Thank you all for coming. Friends who are here and those watching the live stream, and the analysts who are here, shareholders and journalist friends, you are the hardworking ones today. Because it's snowy in Beijing, you all came to Xiaoxi in heavy snow. Welcome, everyone. First of all, I would like to thank all the shareholders, analysts, and media for your support to Youdao in the past year. It is because of your support that our business can continue to progress. Today, I will introduce to you for about 40 minutes, mainly reviewing the progress of Youdao business in the past year. And then talk about the company's current operating strategy. Afterwards, I will focus on the company's AI technology, especially the current progress in the construction, research, and application of large models.
Later, I will introduce the company's three business lines: our learning services business, intelligent hardware business, the latest progress in online marketing business. The last part of section six, we'll discuss other important matters regarding the company's development. First of all, let's talk about the first three quarters of this year. The net income reached CNY 3.91 billion. Then, it increased by 9.8% compared to the previous year. Look at the three business sectors on the bar chart. So our main focus is on the education services sector. It includes our digital courses, as well as our internet-based learning app. These have been continuously innovated. In the past year, we have achieved steady growth. At the same time, the company's online marketing business has performed relatively well.
Based on innovations such as AI and international expansion, we have also seized opportunities in vertical industry, advertising, and marketing. This has resulted in a doubled growth, so this is the overall situation. In the first three quarters of this year, Youdao Company had a loss of CNY 540 million. Compared to the previous year, the loss has narrowed by 32%. Overall, the company is still in a loss-making state. At the same time, our losses are rapidly narrowing. The path to profitability is becoming clearer for us. Let's quickly look at some more financial indicators.
In the second line, the gross profit margin in the first three quarters was 51%, with a year-on-year growth of 1%. In the third line, the proportion of the marketing and sales expenses to revenue decreased by 4 percentage points from 50.9% to 46.8%, and this showed that the efficiency of acquiring new customers significantly increased. We hope to further reduce this proportion. In terms of R&D investment, in the first three quarters, we invested CNY 580 million. This is a stable investment. We hope to have a huge investment in R&D and steadily produce new technologies and products. In the final two lines, we can see that the operating losses are narrowing and the cash flow has improved.
For this page, let's look at what are the leading products and the businesses in Youdao. If the investors chose to invest in Youdao, besides to invest in the industry, the team, I think the main focus will be in the leading products and the businesses. To put it simple, now, we are mainly focused on four areas of businesses. At the bottom of this slide, this is the Youdao AI technology stack. It includes Ziyue large model, the neural network translation, vision, speech, and other important AI technologies, and especially in education large model and translation technology, Youdao is at the leading position.
On this AI technology stack, we have three main businesses. Firstly, the learning service is our largest business. In this area, we can see that our courses and digital content services are above.
Uh, uh. Including digital courses and various other courses.
Uh, In the middle, it includes Youdao app-based learning services. Uh, GPAPP, including Youdao Dictionary, Youdao Translation, Hi Echo, and Youdao Cloud Notes. These are the most advanced in their respective fields. On the far right, we have U- Dictionary and iRecorder. These are our applications for going global. They are also in a rapid development process. At the bottom of this learning service, we have China University MOOC, and that is Cloud Classroom. It is our platform for university students and adults to learn. We look to the right, and there is a business of smart hardware that we have. Here, we have both products for To C. There is the Youdao Dictionary Pen. There is the Youdao listening player and AI learn machine. These are the learning hardware products for To C. We also have our newly developed To B. They are smart learning To B educational equipment.
This is our hardware business. The last section on the far right is the online marketing service that we have. So in terms of marketing services, this includes performance advertising, brand advertising, and advertising alliances. At the same time, there is also a product called Youdao Ads that targets overseas markets. In the past two years, we have also done well in this business. Overall, our business philosophy is to pursue differentiation and leading in segmented markets for products and businesses. So the products listed here are basically at the forefront in their respective fields. So time should be a friend of these businesses. This is the business philosophy that we pursue and strive to achieve. For example, Youdao Dictionary has a history of 15 years. In the field of dictionaries and translations, has been the first position in the market, and it has a very good reputation.
There are new innovations every year, just like the number of members of Youdao Dictionary has increased dramatically this year. So currently, let me talk about the basic strategy of the management team for the company's business operations. First of all, the company is rooted in educational technology. We believe that educational technology is a field that is very suitable for the company to deeply cultivate, because there is a new trend of large models and personalized learning. This makes the prospects of education technology in China or globally very promising. So we are rooted in this field to create the best products to serve our customers. This is a direction for the company's business operations. The second important thing for the company this year is we should strive To B at the forefront of the whole market in the development and application of large models.
