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Gaotu Techedu Announces Fourth Quarter and Fiscal Year 2023 Unaudited Financial Results

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BEIJING, Feb. 27, 2024 /PRNewswire/ — Gaotu Techedu Inc. (NYSE: GOTU) (“Gaotu” or the “Company”), a technology-driven education company and online large-class tutoring service provider in China, today announced its unaudited financial results for the fourth quarter and fiscal year ended December 31, 2023.

Fourth Quarter 2023 Highlights[1]

Net revenues were RMB761.0 million, increased by 20.9% from RMB629.6 million in the same period of 2022.Gross billings[2] were RMB1,278.1 million, increased by 28.1% from RMB997.4 million in the same period of 2022.Loss from operations was RMB187.9 million, compared with RMB13.2 million in the same period of 2022.Net loss was RMB119.6 million, compared with net income of RMB70.6 million in the same period of 2022.Non-GAAP net loss was RMB104.0 million, compared with non-GAAP net income of RMB87.4 million in the same period of 2022.Net operating cash inflow was RMB491.5 million, increased by 3.1% from RMB476.7 million in the same period of 2022.

Fourth Quarter 2023 Key Financial and Operating Data
(In thousands of RMB, except for percentages)

For the three months ended December 31,

2022

2023

Pct. Change

Net revenues

629,631

761,014

20.9 %

Gross billings

997,439

1,278,132

28.1 %

Loss from operations

(13,248)

(187,915)

1,318.4 %

Net income/(loss)

70,613

(119,649)

(269.4) %

Non-GAAP net income/(loss)

87,392

(103,970)

(219.0) %

Net operating cash inflow

476,698

491,493

3.1 %

 

[1] For a reconciliation of non-GAAP numbers, please see the table captioned “Reconciliations of non-GAAP measures to the most comparable GAAP measures” at the end of this press release. Non-GAAP income (loss) from operations and non-GAAP net income (loss) exclude share-based compensation expenses.

[2] Gross billings is a non-GAAP financial measure, which is defined as the total amount of cash received for the sale of course offerings in such period, net of the total amount of refunds in such period. See “About Non-GAAP Financial Measures” and “Reconciliations of non-GAAP measures to the most comparable GAAP measures” elsewhere in this press release.

Fiscal Year Ended December 31, 2023 Highlights

Net revenues were RMB2,960.8 million, increased by 18.5% from RMB2,498.2 million in the same period of 2022.Gross billings were RMB3,338.8 million, increased by 31.7% from RMB2,534.2 million in the same period of 2022.Loss from operations was RMB149.0 million, compared with RMB118.1 million in the same period of 2022.Net loss was RMB7.3 million, compared with net income of RMB13.2 million in the same period of 2022.Non-GAAP net income was RMB51.1 million, compared with RMB135.8 million in the same period of 2022.Net operating cash inflow was RMB353.7 million, increased by 548.4% from RMB54.5 million in the same period of 2022.

Fiscal Year 2023 Key Financial and Operating Data

(In thousands of RMB, except for percentages)

Fiscal Year ended December 31,

2022

2023

Pct. Change

Net revenues

2,498,214

2,960,813

18.5 %

Gross billings

2,534,244

3,338,750

31.7 %

Loss from operations

(118,052)

(149,006)

26.2 %

Net income/(loss)

13,172

(7,298)

(155.4) %

Non-GAAP net income

135,826

51,055

(62.4) %

Net operating cash inflow

54,545

353,697

548.4 %

Larry Xiangdong Chen, the Company’s founder, Chairman and CEO, commented, ” During the past quarter, we continued to bolster our core business strengths while simultaneously pushing the boundaries of new initiatives. We observed a notable uptick in demand for high-quality educational products and learning services and our deep industry insights, exceptional organizational capabilities and well-established teacher recruitment and training systems have provided a robust foundation for the sustainable development of our business. Our net revenues increased 20.9% year-over-year to RMB761.0 million, exceeding our expectations. Our gross billings grew 28.1% year-over-year to approximately RMB1.3 billion, indicating an accelerating growth trend compared to prior quarters. We expect this accelerating momentum of our business to continue.

We have full confidence in Gaotu’s prospects for 2024 and for the further future. Moving forward, we believe that we can achieve promising topline growth while enhancing profitability by consistently delivering top-notch educational products and learning services, thus generating long-term value for both our shareholders and society.”

Shannon Shen, CFO of the Company, added, ” During the quarter, our business entered a healthy phase of rapid and sustainable expansion. Our traditional learning services continue to maintain a leading edge in the online space while our new initiatives focused on non-academic tutoring services have shown excellent growth momentum. For the full year of 2023, the gross billings for traditional services combined with new initiatives achieved nearly 50% year-over-year growth. This outcome was underpinned by a combination of top-notch educational products and high-caliber learning services. Benefiting from ongoing improvements in operational efficiency, our net operating cash inflow reached RMB491.5 million, while our cash, cash equivalents, restricted cash, withdrawable cash balance on third-party payment as well as short and long-term investments exceeded RMB4.0 billion, laying solid groundwork for the long-term growth of our business.

By strengthening our core competencies, we were able to swiftly deploy resources based on changes in the market environment and user demand. We will continue to execute stock buybacks in accordance with the guidance of the board of directors, and create long-term value for our shareholders.”

Financial Results for the Fourth Quarter of 2023

Net Revenues

Net revenues increased by 20.9% to RMB761.0 million from RMB629.6 million in the fourth quarter of 2022, which was mainly due to the continuous year-over-year growth of gross billings in 2023 as a result of our sufficient and effective response to the strong market demand.

