HANGZHOU, China, Feb. 23,
2023 /PRNewswire/ -- Youdao, Inc. ("Youdao" or
the "Company") (NYSE: DAO), a leading technology-focused
intelligent learning company in China, today announced its unaudited financial
results for the fourth quarter and fiscal year ended December 31, 2022.
Fourth Quarter 2022 Financial
Highlights[1]
- Total net revenues were RMB1.5
billion (US$210.8 million),
representing a 38.6% increase from the same period in 2021.
- Net revenues from learning services were RMB806.3 million (US$116.9
million), representing a 39.2% increase from the same period
in 2021.
- Net revenues from smart devices were RMB407.0 million (US$59.0
million), representing a 28.1% increase from the same period
in 2021.
- Net revenues from online marketing services were
RMB240.8 million (US$34.9 million), representing a 58.6% increase
from the same period in 2021.
- Gross margin was 53.3%, compared with 42.5% for the same
period in 2021.
[1] As
previously disclosed, in compliance with applicable regulatory
requirements, the Company had ceased to offer the after-school
tutoring services on academic subjects in China's compulsory
education system (the "Academic AST Business") at the end of
December 2021. The Academic AST Business met the criteria of
discontinued operations. Retrospective adjustments to the
historical statement of operations have also been made to provide a
consistent basis of comparison for the financial results of the
continuing operations. The financial information and non-GAAP
financial information included in this press release are presented
on a continuing operations basis, unless otherwise specifically
stated.
|
Fiscal Year 2022 Financial Highlights
- Total net revenues were RMB5.0
billion (US$726.8 million),
representing a 24.8% increase from 2021.
- Net revenues from learning services were RMB3.1 billion (US$447.2
million), representing a 26.3% increase from 2021.
- Net revenues from smart devices were RMB1.3 billion (US$182.2
million), representing a 28.2% increase from 2021.
- Net revenues from online marketing services were
RMB672.4 million (US$97.5 million), representing a 13.2% increase
from 2021.
- Gross margin was 51.6%, compared with 49.5% for
2021.
"Our ongoing investment in AI technology facilitated our ability
to consistently introduce and broaden our digital content services
and smart device offerings throughout 2022. In both the third and
fourth quarters, the net revenues from our digital content services
covered its costs and operating expenses, showing the improved
health of our business. Our new smart devices launched in the
second half of 2022, including upgraded dictionary pens and smart
learning pads, were highly recognized by customers, which led to
strong sales growth during the November
11 Shopping Festival. As a result of the solid performance
of our new services and smart devices, we achieved record-high net
revenues and our first-ever income from operations in the fourth
quarter. Our improved financial and operating indicators
demonstrate that we have the right strategy in place to support our
growth trajectory," said Dr. Feng
Zhou, Chief Executive Officer and Director of Youdao.
"Years of experience have taught us that the full value of AI
cannot be realized on its own. To effectively support users,
technologies must be integrated with sound business scenarios.
Looking ahead, we will continue to prioritize our users. By
leveraging our advanced technology and innovation, we will continue
to introduce additional high-quality educational products and
services to meet users' diverse and personalized demands." Dr. Zhou
concluded.
Fourth Quarter 2022 Financial Results
Net Revenues
Net revenues for the fourth quarter of 2022 were RMB1.5 billion (US$210.8
million), representing a 38.6% increase from RMB1.0 billion for the same period of 2021.
Net revenues from learning services were RMB806.3 million (US$116.9
million) for the fourth quarter of 2022, representing a
39.2% increase from RMB579.3 million
for the same period of 2021. The year-over-year growth was
primarily driven by the strong sales performance from the new
services initiated after the implementation of the "Double
Reduction" Policy.
Net revenues from smart devices were RMB407.0 million (US$59.0
million) for the fourth quarter of 2022, representing a
28.1% increase from RMB317.7 million
for the same period of 2021, primarily driven by the popularity of
Youdao's newly launched products, such as the Youdao Dictionary Pen
X5.
Net revenues from online marketing services were RMB240.8 million (US$34.9
million) for the fourth quarter of 2022, representing a
58.6% increase from RMB151.8 million
for the same period of 2021. The year-over-year increase in
revenues from online marketing services was mainly attributable to
the increase in performance-based advertisements through third
parties' internet properties.
Gross Profit and Gross Margin
Gross profit for the fourth quarter of 2022 was RMB774.7 million (US$112.3
million), representing a 74.0% increase from RMB445.3 million for the same period of 2021.
Gross margin increased to 53.3% for the fourth quarter of 2022 from
42.5% for the same period of 2021.
