Youdao, Inc. · NYSE:DAO
Youdao — Q1 2023 Earnings Presentation
17 slides from Youdao's earnings presentation, May 25, 2023
Slide 1: 4Q22 Investor Presentation
4Q22 Investor Presentation Investor Relations, February 23, 2023
Slide 2: Forward-looking statements
This presentation contains forward-looking statements. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. Statements that are not historical facts, including statements about the Company’s beliefs and expectations, are forward-l
Slide 3: Youdao makes learning happen
Youdao makes learning happen. We are a leading technology-focused intelligent learning company in China. Youdao was founded in 2006 as part of NetEase, a leading internet technology company in China, dedicated to providing online services centered around content, community, communication and commerc
Slide 4: Net Revenues and Gross Margin
Net Revenues and Gross Margin (RMB Millions) 1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 3Q22 4Q22 1Q23 60.0% 53.5% 54.2% 53.3% 52.4% 52.6% 51.7% 51.0% 1,600.0 42.5% 42.8% 157.5 240.8 1,200.0 40.0% 121.4 356.5 218.1 407.0 137.0 151.8 253.2 139.1 166.0 152.8 212.7 800.0 254.5 201.9 206.3 317.7 239.9 20.0% 825.9 88
Slide 5: (Loss)/Income from Operations
(Loss)/Income from Operations (RMB Millions) 1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 3Q22 4Q22 1Q23 200.0 24.7 0.0 (125.1) (200.0) (195.8) (214.3) (225.7) (219.0) (254.9) (248.3) (400.0) (455.2) (600.0)
Slide 6: Operating Cashflow
Operating Cashflow (RMB Millions) 1Q22 2Q22 3Q22 4Q22 1Q23 200.0 104.2 84.1 0.0 (200.0) (294.1) (400.0) (425.6) (437.0) (600.0)
Slide 7: Youdao NMT and ASR Transformer technology timeline
In 2018, Youdao NMT was upgraded and based on Transformer. In 2019, the second generation of dictionary pen was equipped with offline Transformer NMT for the first time. In 2020, Youdao put Transformer ASR into business. In 2021, the streaming ASR technology based on Transformer was implemented. In
Slide 8: Youdao Desktop Translation with three major AI functions
We recently launched Youdao Desktop Translation with three major AI functions • AIBox: provides sentence polishing, grammar correction, writing suggestions, and key point extraction • AI Document Translation: supports multiple file formats including doc, docx, ppt, pdf, xlsx, etc. • English Writing
Slide 9: 40%+ YoY gross billings from learning services
Gross billings from learning services Year-over-year growth of (excluding adult courses) gross billings from learning services (excluding adult courses) 40%+ YoY 80% Over 70% 60% 40% 20% 0% 23-Jan 23-Feb & 23-Mar Average -20% Below -20% 1Q22 1Q23 -40%
Slide 10: Gross margin approaching 70% in 1Q23
• A student from our “Champion Class”, released in 4Q22, • Gross margin: approaching 70% in 1Q23 gained the top spot in the youth group championship at the British Junior Go Championship in 1Q23 • Net revenues from digital content services could cover the cost and operating expenses for 3 consecutiv
Slide 11: Youdao Fun Reading
Youdao Fun Reading A child-focused digital online reading service Gross billings: rose by approaching 40% YoY in 1Q23 Features Intelligent grading and content recommendation Interactive Q&A during the reading process Tailor-made learning reports
Slide 12: Online marketing services 79.7% YoY
(RMB Millions) 250.0 79.7% YoY 218.1 200.0 • The increase in net revenues was mainly 150.0 attributable to the increased demand for 121.4 performance-based advertisements through 100.0 third parties’ internet properties 50.0 0.0 1Q22 1Q23
Slide 13: New Apps in Youdao Dictionary Pen OS Activation volume
New Apps in Youdao Dictionary Pen OS Activation volume The activation volume indicates the actual delivery of the products to users and the adoption as active users Over 20% year-over-year growth in activation of Youdao dictionary pens in March 2023 Baidu NetDisk Chinese Children's Encyclopedia
Slide 14: Dictionary Pen X5 and P5 standard tests
Youdao Dictionary Pen X5 and P5 accomplished the first batch of standard tests by China Academy of Information and Communications Technology with solid performance • Achieved 100% accuracy in 12 complex application scenarios • Showcasing our pioneering and leading position in the industry
Slide 15: Summary of Key Financial Information: balance sheet
Summary of Key Financial Information (in RMB'000) Key balance sheet items March 31, 2023 December 31, 2022 Cash Assets* 601,038 1,016,909 Accounts Receivable, Net 260,049 405,139 Inventories 219,324 232,260 Total Current Assets 1,264,394 1,869,973 Total Assets 1,658,319 2,276,156 Contract Liabilitie
Slide 16: Summary of Key Financial Information: income statement
Summary of Key Financial Information (in RMB'000, except for percentages) Key Income Statement Items 1Q22 4Q22 1Q23 Net Revenue 1,200,541 1,453,982 1,163,270 Learning Services 826,011 806,270 732,421 Smart Devices 253,160 406,956 212,749 Online Marketing Services 121,370 240,756 218,100 Cost of Reve
Slide 17: Thank You
THANK YOU