Investing.com -- DiDi Global was downgraded to Neutral from Outperform by Macquarie, which said heavy spending on food delivery expansion in Brazil is likely to cap near-term earnings despite steady growth in its China ride-hailing business.

Macquarie also cut its price target to $3.90 from $9.30, citing rising investment in overseas operations and robotaxi development.

DiDi’s fourth-quarter 2025 results showed stable revenue growth but weaker profitability as losses widened in its international segment.

Revenue for the quarter was 58 billion yuan ($8.0 billion), up 10% from a year earlier and broadly in line with expectations, while gross transaction value rose 20% to 124 billion yuan.

Adjusted EBITA, however, swung to a loss of about 2.1 billion yuan, below market expectations, as the international segment posted a 3.4 billion yuan loss, about four times higher than a year earlier.

The losses were largely tied to the company’s push into food delivery in Brazil, where expansion and incentives for users and drivers have raised costs.

The brokerage expects the international segment to post an EBITA loss of about 10 billion yuan in 2026 as transaction volumes grow and spending continues.

DiDi’s core China operations remained stable. The brokerage said domestic ride-hailing gross transaction value grew 11% in the quarter, while average selling prices rose 1% year over year, the first increase since 2023, indicating improving balance between supply and demand in the market.

While mobility and fintech operations overseas have turned profitable, Macquarie said heavy investment in Brazil’s delivery business is weighing on overall results.

The brokerage said management expects spending to have peaked in the fourth quarter of 2025 and anticipates a recovery in profitability in 2026, partly supported by cost efficiencies from DiDi’s bike-hailing network.

Macquarie said limited visibility on a potential Hong Kong listing and continued investment overseas leave few near-term catalysts for the stock.