Summary of Action Education Conference Call Company Overview - **Company**: Action Education - **Industry**: Management Training and Consulting Key Points Financial Performance - For Q3 2025, Action Education reported a revenue of **¥566 million** and a net profit attributable to shareholders of **¥215 million** [4][6] - Total assets reached **¥2.177 billion**, with net assets at **¥960 million** and contract liabilities at **¥1.05 billion** [4][6] - Major revenue sources include: - Concentrated EMBA: **¥203 million** (35.92%) - Principal EMBA: **¥200 million** (35.45%) - Management Consulting: **¥88.34 million** (15.65%) [4][6] Core Business Segments - Concentrated EMBA and Principal EMBA account for over **70%** of total revenue, highlighting the concentration of core business [2][4] - Total revenue from the three main products constitutes **87%** of overall income [2][4] Training Participation - In Q3 2025, the number of participants for Concentrated EMBA exceeded **8,300** with an attendance rate of **107%** [2][5] - Principal EMBA had over **7,800** participants with a **100%** attendance rate [2][5] Market Response and Growth Strategies - Despite market uncertainties in Q2, the company demonstrated strong resilience, leading to a significant rebound in revenue and cash flow in Q3 [2][6] - The industrial manufacturing sector has become the largest client industry, accounting for **21%** of total payments, surpassing the food industry [2][7] - The healthcare sector has risen to the third position, indicating shifts in client structure due to macroeconomic changes [2][7] Cost Management - Operating costs decreased by approximately **10%** in Q3, attributed to economies of scale and increased participation lowering unit costs [2][9][10] - The overall gross margin for the first nine months of the year was **78%**, with a slight decrease in sales expense ratio [11] AI Product Development - Action Education launched AI Sales Master and AI Organizational Building tools, receiving positive feedback and orders from clients [3][13] - Future pricing strategy for AI products aims to enhance total revenue through volume rather than high pricing [13] Expansion Plans - The "Hundred Schools Plan" aims to increase sales channels and brand influence, with over **50%** of new locations in previously untapped areas [2][8][12] - Currently, **14** city general managers are in incubation, with **8** entering the second phase of site establishment [12] Dividend Policy - The company maintains a high dividend policy, aiming for full distribution to shareholders based on strong performance expectations by year-end [15] Future Outlook - The company anticipates sustained profit margins around **30%**, with stable management and financial expenses [11] - Continued recruitment of talent and expansion of the "Hundred Schools Plan" is expected to drive future growth [12] This summary encapsulates the key insights from the conference call, focusing on financial performance, market strategies, product development, and future outlook for Action Education.

Summary of Action Education's Conference Call Company Overview - **Company**: Action Education - **Industry**: Education and Management Consulting Key Financial Metrics - **Revenue**: 3.43 billion CNY in H1 2025 - **Net Profit**: 1.32 billion CNY - **Net Profit Attributable to Shareholders**: 1.31 billion CNY - **EMBA Revenue**: 1.28 billion CNY from Principal EMBA and 1.2 billion CNY from Concentrated EMBA [2][3] - **Management Consulting Revenue**: 54.43 million CNY, accounting for 18% of total revenue [2][3] Performance Insights - **Attendance Rates**: - Concentrated EMBA had a 96% attendance rate in H1 2025, down from 112% in the previous year [4] - Principal EMBA had an attendance rate of 108% [3] - **Growth in Orders**: Orders increased by 60-70% in July 2025, indicating strong demand [5] Operational Efficiency - **Gross Margin Improvement**: Increased from 67.4% to 72% due to a higher proportion of concentrated and principal courses [6] - **Cost Management**: Reduction in sales expenses while R&D expenses increased, leading to improved operational efficiency [6] Strategic Initiatives - **AR Organization Development**: Plans to build a world-class AR organization within 3-5 years, focusing on human resources, marketing, research, and financial control systems [7] - **AI Integration**: Implementation of AI technologies to enhance recruitment and training, resulting in a 16% increase in new employee retention and a 46% increase in sales