Cost of Revenues

Cost of revenues increased by 42.9% to RMB227.7 million from RMB159.3 million in the fourth quarter of 2022. The increase was mainly due to the growth of labor cost of instructors and tutors, as well as the increase of learning materials cost.

Gross Profit and Gross Margin

Gross profit increased by 13.4% to RMB533.3 million from RMB470.3 million in the fourth quarter of 2022. Gross profit margin decreased to 70.1% from 74.7% in the same period of 2022.

Non-GAAP gross profit increased by 13.4% to RMB537.2 million from RMB473.9 million in the fourth quarter of 2022. Non-GAAP gross profit margin decreased to 70.6% from 75.3% in the same period of 2022.

Operating Expenses

Operating expenses increased by 49.1% to RMB721.2 million from RMB483.6 million in the fourth quarter of 2022. The increase was primarily due to the growth of labor expenses, as well as a higher expenditure on marketing and branding activities.

Selling expenses increased to RMB465.7 million from RMB289.8 million in the fourth quarter of 2022.Research and development expenses increased to RMB136.0 million from RMB111.4 million in the fourth quarter of 2022.General and administrative expenses increased to RMB119.5 million from RMB82.4 million in the fourth quarter of 2022.

(Loss)/income from Operations

Loss from operations was RMB187.9 million, compared with loss from operations of RMB13.2 million in the fourth quarter of 2022.

Non-GAAP loss from operations was RMB172.2 million, compared with non-GAAP income from operations of RMB3.5 million in the fourth quarter of 2022.

Interest Income and Realized Gains from Investments

Interest income and realized gains from investments, on aggregate, were RMB23.9 million, compared with a total of RMB22.4 million in the fourth quarter of 2022.

Other Income

Other income was RMB32.8 million, compared with RMB26.9 million in the fourth quarter of 2022.

Net (Loss)/income

Net loss was RMB119.6 million, compared with net income of RMB70.6 million in the fourth quarter of 2022.

Non-GAAP net loss was RMB104.0 million, compared with non-GAAP net income of RMB87.4 million in the fourth quarter of 2022.

Cash Flow

Net operating cash inflow in the fourth quarter of 2023 was RMB491.5 million.

Basic and Diluted Net Loss per ADS

Basic and diluted net loss per ADS were both RMB0.46 in the fourth quarter of 2023.

Non-GAAP basic and diluted net loss per ADS were both RMB0.40 in the fourth quarter of 2023.

Share Outstanding

As of December 31, 2023, the Company had 172,111,890 ordinary shares outstanding.

Cash, Cash Equivalents, Restricted Cash, Short-term and Long-term Investments and Withdrawable Cash Balance on Third-party Payment Platforms

As of December 31, 2023, the Company had cash and cash equivalents, restricted cash, short-term and long-term investments and withdrawable cash balance on third-party payment platforms of RMB4,025.2 million in aggregate, compared with a total of RMB3,768.3 million as of December 31, 2022. 

Withdrawable cash balance on third-party payment platforms consisted of cash payments received from students but held by third-party payment platforms such as WeChat Pay and Alipay, which are highly liquid and can be quickly converted into cash and cash equivalents.

Financial Results for the Fiscal Year of 2023

Net Revenues

Net revenues increased by 18.5% to RMB2,960.8 million from RMB2,498.2 million in 2022. The increase was mainly due to the growth of gross billings in 2023.

Cost of Revenues

Cost of revenues increased by 12.7% to RMB790.2 million from RMB701.1 million in 2022. The increase was mainly due to the growth of labor cost of instructors and tutors, as well as the increase of learning materials cost, which was partially offset by the decrease of share-based compensation cost.

Gross Profit and Gross Margin

Gross profit increased by 20.8% to RMB2,170.6 million from RMB1,797.2 million in 2022. Gross profit margin increased to 73.3% from 71.9% in 2022.

Non-GAAP gross profit increased by 18.7% to RMB2,183.6 million from RMB1,839.7 million in 2022. Non-GAAP gross profit margin increased to 73.7% from 73.6% in 2022.

Operating Expenses

Operating expenses increased by 21.1% to RMB2,319.6 million from RMB1,915.2 million in 2022. The increase was primarily due to the growth of labor expenses, as well as a higher expenditure on marketing and branding activities, which was partially offset by the decrease of share-based compensation expenses.

Selling expenses increased to RMB1,501.2 million from RMB1,179.8 million in 2022.Research and development expenses increased to RMB462.0 million from RMB445.1 million in 2022.General and administrative expenses increased to RMB356.4 million from RMB290.3 million in 2022.

(Loss)/income from Operations

Loss from operations was RMB149.0 million, compared with loss from operations of RMB118.1 million in 2022.

Non-GAAP loss from operations was RMB90.7 million, compared with non-GAAP income from operations of RMB4.6 million in 2022.

Interest Income and Realized Gains from Investments

Interest income and realized gains from investments, on aggregate, were RMB107.1 million, compared with a total of RMB63.6 million in 2022.

Other Income

Other income was RMB54.5 million, compared with RMB51.9 million in 2022.

Net (Loss)/income

Net loss was RMB7.3 million, compared with net income of RMB13.2 million in 2022.

Non-GAAP net income was RMB51.1 million, compared with non-GAAP net income of RMB135.8 million in 2022.

Cash Flow

Net operating cash inflow in 2023 was RMB353.7 million.

Basic and Diluted Net (Loss)/income per ADS

Basic and diluted net loss per ADS were both RMB0.03 in 2023.

Non-GAAP basic and diluted net income per ADS were both RMB0.19 in 2023.

Share Repurchase

In November 2022, the Company’s board of directors authorized a share repurchase program under which the Company may repurchase up to US$30 million worth of its shares, effective until November 22, 2025. In November 2023, the Company’s board of directors authorized modifications to its existing share repurchase program, increasing the aggregate value of shares that may be repurchased from US$30 million to US$80 million, effective until November 22, 2025.