This is currently our biggest focus in terms of technology. The third thing is that content is actually a very important and crucial area for the company. So whether it's in quality courses or in the content services of digital learning, and in learning content for college students like MOOC, we must strive to be the best in the industry and promote the development of our entire learning content service business. So in short, these are the three aspects. Based on educational technology, then we must achieve industry-leading technology and do solid work and differentiate ourselves in terms of content. I hope to solidly operate through a three-pronged strategy. On one hand, we continuously expand and strengthen our business to increase revenue. On the other hand, in the current economic environment, we also strive to improve the efficiency of our operations.
In this way, we can achieve company growth, as well as continuously improving the financial situation as a whole. Of course, one of our tasks now is to make the company profitable as soon as possible. This is the current operational strategy of the entire management team. Now, I will move on to the second part. Let me introduce the company's work in AI technology to everyone, especially in the field of large models. As everyone knows, this year, we were the first in China to launch the first large model in the education field in China, Ziyue. Although the time is relatively short, but our Ziyue capabilities are already quite comprehensive. Let me explain it to everyone from four aspects, starting from the underlying algorithms and data. Ziyue used our own, well-established dataset in various disciplines during training. This is unique to us.
Then, based on such a comprehensive and powerful dataset, we conducted training. Then we also expanded the vocabulary of the model recently. Then the interaction ability of the intelligent agent was adapted. Then we also enlarged the context window, because the larger the model's window capacity is, then the stronger our ability to process long passages of content. Then in terms of domain support, Youdao Ziyue already has relatively strong mathematical and physical reasoning abilities. That also includes the ability of the agent, as well as various general abilities and the ability to answer questions in all disciplines. In terms of language, from day one, Ziyue is a bilingual large model, bilingual in English and Chinese, and it has a unique ability. Ziyue can simultaneously handle mixed communication in Chinese and English. We can handle even mixed Chinese and English sentences very well.
Finally, in terms of business integration, we mainly focus on educational products within the education sector. At the same time, we also support our routine applications in work scenarios. In addition to internal company use, we have also started collaborations with some external partners, promote its application outside the company. This is the current basic situation of the Ziyue. So Youdao and the entire NetEase group are working on this large model project. What is the core focus? The core focus is implementation. From day one, we have been emphasizing the implementation is our primary focus. So in this aspect, we hope to achieve the fastest and best in the industry. Since the beginning of this year, Ziyue has been implemented in at least six applications.
For example, our virtual spoken English coach, AI box translation, in-depth explanation of English grammar, guidance on AI composition writing, as well as document Q&A. Actually, there are more than these six applications. Let's synchronize with everyone our virtual spoken English tutor, Hi Echo, because this is our first large-scale application. This product was launched in August, and it has been integrated into the Youdao Dictionary Pen X6 Pro, and in October, we released it as a standalone app and a WeChat Mini Program. So now everyone can find it in the App Store by searching for Hi Echo. The highlights of this product are threefold: firstly, it offers a high degree of freedom in communication. You can communicate with it in English fluently. It also understands Chinese, but it prefers to converse in English to help you improve your English proficiency.
Secondly, it supports customization for various scenarios, allowing free-form communication in any scenario or specific communication in over 70 different scenarios. You can talk to it about anything. Thirdly, it has strong educational attributes. After chatting with it, it can provide you with a learning report, highlighting your strengths and weaknesses. It will also point out which words are pronounced incorrectly. So as of now, this product has achieved initial success, so the number of registered users on the Hi Echo app has reached hundreds of thousands. So taking this opportunity today, let me introduce you to the latest developments of Hi Echo. So it was last week, Hi Echo launched a brand-new version 2, and we released seven major updates all at once, all of which are highly needed by our users. So what are these seven major updates? Including our new characters for oral English teaching.
The previous one was called Echo, and these two new characters are Daniel and Sherry, one male and one female, so users have more character options, which users really like. We added a male proficiency level setting, so whether you are a beginner in English or you are already a very proficient English user, you can find the suitable difficulty level for your oral English. We have added a selection for voice settings. You can choose British accent or American accent. Users in primary and secondary schools need British accent practice. However, adults actually use American accents, so you can freely choose. We have also added a setting for speech speed. Previously, many users complained, speaking too fast is difficult to understand. Now you can adjust it to be very slow. In this way, you can practice.
