Shares of Youdao Inc. (NYSE: DAO) jumped 19% at Thursday's close on revenues that more than doubled in the third quarter.
The Hangzhou-based online education provider said in a statement today that revenue surged 159% year-over-year to $131.97 million, beating estimates of $126.35 million, according to Benzinga. While its loss widened to $1.14 per share, it was better than the expected $1.18 per share loss.
The strong results reflect Youdao’s surging online demand it’s seeing amid the coronavirus pandemic. As a result, paid student enrollments for K-12 courses on Youdao’s premium courses in the quarter hit 498,700, a 438% increase from the same period of the preceding year. Gross billings of online courses reached $140.7 million, up 228% year-over-year.
“As the online education market quickly gets more expansive and more competitive, our unique product matrix, comprising online courses, intelligent devices, and learning apps, enables us to better address customer needs in innovative ways and to achieve organic growth,” Dr. Feng Zhou, the chief executive officer and director of Youdao, said in a statement today.
He added, “We will continue to scale, delivering high-quality products and services to more students, to propel our long-term growth."
On the news, the stock in Youdao traded as much as $30.41 per share today, its highest level in nearly a month. The online education arm of NetEase Inc. (Nasdaq: NTES; HKEX: 09999) continues its strong performance this year; shares are up 112% year-to-date.
While the company did not provide guidance, Dr. Zhou highlighted “revenue growth,” and “expansion” as part of its key focus areas this year.
“Overall, our strategy this year is to seize key expansion opportunities. One important principle we base many decisions on is the principle of value accumulation,” he told analysts in a conference call today after the company reported earnings.
Further, “We have put a lot of effort into ensuring that.”
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