Company Overview - Youdao is a leading intelligent learning company in China, showcasing its AI-equipped smart device, the Youdao Dictionary Pen X7 series, at CES 2025 [1] - The company focuses on using technology to provide educational content, applications, and solutions for learners of all ages [16] Product Highlights - The Youdao Dictionary Pen X7 series features proprietary applications, including Hi Echo and Mr P AI Tutor, based on the 'Zi Yue' educational large language model [2] - The X7 series provides offline translation capabilities through an edge-side large language model, enhancing the accuracy and fluency of language learning [12] - The dictionary pen also offers AI intelligent learning features such as AI essay refinement [13] - The Youdao Dictionary Pen X7 quickly became the best-selling product in the thousand-yuan price range, surpassing 30,000 units sold [14] Technological Innovation - Youdao launched China's first educational large language model, 'Zi Yue', in 2023, which has been integrated into all of its software and hardware products [4] - The company has developed the industry's first edge large language model, applied to the X7 series of dictionary pens, achieving translation results comparable to online NMT [11][12] - Youdao is exploring the application of smaller models on the edge for specific scenarios, enhancing precision and user experience [8][10] Market Performance - Youdao's AI subscription service has achieved rapid growth for seven consecutive quarters [7] - During the 2024 Nov 11th Shopping Festival in China, the Youdao Dictionary Pen X7 Pro topped several industry rankings on major e-commerce platforms, marking the fifth consecutive year of leading sales in its category [14] Strategic Focus - Youdao is actively promoting the application of the 'Zi Yue' educational large language model in various scenarios, conducting a comprehensive AI upgrade of its business products [7] - The company will continue to increase investment in the research and development of edge model applications, focusing on AI + education to provide learners with a better learning experience [15] Industry Collaboration - Youdao participated in the Microsoft Greater China offline event at CES 2025, engaging in discussions on AI innovation and the globalization of consumer electronics in China [3]

Investment Rating - The report maintains a "Buy" rating for DAO (Youdao) with a target price of $6.69 per ADS [6][17] Core Views - DAO achieved its first-ever Q3 profitability in 2024, with revenue reaching a historical high of RMB 1.573 billion, a 2.19% YoY increase [1] - The company's AI-driven education products showed strong performance, with AI subscription services sales growing over 150% YoY to nearly RMB 70 million [2] - DAO's smart hardware business revenue increased by 25.18% YoY, driven by the launch of the AI-powered Youdao Dictionary Pen X7 series [2] - Online marketing services revenue grew 45.59% YoY, benefiting from AI-optimized RTA advertising and overseas game promotion [2] Financial Performance - For 2024 Q1-Q3, DAO reported revenue of RMB 4.286 billion, a 9.66% YoY increase, with a significant reduction in net loss to RMB 0.79 million [1] - Non-GAAP net income turned positive at RMB 13 million for the first nine months of 2024 [1] - The company improved cost efficiency, with sales expense ratio decreasing by 10.77 percentage points YoY to 33.04% in Q3 2024 [2] Business Segment Analysis Learning Services - Revenue decreased by 19.24% YoY to RMB 768 million in Q3 2024 due to reduced low-ROI customized services [2] - Digital content services generated RMB 514 million in net revenue, while AI subscription services contributed nearly RMB 70 million [2] Smart Hardware - Revenue grew 25.18% YoY to RMB 315 million in Q3 2024 [2] - The Youdao Dictionary Pen X7 series became the first learning hardware to achieve offline AI large model translation [2] Online Marketing Services - Revenue increased 45.59% YoY to RMB 489 million in Q3 2024 [2] - RTA advertising grew over 100% YoY, and KOL advertising increased more than 50% due to overseas game promotion [2] Financial Projections - Revenue is expected to grow from RMB 5.75 billion in 2024 to RMB 7.198 billion in 2026 [4][15] - Non-GAAP net income is projected to increase from RMB 41 million in 2024 to RMB 291 million in 2026 [15] - The PS ratio is forecasted to decrease from 0.75x in 2024 to 0.60x in 2026 [4] Valuation and Comparison - DAO's 2024E PS ratio of 0.75x is lower than peers like New Oriental (2.12x) and Gaotu (1.07x) [18] - The company's market capitalization stands at RMB 4.332 billion as of November 18, 2024 [18]

交银国际研究 公司更新 资料来源：FactSet，公司资料, 交银国际预测 ^净利润和每股盈利基于 Non-GAAP 基础 收盘价 目标价 潜在涨幅 美元 4.95 美元 7.30↑ +47.5% 财务模型更新 2024 年 11 月 15 日 有道 (DAO US) 实现首次 3 季度盈利，硬件恢复增长，高中及 AI 仍是长期战略重点 公司 3 季度利润好于预期，预计有望实现全年调整后净利润盈利。短期高 中投入力度缩减影响增长，但续报率数据稳步提升，预计公司有望在保证 盈利的前提下动态调整投入力度，拉动业务增长，高中及 AI 仍是长期战略 重点。基于盈利为先的战略下业务调整，我们下调2025 年收入预测7%，微 调 2025 年利润，考虑广告业务对公司利润提升的重要性，我们将其加入估 值贡献。基于SOTP估值法，目标价从4.5美元上调至7.3美元，其中基于15 倍/10 倍高中/广告业务 2025 年市盈率及 0.7 倍硬件业务 2025 年市销率。维 持买入。 3 季度利润好于预期。调整后净利润8900 万元（人民币，下同），好于 市场预期的 3500 万元。收入同比增 2%，其中学习服务收入同比下降 1 ...

