Gaotu(US:GOTU) Xin Lang Zheng Quan·2025-11-26 08:28Core Insights - The core viewpoint of the article highlights the strong financial performance and operational improvements of Gaotu Group, showcasing significant revenue growth and enhanced profitability in the third quarter of fiscal year 2025. Financial Performance - Gaotu Group reported revenue of 1.58 billion RMB for Q3 2025, representing a year-over-year increase of 30.7% [1] - Cash revenue reached 1.19 billion RMB, up 11.2% year-over-year [1] - Cumulative revenue for the first nine months was 4.46 billion RMB, reflecting a 41% year-over-year growth [1] Profitability and Operational Efficiency - The company significantly improved its profitability, with adjusted operating losses and net losses narrowing by 64.6% and 69.9% respectively [2] - The adjusted net loss margin improved by 29.1 percentage points year-over-year [2] - Operating expenses as a percentage of revenue decreased by 27.6 percentage points, and customer acquisition efficiency improved by 12.8% year-over-year [2] - Deferred revenue reached 1.77 billion RMB, a 23.2% increase year-over-year, providing good visibility for future revenue [2] Cash Reserves and Shareholder Returns - As of the end of Q3, the company held over 3.04 billion RMB in cash and cash equivalents, restricted funds, and short-term and long-term investments [3] - The previously announced $80 million stock repurchase plan was completed ahead of schedule, with a new $100 million repurchase plan initiated in May 2025 [3] - Approximately 27.52 million American Depositary Shares (ADS) were repurchased under both plans, totaling nearly 620 million RMB [3] AI-Driven Upgrades and Competitive Advantage - The CEO emphasized the focus on user needs and the integration of AI across the entire product and service lifecycle, enhancing both scale efficiency and personalized experiences [4] - The company aims to build a more competitive "good teacher" supply chain and strengthen data-driven operational mechanisms to ensure sustainable long-term value for users, employees, and shareholders [4] Q4 2025 Outlook - For Q4 2025, Gaotu expects revenue to be between 1.628 billion and 1.648 billion RMB, representing a year-over-year growth of 17.2% to 18.7% [5] - The company is positioned to reach a profitability inflection point, leveraging its technology-driven, product innovation, and efficient operations to solidify its leading position in the Chinese education technology sector [5]