performance [9][10] Customer Service and Product Upgrades - **Smart Service Platform**: Aiming to enhance efficiency for entrepreneurs through technology, including the launch of the "Digital Organization" course in collaboration with DingTalk's co-founder [8] - **High-Frequency Training**: New employees now receive 28 training sessions per month, significantly improving their communication and sales skills [11] Market Challenges - **Impact of Trade Wars**: Attendance rates dropped in Q2 2025 due to trade tensions, particularly affecting regions reliant on foreign trade [18][21] - **Regional Variability**: Some areas like Guangdong faced significant declines, while others like Shanghai maintained better attendance [18] Expansion Plans - **Hundred Cities, Hundred Schools Strategy**: Successfully recruited 9 general managers and established 7 offices, with expectations of generating 50-60 million CNY in revenue this year [15][22] - **Sales Leadership Development**: New sales leaders are expected to stabilize by the end of 2025, contributing significantly to revenue growth [23] Conclusion - **Future Outlook**: Confidence in achieving annual operational goals due to improved attendance rates and strong order growth, alongside strategic investments in AI and organizational development [5][19]

Summary of Action Education Conference Call Company Overview - **Company**: Action Education - **Fiscal Year**: 2024 - **Revenue**: 241 million CNY, up 12.15% year-over-year [2][4] - **Net Profit**: 278 million CNY, up 22.39% year-over-year [4] - **Basic Earnings Per Share**: 2.25 CNY, up 20.97% year-over-year [4] Financial Highlights - **Total Assets**: 2.232 billion CNY, with nearly 90% in cash, financial assets, and receivables [2][5] - **Contract Liabilities**: Increased to 1.08 billion CNY, indicating a higher order volume than revenue recognition [2][5] - **Cash Flow from Operations**: 399 million CNY, down 12% year-over-year [2][4] Revenue Composition and Profitability - **Concentrated EMBA and Principal EMBA**: Combined revenue share of 67.8%, with gross margins exceeding 86% [2][6] - **Principal Program Class**: Revenue share of 12%, gross margin of 66.11% [2][6] - **Consulting Business**: Revenue share of 18.62%, gross margin of 44.19% [2][6] - **Digital Business School**: Revenue of 9.67 million CNY, gross margin of 96.04% [6] - **Book Business**: Revenue of 3.05 million CNY, gross margin of 26.57% [6] Course and Attendance Metrics - **Concentrated EMBA**: Average attendance of 10,577 per session, ticket price of 232-239 CNY, attendance rate of approximately 95% [2][7] - **Principal Class**: Average attendance of 11,388 per session, ticket price of 24,300 CNY, attendance rate of 101% [2][7] - **Future Course Plans**: Anticipated 10% increase in course offerings for 2025 [2][8] Client Acquisition and Strategy - **Golden Brick Plan**: New client acquisition of 295, with total orders of 604.45 million CNY, representing 65% of total orders [2][11] - **Top Clients**: Top 20 clients contributed approximately 170 million CNY [2][11] - **Dual Nine Goals**: Focus on referral and repurchase rates, with ongoing efforts to enhance course value and customer satisfaction [2][12][13] Expansion Plans - **Hundred Schools Plan**: Aiming for large-scale expansion with internal and external recruitment of city managers [2][14] - **Current Progress**: Targeting 10 city manager appointments, with 4 already in place [2][14] Systematic Improvements - **Internal Management System**: Enhanced customer management and client acquisition processes to avoid internal competition [2][15] - **AR Sales Master**: AI-driven training tool for new employees, with nearly 1,000 sales personnel using it [2][15] Market and Economic Context - **Impact of Global Trade Policies**: Adjustments to training programs to help clients adapt to changes in trade policies [2][16][18] - **Competitive Strategies**: Initiatives to enhance brand visibility and customer engagement through various marketing strategies [2][17] Future Outlook - **Q1 2025 Expectations**: Anticipated lower performance due to seasonal factors, with detailed reports pending [2][19] - **AI Technology Applications**: Ongoing development of AI tools for employee training and customer assessment, with expected releases in late May or early June [2][20] Conclusion - **Overall Performance**: Action Education shows strong growth in revenue and profitability, with strategic plans for expansion and technological advancements to enhance training and client engagement.