QuantaSing Group Posts Double-Digit Growth In Revenue, Registered Users In Fiscal Q2 Driven By Growing Demand For Its Senior Courses
–News Direct–
By Meg Flippin, Benzinga
QuantaSing Group Ltd. (NASDAQ: QSG), the Chinese online learning service provider, posted double-digit revenue growth in Q2 of fiscal year 2024, buoyed by growing demand for the companys courses aimed at seniors.
For the three months ended December 31, 2023, QuantaSing reported revenue of RMB 980.5 million ($138.1 million), up 24.7% year-over-year. Net income in the quarter was RMB 107.6 million ($15.2 million). That compares to a net loss of RMB 41.4 million in the year-ago fiscal second quarter.
The growth seen in the quarterly results was driven by a 44.6% increase in total registered users to 112.4 million from 77.8 million as of December 31, 2022. Paying learners increased 24.2% year-over-year to about 0.4 million.
Looking out to the full fiscal year 2024, QuantaSing expects revenue to come in between RMB 900 million to RMB 930 million, representing a year-over-year increase of 11.5% to 15.2%.
Capitalizing On The Aging China Population
QuantaSing is one of the largest providers of online education for adults in China, focusing on both the learning and personal interest markets. Using cutting-edge technology including livestreaming and artificial intelligence, QuantaSing provides seniors with easy-to-understand, affordable and accessible online courses. Its capitalizing on the aging population in China, which is growing at such rates the World Bank designated it a super-aged society.
As of 2023 China had more than 297 million residents aged 60+, accounting for 21.1% of the total population. This group has money to spend and is on a quest to pursue hobbies and continuing education opportunities. Its one of the reasons why the silver economy is valued at around RMB 7 trillion ($982 billion), and is forecast to surge to RMB30 trillion ($4.2 trillion) by 2035, according to China National Radio.
The evolving needs and desires of middle-aged and elderly people in China represent a significant opportunity for us, Peng Li, Chairman and Chief Executive Officer of QuantaSing, said on a conference call to discuss second-quarter results with investors and analysts. Last quarter, we saw a solid 24.7% increase in revenue, proving that our strategy to expand our course offerings is paying off. We are seizing the opportunity presented by growing demand for courses made for senior learners.
Livestreaming E-commerce And AI
To boost its offering, QuantaSing has poured resources into several initiatives including integrating senior learning with livestreaming e-commerce and leveraging artificial intelligence to meet the strong demand it is seeing. Its livestreaming business, which it launched in June 2023, is initially focused on Chinese liquor. In its fiscal first quarter, QuantaSings live e-commerce business generated RMB 41.9 million in Gross Merchandise Value (GMV). With a specialized team creating apps and AI tools, the company is looking for global opportunities and is adding staff to the team toward that end. QuantaSing plans to open AI offices in Hong Kong and Singapore shortly and is developing its own AI tools.
QuantaSing isnt the only learning platform company going after seniors in China. But it's trying to become the app older adults go to for all their learning. The idea is to become synonymous with senior learning in China similar to what Duolingo Inc. (NYSE: DUOL) did for learning a new language, Khan Academy has done for virtually educating students and Udemy Inc. (NASDAQ: UDMY) has done for business learning. That goal is being aided by the government in China, which recently introduced measures to strengthen the silver economy, such as urging enterprises to enhance their offerings for older adults including revamping apps and websites and creating standards for senior-friendly mobile devices. That will benefit QuantaSing as it should enhance the learning experience for its users from a hardware perspective, Li said during the earnings call.
Streamlining Operations
In addition to churning out new courses and offerings for seniors, the company is also overhauling how it recruits and retains new learners with an eye toward cutting costs. For instance, it recently upgraded its integrated business management process and now conducts pilot testing before rolling out new classes. It also now enables tutors to more easily manage tasks like one-click class reminders. Those efforts are paying off. The company said course completion rates and overall repurchases have increased. The repurchase rate for its standing mediation course, as one example, has increased to 32.8% in December 2023 from 18.4% in September. The goal is to streamline the operation system across all its courses.
As living standards improve, middle-aged and elderly people seek more than just health or longevity. They want experiences that will provide cultural and intellectual enrichment. Our diverse range of online courses includes many which are tailored to the interests of these demographics, said QuantaSings CEO. Our platform is dedicated to lifelong learning, and we have always emphasized user engagement and satisfaction. This means we are well equipped to fulfill user desire for intellectual stimulation and personal growth.
Featured photo by Alexander Schimmeck on Unsplash.
QuantaSing is a leading online service provider in China dedicated to improving peoples quality of life and well-being by providing lifelong personal learning and development opportunities. The Company is the largest service provider in Chinas online adult learning market and Chinas adult personal interest learning market in terms of revenue, according to a report by Frost & Sullivan based on data from 2022. By leveraging its proprietary tools and technology, QuantaSing offers easy-to-understand, affordable, and accessible online courses to adult learners, empowering users to pursue personal development. Leveraging its extensive experience in individual online learning services and its robust technology infrastructure, the Company has expanded its services to corporate clients, and diversified its operations into its e-commerce business and its AI and technology business.
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