Sunlands Technology Group (STG) Q3 2025 earnings summary

Executive summary

• Net revenue reached RMB 523 million (US$73.5 million) in Q3 2025, up 6.5% year-over-year, with net income surging 40.5% to RMB 125.4 million (US$17.6 million), reflecting strong profitability and business resilience.

• Gross profit increased 13.1% to RMB 462.7 million, and net income margin improved to 24% from 18.2% a year ago.

• Strategic focus on high-margin, demand-driven course categories and quality-driven growth, especially in senior learning and interest-based courses, drove profitability and operating leverage.

• AI-driven platform enhancements and industry collaborations are deepening user engagement and operational efficiency.

Financial highlights

• Net revenues increased 6.5% year-over-year to RMB 523 million, driven by interest-based courses.

• Gross profit rose 13.1% to RMB 462.7 million, with cost of revenues down 26.5% to RMB 60.3 million.

• Net income was RMB 125.4 million, up from RMB 89.3 million a year ago; net margin expanded to 24%.

• Basic and diluted net income per share was RMB 18.64 (US$2.62).

• Gross billings (non-GAAP) were RMB 349.2 million, down from RMB 360.3 million year-over-year.

Outlook and guidance

• Q4 2025 net revenues expected between RMB 440 million and RMB 460 million, representing a 4.9%-9% year-over-year decrease.

• Guidance reflects current market conditions and preliminary estimates of demand.