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Youdao Reports Second Quarter 2024 Unaudited Financial Results

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Youdao reported Q2 2024 financial results with total net revenues of RMB1.3 billion (US$181.9 million), a 9.5% increase year-over-year. Key highlights include:

- Net revenues from online marketing services grew 68.4% to RMB511.2 million
- Gross margin improved to 48.2% from 47.0% last year
- Operating loss narrowed significantly to RMB72.6 million from RMB289.1 million
- Net loss attributable to shareholders decreased to RMB99.5 million from RMB299.2 million

The company saw strong growth in AI-driven subscription services and online marketing, while learning services and smart device revenues declined. Youdao expects to achieve full-year positive operating income in the near future, driven by AI empowerment across business lines.

Youdao ha riportato i risultati finanziari del secondo trimestre 2024 con entrate nette totali di 1,3 miliardi di RMB (181,9 milioni di USD), un aumento del 9,5% rispetto all'anno precedente. I punti salienti includono:

- Le entrate nette dai servizi di marketing online sono aumentate del 68,4% a 511,2 milioni di RMB
- Il margine lordo è migliorato al 48,2% rispetto al 47,0% dell'anno scorso
- La perdita operativa si è ridotta significativamente a 72,6 milioni di RMB rispetto ai 289,1 milioni di RMB
- La perdita netta attribuibile agli azionisti è diminuita a 99,5 milioni di RMB rispetto ai 299,2 milioni di RMB

La società ha mostrato una forte crescita nei servizi in abbonamento basati sull'AI e nel marketing online, mentre i ricavi dai servizi di apprendimento e dai dispositivi intelligenti sono diminuiti. Youdao prevede di raggiungere un reddito operativo positivo per l'intero anno nel prossimo futuro, grazie all'applicazione dell'AI in tutti i settori.

Youdao reportó los resultados financieros del segundo trimestre de 2024 con ingresos netos totales de 1.3 mil millones de RMB (181.9 millones de USD), un aumento del 9.5% interanual. Los aspectos destacados incluyen:

- Los ingresos netos por servicios de marketing en línea crecieron un 68.4% alcanzando 511.2 millones de RMB
- El margen bruto mejoró al 48.2% desde el 47.0% del año pasado
- La pérdida operativa se redujo significativamente a 72.6 millones de RMB desde 289.1 millones de RMB
- La pérdida neta atribuible a los accionistas disminuyó a 99.5 millones de RMB desde 299.2 millones de RMB

La empresa experimentó un fuerte crecimiento en los servicios de suscripción impulsados por IA y en marketing en línea, mientras que los ingresos por servicios de aprendizaje y dispositivos inteligentes disminuyeron. Youdao espera alcanzar ingresos operativos positivos para el año completo en un futuro cercano, impulsado por la integración de la IA en todas las líneas de negocio.

Youdao는 2024년 2분기 재무 결과를 보고하며 총 순매출 13억 위안 (1억 8190만 달러), 전년 동기 대비 9.5% 증가를 기록했습니다. 주요 하이라이트는 다음과 같습니다:

- 온라인 마케팅 서비스의 순매출이 68.4% 증가하여 5억 1120만 위안에 도달했습니다
- 총 마진이 지난해 47.0%에서 48.2%로 개선되었습니다
- 운영 손실이 2억 8910만 위안에서 7260만 위안으로 크게 축소되었습니다
- 주주에게 귀속된 순손실이 2억 9920만 위안에서 9950만 위안으로 감소했습니다

회사는 AI 기반 구독 서비스와 온라인 마케팅에서 강력한 성장을 보였지만, 학습 서비스와 스마트 기기 수익은 감소했습니다. Youdao는 향후 AI 활용을 통해 전 사업 부문에서 긍정적인 운영 소득을 달성할 것으로 예상하고 있습니다.