As of December 31, 2023, the Company had cumulatively repurchased approximately 4.9 million ADSs for approximately US$12.4 million under its existing share repurchase program.

In November 2022, Mr. Larry Xiangdong Chen, the Company’s founder, Chairman and CEO, announced his plan to personally purchase up to US$20 million of the Company’s shares. In 2023, Mr. Larry Xiangdong Chen, had cumulatively purchased approximately 0.88 million ADSs under the existing purchase plan.

Business Outlook

Based on the Company’s current estimates, total net revenues for the first quarter of 2024 are expected to be between RMB908 million and RMB928 million, representing an increase of 28.4% to 31.2% on a year-over-year basis. These estimates reflect the Company’s current expectations, which are subject to change.

Conference Call

The Company will hold an earnings conference call at 8:00 AM U.S. Eastern Time on Tuesday, February 27, 2024 (9:00 PM on the same day, Beijing/Hong Kong Time). Dial-in details for the earnings conference call are as follows:

International: 1-412-317-6061
United States: 1-888-317-6003
Hong Kong: 800-963-976
Mainland China: 400-120-6115
Passcode: 4247479

A telephone replay will be available two hours after the conclusion of the conference call through March 5, 2024. The dial-in details are:

International: 1-412-317-0088
United States: 1-877-344-7529
Passcode: 8489727

Additionally, a live and archived webcast of this conference call will be available at http://ir.gaotu.cn/home. 

Safe Harbor Statement

This announcement contains forward-looking statements. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as “will,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates” and similar statements. Among other things, the business outlook, as well as the Company’s strategic and operational plans, contain forward-looking statements. 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. 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. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: the Company’s ability to continue to attract students to enroll in its courses; the Company’s ability to continue to recruit, train and retain qualified teachers; the Company’s ability to improve the content of its existing course offerings and to develop new courses; the Company’s ability to maintain and enhance its brand; the Company’s ability to maintain and continue to improve its teaching results; and the Company’s ability to compete effectively against its competitors. Further information regarding these and other risks is included in the Company’s reports filed with, or furnished to the U.S. Securities and Exchange Commission. All information provided in this press release and in the attachments is as of the date of this press release, and the Company undertakes no duty to update such information or any forward-looking statement, except as required under applicable law.

About Gaotu Techedu Inc.

Gaotu is a technology-driven education company and online large-class tutoring service provider in China. The Company offers learning services and educational content & digitalized learning products. Gaotu adopts an online live large-class format to deliver its courses, which the Company believes is the most effective and scalable model to disseminate scarce high-quality teaching resources to aspiring students in China. Big data analytics permeates every aspect of the Company’s business and facilitates the application of the latest technology to improve teaching delivery, student learning experience, and operational efficiency.

About Non-GAAP Financial Measures

The Company uses gross billings, non-GAAP gross profit, non-GAAP income (loss) from operations and non-GAAP net income (loss), each a non-GAAP financial measure, in evaluating its operating results and for financial and operational decision-making purposes.

The Company defines gross billings for a specific period as the total amount of cash received for the sale of course offerings in such period, net of the total amount of refunds in such period. The Company’s management uses gross billings as a performance measurement because the Company generally bills its students for the entire course fee at the time of sale of its course offerings and recognizes revenue proportionally as the classes are delivered. For some courses, the Company continues to provide students with 12 months to 36 months access to the pre-recorded audio-video courses after the online live courses are delivered. The Company believes that gross billings provides valuable insight into the sales of its course packages and the performance of its business. As gross billings have material limitations as an analytical metrics and may not be calculated in the same manner by all companies, it may not be comparable to other similarly titled measures used by other companies.

Non-GAAP gross profit, non-GAAP income (loss) from operations and non-GAAP net income (loss) exclude share-based compensation expenses. The Company believes that these non-GAAP financial measures provide meaningful supplemental information regarding its performance and liquidity by excluding share-based expenses that may not be indicative of its operating performance from a cash perspective. The Company believes that both management and investors benefit from these non-GAAP financial measures in assessing its performance and when planning and forecasting future periods. These non-GAAP financial measures also facilitate management’s internal comparisons to the Company’s historical performance. A limitation of using non-GAAP measures is that these non-GAAP measures exclude share-based compensation charges that have been and will continue to be for the foreseeable future a significant recurring expense in the Company’s business.

The presentation of these non-GAAP financial measures is not intended to be considered in isolation from or as a substitute for the financial information prepared and presented in accordance with GAAP. For more information on these non-GAAP financial measures, please see the table captioned “Reconciliations of non-GAAP measures to the most comparable GAAP measures” set forth at the end of this release.

The accompanying tables have more details on the reconciliations between GAAP financial measures that are most directly comparable to non-GAAP financial measures.

Exchange Rate

The Company’s business is primarily conducted in China and a significant majority of revenues generated are denominated in Renminbi (“RMB”). This announcement contains currency conversions of RMB amounts into U.S. dollars (“USD”) solely for the convenience of the reader. Unless otherwise noted, all translations from RMB to USD are made at a rate of RMB7.0999 to USD1.0000, the effective noon buying rate for December 29, 2023 as set forth in the H.10 statistical release of the Federal Reserve Board. No representation is made that the RMB amounts could have been, or could be, converted, realized or settled into USD at that rate on December 29, 2023, or at any other rate.

For further information, please contact:

Gaotu Techedu Inc.
Investor Relations
E-mail: ir@gaotu.cn 

Christensen

In China
Ms. Vivian Wang
Phone: +852-2232-3978
E-mail: gotu@christensencomms.com 

In the US
Ms. Linda Bergkamp
Phone: +1-480-614-3004
Email: linda.bergkamp@christensencomms.com 

 

 

 

Gaotu Techedu Inc.

