Business & Economy

Didi says China revenues could be hit due to Beijing’s ban on its app

Shanghai, China, Jul 5 (EFE).- Ride hailing service, Didi, referred to as the Uber of China, said the government’s suspension of its application’s downloads could reduce its revenue in the country.

“The Company expects that the app takedown may have an adverse impact on its revenue in China,” Didi said in a statement posted on its website late Sunday.

The company clarified that Chinese users who had already downloaded and installed their application would be able to continue using it while its operations in the other countries, including Brazil, Mexico and Colombia, would remain “normal.”

On Sunday, China’s cyberspace regulator ordered app stores to stop offering Didi’s app saying that its investigations had concluded that the company was abusing user data.

The order came a few days after Didi announced on July 2 the suspension of new user registration in China as required during a review by the Cyberspace Administration of China.

Beijing said last week that it was starting a cybersecurity probe into Didi for violating national laws by collecting certain data from its users.

In its Sunday statement, the company promised to “strive to rectify any problems, improve its risk prevention awareness and technological capabilities, protect users’ privacy and data security, and continue to provide secure and convenient services to its users.”

The launch of the probe caused Didi’s shares on the New York Stock Exchange to fall Friday.

The company had made its Wall Street debut on Wednesday, reaching a market valuation of close to $80 billion.

The review into Didi comes at a time when the Chinese authorities’ relationship with the country’s big tech firms appears to have soured, especially with those that have large subsidiaries dedicated to the fintech sector.

In April, the Alibaba conglomerate was hit by the largest-ever antitrust penalty imposed by China, while regulators in November suspended the IPO of its subsidiary Ant, which was expected to be the largest in history. EFE


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