Youdao a rapporté les résultats financiers du deuxième trimestre 2024 avec des revenus nets totaux de 1,3 milliard de RMB (181,9 millions de USD), soit une augmentation de 9,5 % par rapport à l'année précédente. Les principales faits saillants incluent :

- Les revenus nets des services de marketing en ligne ont augmenté de 68,4 % pour atteindre 511,2 millions de RMB
- La marge brute s'est améliorée à 48,2 % contre 47,0 % l'année dernière
- La perte d'exploitation a été considérablement réduite à 72,6 millions de RMB contre 289,1 millions de RMB
- La perte nette attribuable aux actionnaires a diminué à 99,5 millions de RMB contre 299,2 millions de RMB

L'entreprise a connu une forte croissance dans les services d'abonnement propulsés par l'IA et dans le marketing en ligne, tandis que les revenus des services d'apprentissage et des appareils intelligents ont diminué. Youdao s'attend à parvenir à un revenu d'exploitation positif sur l'ensemble de l'année dans un avenir proche, grâce à l'autonomisation de l'IA dans toutes les lignes d'affaires.

Youdao berichtete über die finanziellen Ergebnisse des zweiten Quartals 2024 mit gesamt Nettoumsätzen von 1,3 Milliarden RMB (181,9 Millionen USD), was einem Anstieg von 9,5 % im Jahresvergleich entspricht. Zu den wichtigsten Highlights gehören:

- Die Nettoumsätze aus Online-Marketingdiensten stiegen um 68,4 % auf 511,2 Millionen RMB
- Die Bruttomarge verbesserte sich auf 48,2 % von 47,0 % im Vorjahr
- Der operative Verlust verringerte sich erheblich auf 72,6 Millionen RMB von 289,1 Millionen RMB
- Der den Aktionären zurechenbare Nettoverlust sank auf 99,5 Millionen RMB von 299,2 Millionen RMB

Das Unternehmen verzeichnete ein starkes Wachstum bei KI-gesteuerten Abonnementdiensten und Online-Marketing, während die Umsätze aus Lernservices und intelligenten Geräten zurückgingen. Youdao erwartet, in naher Zukunft einen positiven operativen Gewinn für das gesamte Jahr zu erzielen, angetrieben durch die KI-Integration in alle Geschäftsbereiche.

Positive
  • Total net revenues increased 9.5% year-over-year to RMB1.3 billion
  • Online marketing services revenue grew 68.4% to RMB511.2 million
  • Gross margin improved to 48.2% from 47.0% last year
  • Operating loss narrowed significantly to RMB72.6 million from RMB289.1 million
  • Net loss attributable to shareholders decreased to RMB99.5 million from RMB299.2 million
  • Operating cash inflow reached an all-time high
  • AI-driven subscription services sales increased nearly 200% year-over-year
Negative
  • Net revenues from learning services decreased 5.5% to RMB643.8 million
  • Net revenues from smart devices decreased 25.0% to RMB166.7 million
  • Gross margin for smart devices declined to 30.3% from 35.8% last year

Insights

Youdao's Q2 2024 results show a mixed performance. While total net revenues increased by 9.5% year-over-year to RMB1.3 billion, the company still reported a net loss of RMB99.5 million. However, this loss narrowed significantly from RMB299.2 million in the same period last year.

The standout performer was online marketing services, with revenues surging 68.4% year-over-year to RMB511.2 million, driven by AI-powered advertising tools. This growth offset declines in learning services (-5.5%) and smart devices (-25%).

Improved cost management led to a reduction in operating expenses by 17.2%, contributing to a narrower operating loss margin of 5.5% compared to 24% last year. The company's focus on AI-driven services and operational efficiency appears to be yielding results, with management expressing confidence in achieving full-year positive operating income in the near future.

Youdao's strategic pivot towards AI-powered services is paying dividends. The company's integration of large language models into its college admission consultation services demonstrates its ability to leverage cutting-edge AI for practical applications. The nearly 200% year-over-year increase in AI-driven subscription services sales is particularly noteworthy.

