiDi has a large workforce of over 20,000 employees, and it will need to manage its workforce effectively to remain competitive in the industry.

Overall, DiDi’s financial performance in 2022 appears to be weaker than those in 2021, with COVID restrictions being a contributing factor. However, now that COVID restrictions are easing and DiDi’s 18-month ban on user acquisition has been lifted, it will be interesting to see how the company plans to claw back some of the 90% market share it had before the regulatory storm. 


Fortunately, DiDi has a solid cash reserve and a substantial workforce, which it can utilise to take advantage of growth prospects in the future. 


In 2021, we wrote a commentary “DiDi is a formidable company, just unfortunate to be born in China” – the main argument was that DiDi’s attempt to diversify away from just ride hailing has been pushed back by strong incumbents in the areas it tries to diversify into – such as Meituan.

Nonetheless, being the market leader in transportation in China is still big enough – and Meituan and co. have also found it is hard to encroach into DiDi’s space effectively. 


If you are wondering how to make sense of the myriad of reported metrics used by DiDi (e.g. GTV, adjusted EBITDA, etc.) and other key platform companies, check out our report “Apples to Apples: Benchmarking Shopee, Grab, GoTo and other major tech platforms”.


Thanks for reading The Low Down (TLD), the blog by the team at Momentum Works. Got a different perspective or have a burning opinion to share? Let us know at [email protected].