Q2 2025 TAL Education Group Earnings Call
Yeah.
Speaker Change: Ladies and gentlemen, good day and thank you for standing by welcome to tell education groups fiscal 'twenty 'twenty five second quarter.
Speaker Change: Conference call at this time, all participants are in listen only mode. After the speaker's presentation there'll be a question and answer session. Please be informed that today's conference is being recorded.
Speaker Change: I'd like to hand, the conference over to Mr. Folio Investor Relations director.
Speaker Change: Please go ahead.
Mr. Folio: Thank you all for joining us today Hotel educational Corp, second quarter fiscal year 2025 earnings Conference call. The earnings release was distributed earlier today and you may find a copy on the company's IR website or through the newswires.
Mr. Folio: During this call you will hear from Mr. Alex <unk>, President and Chief Financial Officer, and Mr. Jackson team.
Mr. Folio: Your T Chief Financial Officer.
Mr. Folio: Following the prepared remarks, Mr. <unk> will be available to answer your questions.
Mr. Folio: Before we continue please note that today's discussion will contain forward looking statements made under the safe Harbor provisions of the United States Private Securities Litigation Reform Act of 19 at five.
Mr. Folio: Forward looking statements are subject to risks and uncertainties that may cause actual results to differ materially from our current expectation.
Mr. Folio: Risks and uncertainties include but are not limited to those outlined in our public filings with the SEC for more.
Mr. Folio: More information about these risks and uncertainties, please refer to our filings with the SEC.
Mr. Folio: Also our earnings release and this call include discussions of certain non-GAAP financial measures. Please refer to our earnings release, which contains a reconciliation of the non-GAAP measures to the most directly comparable GAAP measures.
I'd like to turn the call over to Mr. Alex.
Speaker Change: Alex Please go ahead.
Alex: Thank you Paul I'd also like to thank all of you for participating in today's conference call.
Alex: In this call will discuss our financial performance and business progress.
Alex: For the second quarter of fiscal year 2025.
Alex: We will also review some key business results.
Alex: Afterwards.
Alex: I'll provide a brief update on our business strategy and outlook.
Alex: In the past fiscal quarter, we consistently refined our services and experiences for users.
Generating societal value through our dedication to customer experience.
Alex: At the same time, our business is experiencing sustained growth not just by building our teams or opening new learning centers, but to our broader ongoing development that reflects our long term pressure.
Alex: Our focus on innovation user engagement and service excellence has resulted in sustained user value creation through our various products and services.
Alex: In alignment with our strategic objectives, our core businesses have maintained their course of operations.
Alex: Next let's talk about our performance for the second quarter of fiscal year 2025.
Alex: Throughout this quarter, we continue to enhance our core businesses, while actively exploring new growth opportunities, while exploring and investing in additional opportunities and long term strategic capabilities.
Alex: We also maintained our focus on operational efficiency and sustainability.
We continuously adjust our resource allocation to ensure a balanced approach between growth and operational efficiency.
Alex: Our learning services continue to develop steadily empowering learners through our offline and online enrichment learning programs.
Alex: This progress reflects our commitment to.
Alex: So high quality service and expansion of our operational capacity.
Alex: We continue to take a dynamic approach in managing our learning center expansion plan.
Alex: Waiting several factors such as market demand in each area user acceptance of our products, our operating capability and efficiency.
Alex: So in line with our strategic objectives, our online enrichment learning business remained on track we continue to innovate in response to the evolving landscape and changing user behaviors in the online learning sector.
Alex: Over recent years, we have introduced a range of new offerings designed to provide an efficient and engaging digital learning experience for our customers.
Alex: For learning devices, we expanded our product offerings to reach a broader audience, making it easier for more users to find learning solutions tailored to their individual needs.
Alex: Our goal is to motivate learners under self learning journey at home by leveraging smart features and comprehensive resources integrated into our device.
Alex: So with that goal in mind, we further upgraded our hardware and software this quarter enhancing the content library.
