Sunlands Technology Group Announces Unaudited Second Quarter 2025 Financial Results

BEIJING, Aug. 14, 2025 (GLOBE NEWSWIRE) -- Sunlands Technology Group (NYSE:STG) ("Sunlands" or the "Company"), a leader in China's adult online education market and China's adult personal interest learning market, today announced its unaudited financial results for the second quarter ended June 30, 2025.

Second Quarter 2025 Financial and Operational Snapshots

• Net revenues were RMB539.0 million (US$75.2 million), compared to RMB492.2 million in the second quarter of 2024.
• Gross billings (non-GAAP) were RMB400.3 million (US$55.9 million), compared to RMB383.9 million in the second quarter of 2024.
• Gross profit was RMB469.4 million (US$65.5 million), compared to RMB415.6 million in the second quarter of 2024.
• Net income was RMB126.6 million (US$17.7 million), compared to RMB82.3 million in the second quarter of 2024.
• Net income margin¹ was 23.5% in the second quarter of 2025, compared to 16.7% in the second quarter of 2024.
• New student enrollments² were 159,154, compared to 168,296 in the second quarter of 2024.
• As of June 30, 2025, the Company's deferred revenue balance was RMB814.3 million (US$113.7 million), compared to RMB916.5 million as of December 31, 2024.

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1</sup> Net income margin is defined as net income as a percentage of net revenues.



² New student enrollments for a given period refer to the total number of orders placed by students that newly enroll in at least one course during that period, including those students that enroll and then terminate their enrollment with us, excluding orders of our low-price courses, such as "mini courses" and "RMB1 courses", which we offer in the form of recorded videos or short live streaming, to strengthen our competitiveness and improve customer experience.

"In the second quarter of 2025, our net revenues reached RMB539.0 million, up 9.5% year-over-year, supported by resilient learner demand and the continued expansion of our course offerings. Net income surged to RMB126.6 million, with net income margin expanding to 23.5%—representing a 54.0% increase from the same period last year. This marked a significant step-change in our earnings capacity, reflecting the compounding effects of structural cost optimization, improved gross margin, and greater operating leverage. Our deliberate rebalancing of legacy and emerging businesses, combined with disciplined investment in high-impact areas, is creating meaningful value for both learners and shareholders.

Looking ahead, Sunlands remains committed to responsible and sustainable growth. We will continue to deepen AI integration across core operations, while expanding personalized, outcome-driven learning solutions tailored to the shifting needs of China's adult learners—ranging from career upskilling to interest-based enrichment and lifelong development," said Mr. Tongbo Liu, Chief Executive Officer of Sunlands.

Mr. Hangyu Li, Finance Director of Sunlands, commented, "Our second quarter results are strong and in line with expectations. This quarter, net revenues rose 10.5% quarter-over-quarter, a direct outcome of our strategic shift toward interest-based courses which now account for 77.6% of total revenues. With positive operating cash flow for eight quarters, we maintained substantial cash reserves as of quarter-end. This strong financial position empowers us to innovate and capture growth opportunities in an increasingly competitive market environment. Moving forward, we remain focused on sustaining high-quality earnings, driving operational efficiency, and making strategic investments in innovation to unlock new areas of growth."

Financial Results for the second Quarter of 2025

Net Revenues

In the second quarter of 2025, net revenues increased by 9.5% to RMB539.0 million (US$75.2 million) from RMB492.2 million in the second quarter of 2024. The increase was primarily driven by the growth in gross billings from interest courses

Cost of Revenues

Cost of revenues decreased by 9.1% to RMB69.6 million (US$9.7 million) in the second quarter of 2025 from RMB76.6 million in the second quarter of 2024. The decrease was mainly due to the declined compensation expenses related to headcount reduction of the Company's teachers and mentors for degree- or diploma-oriented post-secondary courses.

Gross Profit

Gross profit increased by 12.9% to RMB469.4 million (US$65.5 million) in the second quarter of 2025 from RMB415.6 million in the second quarter of 2024.

Operating Expenses

In the second quarter of 2025, operating expenses were RMB342.6 million (US$47.8 million), representing a 1.1% increase from RMB338.9 million in the second quarter of 2024.

Sales and marketing expenses increased by 1.7% to RMB302.5 million (US$42.2 million) in the second quarter of 2025 from RMB297.4 million in the second quarter of 2024.

General and administrative expenses decreased by 2.0% to RMB33.2 million (US$4.6 million) in the second quarter of 2025 from RMB33.8 million in the second quarter of 2024.

