Gaotu Techedu Inc. (NYSE: GOTU) recently released its financial results for the third quarter of fiscal year 2025. The company reported revenue of RMB 1.58 billion, a year-on-year increase of 30.7%, while its adjusted net loss narrowed significantly by 69.9%. Alongside steady revenue growth, profitability is gradually improving, signaling the success of its strategic shift from "scale-first" to "efficiency-first."
What stands out is that Gaotu is not stopping at financial recovery. Instead, it has adopted "All with AI, Always AI" as its core strategy, systematically restructuring its teaching products, operational systems, and organizational capabilities to forge a high-quality growth path driven by both technology and talent.
AI is not just an add-on but the engine of a new educational paradigm. "Over the next decade, AI's greatest impact on education won't be replacing teachers but rewriting the way we 'teach' while upholding the essence of 'nurturing,'" said Chen Xiangdong, Founder, Chairman, and CEO of Gaotu, in a recent interview. This philosophy is deeply embedded in the company's operations.
This quarter, Gaotu launched products such as "MaoDou AI Tutor" and "AI Smart Exam Prep," which have achieved large-scale application in learning diagnostics, personalized recommendations, and real-time Q&A. AI can precisely identify students' weak points and dynamically adjust course difficulty and pacing, turning the concept of "personalized education" into reality. More importantly, AI handles standardized, repetitive teaching tasks, freeing up second-line teachers to focus on cultivating study habits and providing emotional support—irreplaceable aspects of education.
"AI isn't here to take jobs but to empower good teachers to do more," Chen emphasized. Gaotu believes the future of education lies not in merely owning large AI models but in deeply integrating AI with a "quality teacher supply chain" to balance efficiency and personalized care.
Beyond products, Gaotu's AI transformation extends to its organizational foundation. The company has established an AI R&D department and an AI Innovation Center, embedding "AI leads" in each business line to foster technology-scenario collaboration. Its self-developed Gaotu Business System (GBS) integrates AI into decision-making, execution, and review processes, ensuring traceable and iterative innovation.
Additionally, Gaotu organized a nationwide AI application competition, encouraging thousands of employees to use AI tools in real-world scenarios. Through mechanisms like the "CEO Special Award," the company incentivizes exploratory projects. Chen himself actively learns and shares AI tools, reinforcing a "collective progress" mindset: "AI isn't just for the young or the tech team—we must all move forward together."
Financially, Gaotu remains healthy, with cash and equivalents exceeding RMB 3.04 billion and deferred revenue reaching RMB 1.77 billion by the end of Q3, providing strong visibility for future quarters. The company expects Q4 revenue to range between RMB 1.628 billion and RMB 1.648 billion, representing year-on-year growth of 17.2%–18.7%.
Although it reported a GAAP net loss of RMB 147 million, adjusted losses have narrowed significantly for multiple consecutive quarters. CFO Shen Nan noted that operating expenses as a percentage of revenue dropped by 27.6 percentage points, while customer acquisition efficiency improved by 12.8%, reflecting ongoing optimization of unit economics.
In the post-"Double Reduction" education landscape, Gaotu has chosen a tougher but more sustainable path: growth driven by product strength, operational efficiency, and technological capability rather than cash burn. While the industry debates whether AI will disrupt education, Gaotu's answer is clear: use AI to reinvent education, but always keep "people" at the center.
This Q3 report is more than a financial statement—it's a strategic declaration. The future of education belongs to those who embrace technological waves while staying true to the essence of nurturing, proving themselves as long-term visionaries.
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