Youdao, Inc. (NYSE:DAO) Q3 2024 Results Conference Call November 14, 2024 5:00 AM ET Company Participants Jeffrey Wang - Investor Relations Director Dr. Feng Zhou - Chief Executive Officer Lei Jin - President Peng Su - Vice President, Strategy and Capital Markets Wayne Li - Vice President, Finance Conference Call Participants Brian Gong - Citigroup Thomas Chong - Jefferies Brenda Zhao - CICC Operator Good day, and welcome to the Youdao 2024 Third Quarter Earnings Conference Call. Today's conference is being ...

HANGZHOU, China, Nov. 14, 2024 /PRNewswire/ -- Youdao, Inc. ("Youdao" or the "Company") (NYSE: DAO), an intelligent learning company with industry-leading technology in China, today announced its unaudited financial results for the third quarter ended September 30, 2024.Third Quarter 2024 Financial Highlights Total net revenues were RMB1.6 billion (US$224.1 million), representing a 2.2% increase from the same period in 2023.- Net revenues from learning services were RMB767.9 million (US$109.4 million), repr ...

BEIJING, Nov. 14, 2024 /PRNewswire/ -- Youdao, Inc. ("Youdao" or the "Company") (NYSE: DAO), an intelligent learning company with industry-leading technology in China, today announced that it will hold its annual general meeting of shareholders (the "AGM") at its offices at Building No.7, West Zone, Zhongguancun Software Park (Phase II), No.10 Xibeiwang East Road, Haidian District, Beijing, People's Republic of China on December 12, 2024 at 3:00 p.m. – 5:00 p.m. (Beijing Time). No proposal will be submitted ...

HANGZHOU, China, Oct. 31, 2024 /PRNewswire/ -- Youdao, Inc. ("Youdao" or the "Company") (NYSE: DAO), an intelligent learning company with industry-leading technology in China, today announced that it will report its third quarter 2024 financial results on Thursday, November 14, 2024, before the open of the U.S. markets. The earnings teleconference call with simultaneous webcast will take place at 5:00 a.m. Eastern Time on Thursday, November 14, 2024 (Beijing/Hong Kong Time: 6:00 p.m., Thursday, November 14, ...

On October 3, NetEase Youdao (DAO, Financial) experienced a significant increase of 30.79%, reaching $5.65 per share with a trading volume of $3.47 million.Financial data reveals that as of June 30, 2024, NetEase Youdao's total revenue was RMB 2.714 billion, marking a 14.5% year-over-year growth. The company's net loss attributable to shareholders was RMB 87.043 million, showing an improvement of 82.71% year-over-year.Important Note: NetEase Youdao is scheduled to disclose its 2024 fiscal third-quarter repo ...

交银国际研究 财务模型更新 盈利预测变动 有道 (DAO US) 聚焦高中、AI 订阅及广告，硬件 3 季度将恢复收入增长 2024 年 2 季度业绩符合预期。学习服务聚焦高中及 AI 订阅，素质教育收入短 期收缩，硬件收入将在3季度恢复增长，中高端词典笔销售将带动硬件利润率 环比改善。预计业务健康度提升，下半年运营层面实现盈利。基于高中业务 以稳健增长为主，我们将 2024 年高中增速从 25-30%下调至 20-25%，基于 15 倍高中业务市盈率不变，目标价从 5.0 美元下调至 4.5 美元，维持买入。 2 季度收入同比增 9.5%至 13 亿元（人民币，下同），其中学习服务/硬件/ 广告分别-5.5%/-25%/+68%。调整后净亏损 9600 万元，对比我们/彭博市场 预期亏损 9900 万元/1.2 亿元。 业绩要点：1）数字内容服务收入同比增 6.8%，有道领世续报率达 70%+ 创新高，同比提升 10 个百分点。2）广告收入连续 7 个季度同比增速超 50%，受 RTA 和 AI 工具拉动，以及加强与网易合作。3）智能硬件收入和 毛利率同比下降，因中低端价位产品销售占比上升，预计 2 季度将 ...

maybefalse My Buy investment rating for Youdao, Inc.'s (NYSE:DAO) shares stays unchanged. DAO's Q2 2024 bottom line beat and results briefing commentary indicate that the company is coming closer to reaching an operating profitability inflection point. DAO's first quarter results and its AI-related revenues were the focus of the prior May 27, 2024 update. I review Youdao's latest second quarter bottom line performance with this latest write-up. Narrower Than Expected Losses Were The Key Highlight Of DAO ...