Gaotu Techedu Announces Second Quarter 2026 Unaudited Financial Results

BEIJING, Aug. 27, 2026 /PRNewswire/ — Gaotu Techedu Inc. (NYSE: GOTU) (“Gaotu” or the “Company”), a leading technology-driven education company in China focused on enabling lifelong learning through AI-powered solutions, today announced its unaudited financial results for the second quarter ended June 30, 2026. Second Quarter 2026 Highlights [1] Net revenues were RMB1, 670. 1 million, increased by 20. 2% from RMB1, 389. 4 million in the same period of 2025. Gross billings [2] were RMB2, 689. 1 million, increased by 19. 4% from RMB2, 252. 4 million in the same period of 2025. Loss from operations was RMB149. 8 million, compared with loss from operations of RMB241. 9 million in the same period of 2025. Net loss was RMB135. 8 million, compared with net loss of RMB216. 0 million in the same period of 2025. Non-GAAP net loss was RMB129. 1 million, compared with non-GAAP net loss of RMB206. 8 million in the same period of 2025. Net operating cash inflow was RMB861. 2 million, increased by 46. 3% from RMB588. 8 million in the same period of 2025. Second Quarter 2026 Key Financial and Operating Data (In thousands of RMB, except for percentages) For the three months ended June 30, 2025 2026 Pct. Change Net revenues 1, 389, 388 1, 670, 074 20. 2 % Gross billings 2, 252, 387 2, 689, 052 19. 4 % Loss from operations (241, 865) (149, 798) (38. 1) % Net loss (215, 994) (135, 846) (37. 1) % Non-GAAP net loss (206, 849) (129, 056) (37. 6) % Net operating cash inflow 588, 797 861, 156 46. 3 % [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. Six Months Ended June 30, 2026 Highlights Net revenues were RMB3, 359. 5 million, increased by 16. 6% from RMB2, 882. 4 million in the same period of 2025. Gross billings [2] were RMB3, 685. 3 million, increased by 17. 3% from RMB3, 141. 1 million in the same period of 2025. Loss from operations was RMB142. 9 million, compared with loss from operations of RMB207. 1 million in the same period of 2025. Net loss was RMB101. 3 million, compared with net loss of RMB92. 0 million in the same period of 2025. Non-GAAP net loss was RMB87. 6 million, compared with non-GAAP net loss of RMB69. 5 million in the same period of 2025. Net operating cash inflow was RMB32. 8 million, compared with net operating cash inflow of RMB111. 6 million in the same period of 2025. First Six Months 2026 Key Financial and Operating Data (In thousands of RMB, except for percentages) For the six months ended June 30, 2025 2026 Pct. Change Net revenues 2, 882, 431 3, 359, 549 16. 6 % Gross billings 3, 141, 112 3, 685, 314 17. 3 % Loss from operations (207, 092) (142, 925) (31. 0) % Net loss (92, 003) (101, 335) 10. 1 % Non-GAAP net loss (69, 510) (87, 640) 26. 1 % Net operating cash inflow 111, 560 32, 798 (70. 6) % Larry Xiangdong Chen, the Company’s founder, Chairman and CEO, commented, “Our sustained, user-focused investments in educational products, learning services, and organizational capabilities are steadily translating into healthier unit economics and a more efficient operating system. In the second quarter, net revenues increased by 20. 2% year over year to nearly RMB1. 7 billion, and non-GAAP loss from operations narrowed significantly by 38. 5%. We are embedding AI more deeply across our teaching, services, and operational processes to gain actionable insights from users’ learning patterns, interactions and feedback, continually enhancing our product experience, service efficiency, and organizational productivity. Additionally, the brand equity and user trust we have cultivated online are driving our offline expansion, while the high-touch service experience delivered offline, in turn, is deepening our brand awareness and user engagement. Together, these dynamics create a growth flywheel in which data, experience, and brand continuously fuel one another. We also remain committed to returning value to shareholders: as of August 26, 2026, we had repurchased RMB741. 