Product development expenses decreased by 9.3% to RMB6.9 million (US$1.0 million) in the second quarter of 2025 from RMB7.7 million in the second quarter of 2024. The decrease was mainly due to declined compensation expenses related to headcount reduction of the Company's product development personnel.

Net Income

Net income for the second quarter of 2025 was RMB126.6 million (US$17.7 million), as compared to RMB82.3 million in the second quarter of 2024.

Basic and Diluted Net Income Per Share

Basic and diluted net income per share was RMB18.75 (US$2.62) in the second quarter of 2025.

Cash, Cash Equivalents, Restricted Cash and Short-term Investments

As of June 30, 2025, the Company had RMB586.7 million (US$81.9 million) of cash, cash equivalents and restricted cash and RMB166.6 million (US$23.3 million) of short-term investments, as compared to RMB507.2 million of cash and cash equivalents and RMB276.0 million of short-term investments as of December 31, 2024.

Deferred Revenue

As of June 30, 2025, the Company had a deferred revenue balance of RMB814.3 million (US$113.7 million), as compared to RMB916.5 million as of December 31, 2024.

Share Repurchase

On December 6, 2021, the Company's board of directors authorized a share repurchase program, under which the Company may repurchase up to US$15.0 million of Class A ordinary shares in the form of ADSs over the next 24 months. On December 1, 2023, the Company's board of directors authorized to extend its share repurchase program over the next twenty-four months. As of August 11, 2025, the Company had repurchased an aggregate of 760,155 ADSs for approximately US$4.4 million under the share repurchase program.

Financial Results for the First Six Months of 2025

Net Revenues

In the first six months of 2025, net revenues increased by 1.1% to RMB1,026.6 million (US$143.3 million) from RMB1,015.5 million in the first six months of 2024.

Cost of Revenues

Cost of revenues decreased by 7.7% to RMB142.0 million (US$19.8 million) in the first six months of 2025 from RMB153.8 million in the first six months of 2024. The decrease was mainly due to the declined compensation expenses related to headcount reduction of the Company's teachers and mentors.

Gross Profit

Gross profit increased by 2.7% to RMB884.7 million (US$123.5 million) from RMB861.7 million in the first six months of 2024.

Operating Expenses

In the first six months of 2025, operating expenses were RMB683.8 million (US$95.5 million), representing a 0.5% increase from RMB680.1 million in the first six months of 2024.

Sales and marketing expenses increased by 0.7% to RMB603.0 million (US$84.2 million) in the first six months of 2025 from RMB599.0 million in the first six months of 2024.

General and administrative expenses increased by 1.8% to RMB67.6 million (US$9.4 million) in the first six months of 2025 from RMB66.4 million in the first six months of 2024.

Product development expenses decreased by 10.1% to RMB13.2 million (US$1.8 million) in the first six months of 2025 from RMB14.7 million in the first six months of 2024. The decrease was mainly due to declined compensation expenses related to headcount reduction of the Company's product development personnel.

Net Income

Net income for the first six months of 2025 was RMB201.8 million (US$28.2 million), compared with RMB195.0 million in the first six months of 2024.

Basic and Diluted Net Income Per Share

Basic and diluted net income per share was RMB29.87 (US$4.17) in the first six months of 2025, compared with RMB28.44 in the first six months of 2024.

Outlook

For the third quarter of 2025, Sunlands currently expects net revenues to be between RMB500 million to RMB520 million, which would represent an increase of 1.8% to 5.8% year-over-year. The above outlook is based on the current market conditions and reflects the Company's current and preliminary estimates of market and operating conditions and customer demand, which are all subject to substantial uncertainty.

Exchange Rate

The Company's business is primarily conducted in China and all revenues are denominated in Renminbi ("RMB"). This announcement contains currency conversions of RMB amounts into U.S. dollars ("US$") solely for the convenience of the reader. Unless otherwise noted, all translations from RMB to US$ are made at a rate of RMB7.1636 to US$1.00, the effective noon buying rate for June 30, 2025 as set forth in the H.10 statistical release of the Federal Reserve Board. No representation is made that the RMB amounts could have been, or could be, converted, realized or settled into US$ at that rate on June 30, 2025, or at any other rate.

Conference Call and Webcast

Sunlands' management team will host a conference call at 6:00 AM U.S. Eastern Time, (6:00 PM Beijing/Hong Kong time) on August 14, 2025, following the quarterly results announcement.

For participants who wish to join the call, please access the link provided below to complete online registration 15 minutes prior to the scheduled call start time. Upon registration, participants will receive details for the conference call, including dial-in numbers, a personal PIN and an e-mail with detailed instructions to join the conference call.

