Youdao reports Q3 EPS (12c), consensus (12c)

Reports Q3 revenue $210.91M, consensus $194.73M. “AI continues to drive the development of our learning services, smart devices and online marketing services, enhancing product quality and user satisfaction. As a result, net revenues in the third quarter reached a record high, while loss from operations significantly narrowed. We made multiple advancements during the period that are gaining market traction, supporting our financial improvements. First, we introduced Hi Echo, the world’s first digital human language coach, helping users improve their English-speaking skills anytime and anywhere. Second, we launched AI quiz recommendations and other features, which drove historically high gross margins for digital content services. Third, by leveraging AI technology, we provided users with more personalized solutions, resulting in all-time high net revenues from online marketing services. Lastly, users have embraced our newly launched Youdao Dictionary Pen X6 Pro, which includes advanced features, such as English grammar instructions,” said Feng Zhou, CEO and director of Youdao.