The success of RTA (Real-Time API) and AI tools in advertising underscores Youdao's technical prowess in applying AI to drive revenue growth. This aligns with broader industry trends of AI integration in ed-tech and digital marketing. However, the decline in smart devices revenue suggests challenges in hardware sales, possibly due to market saturation or increased competition.

Looking ahead, Youdao's focus on combining AI capabilities with operational excellence across business lines positions it well in the evolving AI + education landscape. The company's ability to continually innovate and adapt its AI offerings will be important for maintaining its competitive edge.

HANGZHOU, China, Aug. 22, 2024 /PRNewswire/ -- Youdao, Inc. ("Youdao" or the "Company") (NYSE: DAO), an intelligent learning company with industry-leading technology in China, today announced its unaudited financial results for the second quarter ended June 30, 2024.

Second Quarter 2024 Financial Highlights

  • Total net revenues were RMB1.3 billion (US$181.9 million), representing a 9.5% increase from the same period in 2023.
    - Net revenues from learning services were RMB643.8 million (US$88.6 million), representing a 5.5% decrease from the same period in 2023.
    - Net revenues from smart devices were RMB166.7 million (US$22.9 million), representing a 25.0% decrease from the same period in 2023.
    - Net revenues from online marketing services were RMB511.2 million (US$70.3 million), representing a 68.4% increase from the same period in 2023.
  • Gross margin was 48.2%, compared with 47.0% for the same period in 2023.

"In the second quarter, our financial performance was robust, with operating cash inflow reaching an all-time high and operating loss narrowing significantly year-over-year. Leveraging our advanced large language model capabilities and data advantages, we upgraded our college admission consultation services in Youdao Lingshi to AI-based College Admission Advisers, enhancing both the timeliness and personalization of our services. Driven by RTA (Real-Time API) and AI tools advertising, our online marketing services achieved record net revenues of RMB511.2 million in the second quarter, an increase of 68.4% year-over-year. AI-driven subscription services continued to expand, with the introduction of new applications, including Mr. P AI Tutor, marking a nearly 200% year-over-year increase of total sales in the second quarter. Overall, in the first half of this year, our strategic focus on digital content services, online marketing services, and AI-driven subscription services has yielded significant results, with major financial indicators showing year-over-year improvement," said Dr. Feng Zhou, Chief Executive Officer and Director of Youdao.

"Looking ahead, with our teams' continued execution and barring unexpected market changes, we expect the business to achieve full-year positive operating income in the near future. Youdao's strength lies in our unique ability to advance AI empowerment across business lines, combining technical strength with operational excellence. The rapid development of our online marketing and AI subscription services proves this and will continue to drive our growth. Our online courses, underpinned by high-quality content and differentiated services, are another pillar of our future growth. In the long term, the future of AI + education looks incredibly bright and we will strive to lead the charge," Dr. Zhou concluded.

Second Quarter 2024 Financial Results

Net Revenues 

Net revenues for the second quarter of 2024 were RMB1.3 billion (US$181.9 million), representing a 9.5% increase from RMB1.2 billion for the same period of 2023.

Net revenues from learning services were RMB643.8 million (US$88.6 million) for the second quarter of 2024, representing a 5.5% decrease from RMB680.9 million for the same period of 2023.

Net revenues from smart devices were RMB166.7 million (US$22.9 million) for the second quarter of 2024, representing a 25.0% decrease from RMB222.2 million for the same period of 2023, which was mainly attributable to the decreased unit price due to the change of product mix.

Net revenues from online marketing services were RMB511.2 million (US$70.3 million) for the second quarter of 2024, representing a 68.4% increase from RMB303.6 million for the same period of 2023. The year-over-year increase in revenues from online marketing services was primarily due to the increase in the sales of performance-based advertisements through third parties' internet properties, which was driven by our continued investments in cutting-edge AI technology.

