Gaotu Techedu Inc. (NYSE:GOTU) saw its shares rise 4.8% on Thursday after reporting second-quarter revenue that exceeded analyst projections, despite a slight miss on earnings.
The Chinese edtech company posted revenue of RMB1.39 billion ($215.5 million) for the quarter ending June 30, 2025, above the RMB1.24 billion expected by analysts and reflecting a 37.6% increase year-over-year.
Earnings per share, however, came in at a loss of RMB0.88, slightly below the anticipated RMB0.86 per share. Revenue growth was fueled by a 36.2% year-over-year rise in gross billings, reaching RMB2.25 billion.
“We maintained solid growth momentum in our core business and harnessed the power of AI to enhance our service models, foster product innovation and strengthen our organizational capabilities,” said Larry Xiangdong Chen, the company’s founder, Chairman, and CEO. “These results demonstrate our ability to sustain solid growth momentum while enhancing operational quality and sharpening our competitive edge.”
The company notably reduced its losses compared with the same period last year, with non-GAAP net loss improving 50.5% to RMB206.8 million from RMB418.0 million in Q2 2024.
Gaotu also reported a net operating cash inflow of RMB588.8 million, up 52.5% from the prior year.
Looking ahead, the company expects total net revenues for Q3 2025 to range between RMB1,558 million and RMB1,578 million, representing a 28.9% to 30.6% year-over-year increase. Gaotu ended the quarter with a strong cash position, holding RMB3.82 billion in cash, cash equivalents, restricted cash, and short- and long-term investments as of June 30, 2025.
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