Unaudited condensed consolidated balance sheets

(In thousands of RMB and USD, except for share, per share and per ADS data)

As of December
31,

As of December 31,

2022

2023

2023

RMB

RMB

USD

ASSETS

Current assets

    Cash and cash equivalents

819,911

636,052

89,586

    Restricted cash

22

33,901

4,775

    Short-term investments

2,923,864

2,253,910

317,457

    Inventory, net

22,783

24,596

3,464

    Prepaid expenses and other current assets

399,897

638,248

89,895

Total current assets

4,166,477

3,586,707

505,177

Non-current assets

    Operating lease right-of-use assets

83,663

189,662

26,713

    Property, equipment and software, net

552,032

533,531

75,146

    Land use rights, net

27,373

26,568

3,742

    Long-term investments

–

1,029,632

145,021

    Deferred tax assets

15,679

11,312

1,593

    Rental deposit

9,502

17,742

2,499

    Other non-current assets

21,449

18,155

2,557

TOTAL ASSETS

4,876,175

5,413,309

762,448

LIABILITIES

Current liabilities

    Accrued expenses and other current liabilities
      (including accrued expenses and other current
      liabilities of the consolidated VIE without
      recourse to the Group of RMB367,477
      and RMB484,222 as of December 31, 2022
      and December 31, 2023, respectively)

662,189

805,032

113,386

    Deferred revenue, current portion of the
      consolidated VIE without recourse to the Group

906,914

1,113,480

156,830

   Operating lease liabilities, current portion
      (including current portion of operating lease
      liabilities of the consolidated VIE without
      recourse to the Group of RMB21,281 and
      RMB34,401 as of December 31, 2022 and
      December 31, 2023, respectively)

38,326

50,494

7,112

Income tax payable (including income tax
   payable of the consolidated VIE without
   recourse to the Group of RMB260 and
   RMB4,210 as of December 31, 2022 and
   December 31, 2023, respectively)

1,793

4,278

603

Total current liabilities

1,609,222

1,973,284

277,931

 

 

 

Gaotu Techedu Inc.

Unaudited condensed consolidated balance sheets

(In thousands of RMB and USD, except for share, per share and per ADS data)

As of December
31,

As of December 31,

2022

2023

2023

RMB

RMB

USD

Non-current liabilities

    Deferred revenue, non-current portion of
      the consolidated VIE without recourse
      to the Group

52,419

124,141

17,485

    Operating lease liabilities, non-current
      portion (including non-current portion
      of operating lease liabilities of the
      consolidated VIE without recourse
      to the Group of RMB17,457 and
      RMB121,277 as of December 31, 2022
      and December 31, 2023, respectively)

44,198

137,652

19,388

   Deferred tax liabilities(including deferred
     tax liabilities of the consolidated VIE
     without recourse to the Group of
     RMB74,341 and RMB71,850 as of
     December 31, 2022 and December
     31, 2023, respectively)

74,507

71,967

10,136

TOTAL LIABILITIES

1,780,346

2,307,044

324,940

SHAREHOLDERS’ EQUITY

    Ordinary shares

115

116

16

    Treasury stock, at cost

–

(85,178)

(11,997)

    Additional paid-in capital

7,915,899

7,987,957

1,125,080

    Accumulated other comprehensive loss

(64,062)

(33,209)

(4,677)

    Statutory reserve

40,380

50,225

7,074

    Accumulated deficit

(4,796,503)

(4,813,646)

(677,988)

TOTAL SHAREHOLDERS’ EQUITY

3,095,829

3,106,265

437,508

TOTAL LIABILITIES AND TOTAL
  SHAREHOLDERS’ EQUITY

4,876,175

5,413,309

762,448

 

 

 

Gaotu Techedu Inc.

Unaudited condensed consolidated statements of operations

(In thousands of RMB and USD, except for share, per share and per ADS data)

For the three months ended December 31,

For the year ended December 31,

2022

2023

2023

2022

2023

2023

RMB

RMB

USD

RMB

RMB

USD

Net revenues

629,631

761,014

107,187

2,498,214

2,960,813

417,022

Cost of revenues

(159,302)

(227,719)

(32,074)

(701,050)

(790,207)

(111,298)

Gross profit

470,329

533,295

75,113

1,797,164

2,170,606

305,724

Operating expenses:

Selling expenses

(289,812)

(465,686)

(65,591)

(1,179,760)

(1,501,200)

(211,440)

Research and development
expenses

(111,401)

(136,046)

(19,162)

(445,117)

(462,043)

(65,077)

General and administrative
expenses

(82,364)

(119,478)

(16,828)

(290,339)

(356,369)

(50,194)

Total operating expenses

(483,577)

(721,210)

(101,581)

(1,915,216)

(2,319,612)

(326,711)

Loss from operations

(13,248)

(187,915)

(26,468)

(118,052)

(149,006)

(20,987)

Interest income

7,600

18,603

2,620

21,370

75,829

10,680

Realized gains from
investments

14,778

5,269

742

42,264

31,230

4,399

Other income

26,922

32,776

4,616

51,885

54,471

7,672

Income/(loss) before
provision for income tax
and share of results of
equity investees

36,052

(131,267)

(18,490)

(2,533)

12,524

1,764

Income tax
benefits/(expenses)

34,561

11,618

1,636

15,705

(10,657)

(1,501)

Share of results of equity
investees

–

–

–

–

(9,165)

(1,291)

Net income/(loss)

70,613

(119,649)

(16,854)

13,172

(7,298)

(1,028)

Net income/(loss)
attributable to Gaotu
Techedu Inc.’s ordinary
shareholders

70,613

(119,649)