Gross Profit and Gross Margin

Gross profit for the second quarter of 2024 was RMB636.8 million (US$87.6 million), representing a 12.3% increase from RMB567.2 million for the same period of 2023. Gross margin was 48.2% for the second quarter of 2024, compared with 47.0% for the same period of 2023.

Gross margin for learning services was 60.0% for the second quarter of 2024, compared with 57.4% for the same period of 2023.

Gross margin for smart devices was 30.3% for the second quarter of 2024, compared with 35.8% for the same period of 2023. The decrease was mainly attributable to a lower revenue base of smart devices.

Gross margin for online marketing services was 39.1% for the second quarter of 2024, compared with 31.9% for the same period of 2023. The increase was mainly attributable to the improved gross margin profile of performance-based advertisements through third parties' internet properties compared with the same period of last year.

Operating Expenses

Total operating expenses for the second quarter of 2024 were RMB709.3 million (US$97.6 million), compared with RMB856.3 million for the same period of last year.

Sales and marketing expenses for the second quarter of 2024 were RMB515.7 million (US$71.0 million), representing a decrease of 12.2% from RMB587.7 million for the same period of 2023. This decrease was attributable to the reduced marketing expenditures and outsourcing labor service fees in learning services in the second quarter of 2024.

Research and development expenses for the second quarter of 2024 were RMB153.0 million (US$21.1 million), representing a decrease of 25.4% from RMB205.1 million for the same period of 2023. The decrease was primarily due to the decreased headcount for research and development employees, leading to payroll savings in the second quarter of 2024.

General and administrative expenses for the second quarter of 2024 were RMB40.6 million (US$5.6 million), representing a decrease of 36.1% from RMB63.6 million for the same period of 2023. The decrease was primarily due to decreased expected credit losses on our accounts receivables, as well as the decreased headcount for general and administrative employees, leading to payroll savings in the second quarter of 2024.

Loss from Operations

As a result of the foregoing, loss from operations for the second quarter of 2024 was RMB72.6 million (US$10.0 million), compared with RMB289.1 million for the same period in 2023. The margin of loss from operations was 5.5%, compared with 24.0% for the same period of last year.

Net Loss Attributable to Youdao's Ordinary Shareholders

Net loss attributable to Youdao's ordinary shareholders for the second quarter of 2024 was RMB99.5 million (US$13.7 million), compared with RMB299.2 million for the same period of last year. Non-GAAP net loss attributable to Youdao's ordinary shareholders for the second quarter of 2024 was RMB96.0 million (US$13.2 million), compared with RMB283.6 million for the same period of last year.

Basic and diluted net loss per American depositary share ("ADS") attributable to ordinary shareholders for the second quarter of 2024 was RMB0.85 (US$0.12), compared with RMB2.45 for the same period of 2023. Non-GAAP basic and diluted net loss per ADS attributable to ordinary shareholders was RMB0.82 (US$0.11), compared with RMB2.32 for the same period of 2023.

Other Information

As of June 30, 2024, Youdao's cash, cash equivalents, current and non-current restricted cash, time deposits and short-term investments totaled RMB568.5 million (US$78.2 million), compared with RMB527.1 million as of December 31, 2023. For the second quarter of 2024, net cash provided by operating activities was RMB250.2 million (US$34.4 million), capital expenditures totaled RMB3.8 million (US$0.5 million). Youdao's ability to continue as a going concern is dependent on management's ability to implement an effective business plan amid a changing regulatory environment, generate operating cash flows, and secure external financing for future development. To support Youdao's future business, NetEase Group has agreed to provide financial support for ongoing operations. As of June 30, 2024, Youdao has received various financial support from the NetEase Group, including, among others, RMB878.0 million short-term loans, and US$126.5 million long-term loans with maturity dated March 31, 2027 drawn down under the US$300.0 million revolving loan facility.

