Sunlands Technology Group (STG) Q3 2024 earnings summary

Executive summary

• Q3 2024 net revenues were RMB 491.3 million, a 6.4% year-over-year decrease, with net profit rising 8.6% sequentially to RMB 89.3 million, reflecting resilience amid a challenging market.

• Gross billings (non-GAAP) for Q3 were RMB 360.3 million, down from RMB 390.0 million a year ago.

• New student enrollments rose to 158,395, up from 154,299 in Q3 2023, and total enrollments grew 11.2% year-over-year in the first nine months.

• Management highlighted strong cash flow, strategic realignment toward high-return areas, and operational efficiency.

Financial highlights

• Q3 2024 gross profit was RMB 409.2 million, down 11.1% year-over-year.

• Net income margin for Q3 was 18.2%, compared to 25.1% in Q3 2023.

• Basic and diluted net income per share for Q3 was RMB 13.08.

• Cash, cash equivalents, and restricted cash totaled RMB 535.9 million as of September 30, 2024.

• Deferred revenue as of September 30, 2024, was RMB 920.6 million, down from RMB 1,113.9 million at year-end 2023.

Outlook and guidance

• Q4 2024 net revenues expected between RMB 450 million and RMB 470 million, a 13.2%-16.9% year-over-year decrease.

• Guidance reflects current market conditions, substantial uncertainty, and preliminary management estimates.