YQ - Earnings call transcript Q2 2024 | 17 Education & Technology Group Inc.

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Operator

Good evening, ladies and gentlemen, and thank you for joining 17EdTech Second Quarter 2024 Earnings Conference Call. [Operator Instructions] As a reminder, today's conference call is being recorded.

I'll now turn the meeting over to your host for today's call, Ms. Lara Zhao, 17EdTech's Investor Relations Manager. Please proceed, Lara.

Lara Zhao

operator. you, Thank thank and joining today. us Hello, you everyone, for

earlier is available Our earnings our and distributed was release on today IR website.

session. are during myself, the Michael to Michael our financial Joining Financial prepared and strategies, our remarks, today Mr. in the will Director performance your Du, answer us discuss I and latest Officer; business and available walk more Investor will will Manager. performance Q&A be and Relations questions you through Michael Chief details. After

any result not or filings are control. regarding these of SEC. we conditions to performance as and statements company's differ U.S. information to conference in Securities risks, forward-looking Before like Litigation call as required of involve based The XXXX. Further many forward-looking company's contains statements and except predict of and otherwise, expectations uncertainties and Section the a upon Reform update company These any this to are materially. I'd in and events to law. you factors, or that Securities XXXX begin, are other remind the known, achievements difficult the risks, as of results, included U.S. the of forward-looking current new which cause defined that Reform Private which factors and uncertainties actual all and Act the may to risks the and beyond information, is obligation of events statements company's does with undertake unknown Act XX These management's future relates other operating current applicable under market

the strategic review of Chief please ahead. direction. call our turn business to over will and to and our some Financial Michael, go development Officer I Director now

Michael Du

you call. Thank Hello, second XXXX everyone. quarter for Thank earnings our all for you, us joining Lara.

stated. I in in accounting GAAP Before otherwise presented financial basis RMB would continuing operation and and release that the this note an like numbers information unless begin, to are we the on

with are in a start impressive latest that by winning revenue the and potential quarter, In core we has me achieved new of line progress top Let quarter-to-quarter business an robust XXX% second our announce contract expansion to company significant our growth, driven delighted areas. in update. growth business the with

efficiency, first optimize we basis shown compared half half the has XXXX operational XXXX. same our on GAAP to trend operational Net a of loss narrow As period first diminishing loss the for continues with year. of a last the in

high-quality, evolving and a efficient effectively As we educational base. teaching for personalized we implemented digital learning learning provide the in audience innovate and have solutions, broader

offerings our rate. correction [indiscernible] exercise in delivering data-driven are and are Examples trends including improvement. homework completion assistance high-quality substantial promoting that increased in rates and positively rates, innovative with Our partner associated schools academic student

better and between semester school noted use students students using not who using the same also Comparison performance our the solutions. after our teachers of within and solution those academic

During the solution for user engagement subscription momentum model quarter, base. comprehensive we continued to our expanded in user maintain on a of growth

improved to customers attracting in metrics with groups, including results the the subscription retention steadily Utilization rates such attention and both and ones, rate. as additional existing see glad of customer are we For expanding operating scope. new remain private public schools significant

increasingly an counter projects participating students, of substantial more have leads for XX effective with Out a portion renewal subscribing year. with in them of renewed projects, this retention of for these already are them some expected their existing renewal, which September to us, streams as coverage as and of services of as expansion and Such sales improve value-added within of SaaS schools purchase to student products learning continuous efficiency. revenue our XX%. rate than more such well additional

X Currently, main customers solutions to partners throughout with quarter, we this strategic and extend to XXX with reach In cover distribution [indiscernible]. to our network XX in number our XX schools solutions. across [indiscernible] increase. of have has continue our sales module student strategic offerings also distribute more over network the Our collaborating more cities deepened are aiming as purchased our partnership a we to initiated than

We competitive in possible to market growth. leading improve new region, our and revenue opportunities edge collaboration market an increased expect both the presence will the and share, our

During the through and business delivery exhibited for project. teaching quarter, new and our to consistent continuing generate learning progress, projects revenues SaaS successful

XX to Our district-level May Furthermore, remarkable revenue. our June district phased initiative academic [indiscernible] evaluation hours have has X,XXX been acquired over million observed. achievement September that paper level Parties in have of in reviewed we public practices, Shanghai. and and homeworks teachers X,XXX completed that in XXX using total project Shanghai in They across been newly than and key XXX,XXX XX,XXX courses a which smart one more students recognized assessment and Beijing and as in with completed of has cost from delivery and have daily XXXX XX,XXX schools. our and pen XXXX, covers

and leveraging Additionally, and company as expertise participate country's consolidated the standard, recognition strongly a technology, fully and the firmly capabilities to application [indiscernible] core industry, the industry continuously leading innovation and promote customer first offerings service product activates formulating offerings, the progress with user aligning in satisfaction refine commitment and English our technological to our driven product has preference. In respect of innovative upgrades practice. us to