As of June 30, 2024, the Company's contract liabilities, which mainly consisted of deferred revenues generated from Youdao's learning services, were RMB1.0 billion (US$142.9 million), compared with RMB1.1 billion as of December 31, 2023.

Share Repurchase Program

On November 17, 2022, the Company announced that its board of directors had authorized the Company to adopt a share repurchase program in accordance with applicable laws and regulations for up to US$20.0 million of its Class A ordinary shares (including in the form of ADSs) during a period of up to 36 months. This amount was subsequently increased to US$40.0 million in August 2023. As of June 30, 2024, the Company had repurchased a total of approximately 7.5 million ADSs for around US$33.8 million in the open market under the share repurchase program.

Conference Call

Youdao's management team will host a teleconference call with simultaneous webcast at 6:00 a.m. Eastern Time on Thursday, August 22, 2024 (Beijing/Hong Kong Time: 6:00 p.m., Thursday, August 22, 2024). Youdao's management will be on the call to discuss the financial results and answer questions.

Dial-in details for the earnings conference call are as follows:

United States (toll free):

+1-888-346-8982

International:

+1-412-902-4272

Mainland China (toll free):

400-120-1203

Hong Kong (toll free): 

800-905-945

Hong Kong:

+852-3018-4992

Conference ID:

8395069

A live and archived webcast of the conference call will be available on the Company's investor relations website at http://ir.youdao.com.

A replay of the conference call will be accessible by phone one hour after the conclusion of the live call at the following numbers, until August 29, 2024:

United States: 

+1-877-344-7529

International:

+1-412-317-0088

Replay Access Code:       

8395069

About Youdao, Inc.

Youdao, Inc. (NYSE: DAO) is an intelligent learning company with industry-leading technology in China dedicated to developing and using technologies to provide learning content, applications and solutions to users of all ages. Building on the popularity of its online knowledge tools such as Youdao Dictionary and Youdao Translation, Youdao now offers smart devices, STEAM courses, adult and vocational courses, and education digitalization solutions. In addition, Youdao has developed a variety of interactive learning apps. Youdao was founded in 2006 as part of NetEase, Inc. (NASDAQ: NTES; HKEX: 9999), a leading internet technology company in China.

For more information, please visit: http://ir.youdao.com.

Non-GAAP Measures

Youdao considers and uses non-GAAP financial measures, such as non-GAAP net income/(loss) attributable to the Company's ordinary shareholders and non-GAAP basic and diluted net income/(loss) per ADS, as supplemental metrics in reviewing and assessing its operating performance and formulating its business plan. The presentation of non-GAAP financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP").

Youdao defines non-GAAP net income/(loss) attributable to the Company's ordinary shareholders as net income/(loss) attributable to the Company's ordinary shareholders excluding share-based compensation expenses and impairment of long-term investments. Non-GAAP net income/(loss) attributable to the Company's ordinary shareholders enables Youdao's management to assess its operating results without considering the impact of these items, which are non-cash charges in nature. Youdao believes that these non-GAAP financial measures provide useful information to investors in understanding and evaluating the Company's current operating performance and prospects in the same manner as management does, if they so choose.

Non-GAAP financial measures are not defined under U.S. GAAP and are not presented in accordance with U.S. GAAP. Non-GAAP financial measures have limitations as analytical tools, which possibly do not reflect all items of expense that affect our operations. In addition, the non-GAAP financial measures Youdao uses may differ from the non-GAAP measures uses by other companies, including peer companies, and therefore their comparability may be limited.

For more information on these non-GAAP financial measures, please see the table captioned "Unaudited Reconciliation of GAAP and non-GAAP Results" set forth at the end of this release.

The accompanying table has more details on the reconciliation between our GAAP financial measures that are mostly directly comparable to non-GAAP financial measures. Youdao encourages you to review its financial information in its entirety and not rely on a single financial measure.