Alex: Upgrading the reading section.
Alex: And adding practical smart features to create a more immersive and engaging online learning experience.
Alex: August we launched a lower asp's device, thus serves students learning needs as well as practice needs, we call it Xbox which has begun to gain market acceptance.
Alex: Efforts like these are driving our financial growth.
Alex: Our net revenues.
Alex: Our 619 four.
Alex: 4 million U S dollars.
Alex: War for Trulia, and 404 billion excuse me, a $4 billion 473 million nine RMB for the quarter representing year over year increases of 54, and 58% in U S dollar and RMB.
Alex: <unk> respectively.
Alex: Our non-GAAP income from operations and non-GAAP net income attributable to call for the quarter.
Or $64 5 million U S dollars and $74.3 million respectively.
Speaker Change: So with that overview I'll now hand, the call over to Jackson, who will provide an update on the operational advancements we've made in our core Purcell Flash to also review our financial performance for the second fiscal quarter Jackson over to you.
Okay.
Jackson: Thank you Alex.
Speaker Change: Okay.
Jackson: I am pleased to share with you some details about the progress we made in the fiscal second quarter across our core business lines.
Jackson: Please note that all financial data for the quarter.
Jackson: Unaudited.
Jackson: Okay.
Jackson: I'll start with our learning services and others business.
Jackson: Which includes a broad range of learning programs for customers.
Jackson: Learning services continued its development momentum in the second quarter of fiscal year 2025.
Jackson: Revenue increased year over year.
Jackson: Repelled by advancement.
Jackson: Across multiple product lines.
Jackson: Yes.
Jackson: The largest revenue contributor in this business line remains <unk> small class offerings.
Jackson: Which maintained their upward trajectory.
Jackson: Okay.
Jackson: <unk> growth was primarily driven by enrollment growth.
Jackson: Supported by the extension expansion of.
Jackson: Our operating capacity.
Jackson: We carefully assess both user demand and our operational capacity.
Jackson: We struck a balance that allowed us to meet the growing demand during the summer vacation periods.
Jackson: While managing teaching quality business sustainability.
And operational efficiency.
Jackson: Yeah.
Key efficiency indicators, such as retention rate remained relatively stable quarter over quarter.
Jackson: For our online enrichment learning business.
Jackson: We remain focused on adapting to evolving market landscape.
Jackson: User needs through consistent innovation.
Jackson: By introducing new products and interactive formats.
Jackson: We create value for them for our learners and deliver learning efficacy and experience.
Jackson: Based on our user feedback and market insights, we continue to invest in strengthening our online product capabilities.
Jackson: As well as operational and marketing strategies.
This allows us to expand our current operations.
Jackson: While building a solid foundation for long term competitiveness.
Jackson: Okay.
Jackson: Next our content solutions business.
Jackson: That's revenue continued to grow this quarter.
Jackson: Thanks to our efforts to optimize product.
Jackson: Enhance user experiences.
Jackson: Okay, and strengthen our sales channels.
Jackson: We believe our learning devices.
Jackson: Companions for at home self learning.
Jackson: Which is why we closely monitor user feedback and experience.
Jackson: As a result.
Amid rising sales and an expanding user base.
Jackson: User engagement and time spent on our devices remained at healthy levels this quarter.
In August we launched X book.
Jackson: Further enriching our product lineup.
Jackson: The latest generation tablet features a color E pay per display.
Jackson: And offers three mode.
Jackson: Learning.
Jackson: Practicing and reading.
Jackson: Catering to various learning scenario.
We developed a tiered practicing system.
Jackson: Making practice easier and more efficient.
Jackson: Okay.
Additionally, <unk>.
Jackson: It comes with a comprehensive multi layered content ecosystem.
Jackson: Along with our proprietary assurance that content, we partnered with well known educational publishers and youth content providers to offer a wide range of study AIDS and reading materials.
Jackson: Okay.
Jackson: During this fiscal quarter.