(16,854)

13,172

(7,298)

(1,028)

Net income/(loss) per
ordinary share

Basic

0.41

(0.69)

(0.10)

0.08

(0.04)

(0.01)

Diluted

0.40

(0.69)

(0.10)

0.07

(0.04)

(0.01)

Net income/(loss) per
ADS

Basic

0.27

(0.46)

(0.07)

0.05

(0.03)

(0.00)

Diluted

0.27

(0.46)

(0.07)

0.05

(0.03)

(0.00)

Weighted average shares
used in net income/(loss)
per share

Basic

172,754,938

172,545,719

172,545,719

172,254,080

173,725,790

173,725,790

Diluted

176,653,111

172,545,719

172,545,719

175,991,484

173,725,790

173,725,790

Note: Three ADSs represent two ordinary shares.

 

 

 

Gaotu Techedu Inc.

Reconciliations of non-GAAP measures to the most comparable GAAP measures

(In thousands of RMB and USD, except for share, per share and per ADS data)

For the three months ended December 31,

For the year ended December 31,

2022

2023

2023

2022

2023

2023

RMB

RMB

USD

RMB

RMB

USD

Net revenues

629,631

761,014

107,187

2,498,214

2,960,813

417,022

Less: other revenues(1)

11,600

25,237

3,555

62,104

87,912

12,382

Add: VAT and surcharges

38,716

46,509

6,551

153,052

181,001

25,493

Add: ending deferred revenue

959,333

1,237,621

174,315

959,333

1,237,621

174,315

Add: ending refund liability

60,597

67,157

9,459

60,597

67,157

9,459

Less: beginning deferred revenue

638,426

761,301

107,227

996,218

959,333

135,119

Less: beginning refund liability

40,812

47,631

6,709

78,630

60,597

8,535

Gross billings

997,439

1,278,132

180,021

2,534,244

3,338,750

470,253

Note (1): Include miscellaneous revenues generated from services other than courses.

 

 

 

For the three months ended December
31,

For the year ended December 31,

2022

2023

2023

2022

2023

2023

RMB

RMB

USD

RMB

RMB

USD

Gross profit

470,329

533,295

75,113

1,797,164

2,170,606

305,724

Share-based compensation expenses(1) in
cost of revenues

3,572

3,862

544

42,490

12,959

1,825

Non-GAAP gross profit

473,901

537,157

75,657

1,839,654

2,183,565

307,549

Loss from operations

(13,248)

(187,915)

(26,468)

(118,052)

(149,006)

(20,987)

Share-based compensation expenses(1)

16,779

15,679

2,208

122,654

58,353

8,219

Non-GAAP income/(loss) from
operations

3,531

(172,236)

(24,260)

4,602

(90,653)

(12,768)

Net income/(loss)

70,613

(119,649)

(16,854)

13,172

(7,298)

(1,028)

Share-based compensation expenses(1)

16,779

15,679

2,208

122,654

58,353

8,219

Non-GAAP net income/(loss)

87,392

(103,970)

(14,646)

135,826

51,055

7,191

Note (1): The tax effects of share-based compensation expenses adjustments were nil.

 

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Automotive ECU Market worth $160.59 billion by 2033 | MarketsandMarkets™

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September 7, 2026

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DELRAY BEACH, Fla., Sept. 7, 2026 /PRNewswire/ — According to MarketsandMarkets™, the Automotive ECU Market is projected to grow from USD 113.27 billion in 2026 to USD 160.59 billion by 2033, at a CAGR of 5.1%.

Browse 300 market data Tables and 80 Figures spread through 350 Pages and in-depth TOC on “Automotive ECU Market”

Automotive ECU Market Size & Forecast:

Market Size Available for Years: 2022–20332026 Market Size: USD 113.27 Billion2033 Projected Market Size: USD 160.59 BillionCAGR (2026–2033): 5.1%

Automotive ECU Market Trends & Insights:

32-bit capacity ECU to hold the largest market share in the automotive ECU market during the forecast period.Infotainment and communication system to hold the largest share in the automotive ECU market during the forecast periodNorth America is estimated to hold a significant share of the automotive ECU market during the forecast period

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The automotive ECU market is being driven by the shift toward zonal and centralized E/E architectures, which require higher-performance controllers to manage multiple vehicle functions. Growing ADAS integration and sensor-fusion requirements are increasing demand for ECUs with greater processing capability, functional safety, and low-latency control. The transition toward software-defined vehicles is also raising ECU content through OTA updates, service-oriented software, and reusable computing platforms. At the same time, increasing vehicle electrification is expanding demand for dedicated powertrain, battery management, thermal management, and charging-control ECUs. The adoption of Automotive Ethernet and high-speed in-vehicle networks is further increasing the technical value of gateway and zonal controllers. AI-enabled vehicle functions and generative-AI-based cockpit and ADAS applications are expected to further increase demand for high-performance edge computing and AI-capable automotive processors. Growing cybersecurity, functional-safety, and regulatory requirements are also driving the integration of secure processing, hardware security modules, redundancy, and fail-operational capabilities into ECUs. 

32-bit capacity ECU to hold the largest market share in the automotive ECU market during the forecast period.