Gross margin for learning services increased to 64.1% for the
fourth quarter of 2022 from 51.4% for the same period of 2021,
primarily attributable to the significant increase in revenues,
improved economics of scale and ongoing optimization of Youdao's
faculty compensation structure.
Gross margin for smart devices increased to 46.2% for the fourth
quarter of 2022 from 30.8% for the same period of 2021. The
improvement was mainly attributable to the popularity of Youdao's
newly launched Youdao Dictionary Pen X5, which carries a higher
gross margin than other products.
Gross margin for online marketing services was 29.2% for the
fourth quarter of 2022, compared with 32.6% for the same period of
2021. The decrease was mainly attributable to the increase in
performance-based advertisements through third parties' internet
properties, which typically have a lower gross margin profile.
Operating Expenses
Total operating expenses for the fourth quarter of 2022 were
RMB750.0 million (US$108.7 million), compared with RMB693.6 million for the same period of last
year.
Sales and marketing expenses for the fourth quarter of 2022 were
RMB515.9 million (US$74.8 million), representing an increase of
22.7% from RMB420.4 million for the
same period of 2021. This increase was mainly driven by increasing
sales and marketing efforts associated with Youdao's learning
services and smart devices.
Research and development expenses for the fourth quarter of 2022
were RMB179.5 million (US$26.0 million), representing an increase of
5.4% from RMB170.2 million for the
same period of 2021. The increase was primarily due to higher
payroll-related expenses associated with a larger number of
development and technology professionals in smart devices.
General and administrative expenses for the fourth quarter of
2022 were RMB54.6 million
(US$7.9 million), representing an
increase of 18.4% from RMB46.1
million for the same period of 2021. The increase was mainly
attributable to an increase in employee related expenses in the
fourth quarter of 2022.
Impairment of intangible assets from business combination for
the fourth quarter of 2021 reflected the impairment of the
intangible assets related to a subsidiary acquired due to the
adverse development of its business and change of the regulatory
environment.
(Loss)/Income from Operations
As a result of the foregoing, income from operations for the
fourth quarter of 2022 was RMB24.7
million (US$3.6 million),
compared with loss from operations of RMB248.3 million for the same period in 2021. The
margin of income from operations was 1.7%, compared with margin of
loss from operations of 23.7% for the same period of last year.
Net (Loss)/Income from Continuing Operations Attributable to
Youdao's Ordinary Shareholders
Net income from continuing operations attributable to Youdao's
ordinary shareholders for the fourth quarter of 2022 was
RMB12.3 million (US$1.8 million), compared with net loss from
continuing operations attributable to Youdao's ordinary
shareholders of RMB215.9 million for
the same period of last year. Non-GAAP net income from continuing
operations attributable to Youdao's ordinary shareholders for the
fourth quarter of 2022 was RMB31.1
million (US$4.5 million),
compared with Non-GAAP net loss from continuing operations
attributable to Youdao's ordinary shareholders of RMB168.2 million for the same period of last
year.
Basic and diluted net income from continuing operations per
American depositary share ("ADS") attributable to ordinary
shareholders for the fourth quarter of 2022 was RMB0.10 (US$0.01),
compared with basic and diluted net loss from continuing operations
per ADS attributable to ordinary shareholders of RMB1.75 for the same period of 2021. Non-GAAP
basic and diluted net income from continuing operations per ADS
attributable to ordinary shareholders was RMB0.25 (US$0.04),
compared with Non-GAAP basic and diluted net loss from continuing
operations per ADS attributable to ordinary shareholders of
RMB1.37 for the same period of
2021.
Balance Sheet
As of December 31, 2022, Youdao's
cash, cash equivalents, restricted cash, time deposits and
short-term investments totaled RMB1.0
billion (US$147.4 million),
compared with RMB1.6 billion as of
December 31, 2021. For the fourth
quarter of 2022, net cash provided by continuing operating
activities was RMB84.1 million
(US$12.2 million), capital
expenditures totaled RMB3.8 million
(US$0.5 million), and depreciation
and amortization expenses amounted to RMB11.7 million (US$1.7
million). Youdao's ability to continue as a going concern is
dependent on management's ability to implement an effective
business plan in future periods in light of the changing regulatory
environment, generate operating cash flows and continue to be able
to obtain outside sources of financing as necessary for Youdao's
future development. As of the date of this release, Youdao has
received various financial support from the NetEase Group,
including, among others, RMB878.0
million short-term loans and US$80.0
million long-term loans with maturity dated March 31, 2024 drawn down under the US$300.0 million revolving loan facility.