Jackson: We also upgraded our existing ex Pat learning devices.
Jackson: The newly enhanced reading section.
Jackson: Over 3000 ebooks.
Jackson: Featuring essential reading materials.
Jackson: SEC literature.
Jackson: In shoulders publications.
Jackson: We also developed a level to reading system.
Jackson: Caters to children's various development developmental periods.
Jackson: Okay.
Jackson: It aligns with the new curriculum standards and covers levels from primary school to high school.
Jackson: Moreover.
Jackson: Our newly launched <unk>.
Jackson: Two point, though introduced in June.
Jackson: Offers a host of AI features.
Jackson: Making it a more intelligent and practical learning companion.
Jackson: Okay.
Jackson: Okay.
Jackson: With that overview.
Speaker Change: I would now like to share our key financial results for the second fiscal quarter.
Jackson: Okay.
Jackson: Our net revenues were $619 4 million U S dollars.
Jackson: Or $4 billion $473 9 million RMB.
Jackson: An increase of 54% and 58% year over year in U S dollar and RMB terms, respectively.
Jackson: Okay.
Jackson: Cost of revenue increased by 59, 8% to $276 million.
From a $169 $4 million in the second quarter of fiscal year 2024.
Jackson: non-GAAP cost of revenues, which excludes share based compensation expenses.
Jackson: Increased by 67% to 268 8 million U S dollars from 167.3 million U S dollars in the second quarter of fiscal year 2024.
Jackson: Sure.
Jackson: Okay.
Jackson: Gross profit increased in the second quarter of fiscal 2025.
Rising by 43, 8% year over year to $348 seven many U S dollars from $242 $5 million for the same period last year.
Jackson: Gross margin decreased to 56, 3% from 58, 9% for the same period last year.
Jackson: Okay.
Selling and marketing expenses for the quarter were 181 $9 million.
Jackson: Representing an increase of 56, 4%.
Jackson: From a $116 $3 million for the same period last year.
Jackson: non-GAAP, selling and marketing expenses, which exclude share based compensation expenses increased by 61, 6%.
Jackson: $177 9 million U S dollars from 110 $1 million for the same period last year.
Jackson: Selling and marketing expenses as a percentage of total net revenues.
Increased from 28, 2% to 29, 4% year over year.
Jackson: Okay.
Jackson: General.
Jackson: In administrative expenses.
Jackson: <unk> increased by 23, 1%.
Jackson: Two 119, five many of U S dollars from $97 1 million U S dollars in the same period of last year.
Jackson: non-GAAP general and administrative expenses, which excludes share based compensation costs.
Jackson: Increased by 28, 3% year over year to $108 3 million U S dollars from $84 $4 million for the same period of last year.
Jackson: Yes.
Jackson: non-GAAP general and administrative expenses as a percentage of total net revenues decreased from 25.
Jackson: Person to 17, 5% year over year.
Jackson: Total share based compensation expense allocated to related operating costs and expenses.
Jackson: Decreased by 19, 1% too.
Jackson: $16 9 million in U S dollars in the second quarter of fiscal year 2025.
Jackson: From $29 million in the same period of last year.
Jackson: Okay.
Jackson: Income from operations was $47 6 million U S dollars in the second quarter of fiscal year 2025.
Jackson: Compared with an income from operations of $31 $8 million U S dollars in the same period of last year.
Jackson: non-GAAP income from operations, which includes which excludes excuse me share based compensation expenses was $46 $5 million compared with a non-GAAP income from operations of.
Jackson: $52 7 million U S dollars in the same period last year.
Net income attributable attributable to Tao was $57 $4 million in the second quarter of fiscal year 2025.
Jackson: Compared to net income attributable to Tao.
Jackson: $37 9 million U S dollars in the same period of last year.
Jackson: Okay.
Jackson: non-GAAP net income attributable to <unk>, which excludes share based compensation expenses.
Jackson: Yes.