ECUs with 32-bit capacity are expected to hold the largest share as they provide the processing capability required across a broad mix of control functions, including body control, braking, steering, powertrain, BMS, motor control, transmission, telematics, infotainment, and digital cockpit applications, while retaining the cost and real-time characteristics required for high-volume vehicle platforms. Demand is increasing as OEMs consolidate functions into integrated controllers, requiring higher CPU performance, larger memory, faster networking, and stronger functional-safety and cybersecurity capabilities without moving every control function to expensive high-performance SoCs. For instance, in March 2026, Renesas introduced the 28 nm 32-bit RH850/U2C, targeting chassis and safety systems, BMS, body control, lighting, motor control, and other ASIL-D applications, with improved connectivity, security, and lower power consumption. Infineon also expanded its 32-bit AURIX TC3x family in March 2026 with a 400 MHz option, allowing powertrain, chassis, zone, and domain ECUs to accommodate higher software complexity without changing the underlying ECU platform. This combination of wider application coverage, platform reuse, real-time control, and increasing compute and networking requirements is strengthening the role of 32-bit ECUs as the core processing layer between conventional low-end controllers and high-performance centralized vehicle computers.

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Infotainment and communication system to hold the largest share in the automotive ECU market during the forecast period.

Infotainment and communication systems are expected to hold the largest share in the automotive ECU market during the forecast period as OEMs shift cockpit electronics from dedicated infotainment controllers to high-performance, software-defined platforms integrating AI, connectivity, navigation, applications, and vehicle functions. The rising use of AI-enabled voice interfaces, app ecosystems, continuous OTA updates, and cloud-connected services is increasing the compute and software content of infotainment ECUs, while the need to process high-bandwidth data from cellular, Wi-Fi, Bluetooth, UWB, GNSS, and vehicle networks is pushing OEMs toward more integrated communication architectures. For instance, in April 2026, Hyundai Motor Group introduced Pleos Connect, combining AI-based Gleo, navigation, an open app ecosystem, and continuous OTA updates, with a target deployment of approximately 20 million vehicles by 2030. Further, in May 2026, GM introduced its integrated Connectivity Hub Module (CHM), consolidating cellular, Wi-Fi, Bluetooth, BLE, UWB, and GNSS connectivity while supporting high-bandwidth infotainment and OTA functions, indicating a move away from conventional TCU architectures. These developments are driving the segment toward centralized cockpit compute, integrated connectivity modules, AI acceleration, and software-upgradable architectures, increasing the value of infotainment and communication ECUs relative to conventional function-specific controllers.

North America is estimated to hold a significant share of the automotive ECU market during the forecast period.

North America is estimated to hold a significant share of the automotive ECU market during the forecast period. The region is seeing a structural shift toward centralized and zonal E/E architectures, with major OEMs redesigning ECU configurations to support higher computing loads, faster networking, and software-defined functions. For instance, in April 2026, Ford Motor Company (US) highlighted its Universal EV platform’s fully zonal architecture, which consolidates vehicle functions into fewer modules and uses higher-speed Ethernet for distributed edge computing. In May 2026, General Motors (US) also introduced its integrated Connectivity Hub Module (CHM), which combines multiple wireless interfaces and connectivity electronics to support its next-generation software-defined architecture and reduce wiring complexity. GM is also developing a centralized computing platform scheduled for 2028 that consolidates dozens of ECUs and connects propulsion, steering, braking, safety, and infotainment through a high-speed Ethernet backbone across both ICE and electric vehicles. Similarly, increasing deployment of ADAS and automated-driving functions is raising demand for high-performance ECUs capable of real-time sensor processing, vehicle control, and OTA software updates. The US regulatory push for mandatory advanced safety functions is expected to further support ECU demand, with NHTSA’s FMVSS 127 requiring automatic emergency braking and pedestrian AEB on new light vehicles from September 2029, encouraging wider deployment of sensor-based electronic control systems. These developments are shifting regional ECU demand from conventional function-specific controllers toward higher-value central compute, zonal controllers, gateways, and integrated connectivity platforms.

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Top Companies in Automotive ECU Market:

The Top Companies in Automotive ECU Market are Robert Bosch GmbH (Germany), Denso Corporation (Japan), ZF Friedrichshafen AG (Germany), Aptiv (Ireland), and Aumovio SE (Germany).

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Related Reports:

Occupant Classification System (OCS) Market

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MarketsandMarkets™ is a blue ocean alternative in growth consulting and program management, leveraging a man-machine offering to drive supernormal growth for progressive organizations in the B2B space. With the widest lens on emerging technologies, we are proficient in co-creating supernormal growth for clients across the globe.

Today, 80% of Fortune 2000 companies rely on MarketsandMarkets, and 90 of the top 100 companies in each sector trust us to accelerate their revenue growth. With a global clientele of over 13,000 organizations, we help businesses thrive in a disruptive ecosystem.

The B2B economy is witnessing the emergence of $25 trillion in new revenue streams that are replacing existing ones within this decade. We work with clients on growth programs, helping them monetize this $25 trillion opportunity through our service lines – TAM Expansion, Go-to-Market (GTM) Strategy to Execution, Market Share Gain, Account Enablement, and Thought Leadership Marketing.

Built on the ‘GIVE Growth’ principle, we collaborate with several Forbes Global 2000 B2B companies to keep them future-ready. Our insights and strategies are powered by industry experts, cutting-edge AI, and our Market Intelligence Cloud, KnowledgeStore™, which integrates research and provides ecosystem-wide visibility into revenue shifts.

MarketsandMarkets™ SalesPlay is an AI-driven Revenue Intelligence Co-Pilot designed to help revenue teams prioritize the right accounts, identify critical changes early, and surface opportunities ahead of demand, so pipeline builds naturally and deals close with greater consistency.

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SunTec India Introduces AI-Accelerated Digital Engineering, Integrating AI Across the Software Development Lifecycle

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September 7, 2026

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Embedding AI across every stage—ideation, coding, testing, and deployment to help enterprises build and scale software faster while maintaining human rigor.

NEW DELHI, Sept. 7, 2026 /PRNewswire/ — SunTec India today announced the expansion of its Digital Engineering capabilities with AI-accelerated software development workflows. By embedding AI into every phase of the development cycle, from architecture to automated QA and deployment, the company expedites time-to-market without compromising code quality, security, or domain-specific logic.