As of December 31, 2022, the
Company's contract liabilities, which mainly consisted of deferred
revenues generated from Youdao's learning services, were
RMB1.1 billion (US$154.7 million), compared with RMB1.1 billion as of December 31, 2021.
Fiscal Year 2022 Financial Results
Net Revenues
Net revenues for 2022 were RMB5.0
billion (US$726.8 million),
representing a 24.8% increase from RMB4.0
billion for 2021.
Net revenues from learning services were RMB3.1 billion (US$447.2
million) for 2022, representing a 26.3% increase from
RMB2.4 billion for 2021. The increase
was primarily driven by the strong sales performance from the new
services initiated after the implementation of the "Double
Reduction" Policy.
Net revenues from smart devices were RMB1.3 billion (US$182.2
million) for 2022, representing a 28.2% increase from
RMB980.4 million for 2021. The
increase was primarily driven by the popularity of Youdao's newly
launched products, such as the Youdao Dictionary Pen X5.
Net revenues from online marketing services were RMB672.4 million (US$97.5
million) for 2022, representing a 13.2% increase from
RMB593.9 million for 2021. The
increase was attributable to the increase in the sales of
performance-based advertisements through third parties' internet
properties.
Gross Profit and Gross Margin
Gross profit for 2022 was RMB2.6
billion (US$375.0 million),
compared with RMB2.0 billion for
2021. Gross margin for 2022 was 51.6%, compared with 49.5% for
2021.
Gross margin for learning services increased to 62.0% for 2022
from 59.8% for 2021, primarily attributable to the significant
increase in revenues, improved economics of scale and ongoing
optimization of Youdao's faculty compensation structure.
Gross margin for smart devices increased to 39.1% for 2022 from
36.9% for 2021, primarily attributable to the substantial rise in
sales volume of Youdao Dictionary Pen X5, which carries a higher
gross margin than other products.
Gross margin for online marketing services was 27.4% for 2022,
keeping flat with 28.1% for 2021.
Operating Expenses
Total operating expenses for 2022 were RMB3.4 billion (US$487.3
million), representing an increase of 14.6%, compared with
RMB2.9 billion for 2021.
Sales and marketing expenses for 2022 were RMB2.3 billion (US$337.5
million), representing an increase of 12.1%, compared with
RMB2.1 billion for 2021. This
increase was mainly driven by increasing sales and marketing
efforts associated with Youdao's learning services and smart
devices.
Research and development expenses for 2022 were RMB803.8 million (US$116.5
million), representing an increase of 32.3%, compared with
RMB607.4 million for 2021. The
increase was primarily due to higher payroll-related expenses
associated with a larger number of development and technology
professionals in smart devices and education digitalization
solutions.
General and administrative expenses for 2022 were RMB229.2 million (US$33.2
million), representing an increase of 20.4%, compared with
RMB190.3 million for 2021. The
increase was mainly attributable to an increase in employee related
expenses in 2022.
Impairment of intangible assets from business combination for
2021 reflected the impairment of the intangible assets related to a
subsidiary acquired due to the adverse development of its business
and change of the regulatory environment.
Loss from Operations
Loss from operations for 2022 was RMB774.7 million (US$112.3
million), compared with RMB943.2
million for 2021. The margin of loss from operations was
15.5%, compared with 23.5% for 2021.
Net Loss from Continuing Operations Attributable to Youdao's
Ordinary Shareholders
Net loss from continuing operations attributable to Youdao's
ordinary shareholders for 2022 was RMB720.9
million (US$104.5 million),
compared with RMB895.4 million for
2021. Non-GAAP net loss from continuing operations attributable to
Youdao's ordinary shareholders for 2022 was RMB639.9 million (US$92.8
million), compared with RMB788.3
million for 2021.
Basic and diluted net loss from continuing operations per ADS
attributable to ordinary shareholders for 2022 was RMB5.83 (US$0.84),
compared with RMB7.36 for 2021.
Non-GAAP basic and diluted net loss from continuing operations per
ADS attributable to ordinary shareholders was RMB5.18 (US$0.75),
compared with RMB6.48 for 2021.
Operating Cash Flow from Continuing Operations
For 2022, net cash used in continuing operating activities was
RMB531.4 million (US$77.0 million), capital expenditures totaled
RMB69.8 million (US$10.1 million), and depreciation and
amortization expenses amounted to RMB42.2
million (US$6.1 million).
Share Repurchase Program
On November 17, 2022, the Company
announced that its board of directors had authorized the Company to
adopt a share repurchase program in accordance with applicable laws
and regulations for up to US$20
million of its Class A ordinary shares (including in the
form of ADSs) during a period of up to 36 months. As of the date of
this release, the Company accumulatively repurchased an aggregate
of approximately 1.8 million ADSs for approximately US$10.0 million from the open market under the
share repurchase program.