Jackson: $74 3 million compared to a non-GAAP net income attributable to Tal.
Jackson: $58 8 million U S dollars in the same period of last year.
Jackson: Okay.
Jackson: Moving on to our balance sheet.
As of August 31, 2024.
Jackson: We had $2 billion and $85 nine many of us dollars in cash and cash equivalents.
Jackson: 1 billion $368 4 million U S dollars and short term investments.
Jackson: $295 1 million U S dollars and current and non current restricted cash.
Jackson: Our deferred revenue balance was $517 6 million U S dollars.
Jackson: As of the end of second fiscal quarter.
Jackson: Yes.
Jackson: Now turning to our cash flow statement.
Jackson: Net cash used in.
Jackson: Operating activities for the second quarter of fiscal year, 2025 was 0.6 million U S dollars.
Okay.
Jackson: Okay.
Jackson: In April 2024, the company's board of directors authorized to extend its share repurchase program launched in April 2021 by 12 months.
Jackson: Yes.
Jackson: Pursuant to the extended share repurchase program. The company may spend up to approximately 503 8 million U S dollars to purchase common shares.
Jackson: Through April 32025.
Jackson: As of August 31, 2024, the company has purchased approximately 500000 common shares.
Jackson: At an aggregate consideration of approximately $13 1 million U S dollars under the share repurchase program.
Jackson: Okay.
Jackson: Okay.
Jackson: That concludes the financial section.
Speaker Change: I will now hand, the call back to Alex to briefly update you on our business outlook.
Alex: Alex. Please go ahead, thanks, Jackson I would like to share our outlook for the upcoming quarter.
Alex Jackson: The fiscal third quarter is generally not a peak season for enrichment learning demand.
Alex Jackson: We may experience fluctuations in our business performance due to seasonal factors.
Nevertheless.
Alex Jackson: We remain dedicated to driving healthy and sustainable long term growth across all our business lines.
Alex Jackson: First of all we will continue refining our various learning programs to deliver high quality learning services to a growing user base. We are committed to ongoing investments in learning services to ensure that our users receive quality.
Alex Jackson: Turning experiences both online and in person.
Alex Jackson: Next we will remain focused on technological innovation.
Alex Jackson: Subsequently launching high quality smart devices that enhance personalized learning experiences.
Alex Jackson: We target to iterate the functionality of our learning devices by harnessing AI technologies.
Keep introducing an updated content and smart tools.
Alex Jackson: Together these efforts will provide a more intelligent and practical learning companion for our users self directed learning at home.
Alex Jackson: Meanwhile, we will also remain focused on managing our sales channels and optimizing our marketing strategies.
Alex Jackson: As a company dedicated to learning.
Alex Jackson: Continue operating and managing our core business lines, while exploring new initiatives and seizing new opportunities.
Alex Jackson: To keep up with our customers' ever evolving needs. We are exploring designed differentiated products and services.
Alex Jackson: Our business model combined with our brand strength and operational efficiency positions us to seize market opportunities and deliver enduring value for our customers and shareholders.
Alex Jackson: So that concludes my prepared remarks, operator, I think we're now ready to open the call for questions.
Speaker Change: Thank you we will now begin the question and answer session.
Speaker Change: Ask a question. Please press star one on your telephone.
Speaker Change: I didn't hear an automated message advising yohan is raised.
Speaker Change: Your question. Please press star one again.
Speaker Change: Our first question comes from the line of <unk> <unk> from UBS. Please ask your questions Alex.
Speaker Change: So Alex your line is open please ask your question.
Speaker Change: Hello.
Speaker Change: Okay.
Alex Jackson: Hi, sorry, I was on mute thank.
Alex Jackson: Thank you management for taking my question and congratulations on the strong without.
Alex Jackson: My question is on target.
Alex Jackson: Could you share more color on that momentum and the operating leverage I'm, sorry operating efficiently.
Alex Jackson: And what is your outlook alright perfect. Thank.