Exchange Rate Information

This announcement contains translations of certain RMB amounts into U.S. dollars ("US$") at specified rates solely for the convenience of the reader. Unless otherwise stated, all translations from RMB to US$ were made at the rate of RMB7.2672 to US$1.00, the exchange rate on June 28, 2024 set forth in the H.10 statistical release of the Federal Reserve Board. The Company makes no representation that the RMB or US$ amounts referred could be converted into US$ or RMB, as the case may be, at any particular rate or at all.

Safe Harbor Statement

This press release contains forward-looking statements. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. Statements that are not historical facts, including statements about the Company's beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties, and a number of factors could cause actual results to differ materially from those contained in any forward-looking statement. In some cases, forward-looking statements can be identified by words or phrases such as "may," "will," "expect," "anticipate," "target," "aim," "estimate," "intend," "plan," "believe," "potential," "continue," "is/are likely to" or other similar expressions. The Company may also make written or oral forward-looking statements in its reports filed with, or furnished to, the U.S. Securities and Exchange Commission, in its annual reports to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Further information regarding such risks, uncertainties or factors is included in the Company's filings with the SEC. The announced results of the second quarter of 2024 are preliminary and subject to adjustments. All information provided in this press release is as of the date of this press release, and the Company does not undertake any duty to update such information, except as required under applicable law.

For investor and media inquiries, please contact:

In China:
Jeffrey Wang
Youdao, Inc.
Tel: +86-10-8255-8163 ext. 89980
E-mail: IR@rd.netease.com 

Piacente Financial Communications
Helen Wu
Tel: +86-10-6508-0677
E-mail: youdao@thepiacentegroup.com 

In the United States:
Piacente Financial Communications
Brandi Piacente
Tel: +1-212-481-2050
E-mail: youdao@thepiacentegroup.com 

 

 

 

YOUDAO, INC.







UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS






(RMB and USD in thousands)























As of December 31,


As of June 30,


As of June 30,



2023


2024


2024



RMB


RMB


USD (1)








Assets







Current assets:







Cash and cash equivalents


454,536


500,811


68,914

Time deposits


277


282


39

Restricted cash


395


1,719


237

Short-term investments


71,848


62,501


8,600

Accounts receivable, net


354,006


393,111


54,094

Inventories


217,067


195,726


26,933

Amounts due from NetEase Group


26,117


68,104


9,371

Prepayment and other current assets


175,705


176,881


24,340

Total current assets


1,299,951


1,399,135


192,528








Non-current assets:







Property, equipment and software, net


70,906


59,513


8,189

Operating lease right-of-use assets, net


89,022


89,252


12,281

Long-term investments


51,396


77,469


10,660

Goodwill


109,944


109,944


15,129

Other assets, net


44,976


46,196


6,357

Total non-current assets


366,244


382,374


52,616








Total assets


1,666,195


1,781,509


245,144








Liabilities, Mezzanine Equity and Shareholders' Deficit







Current liabilities:







Accounts payables


159,005


110,644


15,225

Payroll payable


282,679


194,622


26,781

Amounts due to NetEase Group


82,430


74,164


10,205

Contract liabilities


1,052,622


1,038,676


142,927

Taxes payable


52,781


47,482


6,534

Accrued liabilities and other payables


591,770


743,511


102,310

Short-term loans from NetEase Group


878,000


878,000


120,817

Total current liabilities


3,099,287


3,087,099


424,799








Non-current liabilities:







Long-term lease liabilities


49,337


42,265


5,816

Long-term loans from NetEase Group


630,360


905,553


124,608

Other non-current liabilities


16,314


16,879


2,323

Total non-current liabilities


696,011


964,697


132,747








Total liabilities


3,795,298


4,051,796


557,546








Mezzanine equity


37,961


38,532


5,302








Shareholders' deficit:







Youdao's shareholders' deficit


(2,186,736)


(2,329,034)


(320,486)

Noncontrolling interests


19,672


20,215


2,782

Total shareholders' deficit


(2,167,064)


(2,308,819)


(317,704)








Total liabilities, mezzanine equity and shareholders' deficit


1,666,195


1,781,509


245,144


Note 1:

The conversion of Renminbi (RMB) into United States dollars (USD) is based on the noon buying rate of USD1.00=RMB7.2672 on the last
trading day of June (June 28, 2024) as set forth in the H.10 statistical release of the U.S. Federal Reserve Board.