8 million under our aggregated share repurchase programs. We will continue to prioritize users’ long-term growth, harness advanced technology to elevate our service capabilities, and navigate the evolving market dynamics with operational discipline, enhancing long-term shareholder value.” Robin Bin Luo, COO of the Company, added, “In the second quarter, we continued to upgrade our educational products and services and strengthen our teacher development system, expanding our user base and delivering long-term user value. Notably, we have deepened the integration of AI and digital tools in our business, driving ongoing efficiency gains across the entire user acquisition funnel and our middle and back-office operations, unlocking greater operating leverage and reducing operating expenses as a percentage of net revenues by 7. 9 percentage points year over year. Our net operating cash inflow increased by 46. 3% year over year to RMB861. 2 million during the quarter, reflecting the broad-based improvements in our organizational capabilities and operating efficiency. As of June 30, 2026, excluding the impact of share repurchases, our cash and cash equivalents, restricted cash, and short-term and long-term investments increased by RMB354. 6 million year over year. Going forward, profitable growth remains our top priority. As such, while maintaining a premium user experience and high-quality services, we will allocate resources with greater discipline to drive healthier and more sustainable growth across all business segments.” Financial Results for the Second Quarter of 2026 Net Revenues Net revenues increased by 20. 2% to RMB1, 670. 1 million from RMB1, 389. 4 million in the second quarter of 2025, which was mainly due to continued year-over-year growth in gross billings as a result of our sufficient and effective response to the strong market demand. Furthermore, our high-quality educational products and learning services resulted in improved recognition of our product and service offerings. Cost of Revenues Cost of revenues increased by 18. 3% to RMB559. 2 million from RMB472. 8 million in the second quarter of 2025. The increase was mainly due to the expansion of instructors and tutors workforce, increased server and bandwidth cost, higher rental cost, and increased depreciation and amortization cost. Gross Profit and Gross Margin Gross profit increased by 21. 2% to RMB1, 110. 8 million from RMB916. 5 million in the second quarter of 2025. Gross profit margin increased to 66. 5% from 66. 0% in the same period of 2025. Non-GAAP gross profit increased by 21. 1% to RMB1, 111. 5 million from RMB917. 9 million in the second quarter of 2025. Non-GAAP gross profit margin increased to 66. 6% from 66. 1% in the same period of 2025. Operating Expenses Operating expenses increased by 8. 8% to RMB1, 260. 6 million from RMB1, 158. 4 million in the second quarter of 2025. The increase was primarily due to higher expenditure s on marketing and branding activities, as well as the expansion of employees workforce. Selling expenses increased to RMB913. 2 million from RMB820. 9 million in the second quarter of 2025. Research and development expenses increased to RMB154. 8 million from RMB148. 2 million in the second quarter of 2025. General and administrative expenses increased to RMB192. 6 million from RMB189. 3 million in the second quarter of 2025. Loss from Operations Loss from operations was RMB149. 8 million, compared with loss from operations of RMB241. 9 million in the second quarter of 2025. Non-GAAP loss from operations was RMB143. 0 million, compared with non-GAAP loss from operations of RMB232. 7 million in the second quarter of 2025. Interest Income, N et and Realized Gains from Investments Interest income, net and realized gains from investments, in the aggregate, were RMB8. 