Core Viewpoint - YXT.com Group Holding Limited reported its financial results for the first nine months of 2024, showing a significant reduction in net loss and a strategic shift towards large enterprise accounts in the digital corporate learning industry in China [1][3]. Financial Performance - Total revenues for the first nine months of 2024 were RMB241.7 million (US$34.4 million), down from RMB328.8 million in the same period of the previous year, reflecting a decrease of approximately 26.5% [2][4]. - Gross margin improved to 60.4% from 59.3% year-over-year [2]. - The net loss narrowed to RMB14.9 million (US$2.1 million) compared to a net loss of RMB245.3 million in the same period last year, indicating a significant improvement [2][11]. - The adjusted net loss was RMB123.1 million (US$17.5 million), down from RMB196.1 million in the same period of the previous year [11][29]. Customer Metrics - The number of subscription customers decreased to 2,428 as of September 30, 2024, from 3,039 a year earlier. This decline was influenced by the deconsolidation of CEIBS Publishing Group Limited, which accounted for 571 customers [2]. - Net revenue retention rates for subscription customers fell to 101.0% from 104.8% year-over-year, attributed to the strategic focus on large enterprise accounts [2]. Revenue Breakdown - Revenues from corporate learning solutions totaled RMB240.3 million (US$34.2 million), down from RMB318.6 million in the same period last year [5]. - Subscription-based corporate learning solutions generated RMB221.7 million (US$31.6 million), a decrease from RMB271.1 million, primarily due to the deconsolidation of CEIBS PG and operational adjustments [5]. - Non-subscription based corporate learning solutions revenues were RMB18.6 million (US$2.7 million), down from RMB47.5 million, reflecting a strategic shift towards subscription-based offerings [6]. Cost Management - Cost of revenues decreased by 28.4% to RMB95.8 million (US$13.6 million) from RMB133.8 million, mainly due to the deconsolidation of CEIBS PG and reduced instructor compensation costs [7]. - Sales and marketing expenses were reduced by 38.9% to RMB105.8 million (US$15.1 million) from RMB173.2 million, reflecting cost management initiatives [8]. - Research and development expenses decreased by 33.8% to RMB90.6 million (US$12.9 million) from RMB136.8 million, also due to operational optimizations [9]. Management Commentary - The management expressed optimism about long-term growth prospects, emphasizing the importance of digital learning solutions and the company's strengthening position in the large enterprise segment [3]. - The CFO highlighted the effectiveness of operational optimization initiatives that contributed to the significant reduction in net loss [3].
YXT.com Reports Unaudited Financial Results for the First Nine Months of 2024