Second Quarter 2026 Highlights1
- Net revenues were
RMB90.1 million (US$13.3 million ), compared with net revenues ofRMB25.4 million in the second quarter of 2025. - Gross margin was 69.2%, compared with 57.5% in the second quarter of 2025.
- Net income was
RMB1.1 million (US$0.2 million ), compared with net loss ofRMB26.0 million in the second quarter of 2025. - Net income as a percentage of net revenues was 1.2% in the second quarter of 2026, compared with negative 102.1% in the second quarter of 2025.
- Adjusted net income (non-GAAP), which excluded share-based compensation expenses of
RMB3.6 million (US$0.5 million ), wasRMB4.7 million (US$0.7 million ), compared with adjusted net loss (non-GAAP) ofRMB18.9 million in the second quarter of 2025. - Adjusted net income (non-GAAP) as a percentage of net revenues was 5.2% in the second quarter of 2026, compared with negative 74.3% in the second quarter of 2025.
First Half 2026 Highlights1
- Net revenues were
RMB189.5 million (US$27.9 million ), compared with net revenues ofRMB47.1 million in the first half of 2025. - Gross margin was 65.4%, compared with 47.7% in the first half of 2025.
- Net loss was
RMB18.3 million (US$2.7 million ), compared with net loss ofRMB56.9 million in the first half of 2025. - Net loss as a percentage of net revenues was negative 9.6% in the first half of 2026, compared with negative 120.9% in the first half of 2025.
- Adjusted net loss (non-GAAP), which excluded share-based compensation expenses of
RMB7.8 million (US$1.2 million ), wasRMB10.4 million (US$1.5 million ), compared with adjusted net loss (non-GAAP) ofRMB41.3 million in the first half of 2025. - Adjusted net loss (non-GAAP) as a percentage of net revenues was negative 5.5% in the first half of 2026, compared with negative 87.7% in the first half of 2025.
| 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. | ||
Mr.
“As we continue to extend our AI capabilities across the education ecosystem, we recently introduced a dedicated AI agent for teachers, designed to support key teaching workflows, including assessment, content generation and learning analytics, building upon our district-level AI agent initiatives and student-facing personalized learning services. Together, our district-level, teacher-facing and student-facing AI applications are forming an interconnected ecosystem spanning education administration, teaching and personalized learning. Going forward, we will continue to leverage AI to enhance our products and internal workflows, improve operating efficiency and support healthy, sustainable growth,” he added.
Ms.
“With a cash position of
Second Quarter 2026 Unaudited Financial Results
Net Revenues
Net revenues for the second quarter of 2026 were
Cost of Revenues
Cost of revenues for the second quarter of 2026 was
Gross Profit and Gross Margin
Gross profit for the second quarter of 2026 was
Gross margin for the second quarter of 2026 was 69.2%, compared with 57.5% in the second quarter of 2025, representing an improvement of 11.7 percentage points. The increase in gross margin was primarily attributable to the growing contribution of Yiqi Aixue, the Company's consumer-facing AI application service and the continued optimization of the Company's revenue mix.
Total Operating Expenses
The following table sets forth a breakdown of operating expenses by amounts and percentages of revenue during the periods indicated (in thousands, except for percentages):
| For the three months ended | ||||||||||||||||||||||||
| 2025 | 2026 | Year- | ||||||||||||||||||||||
| RMB | % | RMB | USD | % | over-year | |||||||||||||||||||
| Sales and marketing expenses | 13,995 | 55.1 | % | 26,894 | 3,964 | 29.9 | % | 92.2 | % | |||||||||||||||
| Research and development expenses | 12,002 | 47.2 | % | 20,025 | 2,951 | 22.2 | % | 66.8 | % | |||||||||||||||
| General and administrative expenses | 17,066 | 67.2 | % | 16,032 | 2,363 | 17.8 | % | -6.1 | % | |||||||||||||||
| Total operating expenses | 43,063 | 169.5 | % | 62,951 | 9,278 | 69.9 | % | 46.2 | % | |||||||||||||||
Total operating expenses for the second quarter of 2026 were
Sales and marketing expenses for the second quarter of 2026 were
Research and development expenses for the second quarter of 2026 were
General and administrative expenses for the second quarter of 2026 were
Loss from Operations
Loss from operations for the second quarter of 2026 was
Net Income (Loss)
Net income for the second quarter of 2026 was
Adjusted Net Income (Loss) (non-GAAP)
Adjusted net income (non-GAAP) for the second quarter of 2026 was
Please refer to the table captioned “Reconciliations of non-GAAP measures to the most comparable GAAP measures” at the end of this press release for a reconciliation of net loss under
Cash and Cash Equivalents, Restricted Cash and Term Deposits
Cash and cash equivalents, restricted cash and term deposits were
Conference Call Information
The Company will hold a conference call on
Please note that all participants will need to preregister for the conference call participation by navigating to https://register-conf.media-server.com/register/BI6a9b3074492c49129db706c4d4bc5622.