Conference Call
Youdao's management team will host a teleconference call with
simultaneous webcast at 5:00 a.m. Eastern
Time on Thursday, February 23, 2023 (Beijing/Hong Kong Time: 6:00 p.m., Thursday, February 23, 2023).
Youdao's management will be on the call to discuss the financial
results and answer questions.
Dial-in details for the earnings conference call are as
follows:
United States (toll
free):
|
+1-888-346-8982
|
International:
|
+1-412-902-4272
|
Mainland China (toll
free):
|
400-120-1203
|
Hong Kong (toll
free):
|
800-905-945
|
Hong Kong:
|
+852-3018-4992
|
Conference
ID:
|
8917789
|
A live and archived webcast of the conference call will be
available on the Company's investor relations website at
http://ir.youdao.com.
A replay of the conference call will be accessible by phone one
hour after the conclusion of the live call at the following
numbers, until March 2, 2023:
United
States:
|
+1-877-344-7529
|
International:
|
+1-412-317-0088
|
Replay Access
Code:
|
8917789
|
About Youdao, Inc.
Youdao, Inc. (NYSE: DAO) is a leading technology-focused
intelligent learning company in China dedicated to developing and using
technologies to provide learning content, applications and
solutions to users of all ages. Building on the popularity of its
online knowledge tools such as Youdao Dictionary and Youdao
Translation, Youdao now offers smart devices, STEAM courses, adult
and vocational courses, and education digitalization solutions. In
addition, Youdao has developed a variety of interactive learning
apps. Youdao was founded in 2006 as part of NetEase, Inc. (NASDAQ:
NTES; HKEX: 9999), a leading internet technology company in
China.
For more information, please visit: http://ir.youdao.com.
Non-GAAP Measures
Youdao considers and uses non-GAAP financial measures, such as
non-GAAP net income/(loss) from continuing operations attributable
to the Company's ordinary shareholders and non-GAAP basic and
diluted income/(loss) from continuing operations per ADS, as
supplemental metrics in reviewing and assessing its operating
performance and formulating its business plan. The presentation of
non-GAAP financial measures is not intended to be considered in
isolation or as a substitute for the financial information prepared
and presented in accordance with accounting principles generally
accepted in the United States of
America ("U.S. GAAP").
Youdao defines non-GAAP net income/(loss) from continuing
operations attributable to the Company's ordinary shareholders as
net income/(loss) from continuing operations attributable to the
Company's ordinary shareholders excluding share-based compensation
expenses, amortization of intangible assets from business
combination, impairment of long-term investments, impairment of
intangible assets from business combination, income tax effects of
above GAAP to non-GAAP reconciling items, and adjustment for GAAP
to non-GAAP reconciling items for the income/(loss) attributable to
noncontrolling interests. Non-GAAP net income/(loss) from
continuing operations attributable to the Company's shareholders
enables Youdao's management to assess its operating results without
considering the impact of these items, which are non-cash charges
in nature. Youdao believes that these non-GAAP financial measures
provide useful information to investors in understanding and
evaluating the Company's current operating performance and
prospects in the same manner as management does, if they so
choose.
Non-GAAP financial measures are not defined under U.S. GAAP and
are not presented in accordance with U.S. GAAP. Non-GAAP financial
measures have limitations as analytical tools, which possibly do
not reflect all items of expense that affect our operations. In
addition, the non-GAAP financial measures Youdao uses may differ
from the non-GAAP measures uses by other companies, including peer
companies, and therefore their comparability may be limited.
For more information on these non-GAAP financial measures,
please see the table captioned "Unaudited Reconciliation of GAAP
and non-GAAP Results" set forth at the end of this release.
The accompanying table has more details on the reconciliation
between our GAAP financial measures that are mostly directly
comparable to non-GAAP financial measures. Youdao encourages you to
review its financial information in its entirety and not rely on a
single financial measure.
Exchange Rate Information
This announcement contains translations of certain RMB amounts
into U.S. dollars ("US$") at specified rates solely for the
convenience of the reader. Unless otherwise stated, all
translations from RMB to US$ were made at the rate of RMB6.8972 to US$1.00, the exchange rate on December 30, 2022 set forth in the H.10
statistical release of the Federal Reserve Board. The Company makes
no representation that the RMB or US$ amounts referred could be
converted into US$ or RMB, as the case may be, at any particular
rate or at all.
Safe Harbor Statement
This press release contains forward-looking statements. These
statements are made under the "safe harbor" provisions of the U.S.