Software Built to Last: Engineering at AI Speed, Quality at Human Standards.

While modern AI coding agents accelerate syntax writing, enterprise software engineering still demands strategic design, contextual understanding, and strict governance. Many agencies, hence, end up creating code that is standards-blind and compromises long-term architectural integrity.

But SunTec India’s AI-accelerated approach is fundamentally different. It is designed to utilize AI as a multiplier across the entire SDLC while keeping engineers firmly at the wheel. By automating repetitive engineering tasks, predictive bug analysis, refactoring, and test-case generation, their developers free up the bandwidth to focus on software integrity, security compliance, and user experience.

What their AI-Accelerated SDLC Delivers:

Intelligent Development: AI-first development with real-time code generation, refactoring, and security vulnerability scanning.Automated QA & Testing: Dynamic QA and testing with creation and execution of edge cases, minimizing post-deployment bugs.Optimized DevOps Pipeline: Automated build validation, predictive infrastructure monitoring, and seamless CI/CD integration.Human-in-the-Loop Governance: Enterprise-grade security protocols, architectural oversight, and subject-matter-expert code reviews before production deployment.

“We are not using AI to replace our software engineers; we’re using it to amplify them. By combining 25 years of engineering discipline with modern AI tooling, we give clients the best of both worlds; pairing the speed of AI with the security, precision, and contextual accuracy enterprises demand.” — Murli Pawar, VP of Technology, SunTec India 

Availability & Engagement

SunTec India’s AI-accelerated digital engineering services are available globally. Organizations looking to build a new product or modernize an old one can schedule a strategy session at info@suntecindia.com.

About SunTec India

SunTec India is an AI-enabled IT and Digital Services provider founded in 1999 and headquartered in New Delhi. Its 1,500+ professionals serve 8,500+ clients across 50 countries, spanning data services, eCommerce, digital engineering, ePublishing, and media handling. Gartner-recognized. CMMI Level 3 and ISO certified.

Contact: Rohit, rohit@suntecindia.com 

 

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Thermoplastic Polyimide Market worth $0.86 billion in 2032 – Exclusive Report by MarketsandMarkets™

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12 minutes ago

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September 7, 2026

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DELRAY BEACH, Fla., Sept. 7, 2026 /PRNewswire/ — According to MarketsandMarkets™, the Thermoplastic Polyimide Market projected to grow from USD 0.56 billion in 2026 to USD 0.86 billion by 2032, at a CAGR of 7.4% during the forecast period.

Browse 303 market data tables and 70 figures spread through 346 pages and an in-depth TOC on the “Thermoplastic Polyimide Market – Global Forecast to 2032”

Thermoplastic Polyimide Market Size & Forecast:

Market Size Available for Years: 2022-20322026 Market Size: 0.56 billion2032 Projected Market Size: 0.86 billionCAGR (2026-2032): 7.4%

Thermoplastic Polyimide Market Trends & Insights:

The industry is driven by the increasing growth of data creation and cloud computing. With more businesses being set up on cloud services and newer technologies like AI and big data, the processing load and heat generation of data centers increase, and they need proper cooling to operate at their best.Asia Pacific accounted for the largest share of the global thermoplastic polyimide market in 2025, at 35%, and is projected to register a CAGR of 8.3% between 2026 and 2032.By product type, the unfilled thermoplastic polyimide segment is projected to grow at a CAGR of 6.8% during the forecast period.By form, the resin segment is projected to reach the largest market size by 2032, registering a CAGR of 7.4% during the forecast period.By end-use industry, the electrical and electronics segment is projected to grow at a CAGR of 8.3% through 2032.By processing technique, the injection molding segment is projected to have the largest market share.Mitsui Chemicals, SABIC, and Mitsubishi Gas Chemical Company, Inc. were identified as some of the star players in the thermoplastic polyimide market (global), given their strong market share and product footprint.

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The industry is driven by the increasing demand for lightweight, high-temperature materials in aerospace and defense applications. As demand grows for lightweight, high-temperature materials in aerospace and defense applications, thermoplastic polyimide is gaining adoption in components exposed to demanding thermal and mechanical conditions. Growing automotive and industrial applications are also increasing the need for materials that provide high-temperature performance, dimensional stability, chemical resistance, and wear resistance while enabling efficient processing.

The electrical & electronics segment, by end-use industry, is projected to hold the largest share in the thermoplastic polyimide market.

The electrical & electronics segment is projected to hold the largest share of the thermoplastic polyimide industry. Demand is supported by the increasing need for high-temperature, dimensionally stable, and electrically reliable materials. Thermoplastic polyimide is used in applications such as connectors, sockets, wire and cable components, optical components, semiconductor manufacturing equipment, and other precision electronic components. The growing complexity and performance requirements of electronic and electrical components are further driving the adoption of thermoplastic polyimide in applications exposed to demanding thermal and mechanical conditions. As the electrical and electronics industry continues to expand, demand for high-performance thermoplastic polyimide materials is expected to remain strong.

Resin, by form, is expected to account for the largest market share.

The resin segment, by form, is projected to account for the largest share of the thermoplastic polyimide market. This dominance is supported by the broad use of thermoplastic polyimide resin in injection molding and extrusion to produce complex and high-precision components. The material’s high-temperature performance, dimensional stability, mechanical strength, chemical resistance, and wear properties support applications across automotive, industrial machinery, aerospace and defense, and electrical and electronics industries. Thermoplastic polyimide resin is used in components such as bearings, seal rings, thrust washers, oil seals, impellers, wire coatings, films, and precision electronic components. Its ability to maintain performance under elevated temperatures while enabling efficient thermoplastic processing is expected to support continued demand for resin-form thermoplastic polyimide during the forecast period.

