Sunlands Technology Group Announces Unaudited Third Quarter 2025 Financial Results

BEIJING, Nov. 20, 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 third quarter ended September 30, 2025.

Third Quarter 2025 Financial and Operational Snapshots

• Net revenues were RMB523.0 million (US$73.5 million), compared to RMB491.3 million in the third quarter of 2024.
• Gross billings (non-GAAP) were RMB349.2 million (US$49.0 million), compared to RMB360.3 million in the third quarter of 2024.
• Gross profit was RMB462.7 million (US$65.0 million), compared to RMB409.2 million in the third quarter of 2024.
• Net income was RMB125.4 million (US$17.6 million), compared to RMB89.3 million in the third quarter of 2024.
• Net income margin¹ was 24.0% in the third quarter of 2025, compared to 18.2% in the third quarter of 2024.
• New student enrollments² were 137,493, compared to 158,395 in the third quarter of 2024.
• As of September 30, 2025, the Company's deferred revenue balance was RMB695.5 million (US$97.7 million), compared to RMB916.5 million as of December 31, 2024.

"We're pleased to see that the Company has now entered a phase of steady and healthy growth. Our performance in this quarter once again underscores the resilience of our business model and the effective execution of our strategic roadmap. We delivered net revenues of RMB523.0 million, coupled with a pronounced acceleration in profitability, as net income surged 40.5% year-over-year to RMB125.4 million. These achivements further validated the durability and scalability of our operations. Our strategic pivot towards high-margin, demand-driven course categories continues to yield tangible financial benefits.

Our focus extends beyond short-term financial performance to the accumulation of intrinsic capabilities. Through refined management and structural cost control, we have established strong operating leverage while maintaining consistent investment in innovation and teaching quality. We believe that healthy cash flow, organizational agility, and a learner-centered product mindset will remain the core pillars of Sunlands' competitiveness in this new stage," said Mr. Tongbo Liu, Chief Executive Officer of Sunlands.

Mr. Hangyu Li, Finance Director of Sunlands, commented, "The third quarter results underscore the Company's focus on profitable growth and operational excellence. Net revenues rose 6.5% year-over-year to RMB523.0 million, driven by strong interest-based course performance. Gross profit climbed 13.1% year-over-year to RMB462.7 million, with operating expenses down 5.5%, driving net income to RMB125.4 million. The balance sheet is robust, with ample cash and positive cash flows from operating actives, reflecting a healthy core business. The gross billings per new student enrollment for interest, professional skills and professional certification preparation courses grew 11.7% year-over-year in the quarter, reflecting steady user acquisition momentum despite a more selective marketing approach. Leveraging silver economy tailwinds and tech innovation, the company will continue creating value for users and shareholders."

Financial Results for the Third Quarter of 2025

Net Revenues

In the third quarter of 2025, net revenues increased by 6.5% to RMB523.0 million (US$73.5 million) from RMB491.3 million in the third quarter of 2024. The increase was primarily driven by shorter average service periods, leading to an increase in revenue recognized during 2025.

Cost of Revenues

Cost of revenues decreased by 26.5% to RMB60.3 million (US$8.5 million) in the third quarter of 2025 from RMB82.1 million in the third quarter of 2024. The decrease was mainly due to declined cost of revenues from sales of goods such as learning materials and books.

Gross Profit

Gross profit increased by 13.1% to RMB462.7 million (US$65.0 million) in the third quarter of 2025 from RMB409.2 million in the third quarter of 2024.

Operating Expenses

In the third quarter of 2025, operating expenses were RMB324.4 million (US$45.6 million), representing a 5.5% decrease from RMB343.4 million in the third quarter of 2024.

Sales and marketing expenses decreased by 7.7% to RMB279.7 million (US$39.3 million) in the third quarter of 2025 from RMB303.0 million in the third quarter of 2024.

General and administrative expenses increased by 4.3% to RMB36.0 million (US$5.1 million) in the third quarter of 2025 from RMB34.5 million in the third quarter of 2024.

Product development expenses increased by 48.2% to RMB8.7 million (US$1.2 million) in the third quarter of 2025 from RMB5.8 million in the third quarter of 2024. The increase was mainly due to increased compensation expenses related to headcount expansion of the Company's product development personnel.

