Youdao Earnings Call Transcripts
Fiscal Year 2026
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Q2 2026 saw net revenues rise 3.5% year-over-year to RMB 1.5 billion, with record operating profit and strong cash flow. AI innovation drove growth in learning services and improved margins in online marketing, while smart devices faced margin pressure from higher memory costs.
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Q1 2026 saw 3.8% revenue growth to RMB 1.3 billion, with strong AI-driven innovation and robust online marketing services up 20.9% year-over-year. Operating margin improved sequentially, and management expects continued profitability and cash flow gains in 2026.
Fiscal Year 2025
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Q4 and full year 2025 saw strong revenue and operating profit growth, with learning services and online marketing segments leading gains. AI-driven innovation and international expansion fueled performance, while 2026 guidance targets double-digit growth and continued investment in AI applications.
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Q3 2025 saw 3.6% revenue growth to RMB 1.6B, led by online marketing services (+51.1% YoY), while learning services and smart devices declined. Operating profit fell due to increased investment, but full-year profit and cash flow break-even targets remain on track.
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Q2 saw a return to profitability with 7.2% revenue growth, strong gains in learning and advertising, and improved margins from cost controls. AI-driven products and services fueled segment growth, while new launches and buybacks support future momentum.
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Q1 2025 saw record operating income and a sharp rise in net income, despite a revenue decline driven by learning services. AI-driven product innovation and cost optimization boosted margins, with strong growth in digital content, smart devices, and online marketing.
Fiscal Year 2024
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Achieved first-ever full-year operating profit in 2024, driven by improved margins, cost control, and AI innovation. Revenue grew 4.4% year-over-year, with strong gains in online marketing and smart devices, and a strategic focus on AI-driven growth for 2025.
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Q3 2024 saw a return to profitability with net revenues up 2.2% year-over-year and record operating income. AI-driven growth fueled strong results in smart devices and online marketing, while learning services focused on high-ROI segments.
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Q2 2024 saw 9.5% revenue growth and record operating cash inflow, with operating losses narrowing sharply. Online marketing and AI-driven subscription services led growth, while smart devices rebounded with new high-end launches. Profitability is expected for the full year.