Registration Link:

https://register-conf.media-server.com/register/BI138527c50562419dbce86de3604c0e10

Additionally, a live webcast and archive of the conference call will be available on the Investor Relations section of Sunlands' website at https://ir.sunlands.com/.

About Sunlands

Sunlands Technology Group (NYSE:STG) ("Sunlands" or the "Company"), formerly known as Sunlands Online Education Group, is a leader in China's adult online education market and China's adult personal interest learning market. With a one to many live streaming platform, Sunlands offers various degree- or diploma-oriented post-secondary courses as well as professional certification preparation, professional skills and interest courses. Students can access the Company's services either through PC or mobile applications. The Company's online platform cultivates a personalized, interactive learning environment by featuring a virtual learning community and a vast library of educational content offerings that adapt to the learning habits of its students. Sunlands offers a unique approach to education research and development that organizes subject content into Learning Outcome Trees, the Company's proprietary knowledge management system. Sunlands has a deep understanding of the educational needs of its prospective students and offers solutions that help them achieve their goals.

About Non-GAAP Financial Measures

We use gross billings, EBITDA, non-GAAP operating cost and expenses, non-GAAP income from operations and non-GAAP net income per share, each a non-GAAP financial measure, in evaluating our operating results and for financial and operational decision-making purposes.

We define gross billings for a specific period as the total amount of cash received for the sale of course packages, net of the total amount of refunds paid in such period. Our management uses gross billings as a performance measurement because we generally bill our students for the entire course tuition at the time of sale of our course packages and recognize revenue proportionally over a period. EBITDA is defined as net income excluding depreciation and amortization, interest expense, interest income, and income tax expenses. We believe that gross billings and EBITDA provide valuable insight into the sales of our course packages and the performance of our business.

These non-GAAP financial measures should not be considered in isolation from, or as a substitute for, their most directly comparable financial measures prepared in accordance with GAAP. A reconciliation of the historical non-GAAP financial measures to their respective most directly comparable GAAP measure has been provided in the tables included below. Investors are encouraged to review the reconciliation of the historical non-GAAP financial measures to their respective most directly comparable GAAP financial measures. As gross billings, EBITDA, operating cost and expenses excluding share-based compensation expenses, general and administrative expenses excluding share-based compensation expenses, sales and marketing expenses excluding share-based compensation expenses, product development expenses excluding share-based compensation expenses, income from operations excluding share-based compensation expenses, and basic and diluted net income per share excluding share-based compensation expenses have material limitations as an analytical metric 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. In light of the foregoing limitations, you should not consider gross billings and EBITDA as a substitute for, or superior to, their respective most directly comparable financial measures prepared in accordance with GAAP. We encourage investors and others to review our financial information in its entirety and not rely on a single financial measure.

Safe Harbor Statement

This press release contains forward-looking statements made under the "safe harbor" provisions of Section 21E of the Securities Exchange Act of 1934, as amended, and 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," "confident" and similar statements. Sunlands 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 report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Any statements that are not historical facts, including statements about Sunlands' beliefs and expectations, are forward-looking statements that involve factors, risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Such factors and risks include, but not limited to the following: Sunlands' goals and strategies; its expectations regarding demand for and market acceptance of its brand and services; its ability to retain and increase student enrollments; its ability to offer new courses and educational content; its ability to improve teaching quality and students' learning results; its ability to improve sales and marketing efficiency and effectiveness; its ability to engage, train and retain new faculty members; its future business development, results of operations and financial condition; its ability to maintain and improve technology infrastructure necessary to operate its business; competition in the online education industry in China; relevant government policies and regulations relating to Sunlands' corporate structure, business and industry; and general economic and business condition in China. Further information regarding these and other risks, uncertainties or factors is included in Sunlands' filings with the U.S. Securities and Exchange Commission. All information provided in this press release is current as of the date of the press release, and Sunlands does not undertake any obligation to update such information, except as required under applicable law.

For investor and media enquiries, please contact:

Sunlands Technology Group

Investor Relations

Email: [email protected]

