Financial Data and Key Metrics Changes - For Q1 2020, the company achieved a net revenue of RMB1.298 billion, representing a 382% year-over-year increase [14] - Gross billings reached RMB1.374 billion, a 358% growth year-over-year [15] - GAAP net income was RMB148 million, while non-GAAP net income increased by 406% year-over-year to RMB190.7 million [26] Business Line Data and Key Metrics Changes - K-12 revenue grew by 448% year-over-year to RMB1.12 billion, accounting for 86% of net revenues [17] - Paid enrollments for K-12 courses increased by 315% year-over-year to 647,000 [18] - Revenue from foreign language, professional, and interest courses rose by 188% year-over-year to RMB174 million, representing 13% of net revenues [19] Market Data and Key Metrics Changes - The primary school segment showed the fastest growth among K-12 segments, indicating a healthier student structure [10] - Average enrollments per class increased from 1,700 in Q4 2019 to around 2,000 in Q1 2020 [19] - The company noted that the majority of new enrollments were first-time students, which is crucial for future revenue growth [15] Company Strategy and Development Direction - The company plans to continue investing in customer acquisition, technology development, and talent recruitment to enhance operational efficiency [11] - A two-year stock buyback program of up to $150 million was announced, reflecting management's confidence in long-term development [32] - The company aims to maintain profitability while expanding marketing expenses to secure new customers [11] Management Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving a strong retention rate for new students acquired during the pandemic [42] - The company noted that operational metrics such as student engagement and homework submission rates reached historical highs during Q1 [42] - Management expects revenue for Q2 to be between RMB1.526 billion and RMB1.556 billion, representing a year-over-year increase of 331% to 340% [32] Other Important Information - The company donated RMB20 million worth of courses to students in Wuhan during the COVID-19 outbreak [6] - Selling expenses increased to RMB757.2 million, up from RMB99.5 million in Q1 2019, reflecting the company's investment in marketing [22] - Research and development expenses rose by 227% year-over-year to RMB99.4 million, indicating a focus on content and technology development [23] Q&A Session Summary Question: What is the percentage of brand spending in GSX's sales and marketing expenses? - Management noted that sales and marketing expenses are over seven times that of the same period last year, with a focus on building brand awareness [36] Question: Is there a referral mechanism for existing customers? - Management acknowledged that many new enrollments come from word-of-mouth referrals, but specific data could not be disclosed [39] Question: What is the plan for hiring more tutors? - The company plans to hire over 10,000 tutors to support its growth, emphasizing the importance of attracting top talent for better service [40] Question: How will the company adjust course offerings due to school rescheduling? - Management indicated that they would adjust course schedules and potentially add short-term courses to cater to students' needs [48] Question: Can you provide enrollment and revenue breakdown for primary, secondary, and high school segments? - Management highlighted that the primary school segment has shown the largest growth and strategic significance, with plans to continue improving course offerings in this area [50]

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 20-F (Mark One) ☐ REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR 12(g) OF THE SECURITIES EXCHANGE ACT OF 1934 OR ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2019. OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 OR ☐ SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITI ...