Alex Jackson: Thank you.
Speaker Change: Thanks Felix.
Speaker Change: Alex Let me take on that question first and I may call on Jackson to add some additional insight.
Speaker Change: Really well.
Speaker Change: Look at the last few quarters.
Speaker Change: We've seen continued growth momentum far enrichment learning for us.
Speaker Change: We've been seeing increasing demand for enrichment learning.
Speaker Change: This new generation of parents start to develop their own parental and educational philosophies.
Speaker Change: I think in earlier calls we had called out that this is something that.
Speaker Change: We're envisioning and now I think we're seeing more and more of confirmation.
Speaker Change: This new generation of parents.
Speaker Change: We have developed more focus on their kids, while around that whole person development. In addition to academic performance.
Speaker Change: Although we're still and I think this data is.
Speaker Change: Not easy to come by in terms of the how fast the enrichment learning market overall is growing.
Speaker Change: We really observed more activities and user inquiries.
Speaker Change: <unk> enrichment of learning on the ground.
Speaker Change: Which I think really is indicating growing customer interest.
Speaker Change: So in tandem with the market growth of enrichment learning our learning services business has been experiencing continued progress.
Speaker Change: We've been aiming to help our learners what their holistic development experience.
Speaker Change: By providing interactive.
Speaker Change: Engaging learning experience, we have observed that learners in these type of embar enrichment programs they really exhibits.
Speaker Change: Continued growth in terms of their interest they stay engaged and they also learn very effectively.
Speaker Change: I think Jackson can talk more specifically about the growth momentum and operating efficiency that you had.
Jackson: Thank you Alex and thank you for that.
Speaker Change: Let's maybe limit the conversation to pay or small class enrichment learning first.
Speaker Change: Which as you may know is our largest.
Speaker Change: Business was then.
Speaker Change: Our learning services.
Speaker Change: There are some other businesses within our learning services.
Speaker Change: Category, but.
Speaker Change: Some of them are at a different stack.
Speaker Change: Stage of their lifecycle and exhibit slightly different trends and to the extent you have more questions on other business lines feel free to follow up.
Speaker Change: So luck Alex.
Alex Jackson: We have seen growth in payroll enrichment.
Alex Jackson: In parallel with user interest graph.
Alex Jackson: The overall market development has been an important contributing factor.
Alex Jackson: Our business growth.
Alex Jackson: And if we ship lenses to look away from the market and just look at ourselves.
Alex Jackson: We believe the key growth drivers amongst others.
Alex Jackson: Sure.
Alex Jackson: One to call.
Alex Jackson: Quality of our services.
Alex Jackson: And two.
Alex Jackson: Our capability to recruit and train lecturers.
Alex Jackson: Okay.
Alex Jackson: So service quality.
Alex Jackson: We have been focused and will continue to focus on standardized lecturing approach, while providing an interactive.
Alex Jackson: Student centric learning experience.
Alex Jackson: For luxury or recruiting and training.
Alex Jackson: We pride ourselves in training most of our lecturers in house.
Alex Jackson: To ensure consistent service quantity.
Alex Jackson: Yes.
Alex Jackson: Now as long as these growth drivers continue to prevail.
Alex Jackson: Including what we talked about earlier market demand, our service quality and our capability to recruit and train lectures.
Alex Jackson: We expect growth in this business line.
Alex Jackson: To continue.
Alex Jackson: However in the next few years, we do expect payout enrichment long term growth rate to gradually taper off.
As we are coming off hire based numbers than a couple of years ago.
Alex Jackson: So I think you also asked about operating efficiency.
Alex Jackson: We always aim to maintain a consistent level of efficiency.
Alex Jackson: Through balancing our operating capacity with the market demand we observed.
Alex Jackson: We measure of several efficiency indicators, such as utilization rate refund rate and retention rates.
Alex Jackson: Currently.
Alex Jackson: Our operating metrics are at a level that we believe will sustain our viable business model.
