Read How Gaotu Techedu Fared In Q1

Gaotu Techedu Inc GOTU reported a first-quarter FY22 sales decline of 62.7% year-on-year, to RMB724.6 million ($114.305 million), beating the consensus of $82.4 million.
The revenue decrease was driven by the company's organizational adjustments and business restructuring in 2021.
Gross billings for the quarter fell 73.1% to RMB318.1 million from RMB1.2 billion last year.
The gross profit fell 62.6% Y/Y to RMB511.7 million, while the profit margin expanded 10 basis points to 70.6%.
The operating expenses for the quarter decreased 83.1% to RMB486.4 million.
The operating margin was 3.5%, and operating income for the quarter was RMB25.3 million compared to a loss of RMB1.50 billion last year.
The company held RMB3.2 billion in cash and equivalents as of March 31, 2022.
The company registered a net income of RMB53.7 million for the quarter compared to a net loss of RMB1.4 billion last year.
Non-GAAP earnings per ADS for the quarter were RMB0.35.
Outlook: Gaotu sees Q2 revenue of RMB438 million – RMB458 million, representing a decrease of 79% to 80% Y/Y.
Price Action: GOTU shares are trading higher by 15.2% at $1.52 in premarket on the last check Monday.