SOURCE: Sunlands Technology Group

SUNLANDS TECHNOLOGY GROUP UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (Amounts in thousands, except for share and per share data, or otherwise noted)
		As of December 31,		As of June 30,
		2024		2025
		RMB		RMB		US$
ASSETS
Current assets
Cash and cash equivalents		507,229		586,394		81,857
Restricted cash		-		353		49
Short-term investments		276,029		166,576		23,253
Prepaid expenses and other current assets		96,916		101,628		14,187
Deferred costs, current		4,139		21,170		2,955
Total current assets		884,313		876,121		122,301
Non-current assets
Property and equipment, net		758,215		744,338		103,906
Intangible assets, net		723		486		68
Right-of-use assets		110,154		107,897		15,062
Deferred costs, non-current		56,657		27,453		3,832
Long-term investments		260,083		346,493		48,369
Deferred tax assets		24,699		23,745		3,315
Other non-current assets		26,319		24,518		3,423
Total non-current assets		1,236,850		1,274,930		177,975
TOTAL ASSETS		2,121,163		2,151,051		300,276
LIABILITIES AND SHAREHOLDERS' EQUITY
LIABILITIES
Current liabilities
Accrued expenses and other current liabilities		404,865		372,379		51,984
Deferred revenue, current		382,047		459,349		64,123
Lease liabilities, current portion		8,317		9,088		1,269
Short-term borrowing		-		20,000		2,792
Long-term debt, current portion		6,154		-		-
Total current liabilities		801,383		860,816		120,168

SUNLANDS TECHNOLOGY GROUP UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS-continued (Amounts in thousands, except for share and per share data, or otherwise noted)
		As of December 31,			As of June 30,
		2024			2025
		RMB			RMB			US$
Non-current liabilities
Deferred revenue, non-current		534,463			354,928			49,546
Lease liabilities, non-current portion		137,040			134,133			18,724
Deferred tax liabilities		5,724			4,508			629
Other non-current liabilities		7,309			7,289			1,018
Long-term debt, non-current portion		35,386			-			-
Total non-current liabilities		719,922			500,858			69,917
TOTAL LIABILITIES		1,521,305			1,361,674			190,085
SHAREHOLDERS' EQUITY
Class A ordinary shares (par value of US$0.00005, 796,062,195 shares authorized; 3,131,807 and 3,131,807 shares issued as of December 31, 2024 and June 30, 2025, respectively; 2,600,779 and 2,589,826 shares outstanding as of December 31, 2024 and June 30, 2025, respectively)		1			1			-
Class B ordinary shares (par value of US$0.00005, 826,389 shares authorized; 826,389 and 826,389 shares issued and outstanding as of December 31, 2024 and June 30, 2025, respectively)		-			-			-
Class C ordinary shares (par value of US$0.00005, 203,111,416 shares authorized; 3,332,062 and 3,332,062 shares issued and outstanding as of December 31, 2024 and June 30, 2025, respectively)		1			1			-
Treasury stock		-			-			-
Statutory reserves		11,083			11,083			1,547
Accumulated deficit		(1,840,285	)		(1,638,464	)		(228,721	)
Additional paid-in capital		2,294,381			2,293,508			320,161
Accumulated other comprehensive income		136,164			124,735			17,412
Total Sunlands Technology Group shareholders' equity		601,345			790,864			110,399
Non-controlling interest		(1,487	)		(1,487	)		(208	)
TOTAL SHAREHOLDERS' EQUITY		599,858			789,377			110,191
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY		2,121,163			2,151,051			300,276

SUNLANDS TECHNOLOGY GROUP UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Amounts in thousands, except for share and per share data, or otherwise noted)
		For the Three Months Ended June 30,
		2024			2025
		RMB			RMB			US$
Net revenues		492,223			539,015			75,244
Cost of revenues		(76,627	)		(69,641	)		(9,722	)
Gross profit		415,596			469,374			65,522
Operating expenses
Sales and marketing expenses		(297,443	)		(302,527	)		(42,231	)
Product development expenses		(7,657	)		(6,946	)		(970	)
General and administrative expenses		(33,829	)		(33,150	)		(4,628	)
Total operating expenses		(338,929	)		(342,623	)		(47,829	)
Income from operations		76,667			126,751			17,693
Interest income		10,576			6,734			940
Interest expense		(1,516	)		(273	)		(38	)
Other income, net		3,015			7,240			1,011
Loss on disposal of subsidiaries		(250	)		-			-
Income before income tax benefit/(expenses) and loss from equity method investments		88,492			140,452			19,606
Income tax benefit/(expenses)		78			(13,550	)		(1,892	)
Loss from equity method investments		(6,318	)		(257	)		(36	)
Net income		82,252			126,645			17,678
Less: Net loss attributable to non-controlling interest		-			-			-
Net income attributable to Sunlands Technology Group		82,252			126,645			17,678
Net income per share attributable to ordinary shareholders of Sunlands Technology Group:
Basic and diluted		12.00			18.75			2.62
Weighted average shares used in calculating net income per ordinary share:
Basic and diluted		6,852,828			6,753,895			6,753,895