Alex Jackson: And we aspire to maintain our current level of efficiency.
Alex Jackson: In the future.
Alex Jackson: We'll prudently manage our learning Center network.
Alex Jackson: <unk> learning devices, they're really relatively new a new business for <unk>. If you recall I think our first learning tablet came to market.
Alex Jackson: In.
Alex Jackson: February.
Alex Jackson: Three is really just a little bit over a year and half ago.
Speaker Change: But why wouldn't you.
Speaker Change: We're really excited about the opportunity.
Speaker Change: To provide further accessibility to high quality learning content and experiences for a wider range of customers through these mobile devices.
Speaker Change: We track, where our devices have been sold to.
Speaker Change: And we really see that some of our devices have been sold into areas wherever we never.
Speaker Change: Learning centers before.
Speaker Change: So these AI powered devices really presented us an opportunity to serve customers.
Speaker Change: The limitation of our physical footprint and I think really to expand availability.
Speaker Change: These high quality content and learning experiences to a much wider.
Speaker Change: Segments.
Speaker Change: Many more students out there.
Speaker Change: With that goal in mind.
Speaker Change: We recently launched a new device.
Speaker Change: In the lower Asps territory, we talked little bit about this earlier as call Aix book.
Speaker Change: So in addition to hi.
Speaker Change: High quality learning content does this product also has more daily practice functions.
Speaker Change: So they serve alertness learning needs as well as proactive practice knees, which are really important that they go in tandem.
And we've been receiving positive feedback on this new product.
Speaker Change: So our learning device business is currently loss, making.
Speaker Change: The major cost items are primarily product research and development.
Speaker Change: <unk> expenses and bill of materials.
Speaker Change: We are really investing.
Speaker Change: Strongly into R&D.
Speaker Change: Look really we think the foundation of any value add service isn't active.
Speaker Change: And highly engaged installed base.
Speaker Change: As a result of our product capabilities.
Speaker Change: Really witness a steady level of high user engagement far learning devices.
Speaker Change: On an ever expanding user base.
Speaker Change: I'll give you an example.
Speaker Change: So we have an active.
Speaker Change: User base with weekly active rates at around 80%.
Speaker Change: Even as the user base kept on growing.
Speaker Change: And actually the majority of our weekly active users are actually averaging five or more days per week of usage.
Speaker Change: So we're always interested in exploring new revenue opportunities.
Speaker Change: But this needs to come not at the expense of the user experience.
Speaker Change: I have nothing tangible at this point to share in terms of value added services.
Speaker Change: But we will continue to stay focused on product quality and user experience.
Speaker Change: I hope that answers your question.
Speaker Change: Thanks, so much for the insight and great answers now I'll go back to Ken. Thank you again and congrats.
Speaker Change: You.
Speaker Change: Thank you our.
Speaker Change: Our next question comes from the line of Timothy Zhao from Goldman Sachs. Please go ahead team.
Speaker Change: Great.
Timothy Zhao: Hi, Alex Hi, Jackson, Congrats on the very strong quarterly result, and thank you for taking my question.
Timothy Zhao: My question is regarding your sales and marketing expenses, which I noticed that your growth for this quarter is around 60% I would say I think.
Timothy Zhao: In <unk>.
Timothy Zhao: <unk> effort to keep up with and in some instances really to lead the industry's innovations.
Speaker Change: I think in our industry.
Speaker Change: Competition really exists on multiple levels.
Speaker Change: So it's going to be competition on the product level.
Speaker Change: Competing for talent and competing for customers.
Speaker Change: As a company that takes pride in our product and service quality, we really invest heavily in product research and development.
Speaker Change: And thus far our competition for talent.
Speaker Change:
Speaker Change: We aim to attract multidisciplinary talents.
Speaker Change: By leveraging our expertise in the learning industry and our technology Knowhow.
Speaker Change: As for the competition for customers.
Speaker Change: I think really as we discussed earlier.
Speaker Change: Ultimately it's beneficial.
