Dida's ride-sharing business accounts for up to 95% of its revenue. With competitors flooding into the market, how will Dida defend its position?

On August 30, Dida Travel released its half-year report for 2024. The financial report showed that the company's total revenue for the first half of 2024 was 404 million yuan, an increase of 2% year-on-year. The adjusted net profit was 130 million yuan, an increase of 51.3% year-on-year.

In addition, Dida Travel's cash and cash equivalents increased to 1.66 billion yuan, providing strong support for subsequent development and business expansion. Furthermore, in the first half of 2024, Dida Travel's gross profit and gross margin reached 296 million yuan and 73.3%, respectively, consistently maintaining a high gross margin above the industry average.

Dida Travel has reached 368 million registered users. It provides ride-sharing services in 366 cities across the country, with a cumulative total of 17.7 million certified private car owners, an increase of 17% year-on-year. In addition, in the first half of 2024, the overall transaction volume of Dida ride-sharing reached 4.007 billion yuan, with a total of 61.7 million rides.

However, the market has already had sufficient expectations regarding Dida Travel's profitability. As early as 2019, on the occasion of Dida Travel's 5th anniversary, CEO Song Zhongjie stated that the company had already achieved profitability. According to its prospectus data, Dida Travel's revenues for 2021-2023 were 780 million, 569 million, and 815 million yuan, respectively, with adjusted net profits of 338 million, 85 million, and 226 million yuan, successfully achieving profitability for multiple consecutive years.

Nevertheless, despite its successful ride-sharing origins, Dida Travel faces numerous challenges beyond its financial performance.

According to Caijing 3 Minutes, approximately 90% of Dida Travel's revenue comes from its ride-sharing business. In 2018, ride-sharing accounted for only 66% of Dida Travel's revenue, but since 2019, it has stabilized at around 90%, reaching as high as 95% in 2023.

While this asset-light business model enables Dida to quickly and continuously achieve profitability in the short term, the visible ceiling of the ride-sharing business also imposes constraints on the company's growth potential.

Moreover, Dida's asset-light strategy has attracted competition from companies such as Didi, Hello Limousine, Gaode, and T3, which have relaunched or entered the ride-sharing market, posing a significant threat to Dida's business.

According to the E-commerce News, online ride-hailing giants Gaode and T3 have recently launched ride-sharing services. Gaode has announced the launch of its ride-sharing service in 65 cities, including 21 in the Pearl River Delta, 27 in the Yangtze River Delta, and 17 others like Wuhan. Meanwhile, T3 has opened registrations in select cities.

Data shows that Dida Travel's market share in the ride-sharing industry has declined from 66.5% in 2019 to 31% in 2023.

The question for Dida now is how to defend its position in the ride-sharing market while also exploring new growth opportunities in online ride-hailing or other secondary revenue streams.