1 million, compared with a total of RMB19. 1 million in the second quarter of 2025. Other Income, N et Other income, net was RMB4. 8 million, compared with other income, net of RMB5. 6 million in the second quarter of 2025. Net L oss Net loss was RMB135. 8 million, compared with net loss of RMB216. 0 million in the second quarter of 2025. Non-GAAP net loss was RMB129. 1 million, compared with non-GAAP net loss of RMB206. 8 million in the second quarter of 2025. Cash Flow Net operating cash inflow in the second quarter of 2026 was RMB861. 2 million. Basic and Diluted Net L oss per ADS Basic and diluted net loss per ADS were both RMB0. 57 in the second quarter of 2026. Non-GAAP basic and diluted net loss per ADS were both RMB0. 54 in the second quarter of 2026. Share s Outstanding As of June 30, 2026, the Company had 156, 703, 879 ordinary shares outstanding. Cash, Cash Equivalents, Restricted Cash, Short-term and Long-term Investments As of June 30, 2026, the Company had cash and cash equivalents, restricted cash, short-term and long-term investments of RMB3, 992. 9 million in aggregate, compared with a total of RMB3, 972. 5 million as of December 31, 2025. Share Repurchase In November 2022, the Company’s board of directors authorized a share repurchase program (“2022 Share Repurchase Program”), under which the Company may repurchase up to US$30 million of its shares, effective until November 22, 2025. In November 2023, the Company’s board of directors authorized modifications to the 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 September 22, 2025, the Company’s repurchase amount had reached US$80 million and the 2022 Share Repurchase Program was completed. In May 2025, the Company’s board of directors authorized a new share repurchase program (“2025 Share Repurchase Program”), under which the Company may repurchase up to an aggregate value of US$100 million of its shares during the three-year period beginning upon the completion of the Company’s 2022 Share Repurchase Program. As of August 26, 2026, the Company had cumulatively repurchased approximately 36. 5 million ADSs for approximately US$103. 5 million under the aforesaid two share repurchase programs. Business Outlook Based on the Company’s current estimates, total net revenues for the third quarter of 2026 are expected to be between RMB1, 838 million and RMB1, 858 million, representing an increase of 16. 4% to 17. 7% 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 Thursday, August 27, 2026 (8: 00 PM Beijing/Hong Kong Time on Thursday, August 27, 2026). Dial-in details for the earnings conference call are as follows: International: 1-412-317-6061 United States: 1-888-317-6003 Hong Kong: 852-58081995 Mainland China: 400-120-6115 Passcode: 8246246 A telephone replay will be available two hours after the conclusion of the conference call through September 3, 2026. The dial-in details are: International: 1-412-317-0088 United States: 1-855-669-9658 Passcode: 4110808 Additionally, a live and archived webcast of this conference call will be available at https: //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 leading technology-driven education company in China focused on enabling lifelong learning through AI-powered solutions that cultivate interest and drive continuous growth. The Company provides AI-powered, product-led learning solutions for learners from pre-school to adulthood. By combining rare, high-caliber teaching resources with AI-enhanced tools and content, Gaotu creates engaging and effective learning experiences delivered through both online and offline channels. AI and data analytics permeate throughout the Company’s operations to adapt content and teaching methods to individual learner needs, enhance efficiency and drive sustained learning progress. 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 RMB6. 