Of course, we have also added new scenes: technology and culture, self-development are the two new main scenes, as well as 20 sub-scenes. The dialogue report has also been upgraded. Added pronunciation correction for word speed levels. Finally, the interface of the app has been completely redesigned. The interaction is more user-friendly. This is the heavyweight update of Hi Echo version 2. It just went online last week. Go and give it a try. Today is the shareholders' meeting, not a product launch event, but we have prepared a heavyweight new application for everyone. Let's give you a preview. Take a look. So what is this product? Actually, it's a product we wanted to create three years ago. There's a little story. Three years ago, the Youdao Dictionary Pen sold very well. We took a look at which features users use most often.
First of all, of course, the most used feature is the dictionary and the translation function, but the second most frequently used feature by users, surprisingly, is the voice interaction and the chat function. We found that many student users use the Youdao Dictionary Pen to chat, and importantly, asking many questions during learning: Chinese questions, math questions, physics questions. So we thought about what kind of product we should create. We found that our users really need a product that can support all subjects and can solve learning problems through conversation, and at the same time, it's a good companion for students. Then you can communicate through voice. This is an AI teacher for all subjects. This is the product we are previewing today. Please watch a video clip. This is a classic mathematical problem of calculating distance in counters.
The key to solving this problem lies in understanding the relationship between moving towards each other and the distance between the meeting point and the endpoint. Let's analyze it in detail. Why is the difference in distance between car A and car B 40km ? Let's analyze it. In this problem, car A is slower, car B is faster. So when they meet, car A hasn't reached the endpoint yet. Car B has passed the endpoint. Why is time equal to the difference in distance divided by the difference in speed? Is it a fixed rule? We can derive this formula: The distance traveled by the first car is equal to the first car's speed multiplied by time. The distance traveled by the slow car is equal to the slow car's speed multiplied by time.
The key point of this question is the conditions for floating objects and the application of Archimedes' Principle. The answer to this question should be option C. What is the Archimedes' Principle? An object immersed in a liquid or gas experiences an upward buoyant force. The magnitude of the buoyant force is equal to the weight of the liquid or gas displaced by the object. I have also seen stones inside ice cubes floating on the water surface. After the ice completely melts, how does the water surface change? When there are stones inside the ice cube, after the ice melts, the liquid is going down. The analysis is as follows. Let's analyze this multiple-choice question. The option A refers to an oxide composed of two elements. One of them is the compound of oxygen. What do you all think? So this is our upcoming Youdao Ziyue AI teacher.
We will have more product launches in the future after a period of time, so I won't talk too much today. But there are two points that we have strong feelings about internally through our trials and evaluations, and also from the strong feedback of a small number of users during the trial. The first one is because the Ziyue model has done a lot of optimization for the education field of primary and secondary schools, including the use of our powerful knowledge base for primary and secondary schools.
We found that through the optimization of this model in education field, the accuracy rate is higher than GPT. Secondly, students always ask questions. This interactive learning style that allows continuous questioning is different from previous learning products. Such kind of interactive learning style is very effective. Students can ask, what is the answer to this question? and whether we have other solutions. So this learning style brings about totally new possibilities, which is very popular among our students. And, of course, we also need to ensure the safety of this model. And we must ensure that the product is safe and harmless. We should also guarantee and protect the learning autonomy of the learners.
We should gradually review the answers, and the parents can also manage the students so that we will guarantee the products are not only highly efficient, but also improve the learning efficiency of our learners. Another good news is that Ziyue has already passed the regulations of the authorities. This means that Ziyue education large model and its application products can be available to the public. So by taking this opportunity, we will constantly gather the user feedback and iterate and upgrade our products and services.
Besides Ziyue, we have a tradition, in our AI work, and AI is not limited to large model. In November, the Emoti Voice of Youdao, which is an open source text-to-speech engine, namely TTS engine. And it can support Chinese and English, and it can also support the emotion synthesis. And it can synthesize different emotions such as happiness, excitement, anger, sadness, and other emotions into the voice. And during the first week of its launch, Emoti Voice ranks number one in the GitHub trending list of the current week, and now it has over 5,000 stars. Next, I will introduce you the progress in the three main businesses in the first quarters of 2023. First is the learning service.