Net Income

Net income for the third quarter of 2025 was RMB125.4 million (US$17.6 million), as compared to RMB89.3 million in the third quarter of 2024.

Basic and Diluted Net Income Per Share

Basic and diluted net income per share was RMB18.64 (US$2.62) in the third quarter of 2025.

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

As of September 30, 2025, the Company had RMB601.0 million (US$84.4 million) of cash, cash equivalents and restricted cash and RMB176.5 million (US$24.8 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 September 30, 2025, the Company had a deferred revenue balance of RMB695.5 million (US$97.7 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 November 18, 2025, the Company had repurchased an aggregate of 797,615 ADSs for approximately US$4.7 million under the share repurchase program.

Financial Results for the First Nine Months of 2025

Net Revenues

In the first nine months of 2025, net revenues increased by 2.9% to RMB1,549.7 million (US$217.7 million) from RMB1,506.7 million in the first nine months of 2024. The increase was primarily driven by a 1.6% growth in gross billings from interest courses.

Cost of Revenues

Cost of revenues decreased by 14.2% to RMB202.3 million (US$28.4 million) in the first nine months of 2025 from RMB235.9 million in the first nine months of 2024. The decrease was mainly due to declined cost of revenues from sales of goods such as learning materials and books, and declined compensation expenses related to headcount reduction of the Company's teachers and mentors.

Gross Profit

Gross profit increased by 6.0% to RMB1,347.4 million (US$189.3 million) from RMB1,270.8 million in the first nine months of 2024.

Operating Expenses

In the first nine months of 2025, operating expenses were RMB1,008.1 million (US$141.6 million), representing a 1.5% decrease from RMB1,023.4 million in the first nine months of 2024.

Sales and marketing expenses decreased by 2.1% to RMB882.7 million (US$124.0 million) in the first nine months of 2025 from RMB902.1 million in the first nine months of 2024.

General and administrative expenses increased by 2.7% to RMB103.6 million (US$14.5 million) in the first nine months of 2025 from RMB100.9 million in the first nine months of 2024.

Product development expenses increased by 6.5% to RMB21.9 million (US$3.1 million) in the first nine months of 2025 from RMB20.5 million in the first nine months of 2024. The increase was mainly due to increased compensation expenses related to headcount expansion of the Company's product development personnel.

Net Income

Net income for the first nine months of 2025 was RMB327.3 million (US$46.0 million), compared with RMB284.3 million in the first nine months of 2024.

Basic and Diluted Net Income Per Share

Basic and diluted net income per share was RMB48.50 (US$6.81) in the first nine months of 2025, compared with RMB41.52 in the first nine months of 2024.

Outlook

For the fourth quarter of 2025, Sunlands currently expects net revenues to be between RMB440 million to RMB460 million, which would represent a decrease of 4.9% to 9.0% 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 RMB7.1190 to US$1.00, the effective noon buying rate for September 30, 2025 as set forth in the H.10 statistical release of the Federal Reserve Board. No representation is made that the RMB amounts could have been, or could be, converted, realized or settled into US$ at that rate on September 30, 2025, or at any other rate.

Conference Call and Webcast

Sunlands' management team will host a conference call at 7:00 AM U.S. Eastern Time, (8:00 PM Beijing/Hong Kong time) on November 20, 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/BI8300e40c73ed4950972d9e8dd3b708b8

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 September 30,
		2024		2025
		RMB		RMB		US$
ASSETS
Current assets
Cash and cash equivalents		507,229		599,917		84,270
Restricted cash		-		1,049		147
Short-term investments		276,029		176,496		24,792
Prepaid expenses and other current assets		96,916		90,871		12,765
Deferred costs, current		4,139		25,257		3,548
Total current assets		884,313		893,590		125,522
Non-current assets
Property and equipment, net		758,215		737,154		103,547
Intangible assets, net		723		368		52
Right-of-use assets		110,154		101,170		14,211
Deferred costs, non-current		56,657		16,212		2,277
Long-term investments		260,083		332,636		46,725
Deferred tax assets		24,699		20,247		2,844
Other non-current assets		26,319		23,527		3,305
Total non-current assets		1,236,850		1,231,314		172,961
TOTAL ASSETS		2,121,163		2,124,904		298,483
LIABILITIES AND SHAREHOLDERS' EQUITY
LIABILITIES
Current liabilities
Accrued expenses and other current liabilities		404,865		366,480		51,479
Deferred revenue, current		382,047		453,889		63,757
Lease liabilities, current portion		8,317		9,534		1,339
Long-term debt, current portion		6,154		-		-
Total current liabilities		801,383		829,903		116,575

