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DAO

Youdao, Inc.

DAO

Youdao, Inc. • NYSE
$10.24 ▲ 12.53% (+1.14)
Market Cap $1.21 B
52w High $11.82
52w Low $5.94
Dividend Yield 0%
P/E 60.24
Volume 6.85K
Outstanding Shares 117.75M

Income Statement

Period Revenue Operating Expense Net Income Net Profit Margin Earnings Per Share EBITDA
Q3-2025 $1.62B ▲ $656.149M ▲ $119.367K ▲ 0.007% ▲ $0 ▲ $22.216M ▲
Q2-2025 $1.404B ▲ $575.009M ▲ $-17.593M ▼ -1.253% ▼ $-0.15 ▼ $306.034K ▼
Q1-2025 $1.296B ▼ $509.209M ▼ $76.596M ▼ 5.911% ▼ $0.65 ▼ $103.4M ▲
Q4-2024 $1.36B ▼ $565.064M ▼ $84.269M ▼ 6.195% ▲ $0.7 ▼ $88.063M ▼
Q3-2024 $1.538B $667.201M $84.359M 5.485% $0.73 $104.004M

Balance Statement

Period Cash & Short-term Total Assets Total Liabilities Total Equity
Q2-2025 $610.923M ▲ $1.841B ▲ $3.851B ▲ $-2.059B ▼
Q1-2025 $418.276M ▼ $1.539B ▼ $3.542B ▼ $-2.054B ▲
Q4-2024 $655.785M ▲ $1.814B ▲ $3.904B ▲ $-2.14B ▲
Q3-2024 $484.128M ▼ $1.684B ▼ $3.854B ▼ $-2.232B ▲
Q2-2024 $563.594M $1.782B $4.052B $-2.329B

Cash Flow Statement

Period Net Income Cash From Operations Cash From Investing Cash From Financing Net Change Free Cash Flow
Q2-2025 $-17.763M ▼ $0 $0 $0 $0 $0
Q1-2025 $76.743M ▼ $0 $0 $0 $0 $0
Q4-2024 $83.003M ▼ $0 $0 $0 $0 $0
Q3-2024 $86.253M ▲ $0 $0 $0 $0 $0
Q2-2024 $-99.475M $0 $0 $0 $0 $0

Revenue by Products

Product Q3-2020Q4-2020
Fee Based Premium Services
Fee Based Premium Services
 $110.00M ▲$40.00M ▼
Learning Products
Learning Products
 $300.00M ▲$290.00M ▼
Learning Services
Learning Services
 $1.42Bn ▲$0 ▼
Online Courses Services
Online Courses Services
 $1.32Bn ▲$0 ▼
Online Marketing Services
Online Marketing Services
 $340.00M ▲$150.00M ▼

Five-Year Company Overview

Income Statement

Income Statement Youdao has moved from heavy losses to modest profitability over the last few years, while steadily growing its revenue. The business appears to have shifted from a “growth at any cost” model to a more disciplined one, with better cost control and healthier margins. Profitability is still relatively new, so it is not yet clear how durable these profits will be, but the direction of travel on both growth and earnings has been clearly positive.

Balance Sheet

Balance Sheet The balance sheet is a mixed picture. On the positive side, the company holds a reasonable cash cushion relative to its size. On the negative side, debt has risen over time, and reported shareholder equity is deeply negative, which indicates a leveraged and financially tight capital structure. This suggests the company likely depends on continued access to funding and on support from its parent ecosystem, and it leaves less room for error if business conditions worsen.

Cash Flow

Cash Flow Cash generation remains the weakest area. Even though the company is now profitable on paper, it has not consistently translated that into positive operating cash flow, and free cash flow has stayed negative, albeit improving. Capital spending is modest, so the main issue is still the core operations’ ability to fund themselves. The trend toward smaller cash outflows is encouraging, but the business is not yet clearly self-financing and still appears reliant on external capital or group support to bridge the gap.

Competitive Edge

Competitive Edge Youdao occupies a distinctive niche at the intersection of online education, smart learning devices, and AI-driven advertising. Its long-standing dictionary brand gives it strong user recognition, and integration with the broader NetEase ecosystem provides traffic, data, and cross-selling opportunities that many smaller rivals lack. Its diversified revenue base—spanning learning services, hardware, and online marketing—reduces dependence on any single segment. At the same time, it faces intense competition from other Chinese edtech firms, big internet platforms, and global AI players, as well as ongoing regulatory sensitivity around education in China. Its ability to keep scaling the higher-margin marketing and AI services while defending its education franchise will be central to its long-term positioning.

Innovation and R&D

Innovation and R&D Innovation is clearly the core of Youdao’s strategy. The company has built proprietary AI models tailored to language and education, and it is embedding them across software, hardware, and marketing tools. Products like AI-powered translation, smart learning pens, and automated advertising platforms show a consistent push to differentiate through technology rather than just content or pricing. This creates a meaningful technological moat but also requires continued heavy investment to stay ahead in a fast-moving AI landscape. The upside is a richer, more recurring revenue mix from subscriptions and marketing services; the risk is that R&D intensity must remain high amid rapid industry change and strong global competition.

Summary

Overall, Youdao looks like a business in transition from a loss-making, education-focused company to a more diversified, AI-native platform with meaningful exposure to online marketing and smart devices. The core story is improving profitability and operational discipline, supported by strong technology and a powerful parent ecosystem, set against a stretched balance sheet and still-weak cash flow. Its future will depend on whether it can turn its AI and product innovation into durable cash-generating franchises, manage leverage prudently, and navigate a competitive and regulatory environment that remains demanding.

NEWS

November 21, 2025 · 4:00 AM UTC

Youdao Q3 2025 Financial Report: AI-Driven Advertising Revenue Soars, Becoming the Largest Source of Income

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November 20, 2025 · 7:00 AM UTC

Youdao Maintains Profitability for Five Consecutive Quarters, Operating Profit for the First Three Quarters of 2025 Grows Nearly 150% Year-over-Year

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November 20, 2025 · 3:30 AM UTC

Youdao, Inc. to Hold Annual General Meeting on December 16, 2025

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November 6, 2025 · 3:30 AM UTC

Youdao to Report Third Quarter 2025 Financial Results on November 20

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