 

 

 

 

YOUDAO, INC.













UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS









(RMB and USD in thousands, except share and per ADS data)




























Three Months Ended


Six Months Ended



June 30,


March 31,


June 30,


June 30,


June 30,


June 30,



2023


2024


2024


2024


2023


2024



RMB


RMB


RMB


USD (1)


RMB


RMB

Net revenues:













Learning services


680,920


717,996


643,762


88,585


1,413,341


1,361,758

Smart devices


222,157


181,198


166,722


22,942


434,906


347,920

Online marketing services


303,557


492,665


511,237


70,348


521,657


1,003,902

Total net revenues


1,206,634


1,391,859


1,321,721


181,875


2,369,904


2,713,580














Cost of revenues (2)


(639,459)


(710,356)


(684,942)


(94,251)


(1,200,879)


(1,395,298)

Gross profit


567,175


681,503


636,779


87,624


1,169,025


1,318,282














Operating expenses:













Sales and marketing expenses (2)


(587,651)


(455,440)


(515,711)


(70,965)


(1,152,856)


(971,151)

Research and development expenses (2)


(205,076)


(146,723)


(152,987)


(21,052)


(387,906)


(299,710)

General and administrative expenses (2)


(63,579)


(49,416)


(40,634)


(5,591)


(113,185)


(90,050)

Total operating expenses


(856,306)


(651,579)


(709,332)


(97,608)


(1,653,947)


(1,360,911)

(Loss)/Income from operations


(289,131)


29,924


(72,553)


(9,984)


(484,922)


(42,629)














Interest income


2,154


975


917


126


4,448


1,892

Interest expense


(17,087)


(20,334)


(20,816)


(2,864)


(32,850)


(41,150)

Others, net


5,730


2,892


(909)


(125)


12,108


1,983

(Loss)/Income before tax


(298,334)


13,457


(93,361)


(12,847)


(501,216)


(79,904)














Income tax (expenses)/benefits


(4,890)


1,028


(7,053)


(970)


(8,091)


(6,025)

Net (loss)/income


(303,224)


14,485


(100,414)


(13,817)


(509,307)


(85,929)

Net loss/(income) attributable to noncontrolling interests


4,065


(2,053)


939


129


5,795


(1,114)

Net (loss)/income attributable to ordinary shareholders of the Company


(299,159)


12,432


(99,475)


(13,688)


(503,512)


(87,043)














Basic net (loss)/income per ADS


(2.45)


0.11


(0.85)


(0.12)


(4.12)


(0.74)

Diluted net (loss)/income per ADS


(2.45)


0.10


(0.85)


(0.12)


(4.12)


(0.74)














Shares used in computing basic net (loss)/income per ADS


122,247,009


118,317,220


117,173,272


117,173,272


122,257,874


117,745,253

Shares used in computing diluted net (loss)/income per ADS


122,247,009


118,928,848


117,173,272


117,173,272


122,257,874


117,745,253















Note 1:

The conversion of Renminbi (RMB) into United States dollars (USD) is based on the noon buying rate of USD1.00=RMB7.2672 on the last trading day of June (June 28, 2024)
as set forth in the H.10 statistical release of the U.S. Federal Reserve Board.















Note 2:













Share-based compensation in each category:













Cost of revenues


1,049


778


727


100


2,308


1,505

Sales and marketing expenses


2,416


1,136


337


46


3,547


1,473

Research and development expenses


5,618


3,503


939


129


10,403


4,442

General and administrative expenses


3,261


2,479


1,506


208


6,582


3,985

 

 

 

YOUDAO, INC.