Speaker Change: <unk> to the users and to the development of the industry.
Speaker Change: I do a match.
Speaker Change: I think it does impact sales and marketing in some occasions.
Speaker Change: So we believe the key is to lead in product competency.
Speaker Change: While exploring efficient ways to communicate with our customers, especially given that this is an emerging category right.
Speaker Change: We will focus on building sales and marketing capabilities.
Speaker Change: Both within existing channels and building new channels.
Speaker Change: And some of the channels.
Speaker Change: What nurse and I think this is not hard to anticipate that sales and marketing increase.
Speaker Change: But while they also stable and they do stable they do stay stable in other channels.
Speaker Change: So this has to do with market market mechanisms what specific channels.
Speaker Change: We closely monitor the efficiency.
Speaker Change: Across the sales channels.
Speaker Change: Ci space it was really to possess a breadth of structured and unstructured data suitable and relevant to the AI era.
Speaker Change: Some of our historical investments.
Speaker Change: Into prior generations of AD technologies are really benefited us.
Speaker Change: A great treasure trove of data that we sit on today.
Speaker Change: As for developing AI powered applications.
Speaker Change: I think we have an abundance of experience in developing learning applications powered by technology.
Speaker Change: And we understand the complexity of such in depth works.
And really this complexity is coming from years of experience.
Speaker Change: We believe we're really well positioned to take a crack at some.
Speaker Change: Learnings hardest problems.
Speaker Change: Hi.
Speaker Change: So having said that.
Speaker Change: Process.
Next I'd like to share with you more about specific product roadmap and the investment plan.
Speaker Change: So our product roadmap really entails a combination of AI power functions embedded in our existing products.
Speaker Change: And newly rolled out EA major products.
Speaker Change: As you can probably imagine unlike many other verticals.
Speaker Change: Making visible progress.
Speaker Change: Power functions.
Speaker Change: Our existing products and they keep coming out there.
Speaker Change: They are coming out.
Speaker Change: New features but also upgrades.
Speaker Change: On existing features.
Speaker Change: I think on the last few calls we have talked about some of these functionalities such as Este correction and natural language based assistant we call shelves are learning tablet.
Speaker Change: But it doesn't stop there.
Speaker Change: Patients we shared a ball are just examples of what we currently have.
Speaker Change: We intend to roll out new applications.
Speaker Change: Well as upgrading our current applications as we progress.
Speaker Change: I hope that answers your question.
Speaker Change: Right.
Speaker Change: Thank you. All next question comes from the line of leaping Chow Fancy ICC. Please ask your question leaping.
Speaker Change: Yeah.
Speaker Change: Hi, Hi, Jackson, Thanks for taking my question.
leaping: My question is about your dot.
Speaker Change: Dot com business could you please elaborate.
Speaker Change: Just to dot com and how should we think about long term growth outlook of that business. Thank you.
Speaker Change: <unk>. Thanks for the question. This is Jackson, let me take this one.
Speaker Change:
First I would like to share with you some of our thoughts on <unk> Dot com and the online learning industry in general.
Speaker Change:
Speaker Change: If we look back at.
Speaker Change: A few years ago.
Speaker Change: The online learning industry went through a phase where some industry participants were heavily focused on customer acquisition.
Speaker Change: We do not think that's a sustainable approach.
Speaker Change: Yeah.
Speaker Change: And the online learning space the market is evolving.
Speaker Change: And we're seeing user needs changing.
Speaker Change: For example, we see more and more demand for enrichment learning programs.
Speaker Change: And for student centric learning.
Particularly demand for science and technology immersion.
Speaker Change: There is also a transformation on the supply side.
Speaker Change: In terms of what industry participants are providing.
Speaker Change: Participation in today's conference. This does conclude the program you may now disconnect.
Speaker Change: <unk>.
Speaker Change: Okay.
Speaker Change: Okay.
Speaker Change: Okay.
Speaker Change: [music].