Upon registration, you will receive an email containing participant dial-in numbers, and PIN number. To join the conference call, please dial the number you receive, enter the PIN number, and you will be joined to the conference call instantly.
Additionally, a live and archived webcast of this conference call will be available at https://ir.17zuoye.com/.
Non-GAAP Financial Measures
17EdTech’s management uses adjusted net income (loss) as a non-GAAP financial measure to gain an understanding of 17EdTech’s comparative operating performance and future prospects.
Adjusted net income (loss) represents net income (loss) excluding share-based compensation expenses, and such adjustment has no impact on income tax.
Adjusted net income (loss) is used by 17EdTech’s management in its financial and operating decision-making as a non-GAAP financial measure, because management believes it reflects 17EdTech’s ongoing business and operating performance in a manner that allows meaningful period-to-period comparisons. 17EdTech’s management believes that such non-GAAP measure provides useful information to investors and others in understanding and evaluating 17EdTech’s operating performance in the same manner as management does, if they so choose. Specifically, 17EdTech believes the non-GAAP measure provides useful information to both management and investors by excluding certain charges that the Company believes are not indicative of its core operating results.
The non-GAAP financial measure has limitations. It does not include all items of income and expense that affect 17EdTech’s income (loss) from operations. Specifically, the non-GAAP financial measure is not prepared in accordance with GAAP, may not be comparable to non-GAAP financial measures used by other companies and, with respect to the non-GAAP financial measure that excludes certain items under GAAP, does not reflect any benefit that such items may confer to 17EdTech. Management compensates for these limitations by also considering 17EdTech’s financial results as determined in accordance with GAAP. The presentation of this additional information is not meant to be considered superior to, in isolation from or as a substitute for results prepared in accordance with
Exchange Rate Information
The Company’s business is primarily conducted in
About
Safe Harbor Statement
This announcement contains forward-looking statements. These statements are made under the “safe harbor” provisions of the United States 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. Statements that are not historical facts, including statements about 17EdTech’s beliefs and expectations, are forward-looking statements. 17EdTech may also make written or oral forward-looking statements in its periodic reports to the
For investor and media inquiries, please contact:
Ms.
Investor Relations Manager
E-mail: ir@17zuoye.com
| UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||||||
| (In thousands of RMB and USD, except for share and per ADS data, or otherwise noted) | ||||||||||||
| As of | As of | |||||||||||
| 2025 | 2026 | 2026 | ||||||||||
| RMB | RMB | USD | ||||||||||
| ASSETS | ||||||||||||
| Current assets | ||||||||||||
| Cash and cash equivalents | 246,448 | 456,856 | 67,332 | |||||||||
| Restricted cash | 49 | — | — | |||||||||
| Term deposits | 160,471 | — | — | |||||||||
| Accounts receivable, net | 42,577 | 24,342 | 3,588 | |||||||||
| Prepaid expenses and other current assets, net | 101,135 | 78,631 | 11,589 | |||||||||
| Total current assets | 550,680 | 559,829 | 82,509 | |||||||||
| Non-current assets | ||||||||||||