Private Securities Litigation Reform Act of 1995. 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, and a number of factors could cause actual results
to differ materially from those contained in any forward-looking
statement. In some cases, forward-looking statements can be
identified by words or phrases such as "may," "will," "expect,"
"anticipate," "target," "aim," "estimate," "intend," "plan,"
"believe," "potential," "continue," "is/are likely to" or other
similar expressions. 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. Further
information regarding such risks, uncertainties or factors is
included in the Company's filings with the SEC. The announced
results of the fourth quarter and full year of 2022 are preliminary
and subject to audit adjustments. All information provided in this
press release is as of the date of this press release, and the
Company does not undertake any duty to update such information,
except as required under applicable law.
For investor and media inquiries,
please contact:
In China:
Jeffrey Wang
Youdao, Inc.
Tel: +86-10-8255-8163 ext. 89980
E-mail: IR@rd.netease.com
The Piacente Group, Inc.
Emilie Wu
Tel: +86-21-6039-8363
E-mail: youdao@thepiacentegroup.com
In the United States:
The Piacente Group, Inc.
Brandi Piacente
Tel: +1-212-481-2050
E-mail: youdao@thepiacentegroup.com
YOUDAO,
INC.
|
|
|
|
|
|
|
UNAUDITED CONDENSED
CONSOLIDATED BALANCE SHEETS
|
|
|
|
|
|
|
(RMB and USD in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As of December
31,
|
|
As of December
31,
|
|
As of December
31,
|
|
|
2021
|
|
2022
|
|
2022
|
|
|
RMB
|
|
RMB
|
|
USD (1)
|
|
|
|
|
|
|
|
Assets
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
322,777
|
|
783,611
|
|
113,613
|
Time
deposits
|
|
268
|
|
273
|
|
40
|
Restricted
cash
|
|
749,770
|
|
873
|
|
127
|
Short-term
investments
|
|
503,831
|
|
232,152
|
|
33,659
|
Accounts receivable,
net
|
|
248,339
|
|
405,139
|
|
58,740
|
Inventories,
net
|
|
255,411
|
|
232,260
|
|
33,675
|
Amounts due from
NetEase Group
|
|
6,192
|
|
7,888
|
|
1,144
|
Prepayment and other
current assets
|
|
182,577
|
|
207,777
|
|
30,124
|
Assets held for
sale
|
|
497
|
|
-
|
|
-
|
Total current
assets
|
|
2,269,662
|
|
1,869,973
|
|
271,122
|
|
|
|
|
|
|
|
Non-current
assets:
|
|
|
|
|
|
|
Property, equipment and
software, net
|
|
80,315
|
|
92,116
|
|
13,356
|
Operating lease
right-of-use assets, net
|
|
118,104
|
|
78,405
|
|
11,368
|
Long-term
investments
|
|
32,518
|
|
90,703
|
|
13,151
|
Goodwill
|
|
109,944
|
|
109,944
|
|
15,940
|
Other assets,
net
|
|
22,436
|
|
35,015
|
|
5,075
|
Assets held for
sale
|
|
1,088
|
|
-
|
|
-
|
Total non-current
assets
|
|
364,405
|
|
406,183
|
|
58,890
|
|
|
|
|
|
|
|
Total
assets
|
|
2,634,067
|
|
2,276,156
|
|
330,012
|
|
|
|
|
|
|
|
Liabilities,
Mezzanine Equity and Shareholders' Deficit
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
Accounts
payables
|
|
161,006
|
|
282,354
|
|
40,937
|
Payroll
payable
|
|
277,383
|
|
266,340
|
|
38,616
|
Amounts due to NetEase
Group
|
|
83,041
|
|
68,809
|
|
9,976
|
Contract
liabilities
|
|
1,065,639
|
|
1,067,285
|
|
154,742
|
Taxes
payable
|
|
53,323
|
|
50,908
|
|
7,381
|
Accrued liabilities and
other payables
|
|
515,567
|
|
564,922
|
|
81,907
|
Short-term loans from
NetEase Group
|
|
878,000
|
|
878,000
|
|
127,298
|
Total current
liabilities
|
|
3,033,959
|
|
3,178,618
|
|
460,857
|
|
|
|
|
|
|
|
Non-current
liabilities:
|
|
|
|
|
|
|
Long-term lease
liabilities
|
|
73,070
|
|
43,635
|
|
6,326
|
Long-term loans from
NetEase Group
|
|
255,028
|
|
522,345
|
|
75,733
|
Other non-current
liabilities
|
|
2,411
|
|
8,832
|
|
1,281
|
Total non-current
liabilities
|
|
330,509
|
|
574,812
|
|
83,340
|
|
|
|
|
|
|
|
Total
liabilities
|
|
3,364,468
|
|
3,753,430
|
|
544,197
|
|
|
|
|
|
|
|
Mezzanine
equity
|
|
78,592
|
|
64,571
|
|
9,362
|
|
|
|
|
|
|
|
Shareholders'
deficit:
|
|
|
|
|
|
|
Youdao's shareholders'
deficit
|
|
(807,067)
|
|
(1,535,089)
|
|
(222,567)
|
Noncontrolling
interests
|
|
(1,926)
|
|
(6,756)
|
|
(980)
|
Total shareholders'
deficit
|
|
(808,993)
|
|
(1,541,845)
|
|
(223,547)
|
|
|
|
|
|
|
|
Total liabilities,
mezzanine equity and shareholders' deficit
|
|
2,634,067
|
|
2,276,156
|
|
330,012
|
|
|
|
|
|
|
|
Note 1:
The conversion of Renminbi (RMB) into United States dollars (USD)
is based on the noon buying rate of USD1.00=RMB6.8972 on the
last trading day of December
(December 30, 2022) as set forth in the H.10 statistical release of
the U.S. Federal Reserve Board.
