Core Viewpoint - Gaotu Group reported a revenue of approximately 1.39 billion RMB for Q2 2025, marking a year-on-year growth of 37.6%, exceeding the guidance of 1.32 billion RMB set in the previous quarter. This is the sixth consecutive quarter of revenue growth exceeding 30% [2][4][6]. Revenue Performance - The revenue growth was primarily driven by strong market demand and the recognition of high-quality educational products and services. The learning services segment accounted for over 95% of total revenue, with non-subject training for K12 students contributing nearly 40% and achieving triple-digit year-on-year growth for the fifth consecutive quarter [8][12][16]. - Cash revenue reached 2.25 billion RMB, reflecting a year-on-year increase of 36.2%, and operating cash flow was nearly 590 million RMB [6][9]. Profitability and Losses - Despite the strong revenue performance, Gaotu reported a net loss of 216 million RMB, marking the seventh loss in the last eight quarters. This was a disappointment for the capital market, especially after a profitable previous quarter [4][12][15]. - The primary reason for the loss was high operational costs, which increased by 50.9% year-on-year to 470 million RMB, significantly outpacing revenue growth [15][17]. Cost Structure - The increase in costs was attributed to a rise in the number of teachers, higher rental costs, and increased depreciation and amortization expenses. The company is focusing on offline expansion, which is expected to fill the demand gap in the offline education market [15][16]. - The operational expenses decreased by 0.2% year-on-year, with marketing expenses down by 1.7%, indicating improved operational efficiency [9][10]. Market Strategy and Future Outlook - Gaotu's CFO indicated that the company had set a revenue growth target of approximately 30% for the year, but the actual growth in the first half exceeded 47.3%. The company plans to raise its full-year revenue growth expectations accordingly [9][10]. - The company is exploring the integration of celebrity IPs with real-time AI correction technology to enhance its marketing effectiveness and operational efficiency [10][19]. Seasonal Trends - The company’s financial performance is influenced by seasonal fluctuations in the K12 education sector, with significant differences in cash income and profitability between different quarters. The first and third quarters typically see lower cash income due to new student registrations, while the second and fourth quarters benefit from both new and returning students [18][19].

Core Viewpoint - The company reported a significant revenue growth of 37.6% year-on-year for Q2 2025, reaching approximately 1.39 billion RMB, but still faced a net loss of 216 million RMB, marking the seventh loss in eight quarters, which disappointed the capital market [1][3][10]. Revenue Performance - As of June 30, 2025, the company's revenue for Q2 was approximately 1.39 billion RMB, with cash income of 2.25 billion RMB, reflecting a year-on-year growth of 36.2% [3][6]. - The company has maintained over 30% revenue growth for six consecutive quarters, with an average growth rate of 51.7% [3][6]. - The main driver of revenue growth was the strong market demand and high-quality educational products, with learning services accounting for over 95% of total revenue [6][7]. Business Segmentation - The learning services business includes non-subject training for K12, traditional services for high school students, and services for college students and adults, with the first two segments contributing over 85% of revenue [6][7]. - The non-subject training for K12 has been a significant growth driver, with revenue share close to 40% and achieving triple-digit year-on-year growth for five consecutive quarters [6][7]. - The traditional high school business saw a 12.1% year-on-year revenue growth, while the college and adult education services accounted for over 10% of revenue, with significant improvement in operating losses [6][7]. Operational Efficiency - The company’s operational expenses decreased by 0.2% year-on-year, with marketing expenses down by 1.7%, ending a streak of eight consecutive quarters of significant increases [7][8]. - The return on investment (ROI) improved from 1.99 to 2.75 year-on-year, indicating a 38.6% increase in operational efficiency [8]. Cost and Loss Analysis - The company reported an operational cost of 470 million RMB for the quarter, a 50.9% increase year-on-year, which outpaced revenue growth [10][13]. - The increase in costs was attributed to a rise in the number of teachers, rental costs, and depreciation [13]. - Despite the revenue growth, the company faced a net loss due to high operational costs and a decrease in revenue from the previous quarter [10][14]. Seasonal Revenue Fluctuations - The company’s cash income is significantly affected by seasonal fluctuations, with Q2 typically seeing lower cash income compared to Q1 and Q3, which are peak registration periods [15]. - The management anticipates that the net loss in Q2 aligns with seasonal trends and is expected, with a goal of achieving annual profitability by 2026 [15].

Core Viewpoint - Gaotu Group reported a revenue of approximately 1.39 billion RMB for Q2 2025, marking a year-on-year growth of 37.6%, exceeding the guidance provided in the previous quarter [1][2] - Despite strong revenue growth, the company recorded a net loss of 216 million RMB, marking the seventh loss in the last eight quarters, which disappointed the capital market [1][8] Revenue Growth - As of June 30, 2025, Gaotu's Q2 revenue was approximately 1.39 billion RMB, with a year-on-year increase of 37.6% and cash revenue of 2.25 billion RMB, up 36.2% [2] - The company has maintained over 30% revenue growth for six consecutive quarters, with an average growth rate of 51.7% [2] - The main driver of revenue growth was the strong market demand and high-quality educational products and services [4] Business Segmentation - Gaotu's main business is learning services, which accounted for over 95% of revenue in Q2 [4] - The K12 non-subject training business contributed nearly 40% of total revenue, achieving triple-digit year-on-year growth for the fifth consecutive quarter [4][5] - The traditional business for high school students saw a year-on-year revenue increase of 12.1%, although growth slowed due to fewer classes during the Spring Festival [5] Cost and Profitability - The company reported an operating cost of 470 million RMB, a year-on-year increase of 50.9%, which outpaced revenue growth [11] - The increase in costs was attributed to a rise in the number of teachers, rental costs, and depreciation [12] - Despite the increase in costs, the company aims for long-term growth, with offline learning center revenue growing over 20% year-on-year [13] Operational Efficiency - Gaotu's return on investment (ROI) improved from 1.99 to 2.75 year-on-year, reflecting significant operational efficiency gains [7] - Marketing expenses decreased by 1.7% year-on-year, ending a streak of eight consecutive quarters of growth [6] Seasonal Trends - The company experienced a net loss in Q2, which aligns with the seasonal fluctuations typical in the K12 education sector [16] - Cash income is generally higher in the first and third quarters due to new student registrations, while the second and fourth quarters benefit from both new and returning students [15][16]