Youdao (NYSE:DAO – Get Free Report) released its quarterly earnings data on Thursday. The company reported $0.05 EPS for the quarter, hitting the consensus estimate of $0.05, FiscalAI reports. The company had revenue of $195.52 million for the quarter, compared to the consensus estimate of $201.43 million. Youdao had a negative return on equity of 6.41% and a net margin of 1.81%.
Here are the key takeaways from Youdao’s conference call:
- Youdao posted RMB 1.3 billion in Q1 revenue, up 3.8% year over year, while operating profit was RMB 57.5 million, marking the company’s 7th consecutive quarter of operating profitability.
- Management said AI remains the core growth strategy, highlighted by new launches including Confucius 4, EmotiVoice 2, and Confucius Translation 4, alongside new AI applications like LobsterAI and Youdao Baoku.
- Learning services grew to RMB 627.5 million in revenue, supported by Youdao Lingshi gross billings growth of over 20% and early traction for AI Essay Grading, which has graded about 10,000 essays to date.
- Online marketing services was the standout segment, with revenue up 20.9% year over year to RMB 611.1 million and gross margin improving to 39.6%, driven by performance advertising and AI-enabled products.
- Smart devices revenue fell sharply by 42.6% year over year to RMB 109.4 million, as management continued to prioritize inventory discipline and profitability over near-term volume growth.
Youdao Trading Up 4.0%
Shares of NYSE:DAO opened at $12.48 on Thursday. Youdao has a 12-month low of $8.00 and a 12-month high of $13.04. The business’s fifty day simple moving average is $10.71 and its 200-day simple moving average is $10.33. The company has a market capitalization of $1.50 billion, a PE ratio of 95.98 and a beta of 0.57.
Analysts Set New Price Targets
Institutional Inflows and Outflows
A hedge fund recently raised its stake in Youdao stock. Public Employees Retirement System of Ohio grew its stake in Youdao, Inc. Unsponsored ADR (NYSE:DAO – Free Report) by 35.9% during the third quarter, according to its most recent 13F filing with the Securities and Exchange Commission. The firm owned 29,286 shares of the company’s stock after acquiring an additional 7,729 shares during the quarter. Public Employees Retirement System of Ohio’s holdings in Youdao were worth $291,000 at the end of the most recent quarter. 21.91% of the stock is currently owned by institutional investors and hedge funds.
About Youdao
Youdao, Inc (NYSE: DAO), established in 2006 as a subsidiary of NetEase, is headquartered in Beijing, China. The company went public on the New York Stock Exchange in October 2019, marking a significant milestone in its development as an intelligent learning and knowledge service provider. Since its inception, Youdao has combined cloud computing, artificial intelligence and big data analytics to create an adaptive learning ecosystem designed to meet the needs of individual learners and organizations.
At the core of Youdao’s offerings is its suite of digital dictionaries and translation tools, including the flagship Youdao Dictionary app and translation engine.
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