|
YOUDAO,
INC.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
UNAUDITED CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
|
|
|
|
|
|
|
|
|
|
|
|
(RMB and USD in
thousands, except share and per ADS data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Year
Ended
|
|
|
|
|
December
31,
|
|
September
30,
|
|
December
31,
|
|
December
31,
|
|
December
31,
|
|
December
31,
|
|
|
|
|
2021
|
|
2022
|
|
2022
|
|
2022
|
|
2021
|
|
2022
|
|
|
|
|
RMB
|
|
RMB
|
|
RMB
|
|
USD (1)
|
|
RMB
|
|
RMB
|
|
|
Net
revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Learning
services
|
|
579,259
|
|
888,493
|
|
806,270
|
|
116,899
|
|
2,441,421
|
|
3,084,375
|
|
|
Smart
devices
|
|
317,702
|
|
356,480
|
|
406,956
|
|
59,003
|
|
980,424
|
|
1,256,446
|
|
|
Online marketing
services
|
|
151,836
|
|
157,461
|
|
240,756
|
|
34,906
|
|
593,949
|
|
672,361
|
|
|
Total net
revenues
|
|
1,048,797
|
|
1,402,434
|
|
1,453,982
|
|
210,808
|
|
4,015,794
|
|
5,013,182
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenues
(2)
|
|
(603,504)
|
|
(642,254)
|
|
(679,295)
|
|
(98,489)
|
|
(2,026,956)
|
|
(2,426,766)
|
|
|
Gross
profit
|
|
445,293
|
|
760,180
|
|
774,687
|
|
112,319
|
|
1,988,838
|
|
2,586,416
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales and marketing
expenses (2)
|
|
(420,437)
|
|
(709,769)
|
|
(515,944)
|
|
(74,805)
|
|
(2,077,638)
|
|
(2,328,095)
|
|
|
Research and
development expenses (2)
|
|
(170,245)
|
|
(212,926)
|
|
(179,474)
|
|
(26,021)
|
|
(607,373)
|
|
(803,791)
|
|
|
General and
administrative expenses (2)
|
|
(46,112)
|
|
(56,520)
|
|
(54,597)
|
|
(7,916)
|
|
(190,297)
|
|
(229,210)
|
|
|
Impairment of
intangible assets from business combination
|
|
(56,778)
|
|
-
|
|
-
|
|
-
|
|
(56,778)
|
|
-
|
|
|
Total operating
expenses
|
|
(693,572)
|
|
(979,215)
|
|
(750,015)
|
|
(108,742)
|
|
(2,932,086)
|
|
(3,361,096)
|
|
|
(Loss)/Income from
operations
|
|
(248,279)
|
|
(219,035)
|
|
24,672
|
|
3,577
|
|
(943,248)
|
|
(774,680)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
income
|
|
3,012
|
|
4,033
|
|
3,072
|
|
445
|
|
18,780
|
|
12,908
|
|
|
Interest
expense
|
|
(8,428)
|
|
(12,277)
|
|
(14,643)
|
|
(2,123)
|
|
(31,644)
|
|
(45,607)
|
|
|
Others, net
|
|
12,339
|
|
40,058
|
|
3,767
|
|
546
|
|
36,673
|
|
81,445
|
|
|
(Loss)/Income before
tax
|
|
(241,356)
|
|
(187,221)
|
|
16,868
|
|
2,445
|
|
(919,439)
|
|
(725,934)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax
benefit/(expense)
|
|
556
|
|
1,108
|
|
(13,833)
|
|
(2,006)
|
|
(6,648)
|
|
(13,844)
|
|
|
Net (loss)/income
from continuing operations
|
|
(240,800)
|
|
(186,113)
|
|
3,035
|
|
439
|
|
(926,087)
|
|
(739,778)
|
|
|
Net income/(loss)
from discontinued operations
|
|
199,290
|
|
-
|
|
-
|
|
-
|
|
(100,267)
|
|
(6,105)
|
|
|
Net
(loss)/income
|
|
(41,510)
|
|
(186,113)
|
|
3,035
|
|
439
|
|
(1,026,354)
|
|
(745,883)
|
|
|
Net loss attributable
to noncontrolling interests
|
|
24,897
|
|
2,194
|
|
9,263
|
|
1,343
|
|
30,699
|
|
18,851
|
|
|
Net (loss)/income
attributable to ordinary shareholders of the Company
|
|
(16,613)
|
|
(183,919)
|
|
12,298
|
|
1,782
|
|
(995,655)
|
|
(727,032)
|
|
|
