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17 Education & Technology Group, Inc. (YQ)
:YQ
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17 Education & Technology Group
(NASDAQ:YQ)
49Neutral
17 Education & Technology Group (YQ) vs. S&P 500 (SPY)
Market Cap
$11.25M
Dividend YieldN/A
Average Volume (3M)33.87K
Price to Earnings (P/E)―
Beta (1Y)0.60
Revenue Growth20.58%
EPS Growth18.04%
CountryUS
Employees503
SectorTechnology
Sector Strength51
IndustryEducation & Training Services
Share Statistics
EPS (TTM)-3.33
Shares Outstanding6,578,035
10 Day Avg. Volume76,363
30 Day Avg. Volume33,872
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.77
Price to Cash Flow (P/CF)N/A
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
17 Education & Technology Group Business Overview & Revenue Model
Company Description17 Education & Technology Group (YQ) is a China-based education technology company that focuses on providing K-12 education services. The company integrates technology with education to offer innovative solutions, including intelligent learning systems and learning devices, to enhance the educational experience for students, teachers, and parents. Their core products and services are designed to improve learning efficiency and outcomes through personalized education and data-driven insights.
How the Company Makes Money17 Education & Technology Group primarily makes money through the sale of its educational products and services. The company generates revenue by offering subscription-based access to its intelligent learning systems, which are used by schools and educational institutions. Additionally, revenue is derived from the sale of learning devices that complement their software solutions. The company may also earn money through strategic partnerships with educational institutions and other technology providers to expand its reach and enhance its offerings. Key revenue streams include recurring subscription fees, device sales, and potential collaborations that provide additional monetization opportunities.
17 Education & Technology Group Financial Statement Overview
Summary
17 Education & Technology Group is facing significant financial challenges, with declining revenues, persistent losses, and negative cash flows. While the company's low leverage is a positive sign, its inability to generate profits and cash flow raises concerns about its long-term sustainability. The education sector's competitive and regulatory environment might be contributing to these difficulties.Income Statement
The company has been experiencing declining revenues, evident from a significant drop from $2.18 billion in 2021 to $170.96 million in 2023. This steep decline indicates potential challenges in maintaining market share or demand. The gross profit margin also decreased to 47.2% in 2023 from 59.2% in 2021, and the company has been consistently operating at a net loss, with a net profit margin of -182.3% in 2023. These factors suggest an ongoing struggle with profitability.35
Negative
Balance Sheet
The balance sheet shows a relatively low debt-to-equity ratio of 0.035 in 2023, indicating low leverage, which is a positive aspect. However, the return on equity (ROE) remains negative at -63.1%, reflecting poor profitability. The equity ratio stands at 72.2%, indicating strong equity support, but the decrease in total assets and stockholders' equity highlights a potential erosion of asset base over time.55
Neutral
Cash Flow
The company continues to face cash flow challenges with negative operating cash flow of -$212.08 million in 2023, slightly improved from -$463.93 million in 2022. Free cash flow remains negative, at -$238.67 million in 2023, although showing some improvement. The operating cash flow to net income ratio is concerning at 0.68, indicating inefficiencies in converting income to cash.40
Negative
| Breakdown | |||||
| TTM | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 | Dec 2019 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 199.97M | 170.96M | 531.06M | 2.18B | 1.29B | 406.25M | Gross Profit |
| 77.50M | 80.70M | 324.86M | 1.31B | 798.70M | 232.77M | EBIT |
| -247.00M | -342.75M | -211.15M | -1.35B | -1.33B | -1.00B | EBITDA |
| -242.96M | -326.58M | -186.42M | -1.29B | -1.29B | -940.59M | Net Income Common Stockholders |
| -227.62M | -311.78M | -177.71M | -1.38B | -1.31B | -964.34M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 653.86M | 480.59M | 727.43M | 1.18B | 2.83B | 653.86M | Total Assets |
| 918.29M | 684.53M | 980.52M | 1.58B | 3.39B | 918.29M | Total Debt |
| 149.43M | 17.31M | 26.25M | 147.21M | 187.52M | 149.43M | Net Debt |
| -504.43M | -289.62M | -681.64M | -1.03B | -2.65B | -504.43M | Total Liabilities |
| 5.38B | 190.26M | 221.66M | 783.38M | 1.33B | 5.38B | Stockholders Equity |
| -4.46B | 494.27M | 758.86M | 797.04M | 2.06B | -4.46B |
| Cash Flow | Free Cash Flow | ||||
| 0.00 | -238.66M | -466.69M | -1.64B | -612.49M | -679.88M | Operating Cash Flow |
| 0.00 | -212.07M | -463.93M | -1.51B | -522.99M | -631.29M | Investing Cash Flow |
| 0.00 | -161.14M | -8.93M | -117.60M | -89.50M | -28.59M | Financing Cash Flow |
| 0.00 | -51.36M | -33.86M | 952.00K | 2.80B | 84.45M |
17 Education & Technology Group Technical Analysis
Negative
1.45
Price Trends
1.90
Negative
1.82
Negative
1.99
Negative
Market Momentum
-0.04
Positive
42.88
Neutral
19.97
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For YQ, the sentiment is Negative. The current price of 1.45 is below the 20-day moving average (MA) of 1.85, below the 50-day MA of 1.90, and below the 200-day MA of 1.99, indicating a bearish trend. The MACD of -0.04 indicates Positive momentum. The RSI at 42.88 is Neutral, neither overbought nor oversold. The STOCH value of 19.97 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for YQ.