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 September 30,
		2024			2025
		RMB			RMB			US$
Non-current liabilities
Deferred revenue, non-current		534,463			241,570			33,933
Lease liabilities, non-current portion		137,040			127,435			17,901
Deferred tax liabilities		5,724			3,418			480
Other non-current liabilities		7,309			7,289			1,024
Long-term debt, non-current portion		35,386			-			-
Total non-current liabilities		719,922			379,712			53,338
TOTAL LIABILITIES		1,521,305			1,209,615			169,913
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 September 30, 2025, respectively; 2,600,779 and 2,554,347 shares
outstanding as of December 31, 2024 and September 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 September 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 September 30, 2025, respectively)		1			1			-
Treasury stock		-			-			-
Statutory reserves		11,083			11,083			1,557
Accumulated deficit		(1,840,285)			(1,513,028)			(212,534)
Additional paid-in capital		2,294,381			2,289,063			321,543
Accumulated other comprehensive income		136,164			129,656			18,213
Total Sunlands Technology Group shareholders' equity		601,345			916,776			128,779
Non-controlling interest		(1,487)			(1,487)			(209)
TOTAL SHAREHOLDERS' EQUITY		599,858			915,289			128,570
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY		2,121,163			2,124,904			298,483

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 September 30,
		2024			2025
		RMB			RMB			US$
Net revenues		491,264			523,049			73,472
Cost of revenues		(82,093)			(60,314)			(8,472)
Gross profit		409,171			462,735			65,000
Operating expenses
Sales and marketing expenses		(303,047)			(279,725)			(39,293)
Product development expenses		(5,849)			(8,671)			(1,218)
General and administrative expenses		(34,472)			(35,956)			(5,051)
Total operating expenses		(343,368)			(324,352)			(45,562)
Income from operations		65,803			138,383			19,438
Interest income		7,810			6,462			908
Interest expense		(1,415)			(114)			(16)
Other income, net		10,443			8,323			1,169
Loss on disposal of subsidiaries		(588)			-			-
Income before income tax benefit/(expenses)
and income/loss from equity method investments		82,053			153,054			21,499
Income tax benefit/(expenses)		6,506			(24,360)			(3,422)
Income/(loss) from equity method investments		730			(3,258)			(458)
Net income		89,289			125,436			17,619
Less: Net loss attributable to non-controlling interest		-			-			-
Net income attributable to Sunlands Technology Group		89,289			125,436			17,619
Net income per share attributable to ordinary shareholders of
Sunlands Technology Group:
Basic and diluted		13.08			18.64			2.62
Weighted average shares used in calculating net income
per ordinary share:
Basic and diluted		6,828,784			6,728,503			6,728,503

SUNLANDS TECHNOLOGY GROUP UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Amounts in thousands)
		For the Three Months Ended September 30,
		2024			2025
		RMB			RMB			US$
Net income		89,289			125,436			17,619
Other comprehensive (loss)/income, net of tax effect of nil:
Change in cumulative foreign currency translation adjustments		(20,526)			(3,671)			(516)
Unrealized loss on available-for-sale investments, net of tax effect of nil		-			8,592			1,207
Total comprehensive income		68,763			130,357			18,310
Less: comprehensive income attributable to non-controlling interest		-			-			-
Comprehensive income attributable to Sunlands Technology Group		68,763			130,357			18,310