Financial Data and Key Metrics Changes - For the fiscal year 2019, the company reported net revenue of RMB2.11 billion, representing a 432% increase from RMB397 million in 2018 [15] - Gross billings increased by 413% year-over-year to RMB3.36 billion from RMB665 million [15] - Non-GAAP income surged to RMB287 million in 2019, up 1021% from RMB26 million in 2018, resulting in a non-GAAP net income margin of 14% compared to 6% the previous year [15][16] - In Q4 2019, revenue increased 413% year-over-year to RMB935 million, exceeding guidance [16] - Net operating cash flow for Q4 reached RMB739 million, up 395% year-over-year from RMB149 million [25] Business Line Data and Key Metrics Changes - Net revenue from K-12 courses increased by 468% year-over-year to RMB773 million, accounting for 83% of total net revenues [17] - The primary school business revenue grew by 894% year-over-year in Q4, indicating strong growth and brand recognition [18] - Net revenue from foreign language, professional, and interest courses rose by 310% year-over-year to RMB150 million, representing 16% of net revenues [19] Market Data and Key Metrics Changes - Total enrollments for courses priced at or above RMB9.9 hit a record high of 1.12 million, a 3.9 times increase from the same period in 2018 [17] - Paid enrollments for courses priced at or above RMB99 increased to 1.1 million, growing 4.4 times year-over-year [17] Company Strategy and Development Direction - The company emphasizes a focused strategy on online live large classes, which has allowed it to outperform industry averages [8][9] - The management believes that maintaining a focus on one core business will lead to better organizational capabilities and growth [9][10] - The company plans to continue investing in research and development to enhance the learning experience and operational efficiency [21] Management Comments on Operating Environment and Future Outlook - The management expressed concern over the impact of the Coronavirus outbreak on the Chinese economy but noted an increase in online teaching activities [27] - The company has adapted by providing free courses and support to offline institutions during the outbreak [12][13] - Future guidance for Q1 2020 estimates net revenues between RMB1.086 billion and RMB1.106 billion, representing a year-over-year increase of 304% to 311% [25] Other Important Information - The company has a cash balance of RMB2.74 billion as of December 31, 2019, which includes cash, short-term investments, and long-term wealth management products [6] - The deferred revenue balance was RMB1.34 billion, primarily consisting of tuition collected in advance [25] Q&A Session Summary Question: Can you provide more details on the impact of the Coronavirus on online traffic and your strategy for retention? - Management noted that the outbreak has changed behaviors, leading to increased online course enrollments, with nearly 15 million enrollments in three live classes [27][29] Question: What is your customer acquisition strategy moving forward? - The company plans to maintain a focus on customer satisfaction to enhance retention and reduce acquisition costs, with a weighted average customer acquisition cost of RMB470 for the year [33][36] Question: Can you elaborate on the reasons behind margin expansion? - Margin expansion is attributed to economies of scale in the large class business model, with fixed compensation for instructors being diluted as class sizes grow [40][41] Question: What is the expected retention rate for tutors and how does compensation compare to peers? - The company reported a high retention rate for instructors, with compensation structured to include fixed, performance-based, and share-based components [57][59]

GSX Techedu, Inc (GSX) Q3 2019 Earnings Conference Call November 5, 2019 8:00 AM ET Company Participants Sandy Qin - Head of Investor Relations Larry Chen - Chairman and CEO Nan Shen - CFO Conference Call Participants Alexander Yu - Credit Suisse Xiaoguang Zhao - Barclays CH Chan - CLSA Operator Ladies and gentlemen, thank you for standing by and welcome to the GSX Techedu Third Quarter 2019 Earnings Conference Call. [Operator Instructions] Please note this event is being recorded on Tuesday, the 5th of Nov ...

Company Overview - GSX Techedu Inc is laser-focused on online live large-class tutoring[8] - The company's mission is to make education better through technology[6] - GSX Techedu Inc is the 3rd largest online K-12 large-class after-school tutoring service provider in China in terms of gross billings in 2018[8] Education Quality and Content - The company disseminates China's scarce high-quality teaching resources through specialization and collaboration[23] - The company employs professional tutors with an average of 11+ years of teaching experience as of June 30, 2019[24] - Less than 2% of candidates are employed in 2018[24] - The company offers the highest average compensation among online service providers in 2018[24] - The company's course materials are designed and developed in-house[28] Technology and Operations - The company utilizes live broadcasting technology with a maximum capacity of 100,000 students and an average delay time of less than 300 milliseconds[35] - The company uses AI and Big Data, analyzing over 15,000 dimensions of student behavioral data[35] Financial Performance - Adjusted Gross Profit Margin increased from 56% in 1Q18 to 73% in 2Q19[38]