17 Education & Technology Group Risk Analysis
17 Education & Technology Group disclosed 94 risk factors in its most recent earnings report. 17 Education & Technology Group reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
17 Education & Technology Group Peers Comparison
Overall Rating
UnderperformOutperform
Sector (57)
Financial Indicators
Performance Comparison
YQ
17 Education & Technology Group
1.45
-1.06
-42.23%
CHGG
Chegg
0.48
-6.39
-93.01%
17 Education & Technology Group Earnings Call Summary
Earnings Call Date: Mar 25, 2025 | % Change Since: -38.56% | Next Earnings Date: Jun 5, 2025
Earnings Call Sentiment Positive
The earnings call reflects a positive outlook with significant growth in subscription models and cost optimization, despite challenges such as a decline in quarterly revenue and gross margin due to strategic shifts. The company's focus on AI and customer retention positions it well for future growth.Highlights
Year-Over-Year Top-Line Growth
The company achieved a year-over-year top-line growth of 11% to RMB189.2 million for the full year, driven by strategic market expansion and new contract acquisitions.
SaaS Subscription Model Growth
The SaaS subscription business model maintained an upward trend with three-digit growth compared to the same quarter last year, bolstered by strong retention rates and multi-year subscription renewals.
Cost Optimization Success
Operating expenses decreased by 34% from the same quarter last year, resulting in a 35% reduction in net loss on a GAAP basis.
High Customer Retention
More than 90% of customers whose contracts were up for renewal decided to continue subscribing, with some expanding their coverage.
AI-Enhanced Offerings
The company has integrated AI into its product offerings, receiving positive feedback and market recognition, and aims to deliver sustainable growth and innovations in the future.
Lowlights
Quarterly Revenue Decline
Net revenues for the fourth quarter were RMB36.6 million, reflecting a 23% decrease from the same quarter the previous year, primarily due to a reduction in district-level flagship projects.
Lower Gross Margin
Gross margin for the fourth quarter of 2024 was 33.6%, compared with 43.4% in the fourth quarter of 2023, due to the delivery of a legacy project with lower margins.
Cash Reserves Decline
Cash and cash equivalents, restricted cash, and term deposits were RMB359.3 million as of December 31, 2024, compared with RMB476.7 million as of December 31, 2023.
Company Guidance
During the 17EdTech's Fourth Quarter 2024 and Full Year Earnings Conference Call, management reported a year-over-year top-line growth of 11% to RMB189.2 million, although fourth-quarter net revenues decreased by 23% to RMB36.6 million due to a strategic shift towards subscription-based school projects. Despite the revenue dip, the company achieved a 35% reduction in net loss on a GAAP basis, thanks to a 34% decrease in operating expenses. The SaaS subscription business demonstrated robust performance, with triple-digit growth in student subscriptions and a customer retention rate exceeding 90%. The gross margin for the quarter was 33.6%, affected by a low-margin legacy project. Additionally, cash reserves stood at RMB359.3 million as of December 31, 2024. Looking forward, 17EdTech aims to leverage AI to enhance educational products and sustain growth through strategic market expansion and innovation.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.