From Q1 to Q3, the net revenue of the learning service business line reached CNY 2.36 billion, with a year-on-year growth of 3.8%. And, the main growth engine is the digital content service. Many students are using Youdao Lingxi service. In Q2, we launched the college application system. We provide the users with the four core functions, including the intelligent college application, admission, probability calculation, university and major search, and professional assessment and planning. And the page view in the current quarter has exceeded 2 million times. And in Q3, we launched the video-based question recommendation. And, in the current quarter, the students has already received 7.6 million questions. Youdao Bow en is our large-scale humanistic and aesthetic quality course. This year, we made several important upgrading. Firstly, we launched the creative guidance service.
This is AI-supported essay correction. With the AI large model, the time of precise and comprehensive essay correction is shortened by 50%, and we also released the bilingual China products, so as to tell Chinese stories with authentic English, so that our users can have a more in-depth understanding of Chinese culture and history and improve their English expression capability. We also launched the Chinese stories in national treasures in cooperation with the Shanxi History Museum. This cooperation aims to inherit culture and civilization wealth and foster culture confidence, and this initiative is covered and praised by Xinhua Network. We also have a documentary called Cultural Relics Are Also Fashionable, which was selected as one of the top 100 positive online audiovisual works. This is also the only national excellent work selected from the works of educational technology enterprises.
Then I would like to introduce you the programming courses. And the Xiaot uling programming product in Youdao has years of accumulation of experience and a good reputation. And the main focus area is the information science study in primary and secondary schools. And it is the most important area for primary and secondary school. And in June, the Ministry of Education released new policies, and the programming courses will be included in all the primary and secondary schools. And the characteristics is that we provide a one-stop service, including the information science knowledge learning, the competition preparation, post-competition score estimation. The post-competition score estimation is a free service, but it is very important for our students. And now, all the participants in the information science learning, half of them have already used the post-competition score estimation services for free.
In Haidian District, every year, we host the programming competition every year. Next, I would like to introduce you, Youdao Zongheng. It is a Go course. Youdao Zongheng is a Go course, which ranks number one in terms of student enrollment, and it is used by most number of the students. The Go course of Youdao not only has high teaching quality, but also implemented digitalization. Youdao Zongheng Chess Academy app has the largest user base, and the integration of the Go teaching and digital platform has made us number one in the industry. It provides free courses of Go, and it also allows the users to play against either human or AI opponent, and it also has a function of replay and analysis.
After the users play against either human or AI opponents, they can automatically access voice replays and explanations, helping them maintain interest in Go and improve their skills of Go playing. This is the learning services business line and the related development progress. The second business line is the intelligent hardware business. In the first three quarters, the net revenue of the intelligent hardware reached CNY 690 million. Until now, dictionary pen has launched three new products: X6 Pro, S6, and P6. The new products have some new functions, such as grammar lecture, the virtual oral English tutor, and 100-day super long standby, which are well received by the users. S6 is the end user product. S6 is about CNY 500 million. We achieved great success in S6.
P6 is a high-end product, which is more than CNY 1,300. This is about the hardware products. In terms of the channels, now, we are reintegrating the channels. Although we faced some difficulties, we will try our best to recover the channels. In August, we also launched the new Pro product for listening. Based on Ziyue large model, we provided powerful functions such as online subtitles, one-click vocabulary lookup, paragraph overview analysis, and core vocabulary answers, and achieved very good results. The Youdao Dictionary Pen achieved an outstanding performance in both e-commerce, shopping festivals, and industry evaluations. Youdao Dictionary Pen achieved the top sales position in its category on JD.com and Tmall during 18 June and Double Eleven shopping festivals.
In the initial batch of product evaluations organized by China Academy of Information and Communications Technology, Youdao Dictionary Pen achieved a 100% accuracy rate in translation results across 12 complex application scenarios, ranking first in its category. Some friends are concerned about the year-on-year decrease in the net revenue of hardware business in the first three quarters. How our company sees the hardware businesses, and according to the analysis of the management, there are mainly two reasons. First, the consumer electronics market is relatively sluggish this year. This is the external factor. Secondly, our company optimizes the channels with low ROI, and in the short term, it will have some impact on our revenue, but for the mid and the long term, it will improve the health of our business.