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Asia Pacific is the fastest-growing region in the thermoplastic polyimide market.

Asia Pacific is projected to be the fastest-growing region in the thermoplastic polyimide market, supported by expanding electrical and electronics, automotive, and advanced manufacturing activities across the region. Increasing investments in electronics and semiconductor manufacturing, automotive production, and high-value industrial applications are strengthening demand for high-performance materials. The region also has an established presence of thermoplastic polyimide suppliers and expanding manufacturing capabilities, particularly across China, Japan, and South Korea. These factors, together with increasing adoption of lightweight and high-temperature materials, are expected to support rapid growth of the thermoplastic polyimide market in Asia Pacific.

Key Players

Leading players in the thermoplastic polyimide companies are including Mitsui Chemicals (Japan), Sabic (Saudi Arabia), Solver Polyimide (China), Huntsman (US), Mitsubishi Gas Chemical Company, Inc. (Japan), Jiangsu Junhua Hpp Co., Ltd. (China), Changzhou Sunchem New Material Co., Ltd. (China), Wanhua Chemical (China), Arakawa Chemical Industries, Ltd. (Japan), Arkema (France), Evonik (Germany), Allstar Material (China), Jiangsu Qingquan Chemical Co., Ltd. (China), and Kingfa Sci. & Tech. Co., Ltd. (China).

Investment Funding

The thermoplastic polyimide market is seeing increasing investment and financing activity among companies in the market and the broader high-performance materials ecosystem. In 2025, Arkema completed EUR 400 million (approximately USD 464.9 million) undated hybrid bond issuance to diversify its financing resources and mainly refinance an existing hybrid bond. The financing activity reflects continued capital access among major specialty materials companies and supports their broader financial capacity for business development and technology investments. Leading thermoplastic polyimide producers are also expanding their product portfolios and application capabilities to address demand for high-performance materials.

Revenue Shift

The thermoplastic polyimide market is witnessing a gradual shift toward higher value and more specialized applications. Mitsui Chemicals states that the application range of AURUM thermoplastic polyimide is expanding across electrical and electronic components, semiconductor manufacturing equipment, automotive and transportation parts, industrial machinery, films, and aerospace applications. SABIC has also introduced new EXTEM thermoplastic polyimide grades for emerging optical interconnect applications. Wanhua Chemical has developed thermoplastic polyimide products and production capabilities as part of its specialty engineering materials portfolio, indicating increasing participation from Chinese manufacturers in the thermoplastic polyimide market. These developments indicate growing use of thermoplastic polyimide in applications that require high-temperature performance, dimensional stability, electrical properties, and precision processing.

Company Revenue Share Details

The combined market share of the top five players is estimated at approximately 60–70%, indicating a consolidated market. This level of concentration suggests that although leading vendors maintain strong market positions through diversified product portfolios and technological innovation, no single company has established dominant control, leaving ample opportunities for competition and future consolidation. The top five companies include Mitsui Chemicals, Inc., SABIC, Mitsubishi Gas Chemical Company Inc, Wanhua Chemical, and Kingfa Sci. & Tech. The presence of established specialty chemical manufacturers alongside engineering plastics producers reflects the evolving competitive landscape. As demand increases across electrical and electronics, automotive, aerospace & defense, industrial machinery, and other applications, companies are expected to strengthen their positions through product innovation, strategic partnerships, geographic expansion, and acquisitions.

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See More Latest Resins & Polymers Industry Reports:

Medical Plastics Market Medical Plastics Market by Type (Standard Plastics, Engineering Plastics, High-performance Plastics), Application (Medical Disposables, Medical Instruments & Devices, Prosthetics & Implants, Drug Delivery, Medical Packaging) – Global Forecast to 2031

Polyols Market by Type (Polyether Polyols, Polyester Polyols), Application (Flexible Polyurethane Foam, Rigid Polyurethane Foam, CASE), End-use Industry (Building & Construction, Furnishing, Automotive, Electronics), and Region – Global Forecast to 2031

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Medical Tubing Market by Material (Plastics, Rubbers, Specialty Polymers), Application (Bulk Disposable Tubing, Catheters & Cannulas, Drug Delivery Systems), Structure (Single-Lumen, Multi-Lumen, Co-Extruded, Braided) – Global Forecast to 2031

About MarketsandMarkets™  

MarketsandMarkets™ has been recognized as one of America’s Best Management Consulting Firms by Forbes, as per their recent report.

MarketsandMarkets™ is a blue ocean alternative in growth consulting and program management, leveraging a man-machine offering to drive supernormal growth for progressive organizations in the B2B space. With the widest lens on emerging technologies, we are proficient in co-creating supernormal growth for clients across the globe.

Today, 80% of Fortune 2000 companies rely on MarketsandMarkets, and 90 of the top 100 companies in each sector trust us to accelerate their revenue growth. With a global clientele of over 13,000 organizations, we help businesses thrive in a disruptive ecosystem.

The B2B economy is witnessing the emergence of $25 trillion in new revenue streams that are replacing existing ones within this decade. We work with clients on growth programs, helping them monetize this $25 trillion opportunity through our service lines – TAM Expansion, Go-to-Market (GTM) Strategy to Execution, Market Share Gain, Account Enablement, and Thought Leadership Marketing.

Built on the ‘GIVE Growth’ principle, we collaborate with several Forbes Global 2000 B2B companies to keep them future-ready. Our insights and strategies are powered by industry experts, cutting-edge AI, and our Market Intelligence Cloud, KnowledgeStore™, which integrates research and provides ecosystem-wide visibility into revenue shifts.

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