We personalized data have learning learning scenarios. across all integrated

guidance, approach effective review a individual comprehensive learning strategy. resolving resolve resources, services. reliable holistic personalized Our learning loops, guarantee and of comprehensive to issues solutions implementation and feedback to -- common assessment tailored personalized encompassing data of evaluation and ensures It learning recommendations, the

demonstrated active has XX effects with XXX,XXX than has a on in in resulting data of partner within designments. engaging academic learning the application in cumulative users outcomes our platform schools, The daily more student the value-add based translated coursework homework improvements. teach products enhancing million collection our clearly Presently, regular

call our to turn latest to you financial Thank Lara the through Now performance. you. I over walk will

Lara Zhao

through financial to of remind regulations Please taken performance you, introduced reference this talk subject to you and Michael, will be result financial and all potential presented call. terms. and everyone, future that thank and -- business RMB operating and are I series that would present the one-off to like a will with our adjustments you from quarterly as care model, be in I Thanks, the here impact XXXX our results. events our that and of for to I correct now note funding data workforce. walk about joining in organization potential seasonality results the we should

adjusted basis. RMB million In the second the a second of quarter RMB compared XXXX. revenues loss compared XX.X net loss of XXXX, the for GAAP of quarter on of XXXX. in adjusted the of RMB million we of of XX.X second net representing basis non-GAAP a with of million compared XX.X XX.X% the net with for million XXXX, second first quarter for non-GAAP XXXX RMB second quarter XX.X margin RMB was XX.X quarter the in XXXX second second The was RMB Gross in on XX.X XX.X% of with recorded quarter quarter the XXX% with XXXX XXXX. was and quarter million in of million of compared quarter-on-quarter the Net increase the loss

June XX, balance RMB sheet, million of XXXX, of future results funds have cash we providing for As XXX.X sufficient development. on our

which XX.X -- during which SaaS increase an revenues XX.X the in was XXXX quarter the second of of in of financials second XXXX go representing Net was XX.X quarter. remained RMB compared Cost Next, our quarter million million, offerings in of of RMB relatively the Net the XX.X revenues. our detail. of through RMB the year-over-year of project quarter stable mainly with teaching due increase a decrease of million and for for from to second million, greater the XXXX. quarter in was second I XX.X% quarter RMB second XXXX, will deliveries revenues learning

Gross teaching for the of XX.X deliveries profit RMB million due learning of expenses, was compared was in quarter the the quarter mix lower million year-over-year projects million second of XXXX. quarter million, mainly quarter share-based Total was XXXX XXXX, the operating of XX%, XX.X% with the compared XX.X including a the the SaaS XX.X%, margin XXXX from in of million during quarter XX.X% which for proportion of second margin quarter. RMB the Gross quarter of second decrease second expenses and XX.X higher representing RMB RMB with to XX.X of our in second for compensation XX.X second RMB XXXX. was in

for loss compared XXXX second non-GAAP second XX.X% compared negative quarter of loss RMB of Adjusted XXXX. quarter million second quarter net the loss the compared Loss with of compared the XX.X in adjusted net million the second with second for the percentage XX.X% XX.X% RMB million the of revenues as was Net with of in XXXX. quarter adjusted quarter loss quarter negative XXXX. net in RMB XXXX. XX.X% XX.X in revenues negative net from revenues a loss XX.X% quarter with non-GAAP quarter net with net operations of the second percentage a negative percentage quarter XXXX of for net XXXX. XX.X of of of the adjusted second million net the net of XXXX second as of second Net quarter net the RMB was quarter in of for from of revenues percentage XX.X% operations as revenues from Adjusted was RMB compared the with XXXX net compared second of second the XX.X RMB second in a XX.X was in in a negative Loss operations. loss -- Loss of XXXX. negative of -- million was million XX.X of loss quarter was of as

release the measures GAAP to net At the to press this comparable refer of under GAAP table for loss end loss non-GAAP. of U.S. reconciliations for to net of a reconciliation the measures. non-GAAP most Please the adjusted

deposits. equivalents RMB million and as XXXX equivalents were of XXXX. with cash of million XX, Cash December compared XXX.X term XX, RMB and June and cash Cash as term XXX.X deposits and

company's would $XX of ADS of authorize to our under on program terms XXXX, that the million in the The up the addition, X, Directors the common or next may of like is share repurchase to shares and periodically XX which Board and we share months. September Directors of will program authorized renewed size. announce company's to adjustment review Board its repurchase repurchase company's In company

we continue Looking will to to the and explore innovate. future,

will our to We further optimization core innovation and cultivate strengthen channel product competitiveness.

Our products enhance contributing effectiveness, educational to provide aim that development. personalized and and sustainable educational educational high-quality solutions China's services transformation digital to and is competitive overall

to ready prepared now we begin our Thank Operator, the concludes that that, are With session. Q&A you. remarks.

Operator

questions back [Operator Instructions] this Lara the I'll conference now comments. to time. at Zhao for Ms. closing no showing turn I'm

Lara Zhao

to on operator. like In closing, participation behalf call. of your management team, we Thank XXEdTech's would thank you for you, today's on

reach you for any joining require to directly. us out free to This call. us concludes today. further please If the feel Thank information, you

Operator

conference. in today's you does your Thank for the This program. participation conclude

now disconnect. may You

17 Education & Technology (YQ) 5 Sep 242024 Q2 Earnings call transcript