| Property and equipment, net | 22,455 | 19,187 | 2,828 | |||||||||
| Right-of-use assets | 15,003 | 12,541 | 1,848 | |||||||||
| Other non-current assets | 2,385 | 2,364 | 348 | |||||||||
| TOTAL ASSETS | 590,523 | 593,921 | 87,533 | |||||||||
| LIABILITIES | ||||||||||||
| Current liabilities | ||||||||||||
| Accrued expenses and other current liabilities | 123,280 | 135,109 | 19,913 | |||||||||
| Deferred revenue and advances from customers, current | 165,939 | 176,513 | 26,015 | |||||||||
| Operating lease liabilities, current | 4,992 | 4,507 | 664 | |||||||||
| Total current liabilities | 294,211 | 316,129 | 46,592 | |||||||||
| As of | As of | |||||||||||
| 2025 | 2026 | 2026 | ||||||||||
| RMB | RMB | USD | ||||||||||
| Non-current liabilities | ||||||||||||
| Operating lease liabilities, non-current | 9,684 | 7,568 | 1,115 | |||||||||
| TOTAL LIABILITIES | 303,895 | 323,697 | 47,707 | |||||||||
| SHAREHOLDERS' EQUITY | ||||||||||||
| Class A ordinary shares | 256 | 256 | 38 | |||||||||
| Class B ordinary shares | 140 | 140 | 21 | |||||||||
| (42 | ) | (43 | ) | (6 | ) | |||||||
| Additional paid-in capital | 11,126,837 | 11,134,106 | 1,640,964 | |||||||||
| Accumulated other comprehensive income | 77,527 | 72,107 | 10,626 | |||||||||
| Accumulated deficit | (10,918,090 | ) | (10,936,342 | ) | (1,611,817 | ) | ||||||
| TOTAL SHAREHOLDERS' EQUITY | 286,628 | 270,224 | 39,826 | |||||||||
| TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | 590,523 | 593,921 | 87,533 | |||||||||
| UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||
| (In thousands of RMB and USD, except for share and per ADS data, or otherwise noted) | ||||||||||||
| For the three months ended | ||||||||||||
| 2025 | 2026 | 2026 | ||||||||||
| RMB | RMB | USD | ||||||||||
| Net revenues | 25,410 | 90,092 | 13,278 | |||||||||
| Cost of revenues | (10,798 | ) | (27,772 | ) | (4,093 | ) | ||||||
| Gross profit | 14,612 | 62,320 | 9,185 | |||||||||
| Operating expenses (Note 1) | ||||||||||||
| Sales and marketing expenses | (13,995 | ) | (26,894 | ) | (3,964 | ) | ||||||
| Research and development expenses | (12,002 | ) | (20,025 | ) | (2,951 | ) | ||||||
| General and administrative expenses | (17,066 | ) | (16,032 | ) | (2,363 | ) | ||||||
| Total operating expenses | (43,063 | ) | (62,951 | ) | (9,278 | ) | ||||||
| Loss from operations | (28,451 | ) | (631 | ) | (93 | ) | ||||||
| Interest income | 2,248 | 1,686 | 248 | |||||||||
| Foreign currency exchange loss | (44 | ) | (21 | ) | (3 | ) | ||||||
| Other income, net | 301 | 72 | 11 | |||||||||
| (Loss) income before provision for income tax | (25,946 | ) | 1,106 | 163 | ||||||||
| Income tax expenses | (6 | ) | — | — | ||||||||
| Net (loss) income | (25,952 | ) | 1,106 | 163 | ||||||||
| Net (loss) income available to ordinary shareholders | (25,952 | ) | 1,106 | 163 | ||||||||
| of | ||||||||||||
| Net (loss) income per ordinary share | ||||||||||||
| Basic | (0.06 | ) | 0.00 | 0.00 | ||||||||
| Diluted | (0.06 | ) | 0.00 | 0.00 | ||||||||
| Net (loss) income per ADS (Note 2) | ||||||||||||
| Basic | (3.00 | ) | 0.10 | 0.02 | ||||||||
| Diluted | (3.00 | ) | 0.09 | 0.01 | ||||||||
| Weighted average shares used in calculating net (loss) income per ordinary share | ||||||||||||
| Basic | 461,000,966 | 542,476,566 | 542,476,566 | |||||||||
| Diluted | 461,000,966 | 582,168,348 | 582,168,348 | |||||||||
| Note 1: Share-based compensation expenses were included in the operating expenses as follows: | ||||||||||||
| For the three months ended | ||||||||||||
| 2025 | 2026 | 2026 | ||||||||||