7851 to USD1. 0000, the effective noon buying rate for June 30, 2026 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 June 30, 2026, or at any other rate. For further information, please contact: Gaotu Techedu Inc. Investor Relations E-mail: ir@gaotu. cn Piacente Financial Communications Brandi Piacente Tel: +1 212 481-2050 Jenny Cai Tel: +86 10 6508-0677 E-mail: Gaotu@tpg-ir. 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 June 30, 2025 2026 2026 RMB RMB USD ASSETS Current assets Cash and cash equivalents 596, 195 872, 542 128, 597 Restricted cash 115, 828 57, 069 8, 411 Short-term investments 2, 708, 788 2, 420, 350 356, 715 Inventory, net 54, 950 49, 383 7, 278 Amounts due from related party – 7, 500 1, 105 Prepaid expenses and other current assets, net 504, 779 459, 159 67, 672 Total current assets 3, 980, 540 3, 866, 003 569, 778 Non-current assets Operating lease right-of-use assets 476, 705 459, 425 67, 711 Property, equipment and software, net 1, 009, 132 1, 165, 675 171, 799 Land use rights, net 78, 105 77, 158 11, 372 Long-term investments 551, 641 642, 908 94, 753 Rental deposit 49, 199 46, 331 6, 828 Other non-current assets 54, 364 49, 967 7, 364 TOTAL ASSETS 6, 199, 686 6, 307, 467 929, 605 LIABILITIES Current liabilities Short-term borrowings of the consolidated VIEs without recourse to the Group 100, 000 380, 098 56, 020 Accrued expenses and other current liabilities (including accrued expenses and other current liabilities of the consolidated VIEs without recourse to the Group of RMB1, 131, 781 and RMB1, 010, 653 as of December 31, 2025 and June 30, 2026, respectively) 1, 537, 477 1, 451, 609 213, 941 Amounts due to related party of the consolidated VIEs without recourse to the Group 181, 757 151, 864 22, 382 Deferred revenue, current portion (including current portion of deferred revenue of the consolidated VIEs without recourse to the Group of RMB2, 288, 255 and RMB2, 365, 154 as of December 31, 2025 and June 30, 2026, respectively) 2, 289, 322 2, 367, 027 348, 857 Operating lease liabilities, current portion (including current portion of operating lease liabilities of the consolidated VIEs without recourse to the Group of RMB129, 258 and RMB140, 449 as of December 31, 2025 and June 30, 2026, respectively) 136, 709 149, 181 21, 987 Income tax payable (including income tax payable of the consolidated VIEs without recourse to the Group of RMB171 and RMB250 as of December 31, 2025 and June 30, 2026, respectively) 222 288 42 Total current liabilities 4, 245, 487 4, 500, 067 663, 229 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 June 30, 2025 2026 2026 RMB RMB USD Non-current liabilities Deferred revenue, non-current portion of the consolidated VIEs without recourse to the Group 276, 620 244, 224 35, 994 Operating lease liabilities, non-current portion (including non-current portion of operating lease liabilities of the consolidated VIEs without recourse to the Group of RMB309, 940 and RMB280, 444 as of December 31, 2025 and June 30, 2026, respectively) 316, 703 287, 881 42, 428 Deferred tax liabilities (including deferred tax liabilities of the consolidated VIEs without recourse to the Group of RMB75, 248 and RMB73, 666 as of December 31, 2025 and June 30, 2026, respectively) 75, 248 73, 669 10, 857 Long-term borrowings of the consolidated VIEs without recourse to the Group 31, 883 155, 171 22, 869 TOTAL LIABILITIES 4, 945, 941 5, 261, 012 775, 377 SHAREHOLDERS’ EQUITY Ordinary shares 116 116 17 Treasury stock, at cost (496, 132) (550, 663) (81, 158) Additional paid-in capital 7, 933, 515 7, 916, 467 1, 166, 743 Accumulated other comprehensive loss (48, 072) (82, 448) (12, 151) Statutory reserve 66, 042 66, 042 9, 733 Accumulated deficit (6, 201, 724) (6, 303, 059) (928, 956) TOTAL SHAREHOLDERS’ EQUITY 1, 253, 745 1, 046, 455 154, 228 TOTAL LIABILITIES AND TOTAL SHAREHOLDERS’ EQUITY 6, 199, 686 6, 