UNAUDITED ADDITIONAL INFORMATION













(RMB and USD in thousands)




























Three Months Ended


Six Months Ended



June 30,


March 31,


June 30,


June 30,


June 30,


June 30,



2023


2024


2024


2024


2023


2024



RMB


RMB


RMB


USD


RMB


RMB














Net revenues













Learning services


680,920


717,996


643,762


88,585


1,413,341


1,361,758

Smart devices


222,157


181,198


166,722


22,942


434,906


347,920

Online marketing services


303,557


492,665


511,237


70,348


521,657


1,003,902

Total net revenues


1,206,634


1,391,859


1,321,721


181,875


2,369,904


2,713,580














Cost of revenues













Learning services


290,155


264,759


257,482


35,431


568,280


522,241

Smart devices


142,544


122,060


116,274


16,000


271,132


238,334

Online marketing services


206,760


323,537


311,186


42,820


361,467


634,723

Total cost of revenues


639,459


710,356


684,942


94,251


1,200,879


1,395,298














Gross margin













Learning services


57.4 %


63.1 %


60.0 %


60.0 %


59.8 %


61.6 %

Smart devices


35.8 %


32.6 %


30.3 %


30.3 %


37.7 %


31.5 %

Online marketing services


31.9 %


34.3 %


39.1 %


39.1 %


30.7 %


36.8 %

Total gross margin


47.0 %


49.0 %


48.2 %


48.2 %


49.3 %


48.6 %

 

 

 

YOUDAO, INC.













UNAUDITED RECONCILIATION OF GAAP AND NON-GAAP RESULTS











(RMB and USD in thousands, except per ADS data)




























Three Months Ended


Six Months Ended



June 30,


March 31,


June 30,


June 30,


June 30,


June 30,



2023


2024


2024


2024


2023


2024



RMB


RMB


RMB


USD


RMB


RMB














Net (loss)/income attributable to ordinary shareholders of the Company


(299,159)


12,432


(99,475)


(13,688)


(503,512)


(87,043)

Add: share-based compensation


12,344


7,896


3,509


483


22,840


11,405

         impairment of long-term investment


3,240


-


-


-


3,240


-

Non-GAAP net (loss)/income attributable to ordinary shareholders of the
Company


(283,575)


20,328


(95,966)


(13,205)


(477,432)


(75,638)



























Non-GAAP basic net (loss)/income per ADS


(2.32)


0.17


(0.82)


(0.11)


(3.91)


(0.64)

Non-GAAP diluted net (loss)/income per ADS


(2.32)


0.17


(0.82)


(0.11)


(3.91)


(0.64)

 

Cision View original content:https://www.prnewswire.com/news-releases/youdao-reports-second-quarter-2024-unaudited-financial-results-302228349.html

SOURCE Youdao, Inc.

FAQ

What was Youdao's (DAO) total revenue for Q2 2024?

Youdao's total net revenues for Q2 2024 were RMB1.3 billion (US$181.9 million), representing a 9.5% increase from the same period in 2023.

How did Youdao's (DAO) online marketing services perform in Q2 2024?

Youdao's net revenues from online marketing services were RMB511.2 million (US$70.3 million) for Q2 2024, representing a 68.4% increase from the same period in 2023.

What was Youdao's (DAO) operating loss in Q2 2024?

Youdao's loss from operations for Q2 2024 was RMB72.6 million (US$10.0 million), compared with RMB289.1 million for the same period in 2023.

How much did Youdao (DAO) spend on share repurchases as of June 30, 2024?

As of June 30, 2024, Youdao had repurchased a total of approximately 7.5 million ADSs for around US$33.8 million in the open market under its share repurchase program.

Youdao, Inc. American Depositary Shares, each representing one

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785.24M
29.87M
4.35%
46.43%
0.15%
Education & Training Services
Consumer Defensive
Link
United States of America
Hangzhou