GSX Announces Second Quarter 2020 Unaudited Financial Results

BEIJING,Sept.2,2020 -- GSX Techedu Inc. (NYSE: GSX) ("GSX" or the "Company"),a leading online K-12 large-class after-school tutoring service provider in China,today announced its unaudited financial results for the second quarter ended June 30,2020.

Second Quarter 2020 Highlights[1]

Net revenues was RMB1,650.3 million,a 366.6% year-over-year increase.

- Net revenues of online K-12 courses increased 412.4% year-over-year to RMB1,385.0 million.

Gross billings[2] was RMB2,401.0 million,a 300.6% year-over-year increase.

- Gross billings of online K-12 courses increased 335.5% year-over-year to RMB2,196.1 million.

Paid course enrollments[3] increased 331.7% year-over-year to 1,567 thousand.

- Paid course enrollments of online K-12 increased 366.0% year-over-year to 1,496 thousand.

Net income increased 13.4% year-over-year to RMB18.6 million.

Non-GAAP net income increased 133.0% year-over-year to RMB72.7 million.

Net operating cash inflow increased 172.4% year-over-year to RMB528.0 million.

Second Quarter 2020 Key Financial and Operating Data

(In thousands of RMB,except for paid course enrollments and percentages)

Three Months Ended June 30,

2019

2020

Pct. Change

Net revenues[4]

353,679

1,650,314

366.6%

K-12 courses

270,267

1,384,968

412.4%

Foreign language,professional and interest

76,985

260,371

238.2%

Gross billings[5]

599,373

2,400,996

300.6%

K-12 courses

504,281

2,196,077

335.5%

Foreign language,professional and interest

85,286

202,392

137.3%

Paid course enrollments(In thousands)

363

1,567

331.7%

K-12 courses

321

1,496

366.0%

Foreign language,professional and interest

42

71

69.0%

Net income

16,374

18,627

13.4%

Non-GAAP net income

31,235

72,712

133.0%

Net operating cash inflow

193,840

527,999

172.4%

[1] For a reconciliation of non-GAAP numbers,please see the table captioned "Reconciliations of non-GAAP

measures to the most comparable GAAP measures" at the end of this press release. Non-GAAP income from

operations,non-GAAP net income exclude share-based compensation expenses.

[2] Gross billings is a non-GAAP financial measure,which is defined as the total amount of cash received for the

sale of course offerings in such period,net of the total amount of refunds in such period. See "About Non-

GAAP Financial Measures" and "Reconciliations of non-GAAP measures to the most comparable GAAP

measures" elsewhere in this press release.

[3] Paid course enrollments for a certain period refer to the cumulative number of paid courses enrolled in and

paid for by our students,including multiple paid courses enrolled in and paid for by the same student. Paid

courses refer to our courses that are charged not less than RMB99.0 per course in fees.

[4] The breakdown does not include amount generated from other services because it is negligible.

[5] The breakdown does not include amount generated from other services because it is negligible.

Six Months Ended June 30,2020 Highlights

Net revenues was RMB2,947.9 million,a 373.3% year-over-year increase.

- Net revenues of online K-12 increased 427.8% year-over-year to RMB2,505.1 million.

Gross billings was RMB3,775.4 million,a 319.7% year-over-year increase.

- Gross billings of online K-12 increased 342.2% year-over-year to RMB3,286.7 million.

Paid course enrollments increased 323.3% year-over-year to 2,341 thousand.

- Paid course enrollments of online K-12 increased 350.2% year-over-year to 2,143 thousand.

Net income increased 231.2% year-over-year to RMB166.6 million.

Non-GAAP net income increased 282.4% year-over-year to RMB263.5 million.

Net operating cash inflow increased 149.9% year-over-year to RMB645.7 million.

First Six Months of 2020 Key Financial and Operating Data

(In thousands of RMB,except for paid course enrollments and percentages)

Six Months Ended June 30,

2019

2020

Pct. Change

Net revenues

622,834

2,947,894

373.3%

K-12 courses

474,577

2,505,057

427.8%

Foreign language,professional and interest

137,625

434,557

215.8%

Gross billings

899,468

3,775,395

319.7%

K-12 courses

743,347

3,286,669

342.2%

Foreign language,professional and interest

139,782

481,705

244.6%

Paid course enrollments(In thousands)

553

2,341

323.3%

K-12 courses

476

2,143

350.2%

Foreign language,professional and interest

77

198

157.1%

Net income

50,265

166,615

231.2%

Non-GAAP net income

68,948

263,453

282.4%

Net operating cash inflow

258,449

645,730

149.9%

Larry Xiangdong Chen,GSX's founder,Chairman and CEO,commented,"Against the backdrop of a successful containment of COVID-19 in China,GSX has delivered another robust quarter with net revenues hitting a record,benefiting from a focused strategy and distinguished organizational capability. Our net revenues and gross billings both maintained over 4 times year-over-year growth for another quarter. Our K-12 courses' net revenues,in particular,has been growing fivefold year-over-year for over ten consecutive quarters,further solidifying our position among the top-tier players. We are thrilled to see the growth of paid course enrollment has accelerated to 332% year-over-year,from 259% in the prior year. Coupled with the high-speed growth,we remained profitable for the eighth consecutive quarter and non-GAAP profitable for the ninth consecutive quarter. Moreover,we generated net operating cash inflow of RMB527,999 thousand,a 172.4% increase year-over-year,thanks to the exceptional student retention in the Spring. We plan to execute a profitable growth strategy for the whole year,and we will make efforts to prioritize investments in high ROI traffic acquisition channels,focus on an online live large-class education business model,and continually enhance our organizational capabilities. As a leading player in the online education industry,we will remain humble and down-to-earth,to redefine the online live large-class to a format that delivers the quality of a large class,the learning experience of a small class,and the feelings and effects of a one-on-one class."