307, 467 929, 605 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 June 30, For the six months ended June 30, 2025 2026 2026 2025 2026 2026 RMB RMB USD RMB RMB USD Net revenues 1, 389, 388 1, 670, 074 246, 138 2, 882, 431 3, 359, 549 495, 136 Cost of revenues (472, 840) (559, 227) (82, 420) (925, 301) (1, 074, 042) (158, 294) Gross profit 916, 548 1, 110, 847 163, 718 1, 957, 130 2, 285, 507 336, 842 Operating expenses: Selling expenses (820, 946) (913, 228) (134, 593) (1, 530, 367) (1, 757, 339) (259, 000) Research and development expenses (148, 195) (154, 790) (22, 813) (298, 650) (313, 746) (46, 240) General and administrative expenses (189, 272) (192, 627) (28, 390) (335, 205) (357, 347) (52, 666) Total operating expenses (1, 158, 413) (1, 260, 645) (185, 796) (2, 164, 222) (2, 428, 432) (357, 906) Loss from operations (241, 865) (149, 798) (22, 078) (207, 092) (142, 925) (21, 064) Interest income, net 9, 935 3, 713 547 22, 976 12, 740 1, 878 Realized gains from investments 9, 182 4, 398 648 13, 220 13, 301 1, 960 Other income, net 5, 621 4, 837 713 77, 201 13, 472 1, 986 Loss before provision for income tax and share of results of equity investees (217, 127) (136, 850) (20, 170) (93, 695) (103, 412) (15, 240) Income tax benefits 1, 133 1, 004 148 1, 692 2, 077 306 Net loss (215, 994) (135, 846) (20, 022) (92, 003) (101, 335) (14, 934) Net loss attributable to Gaotu Techedu Inc.’s ordinary shareholders (215, 994) (135, 846) (20, 022) (92, 003) (101, 335) (14, 934) Net loss per ordinary share Basic (1. 32) (0. 86) (0. 13) (0. 56) (0. 64) (0. 09) Diluted (1. 32) (0. 86) (0. 13) (0. 56) (0. 64) (0. 09) Net loss per ADS Basic (0. 88) (0. 57) (0. 09) (0. 37) (0. 43) (0. 06) Diluted (0. 88) (0. 57) (0. 09) (0. 37) (0. 43) (0. 06) Weighted average shares used in net loss per share Basic 163, 339, 258 158, 009, 576 158, 009, 576 165, 033, 053 158, 581, 885 158, 581, 885 Diluted 163, 339, 258 158, 009, 576 158, 009, 576 165, 033, 053 158, 581, 885 158, 581, 885 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 June 30, For the six months ended June 30, 2025 2026 2026 2025 2026 2026 RMB RMB USD RMB RMB USD Net revenues 1, 389, 388 1, 670, 074 246, 138 2, 882, 431 3, 359, 549 495, 136 Less: other revenues (1) 22, 092 24, 354 3, 589 36, 916 48, 200 7, 104 Add: VAT and surcharges 85, 782 189, 473 27, 925 179, 158 324, 034 47, 757 Add: ending deferred revenue 2, 196, 993 2, 611, 251 384, 851 2, 196, 993 2, 611, 251 384, 851 Add: ending refund liability 133, 308 130, 435 19, 224 133, 308 130, 435 19, 224 Less: beginning deferred revenue 1, 444, 967 1, 792, 693 264, 210 2, 085, 893 2, 565, 942 378, 173 Less: beginning refund liability 86, 025 95, 134 14, 021 127, 969 125, 813 18, 543 Gross billings 2, 252, 387 2, 689, 052 396, 318 3, 141, 112 3, 685, 314 543, 148 Note (1): Include miscellaneous revenues generated from services other than courses. For the three months ended June 30, For the six months ended June 30, 2025 2026 2026 2025 2026 2026 RMB RMB USD RMB RMB USD Gross profit 916, 548 1, 110, 847 163, 718 1, 957, 130 2, 285, 507 336, 842 Share-based compensation expenses (1) in cost of revenues 1, 353 689 102 3, 463 1, 123 166 Non-GAAP gross profit 917, 901 1, 111, 536 163, 820 1, 960, 593 2, 286, 630 337, 008 Loss from operations (241, 865) (149, 798) (22, 078) (207, 092) (142, 925) (21, 064) Share-based compensation expenses (1) 9, 145 6, 790 1, 001 22, 493 13, 695 2, 018 Non-GAAP loss from operations (232, 720) (143, 008) (21, 077) (184, 599) (129, 230) (19, 046) Net loss (215, 994) (135, 846) (20, 022) (92, 003) (101, 335) (14, 934) Share-based compensation expenses (1) 9, 145 6, 790 1, 001 22, 493 13, 695 2, 018 Non-GAAP net loss (206, 849) (129, 056) (19, 021) (69, 510) (87, 640) (12, 916) Note (1): The tax effects of share-based compensation expenses adjustments were nil.

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