Didi on the Offensive: Expanding Domestic Profits, Aggressive Food Delivery in Brazil, Robotaxi Fleet to Reach a Thousand Next Year

Didi on the Offensive: Expanding Domestic Profits, Aggressive Food Delivery in Brazil, Robotaxi Fleet to Reach a Thousand Next Year

These days, Didi seems to be demonstrating a classic business story of “cash cow supporting star business”: using the strong cash-generating ability of its domestic business to support high-growth potential overseas businesses (Brazil food delivery) and future technological barriers (Robotaxi).

Domestic fundamentals: Saying goodbye to price wars, technology-driven “organic” margin growth

The market's biggest concerns about Didi's domestic business often focus on two points: whether industry competition will resurge, and whether margin improvement is achieved by squeezing drivers.

In a non-deal roadshow (NDR) organized by Goldman Sachs with Didi management on November 28, the management analyzed for institutional investors as follows:

First, the competitive landscape has entered a “steady state.” Regarding the phenomenon of Gaode temporarily increasing subsidies during the National Day Golden Week, Didi pointed out that this was merely a short-term tactical move by a competitor to promote local lifestyle services. Data shows that after the holiday, subsidies quickly retreated, and the industry did not reignite a price war.

Second, the path to margin improvement demonstrates “high quality” characteristics. Didi has maintained its target of a domestic GTV (Gross Transaction Value) margin of 3.7% by 2025 and expects further expansion of about 50 basis points (bps) by 2026. Furthermore, this expansion is not reliant on squeezing drivers, but stems from a rise in electric vehicle penetration lowering operational costs structurally, as well as more refined consumer incentive management.

International business: Brazil food delivery as a “key battle”

If “stability” defines the domestic market, then Latin America represents “offense.” Didi is making a carefully calculated bet in Brazil’s food delivery market, with a core logic based not on blindly burning cash, but on an “asymmetric advantage.”

Currently, Didi’s ride-hailing business in Latin America (especially Brazil and Mexico) has entered a mature stage, with some quarters achieving a 2% GTV margin, showing self-sustaining cash flow.

At present, Didi is focusing on the Brazil food delivery market. Didi management analyzed the Brazil food delivery market as follows:

  1. The market is large: In 2024, Brazil’s food delivery TAM (Total Addressable Market) reaches USD 20 billion.
  2. Unique advantages: Compared to local giant iFood, Didi possesses a larger two-wheeler (motorcycle) delivery fleet, and its previous high-ROI investments in ride-hailing (5-year period) and fintech (2-year period) prove Didi’s execution capability.
  3. Although the market may involve three-way competition, Didi’s current progress has exceeded management expectations, and there are plans to expand to more lower-tier cities next year.

Robotaxi: “Mass production imminent”

In autonomous driving, Didi is accelerating from R&D to commercial deployment.

The company is currently operating fully driverless Robotaxis in Guangzhou Huangpu and Beijing Yizhuang, and plans to expand the fleet size to over 1,000 vehicles next year. More importantly, the new-generation Robotaxi model jointly developed with GAC Aion is about to enter mass production and will be formally released next month.

In the long term, relying on the platform’s vast traffic data and network density, Didi hopes to secure a place among the leading players in Robotaxi.

Finally, on the capital markets side, Didi has reaffirmed its commitment to shareholder returns. The company is implementing a share buyback plan of up to USD 2 billion (effective until March 2027). Data shows that between August 25 and November 21 alone, the company has already repurchased USD 23.2 million worth of shares.

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The above content is from Chasing Wind Trading Desk.

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