SUNLANDS TECHNOLOGY GROUP UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Amounts in thousands)
		For the Three Months Ended June 30,
		2024		2025
		RMB		RMB			US$
Net income		82,252		126,645			17,678
Other comprehensive income/(loss), net of tax effect of nil:
Change in cumulative foreign currency translation adjustments		3,715		(7,885	)		(1,101	)
Unrealized loss on available-for-sale investments, net of tax effect of nil		-		11,311			1,579
Total comprehensive income		85,967		130,071			18,156
Less: comprehensive income attributable to non-controlling interest		-		-			-
Comprehensive income attributable to Sunlands Technology Group		85,967		130,071			18,156

SUNLANDS TECHNOLOGY GROUP RECONCILIATION OF GAAP AND NON-GAAP RESULTS (Amounts in thousands)
		For the Three Months Ended June 30,
		2024			2025
		RMB			RMB
Net revenues		492,223			539,015
Less: other revenues		(62,094	)		(60,566	)
Add: tax and surcharges		15,740			19,761
Add: ending deferred revenue		986,938			814,277
Add: ending refund liability		126,797			77,942
Less: beginning deferred revenue		(1,044,866	)		(891,617	)
Less: beginning refund liability		(130,840	)		(98,516	)
Gross billings (non-GAAP)		383,898			400,296
Net income		82,252			126,645
Add: income tax (benefit)/expenses		(78	)		13,550
Add: depreciation and amortization		7,362			7,205
Add: interest expense		1,516			273
Less: interest income		(10,576	)		(6,734	)
EBITDA (non-GAAP)		80,476			140,939

SUNLANDS TECHNOLOGY GROUP UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Amounts in thousands, except for share and per share data, or otherwise noted)
		For the Six Months Ended June 30,
		2024			2025
		RMB			RMB			US$
Net revenues		1,015,463			1,026,640			143,313
Cost of revenues		(153,790	)		(141,977	)		(19,819	)
Gross profit		861,673			884,663			123,494
Operating expenses
Sales and marketing expenses		(599,018	)		(602,971	)		(84,172	)
Product development expenses		(14,667	)		(13,188	)		(1,841	)
General and administrative expenses		(66,381	)		(67,609	)		(9,438	)
Total operating expenses		(680,066	)		(683,768	)		(95,451	)
Income from operations		181,607			200,895			28,043
Interest income		19,865			12,141			1,695
Interest expense		(3,120	)		(680	)		(95	)
Other income, net		8,795			13,857			1,934
Loss on disposal of subsidiaries		(250	)		-			-
Income before income tax benefit/(expenses) and loss from equity method investments		206,897			226,213			31,577
Income tax benefit/(expenses)		469			(23,324	)		(3,256	)
Loss from equity method investments		(12,379	)		(1,068	)		(149	)
Net income		194,987			201,821			28,172
Less: Net loss attributable to non-controlling interest		-			-			-
Net income attributable to Sunlands Technology Group		194,987			201,821			28,172
Net income per share attributable to ordinary shareholders of Sunlands Technology Group:
Basic and diluted		28.44			29.87			4.17
Weighted average shares used in calculating net income per ordinary share:
Basic and diluted		6,854,922			6,756,532			6,756,532

SUNLANDS TECHNOLOGY GROUP UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Amounts in thousands)
		For the Six Months Ended June 30,
		2024		2025
		RMB		RMB			US$
Net income		194,987		201,821			28,172
Other comprehensive income/(loss), net of tax effect of nil:
Change in cumulative foreign currency translation adjustments		13,251		(11,481	)		(1,603	)
Unrealized loss on available-for-sale investments, net of tax effect of nil		-		52			7
Total comprehensive income		208,238		190,392			26,576
Less: comprehensive income attributable to non-controlling interest		-		-			-
Comprehensive income attributable to Sunlands Technology Group		208,238		190,392			26,576

SUNLANDS TECHNOLOGY GROUP RECONCILIATION OF GAAP AND NON-GAAP RESULTS (Amounts in thousands)
		For the Six Months Ended June 30,
		2024			2025
		RMB			RMB
Net revenues		1,015,463			1,026,640
Less: other revenues		(120,968	)		(119,486	)
Add: tax and surcharges		32,109			42,051
Add: ending deferred revenue		986,938			814,277
Add: ending refund liability		126,797			77,942
Less: beginning deferred revenue		(1,113,923	)		(916,510	)
Less: beginning refund liability		(143,744	)		(112,342	)
Gross billings (non-GAAP)		782,672			812,572
Net income		194,987			201,821
Add: income tax (benefit)/expenses		(469	)		23,324
Add: depreciation and amortization		14,793			14,423
Add: interest expense		3,120			680
Less: interest income		(19,865	)		(12,141	)
EBITDA (non-GAAP)		192,566			228,107