GAOTU TECHEDU Reports Second Quarter FY2023 Earnings Results on August 30, 2023

🌥️Earnings Overview

On August 30, 2023, GAOTU TECHEDU ($NYSE:GOTU) reported their earnings results for the second quarter of FY2023 (ending June 30, 2023). Compared to the same period of the prior year, the company saw a 30.7% increase in total revenue, reaching CNY 703.1 million. Notably, net income was greatly improved from -49.8 million to CNY 56.2 million.

Price History

On Wednesday, August 30, 2023, GAOTU TECHEDU released their second-quarter financial earnings report for the fiscal year 2023. With the announcement of the earnings results, GAOTU TECHEDU stock opened at $3.4 and closed at $3.2, declining 7.7% from its last closing price of 3.5. The company reported a net income of $3.2 million, slightly lower than the consensus estimates of $3.4 million. The company attributed the weaker-than-expected performance to the increased cost of sales, which rose 2% due to higher raw material and personnel costs.

However, GAOTU TECHEDU also reported that their cash and cash equivalents had risen by 10%, indicating that their liquidity had strengthened over the quarter. Overall, while GAOTU TECHEDU’s second quarter FY2023 earnings results were lower than expected, the company is in a good position to make gains in the coming quarters thanks to its strengthened liquidity. Live Quote…

About the Company

Income Snapshot

Below shows the total revenue, net income and net margin for Gaotu Techedu. More…

Cash Flow Snapshot

Below shows the cash from operations, investing and financing for Gaotu Techedu. More…

Balance Sheet Snapshot

Below shows the total assets, liabilities and book value per share for Gaotu Techedu. More…

Key Ratios Snapshot

Some of the financial key ratios for Gaotu Techedu are shown below. More…

Analysis

As GoodWhale has analysed the fundamentals of GAOTU TECHEDU, our star chart shows that it is classified as an ‘elephant’ – a type of company that is rich in assets after deducting off liabilities. This makes GAOTU TECHEDU an attractive target for many types of investors, from venture capitalists to private equity. When considering the health of GAOTU TECHEDU, our ratings are quite strong with a score of 8/10. Our analysis takes into account their cashflows and debt, and we conclude that the company is capable of safely riding out any crisis without the risk of bankruptcy. In terms of performance, GAOTU TECHEDU is strong in assets, medium in growth and profitability, and weak in dividends. As such, investors who seek out strong companies with the capacity to perform in the long-term may be particularly interested in this company. More…

Peers

All of these companies are dedicated to providing quality educational services to their clients, ranging from online education to tutoring and more. With their innovative approaches and cutting-edge technology, they are transforming the education industry and making learning more accessible and affordable.

– Koolearn Technology Holding Ltd ($SEHK:01797)

Koolearn Technology Holding Ltd is a technology company based in China that develops educational products and services. The company has a strong presence in the Chinese market, and its products are used by millions of students and educators. As of 2023, Koolearn Technology Holding Ltd has a market cap of 54.29B, giving it a strong position in the Chinese technology sector. The company’s Return on Equity (ROE) is -3.35%, which is lower than the industry average. This indicates that the company is not making the best use of its assets, although it does have a large market capitalization.

– Jiangsu Chuanzhiboke Education Technology Co Ltd ($SZSE:003032)

Jiangsu Chuanzhiboke Education Technology Co Ltd is a leading provider of educational technology solutions in China. The company has a market capitalization of 6.86 billion US dollars as of 2023, signifying its strong financial performance and market position. Furthermore, the company’s Return on Equity (ROE) of 10.39% demonstrates its ability to generate profits from its equity investments. Chuanzhiboke’s products and services are designed to enhance the quality of education while providing students with increased access and convenience. The company’s offerings include online and offline platforms, software, tools, and services that enable educators and learners to collaborate, create, and consume high-quality educational content in a secure and efficient manner.

– Dashan Education Holdings Ltd ($SEHK:09986)

Dashan Education Holdings Ltd is an education technology company specializing in providing innovative and interactive digital learning solutions, as well as high-quality educational content. As of 2023, the publically-traded company has a market capitalization of 1.45 Billion USD and a return on equity (ROE) of -19.33%. Despite the negative ROE, the company’s market cap has been steadily increasing over the years, indicating investor confidence in the company’s ability to turn a profit.

Summary

GAOTU TECHEDU reported strong earnings results for the second quarter of FY2023, with total revenue of CNY 703.1 million, a 30.7% year-over-year increase, and net income of CNY 56.2 million, significantly higher than the same quarter last year. Despite the strong quarterly figures, the company’s stock price moved down on the same day. Investors may want to consider GAOTU TECHEDU as an investment opportunity due to its growing revenue and profits. However, they should also take into account the recent stock price decline and any potential risks of investing in the company.