Apple invests $1 billion in Didi Chuxing

An Apple store is seen in Los Angeles, California, United States, April 22, 2016. [Photo/Agencies]

Apple Inc has pumped $1 billion into ride-hailing service Didi Chuxing, the main competitor in China of Uber Technology, in an unusual move that Apple CEO Tim Cook said will help it "learn more about certain segments of the China market".

The investment, announced on Friday, is the largest single investment that Didi has received. It also is a rare one for Apple, since the US tech giant tends to buy out companies rather than inject capital into them.

Apple declined to elaborate on the intentions of the deal, but Cook told Reuters that he saw opportunities for Apple and Didi to collaborate in the future.

"We are making the investment for a number of strategic reasons, including a chance to learn more about certain segments of the China market," he said. "Of course, we believe it will deliver a strong return for our invested capital over time as well."

Didi, which delivers more than 11 million rides a day via its platform, has an estimated valuation of $25 billion. The $1 billion investment makes Apple a strategic partner joining other Didi investors such as China's internet giants Alibaba Group and Tencent Holdings.

The investment comes at a time when Apple is seeing its sales tumble in China, its second-largest market.

"Apple seems to be running out of gas on its device sales, witnessed by its stock performance in recent weeks," said Travis Wu, research director at the Beijing office of multinational consultancy Forrester Inc.

"They must look for new ways to invest and expand, and they do have deep pockets."