Shannon Shen,CFO of GSX,added,"Our graduates achieved outstanding results in the recently administered Chinese high school and college entrance exams,a testament to GSX's superior education quality. This summer vacation provided an unprecedented opportunity for online education companies. On the one hand,the pandemic deepened parents' adoption and understanding of the value of online education. On the other hand,industry leaders are increasingly reaping the benefits from market status and business scale. Resource allocation and customer acquisition strategy for this summer will not only impact the second half of 2020,but also place a solid foundation to mid-to-long term business development. The first-mover advantage is critical for success,and we strategically front-loaded investments in recruitment and training of instructors and tutors,technical support and traffic acquisition for the third quarter. Meanwhile,we executed the share repurchase program upon approval of the Board. This program reflects management's focus on generating long-term value for shareholders,and marks the confidence we have in the Company's long-term growth potential."

Financial Results for the Second Quarter of 2020

Net Revenues

Net revenues reached RMB1,a 366.6% increase from RMB353.7 million in the second quarter of 2019. The increase was mainly driven by the growth in paid course enrollments for K-12 courses. The number of online K-12 paid course enrollments increased 366.0% year-over-year to 1,496 thousand,which was contributed by both first-time paid course enrollments and retention of existing students. The increase in first-time paid course enrollments was primarily driven by our effective investment in sales and marketing efforts and the increase in retention was primarily driven by high teaching quality and optimized services that we provided.

Cost of Revenues

Cost of revenues rose 256.4% to RMB360.7 million from RMB101.2 million in the second quarter of 2019,mainly due to the increase in compensation for instructors and tutors,learning materials,rental expenses,as well as server and bandwidth costs.

Gross Profit

Gross profit increased 410.8% to RMB1,289.7 million from RMB252.5 million in the second quarter of 2019.Gross profit margin increased to 78.1% from 71.4% in the same period of 2019,primarily as a result of economies of scale.

Non-GAAP gross profit increased 408.1% to RMB1,305.4 million from RMB256.9 million in the same period of 2019. Non-GAAP gross profit margin increased to 79.1% from 72.6% in the same period of 2019.

Operating Expenses

Operating expenses were RMB1,450.4 million,increasing from RMB236.3 million in the second quarter of 2019.

Selling expenses increased to RMB1,204.8 million from RMB169.0 million in the second quarter of 2019. The increase was primarily a result of higher marketing expenses to expand the user base and enhance our brands,as well as an increase in compensation to sales and marketing staff.

Research and development expenses increased 240.4% to RMB139.9 million,from RMB41.1 million in the second quarter of 2019. The increase was primarily due to an increase in the number of course professionals and technology development personnel,as well as an increase in compensation for such staff.

General and administrative expenses increased to RMB105.7 million from RMB26.1 million in the second quarter of 2019. The increase in general and administrative expenses was mainly due to an increase in the number of general and administrative personnel,an increase in compensation paid to general and administrative staff,and an increase in fees for investigation purpose.

Income (Loss) from Operations

Loss from operations was RMB160.8 million,compared with income from operations of RMB16.2 million in the second quarter of 2019. The decrease was primarily due to higher investment in sales and marketing activities to extend volume growth and strengthen brand perception.

Non-GAAP loss from operations was RMB106.7 million,compared with income from operations of RMB31.1 million in the second quarter of 2019.

Interest Income and Realized Gains from Investment

Aggregation of interest income and realized gains from investments this quarter,representing the income received from cash,cash equivalents,short-term and long-term wealth management investments,increased 505.0% to RMB24.2 million,from RMB4.0 million in the second quarter of 2019. This increase was primarily due to an increase of cash,cash equivalents and short-term wealth management investments,as well as the realization of gains generated from short-term and long-term wealth management investments during this quarter.

Other Income

Other income increased to RMB87.7 million,from RMB91.0 thousand in the second quarter of 2019. The increase was primarily due to the value-added tax exemption offered by the government,partially offset by the related cost,during the COVID-19 outbreak,which amounted to RMB88.8 million,net of other expenses amounted to RMB1.1 million.

Net Income

Net income increased to RMB18.6 million,from RMB16.4 million in the second quarter of 2019.

Non-GAAP net income increased to RMB72.7 million,from RMB31.2 million in the second quarter of 2019.

