By Dhirendra Tripathi
Investing.com – Didi Global ADRs (NYSE:DIDI) traded 4.3% lower in Thursday’s premarket as the ride-hailing firm slipped deep into red in the third quarter, hurt by falling revenue and higher regulatory costs.
The company today revealed a 30.4-billion-yuan ($4.7 billion) loss for the quarter ended September 30, compared to a 665-million-yuan ($103 million) net profit in the same period a year ago.
Revenue fell to 42.7 billion yuan ($6.7 billion) from 43.4 billion yuan a year earlier.
The company booked an investment loss of almost 21 billion yuan, mainly on account of its recent foray into the highly competitive business of delivering hyper-local groceries.
Didi's public career has been tumultuous from the start. Authorities in China, after finding that Didi ignored their advice on delaying its public issue pending a scrutiny of its data handling practices, first placed limits on its onboarding new users while also mandating online app stores to take its apps off their platforms.
The company later decided to delist from the NYSE, and list in Hong Kong, a move that reports attribute to pressure from the Chinese regulators. The Hong Kong listing is a work in progress.
The regulatory upheaval has cost the company customers while also raising compliance costs for it.
Spending rose 16% during the quarter after Didi was forced to comply with new requirements to better compensate its drivers and improve data governance. Interest income fell by more than a third.