Including:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss)/income from
continuing operations attributable to ordinary
shareholders of the Company
|
|
(215,903)
|
|
(183,919)
|
|
12,298
|
|
1,782
|
|
(895,388)
|
|
(720,927)
|
|
|
Net income/(loss) from
discontinued operations attributable to ordinary
shareholders of the Company
|
|
199,290
|
|
-
|
|
-
|
|
-
|
|
(100,267)
|
|
(6,105)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic net (loss)/income
per ADS
|
|
(0.13)
|
|
(1.49)
|
|
0.10
|
|
0.01
|
|
(8.18)
|
|
(5.88)
|
|
|
-Continuing
operations
|
|
(1.75)
|
|
(1.49)
|
|
0.10
|
|
0.01
|
|
(7.36)
|
|
(5.83)
|
|
|
-Discontinued
operations
|
|
1.62
|
|
-
|
|
-
|
|
-
|
|
(0.82)
|
|
(0.05)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted net
(loss)/income per ADS
|
|
(0.13)
|
|
(1.49)
|
|
0.10
|
|
0.01
|
|
(8.18)
|
|
(5.88)
|
|
|
-Continuing
operations
|
|
(1.75)
|
|
(1.49)
|
|
0.10
|
|
0.01
|
|
(7.36)
|
|
(5.83)
|
|
|
-Discontinued
operations
|
|
1.62
|
|
-
|
|
-
|
|
-
|
|
(0.82)
|
|
(0.05)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares used in
computing basic net (loss)/income per ADS
|
|
123,193,273
|
|
123,767,013
|
|
123,584,460
|
|
123,584,460
|
|
121,650,907
|
|
123,597,604
|
|
|
Shares used in
computing diluted net (loss)/income per ADS
|
|
123,193,273
|
|
123,767,013
|
|
124,345,717
|
|
124,345,717
|
|
121,650,907
|
|
123,597,604
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note 1:
The conversion of Renminbi (RMB) into United States dollars (USD)
is based on the noon buying rate of USD1.00=RMB6.8972 on the
last trading day of December (December 30, 2022) as set forth in
the
H.10 statistical release of the U.S. Federal Reserve
Board.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note
2:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share-based
compensation in each category:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of
revenues
|
|
3,249
|
|
798
|
|
1,231
|
|
178
|
|
7,862
|
|
5,984
|
|
|
Sales and marketing
expenses
|
|
2,800
|
|
2,879
|
|
3,249
|
|
471
|
|
10,521
|
|
12,669
|
|
|
Research and
development expenses
|
|
8,735
|
|
7,586
|
|
5,702
|
|
828
|
|
33,775
|
|
30,578
|
|
|
General and
administrative expenses
|
|
5,449
|
|
4,801
|
|
6,845
|
|
992
|
|
20,043
|
|
21,478
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
YOUDAO,
INC.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
UNAUDITED ADDITIONAL
INFORMATION
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(RMB and USD in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Year
Ended
|
|
|
|
December
31,
|
|
September
30,
|
|
December
31,
|
|
December
31,
|
|
December
31,
|
|
December
31,
|
|
|
|
2021
|
|
2022
|
|
2022
|
|
2022
|
|
2021
|
|
2022
|
|
|
|
RMB
|
|
RMB
|
|
RMB
|
|
USD
|
|
RMB
|
|
RMB
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Learning
services
|
|
579,259
|
|
888,493
|
|
806,270
|
|
116,899
|
|
2,441,421
|
|
3,084,375
|
|
Smart
devices
|
|
317,702
|
|
356,480
|
|
406,956
|
|
59,003
|
|
980,424
|
|
1,256,446
|
|
Online marketing
services
|
|
151,836
|
|
157,461
|
|
240,756
|
|
34,906
|
|
593,949
|
|
672,361
|
|
Total net
revenues
|
|
1,048,797