SUNLANDS TECHNOLOGY GROUP RECONCILIATION OF GAAP AND NON-GAAP RESULTS (Amounts in thousands)
		For the Three Months Ended September 30,
		2024			2025
		RMB			RMB
Net revenues		491,264			523,049
Less: other revenues		(84,838)			(61,277)
Add: tax and surcharges		23,931			16,310
Add: ending deferred revenue		920,593			695,459
Add: deferred revenue in connection with disposal of subsidiaries		3,423			-
Add: ending refund liability		119,618			67,828
Less: beginning deferred revenue		(986,938)			(814,277)
Less: beginning refund liability		(126,797)			(77,942)
Gross billings (non-GAAP)		360,256			349,150
Net income		89,289			125,436
Add: income tax (benefit)/expenses		(6,506)			24,360
Add: depreciation and amortization		7,355			7,199
Add: interest expense		1,415			114
Less: interest income		(7,810)			(6,462)
EBITDA (non-GAAP)		83,743			150,647

SUNLANDS TECHNOLOGY GROUP UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Amounts in thousands, except for share and per share data, or otherwise noted)
		For the Nine Months Ended September 30,
		2024			2025
		RMB			RMB			US$
Net revenues		1,506,727			1,549,689			217,684
Cost of revenues		(235,883)			(202,291)			(28,416)
Gross profit		1,270,844			1,347,398			189,268
Operating expenses
Sales and marketing expenses		(902,065)			(882,696)			(123,992)
Product development expenses		(20,516)			(21,859)			(3,071)
General and administrative expenses		(100,853)			(103,565)			(14,548)
Total operating expenses		(1,023,434)			(1,008,120)			(141,611)
Income from operations		247,410			339,278			47,657
Interest income		27,675			18,603			2,613
Interest expense		(4,535)			(794)			(112)
Other income, net		19,238			22,180			3,116
Loss on disposal of subsidiaries		(838)			-			-
Income before income tax benefit/(expenses)
and loss from equity method investments		288,950			379,267			53,274
Income tax benefit/(expenses)		6,975			(47,684)			(6,698)
Loss from equity method investments		(11,649)			(4,326)			(608)
Net income		284,276			327,257			45,968
Less: Net loss attributable to non-controlling interest		-			-			-
Net income attributable to Sunlands Technology Group		284,276			327,257			45,968
Net income per share attributable to ordinary shareholders of
Sunlands Technology Group:
Basic and diluted		41.52			48.50			6.81
Weighted average shares used in calculating net income
per ordinary share:
Basic and diluted		6,846,146			6,747,844			6,747,844

SUNLANDS TECHNOLOGY GROUP UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Amounts in thousands)
		For the Nine Months Ended September 30,
		2024			2025
		RMB			RMB			US$
Net income		284,276			327,257			45,968
Other comprehensive (loss)/income, net of tax effect of nil:
Change in cumulative foreign currency translation adjustments		(7,275)			(15,152)			(2,128)
Unrealized loss on available-for-sale investments, net of tax effect of nil		-			8,644			1,214
Total comprehensive income		277,001			320,749			45,054
Less: comprehensive income attributable to non-controlling interest		-			-			-
Comprehensive income attributable to Sunlands Technology Group		277,001			320,749			45,054

SUNLANDS TECHNOLOGY GROUP RECONCILIATION OF GAAP AND NON-GAAP RESULTS (Amounts in thousands)
		For the Nine Months Ended September 30,
		2024			2025
		RMB			RMB
Net revenues		1,506,727			1,549,689
Less: other revenues		(205,806)			(180,763)
Add: tax and surcharges		56,040			58,361
Add: ending deferred revenue		920,593			695,459
Add: deferred revenue in connection with disposal of subsidiaries		3,423			-
Add: ending refund liability		119,618			67,828
Less: beginning deferred revenue		(1,113,923)			(916,510)
Less: beginning refund liability		(143,744)			(112,342)
Gross billings (non-GAAP)		1,142,928			1,161,722
Net income		284,276			327,257
Add: income tax (benefit)/expenses		(6,975)			47,684
Add: depreciation and amortization		22,148			21,622
Add: interest expense		4,535			794
Less: interest income		(27,675)			(18,603)
EBITDA (non-GAAP)		276,309			378,754

¹ 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.