Gaotu Techedu Inc. (GOTU) is a Chinese tech-enabled education and digital tutoring services, provider. It is focused on the vocational, and professional educational needs of the students along with digital products. The company has adopted a live large-class format for the delivery of its courses, which is an effective and scalable method to distribute teaching resources to aspiring students. Big data analytics improve teaching delivery, learning experience, and operational efficiency.
The price of GOTU stock on March 7, 2022, regular trading was $1.44 with a considerable hike of 3.60%. Its stock further rocketed by 12.5%, at the last check of the premarket of March 8, 2022.
GOTU: Key Financials
On March 8, 2022, GOTU released its fourth-quarter 2021 unaudited financial report for the three months ended December 31, 2021. Some of the key aspects are discussed below.
Revenue
Net revenue during the fourth quarter of 2021 was RMB1,274.3 million or $199.9 million corresponding to RMB2,211 million in the comparable quarter of 2020. The company recorded a decline of RMB937 million or 42% in net revenues over the year. Also, it topped the revenue estimates of the analysts by $196.3 million.
EPS
Basic and diluted net income per ADS in Q4 2021 was RMB285.9 million or RMB1.11 (basic) and RMB1.09 (diluted) versus a net loss of RMB627.0 million in the corresponding period of 2020. The company observed a considerable increase in its EPS over the year.
GOTU: Events and Happenings
On February 16, 2022, GOTU announced business updates following the local government’s reorganized regulatory requirements. The government imposed that for senior high school students, after-school tutoring services need to stringently follow the notification published by the General Offices of the CPC Central Committee and the State Council of the PRC. The notification stated the “Opinions on Further Alleviating the Burden for Students in Compulsory Education”.
Conclusion
GOTU stock dipped in the last year noticeably by 98% as the pandemic severely impacted the Chinese economy. Recently, the company’s stock rallied in the premarket trading following its financial statement release as it beat the analysts’ estimations of revenue.
