17 Education & Technology Group Inc. Q4 FY2025 earnings call

• Business updates: In the fourth quarter of 2025, steady progress in core business with top - line growth. School - based subscription model business expanded, contributing more to total revenue. New consumer - based product Yiqi Aishi launched, achieved strong pre - sale orders and positive market feedback. Robust pre - sale demand for new product increased free cash flow. Maintained healthy cash balance. - Financial details: Net revenues in Q4 2025 were RMB 38.9 million, 6.4% year - over - year growth. Cost of revenues decreased year - over - year. Gross margin increased. Total operating expenses decreased. Net loss narrowed year - over - year. School - based subscription model business maintained positive progress, contributing to revenue growth and financial health. New AI - personalized learning membership project TGIC launched, leveraging user trust, brand endorsement, hardware and software capabilities, and AI foundation, with various features like smart pen, AI planner, interactive tools, and intelligent learning companion.

In the fourth quarter of 2025, net revenues were RMB 38.9 million, an increase of 94.6% quarter-on-quarter and 6.4% year-over-year. The school-based subscription model business contributed a growing share of total revenue. The new AI - personalized learning membership project, TGIC, achieved strong pre - sale orders. Cost of revenues for the fourth quarter of 2025 was RMB 21.0 million, a year - over - year decrease of 13.6%. Gross profit was RMB 17.9 million, with a gross margin of 46.1% in the fourth quarter of 2025, a 12.5 percentage point increase year - over - year. Total operating expenses for the fourth quarter of 2025 were RMB 72.5 million, a year - over - year decrease of 10.9%. Net loss for the fourth quarter of 2025 was RMB 63 million, with adjusted net loss non - GAAP of RMB 44.1 million. Cash and cash equivalents, restricted cash and term deposits were RMB 407.0 million as of December 31, 2025.

• Continue to strengthen core strengths with AI capabilities as a key driver of sustainable growth. - Further enhance cross - business synergies and reinforce business resilience to support long - term development. - Combine strengths to deliver consumer - centric offerings for sustainable growth and lasting value for learners and shareholders.

• The conference call contains forward - looking statements based on current expectations and market/operating conditions. Risks may cause actual results to differ materially. Further information regarding risks is in the company's filings with the U.S. SEC. The company does not undertake to update forwarding statements except as required by law.

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