| RMB | RMB | USD | ||||||||||
| Share-based compensation expenses: | ||||||||||||
| Sales and marketing expenses | 1,929 | 1,118 | 165 | |||||||||
| Research and development expenses | 2,872 | 939 | 138 | |||||||||
| General and administrative expenses | 2,261 | 1,536 | 226 | |||||||||
| Total | 7,062 | 3,593 | 529 | |||||||||
| Note 2: Each one ADS represents fifty Class A ordinary shares. | ||||||||||||
| 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 | ||||||||||||
| 2025 | 2026 | 2026 | ||||||||||
| RMB | RMB | USD | ||||||||||
| Net (loss) income | (25,952 | ) | 1,106 | 163 | ||||||||
| Share-based compensation | 7,062 | 3,593 | 529 | |||||||||
| Income tax effect | — | — | — | |||||||||
| Adjusted net (loss) income | (18,890 | ) | 4,699 | 692 | ||||||||
| UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||||
| (In thousands of RMB and USD, except for share and per ADS data, or otherwise noted) | |||||||||||||
| For the six months ended | |||||||||||||
| 2025 | 2026 | 2026 | |||||||||||
| RMB | RMB | USD | |||||||||||
| Net revenues | 47,078 | 189,544 | 27,935 | ||||||||||
| Cost of revenues | (24,633 | ) | (65,643 | ) | (9,675 | ) | |||||||
| Gross profit | 22,445 | 123,901 | 18,260 | ||||||||||
| Operating expenses (Note 1) | |||||||||||||
| Sales and marketing expenses | (27,008 | ) | (70,095 | ) | (10,331 | ) | |||||||
| Research and development expenses | (24,594 | ) | (36,212 | ) | (5,337 | ) | |||||||
| General and administrative expenses | (33,167 | ) | (39,519 | ) | (5,824 | ) | |||||||
| Total operating expenses | (84,769 | ) | (145,826 | ) | (21,492 | ) | |||||||
| Loss from operations | (62,324 | ) | (21,925 | ) | (3,232 | ) | |||||||
| Interest income | 4,924 | 3,459 | 510 | ||||||||||
| Foreign currency exchange loss | (111 | ) | (30 | ) | (4 | ) | |||||||
| Other income, net | 621 | 244 | 36 | ||||||||||
| Loss before provision for income tax and income from equity method investments | (56,890 | ) | (18,252 | ) | (2,690 | ) | |||||||
| Income tax expenses | (6 | ) | — | — | |||||||||
| Net loss | (56,896 | ) | (18,252 | ) | (2,690 | ) | |||||||
| Net loss available to ordinary shareholders of 17 | (56,896 | ) | (18,252 | ) | (2,690 | ) | |||||||
| Net loss per ordinary share | |||||||||||||
| Basic and diluted | (0.12 | ) | (0.03 | ) | (0.00 | ) | |||||||
| Net loss per ADS (Note 2) | |||||||||||||
| Basic and diluted | (6.00 | ) | (1.68 | ) | (0.25 | ) | |||||||
| Weighted average shares used in calculating net income (loss) per ordinary share | |||||||||||||
| Basic and diluted | 461,652,947 | 542,610,162 | 542,610,162 | ||||||||||
| Note 1: Share-based compensation expenses were included in the operating expenses as follows: | |||||||||||||
| For the six months ended | |||||||||||||
| 2025 | 2026 | 2026 | |||||||||||
| RMB | RMB | USD | |||||||||||
| Share-based compensation expenses: | |||||||||||||
| Sales and marketing expenses | 4,022 | 1,965 | 290 | ||||||||||
| Research and development expenses | 5,269 | 2,631 | 388 | ||||||||||
| General and administrative expenses | 6,317 | 3,239 | 477 | ||||||||||
| Total | 15,608 | 7,835 | 1,155 | ||||||||||
| Note 2: Each one ADS represents fifty Class A ordinary shares. | |||||||||||||
| 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 six months ended | ||||||||||||
| 2025 | 2026 | 2026 | ||||||||||
| RMB | RMB | USD | ||||||||||
| Net Loss | (56,896 | ) | (18,252 | ) | (2,690 | ) | ||||||
| Share-based compensation | 15,608 | 7,835 | 1,155 | |||||||||
| Income tax effect | — | — | — | |||||||||
| Adjusted net loss | (41,288 | ) | (10,417 | ) | (1,535 | ) | ||||||