Overall speaking, we are quite optimistic about the mid- and long-term development of the intelligent hardware. When we start the dictionary pen, we believe that we launched the product form that is recognized by the users. This will not be, not change. Secondly, it is a long-term, high-value user entry point for our business. It can carry better content and products. And thirdly, the hardware is also a good carrier for the landing of the large models. Because of the three reasons, we believe that our difficulties are temporary. Of course, we are taking specific measures in three areas. Firstly, we will accelerate new product launches in Q4 this year. From Q4 this year to Q1 next year, we will launch four products or even more.
Secondly, on the market sales side, we will, c omplete the channel adjustment work as early as possible, which is expected to be completed in Q4. Thirdly, we will strengthen our smart education hardware business in schools. P6 is our new product, which was launched in November, and it integrates Ziyue large language model application, and it can support the new function of simultaneous interpreting. It supports the conversation and translation of 28 languages. The vocabulary database is expanded to 70 million word entries. It adds the vocabulary databases of 42 professional fields. It also provides the graded reading materials, classical Chinese literature for in-class and extracurricular study, TOEFL, IELTS, and Wusan learning resources. Now, I would like to show you a video to have a better understanding about the functions of P6.
Some performance this quarter, with a growth rate of 30%.
P6 can support the translation of 28 languages. This is Youdao Dictionary Pen P6 product. In terms of hardware, we also have for the smart education devices and services entering into schools. Education informatization is a direction encouraged by the national policy, and Youdao leverage its own AI technology advantages and constantly upgrade its capabilities, products, and services. We have already supported Zhejiang, Sichuan, Jiangsu, Guangdong, and Gansu provinces to accelerate the process of education informatization. This year, we have a new direction that is smart sports. This year, we launched Youdao Interactive Screen, which is a new product. As shown in the graph, it utilizes AI technology. It can support various sports, such as pull-ups, sit-ups, rope jumping, and long jump, to provide the services to students.
This product has been used in nearly 100 schools, and it is well received by the users. We believe that the smart education, the smart sports education product has also very good potential and prospect. The third business direction is online marketing services and businesses. In the first three quarters, the revenue increased by 98.7%. The net revenue for the online marketing business reached CNY 860 million, and it has achieved the growth rate of the net revenue by more than 50% year-on-year for four consecutive quarters. Through the new engine transformer, it will increase the accuracy rate of the smart bidding, and it is KOL-based advertisement launch. We will judge the topics related to KOLs, and the accuracy of the smart matching is nearly 90%.
The second reason why we perform well in the advertising area is that we accumulated a large amount of industry data and also have vertical business optimization. We shifted from a general model to an industry-specific model. This year, Youdao has accumulated high-quality data in entertainment, gaming, e-commerce, real estate, finance, and other industries. The advertising business includes the performance advertising, high brand advertising, advertising alliance in overseas alliance, overseas advertising. We help the Chinese enterprises to go global. We provide AI-supported advertising ecology. This is a well-performing business area this year. This is the main situation of the businesses from Q1 to Q3 this year. Then I would like to introduce you the other matters. On the one hand, we will pursue technology innovation. On the other hand, we will also perform our corporate social responsibility.
The One Screen project for NetEase has been running for five years, reaching nearly 200 rural schools in Sichuan, Gansu, and Hunan provinces, providing 50,000 teachers and students with high-quality live streaming teaching resources of top high schools, such as Chengdu Number Seven Middle School and Zhenhai Middle School, which has changed the future of many children in rural middle schools this year. Over 600 students of the One Screen online courses performed well and achieved outstanding results in Gaokao, namely the National College Entrance Exam. Four students were admitted by Peking University, and 12 students were admitted by C9 universities, and the admission rate of the first-tier university was 47%, and the university admission rate was 76%. We also performed well in social corporate responsibility.
We were successfully listed in top 100 private enterprise in Beijing, top 100 corporate social responsibility enterprise in Beijing, and the top 100 corporate technology innovation in Beijing. We also... We are also listed in 2023 CSR China top 100 best responsible enterprise brand by CSR China Education List for three consecutive years, and these achievements will inspire us to accelerate technology innovation and fulfill our corporate social responsibility more actively. And, in November this year, BOD of Youdao approved a share repurchase plan. That is, the company could repurchase up to $20 million of Class A common stock within a maximum of 36 months in accordance with applicable laws and regulations.
In August, we increased the repurchase amount to $40 million, and as of 30 September , the company has repurchased about 3.6 million shares of American depository stock in the open market under the share purchase plan, for a total of about $18.3 million. Finally, I would like to thank you all for your support. We will continue to provide better services to our users and shareholders. Thank you all.