|
|
1,402,434
|
|
1,453,982
|
|
210,808
|
|
4,015,794
|
|
5,013,182
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of
revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Learning
services
|
|
281,433
|
|
315,086
|
|
289,829
|
|
42,021
|
|
980,700
|
|
1,172,703
|
|
Smart
devices
|
|
219,703
|
|
212,365
|
|
218,969
|
|
31,748
|
|
618,925
|
|
765,641
|
|
Online marketing
services
|
|
102,368
|
|
114,803
|
|
170,497
|
|
24,720
|
|
427,331
|
|
488,422
|
|
Total cost of
revenues
|
|
603,504
|
|
642,254
|
|
679,295
|
|
98,489
|
|
2,026,956
|
|
2,426,766
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross
margin
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Learning
services
|
|
51.4 %
|
|
64.5 %
|
|
64.1 %
|
|
64.1 %
|
|
59.8 %
|
|
62.0 %
|
|
Smart
devices
|
|
30.8 %
|
|
40.4 %
|
|
46.2 %
|
|
46.2 %
|
|
36.9 %
|
|
39.1 %
|
|
Online marketing
services
|
|
32.6 %
|
|
27.1 %
|
|
29.2 %
|
|
29.2 %
|
|
28.1 %
|
|
27.4 %
|
|
Total gross
margin
|
|
42.5 %
|
|
54.2 %
|
|
53.3 %
|
|
53.3 %
|
|
49.5 %
|
|
51.6 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
YOUDAO,
INC.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
UNAUDITED
RECONCILIATION OF GAAP AND NON-GAAP RESULTS
|
|
|
|
|
|
|
|
|
(RMB and USD in
thousands, except per ADS data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Year
Ended
|
|
|
|
December
31,
|
|
September
30,
|
|
December
31,
|
|
December
31,
|
|
December
31,
|
|
December
31,
|
|
|
|
2021
|
|
2022
|
|
2022
|
|
2022
|
|
2021
|
|
2022
|
|
|
|
RMB
|
|
RMB
|
|
RMB
|
|
USD
|
|
RMB
|
|
RMB
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss)/income
from continuing operations attributable to ordinary
shareholders of the Company
|
|
(215,903)
|
|
(183,919)
|
|
12,298
|
|
1,782
|
|
(895,388)
|
|
(720,927)
|
|
Add: share-based
compensation
|
|
20,233
|
|
16,064
|
|
17,027
|
|
2,469
|
|
72,201
|
|
70,709
|
|
amortization of intangible assets from business
combination
|
|
1,976
|
|
-
|
|
-
|
|
-
|
|
2,972
|
|
-
|
|
impairment of long-term investments
|
|
-
|
|
3,500
|
|
1,800
|
|
261
|
|
7,000
|
|
10,300
|
|
impairment of intangible assets from business
combination
|
|
56,778
|
|
-
|
|
-
|
|
-
|
|
56,778
|
|
-
|
|
Less: tax effects on
non-GAAP adjustments
|
|
(8,813)
|
|
-
|
|
-
|
|
-
|
|
(8,962)
|
|
-
|
|
GAAP
to non-GAAP reconciling items for the loss attributable to
noncontrolling
interests
|
|
(22,473)
|
|
-
|
|
-
|
|
-
|
|
(22,854)
|
|
-
|
|
Non-GAAP net
(loss)/income from continuing operations attributable to
ordinary shareholders of the Company
|
|
(168,202)
|
|
(164,355)
|
|
31,125
|
|
4,512
|
|
(788,253)
|
|
(639,918)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP basic net
(loss)/income from continuing operations per ADS
|
|
(1.37)
|
|
(1.33)
|
|
0.25
|
|
0.04
|
|
(6.48)
|
|
(5.18)
|
|
Non-GAAP diluted net
(loss)/income from continuing operations per ADS
|
|
(1.37)
|
|
(1.33)
|
|
0.25
|
|
0.04
|
|
(6.48)
|
|
(5.18)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
View original
content:https://www.prnewswire.com/news-releases/youdao-reports-fourth-quarter-and-fiscal-year-2022-unaudited-financial-results-301754136.html
SOURCE Youdao, Inc.