Cash Flow

Net operating cash inflow for the second quarter of 2020 was RMB528.0million,a 172.4% increase from RMB193.8 million in the second quarter of 2019. Further,an installment of RMB22.3 million of the Zhengzhou properties purchases,along with payments for other capital expenditures amounted to RMB76.0 million,were made during the period.

Basic and Diluted Net Income per ADS

Basic and diluted net income per ADS were RMB0.08 and RMB0.07,respectively,in the second quarter of 2020.

Non-GAAP basic and diluted net income per ADS,were RMB0.31 and RMB0.29,in the second quarter of 2020.

Share Count

As of June 30,2020,the Company had 158,883,260 ordinary shares outstanding.

Cash and Cash Equivalents,Short-term Investments and Long-term Investments

As of June 30,the Company had cash and cash equivalents,short-term investments and long-term investments amounted to RMB2,941.9 million in aggregate,compared with a total of RMB2,735.7 million of cash and cash equivalents,short-term investments and long-term investments as of December 31,2019.

Inventory

As of June 30,the Company's inventory amounted to RMB69.1 million,compared with RMB8.8 million as of December 31,2019. This increase was primarily resulting from the increase of learning materials to support the rapid growth of students.

Accrued expenses and other current liabilities

As of June 30,the Company's accrued expenses and other current liabilities balance was RMB697.9 million,increasing from RMB228.8 million as of December 31,2019. This increase was mainly resulting from the consideration of purchasing the Zhengzhou properties,as well as the increase of salary and welfare payables.

Deferred Revenue

As of June 30,the Company's deferred revenue balance was RMB1,961.1 million,increasing 46.6% from RMB1,337.6 million as of December 31,2019. Deferred revenue primarily consisted of tuition collected in advance.

Other Payables

As of June 30,other payables in non-current liabilities totaled RMB63.9 million,all of which were payables to purchase the Zhengzhou properties.

Recent Development

Share Repurchase

In May 2020,GSX's board of directors authorized a share repurchase program,under which the Company may repurchase up to US$150 million worth of its shares. In May 2020,the Company repurchased approximately 1.1 million ADSs for approximately US$39.8 million.

SEC Investigation

Following a number of short-seller reports about the Company from approximately February 2020 to approximately July 2020,the SEC's Division of Enforcement contacted the Company,requesting it to produce certain financial and operating records dating from January 1,2017. The Company is cooperating with the SEC. We cannot predict the timing,outcome,or consequence of the SEC investigation.

Prior to the SEC contact,the Audit Committee of the Board of Directors of the Company engaged third party professional advisers to conduct an internal independent review into these reports' key allegations. As work remains ongoing,we cannot predict the timing,or consequence of that review.

Business Outlook

Based on the Company's current estimates,total net revenues for the third quarter of 2020 are expected to be between RMB1,936million and RMB1,966 million,representing an increase of 247.6% to 253.0% on a year-over-year basis. These estimates reflect the Company's current expectations,which are subject to change.

Conference Call

The Company will hold an earnings conference call on Wednesday,September 2,at 8:00 AM U.S. Eastern Time (8:00 PM on the same day,Beijing/Hong Kong Time). Dial-in details for the earnings conference call are as follows:

International:

1-412-317-6061

US:

1-888-317-6003

Hong Kong:

800-963976

Mainland China:

4001-206115

Passcode:

4536408

A telephone replay will be available two hours after the conclusion of the conference call through September 9,2020. The dial-in details are:

International:

1-412-317-0088

US:

1-877-344-7529

Passcode:

10146943

Additionally,a live and archived webcast of this conference call will be available at http://gsx.investorroom.com/.

Safe Harbor Statement

This announcement contains forward-looking statements. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates" and similar statements. Among other things,the outlook for the third quarter of 2020 and GSX's strategic and operational plans,contain forward-looking statements. The Company may also make written or oral forward-looking statements in its reports filed with,or furnished to,the U.S. Securities and Exchange Commission,in its annual reports to shareholders,in press releases and other written materials and in oral statements made by its officers,directors or employees to third parties. Statements that are not historical facts,including statements about the Company's beliefs and expectations,are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement,including but not limited to the following: the Company's ability to continue to attract students to enroll in its courses; the Company's ability to continue to recruit,train and retain qualified teachers; the Company's ability to improve the content of its existing course offerings and to develop new courses; the Company's ability to maintain and enhance its brand; the Company's ability to maintain and continue to improve its teaching results; and the Company's ability to compete effectively against its competitors. Further information regarding these and other risks is included in the Company's reports filed with,or furnished to the U.S. Securities and Exchange Commission. All information provided in this press release and in the attachments is as of the date of this press release,and GSX undertakes no duty to update such information or any forward-looking statement,except as required under applicable law.

About GSX Techedu Inc.

GSX Techedu Inc. is a technology-driven education company and leading online K-12 large-class after-school tutoring service provider inChina. GSX offers K-12 courses covering all primary and secondary grades as well as foreign language,professional and interest courses. GSX adopts an online live large-class format to deliver its courses,which the Company believes is the most effective and scalable model to disseminate scarce high-quality teaching resources to aspiring students inChina. Big data analytics permeates each aspect of the Company's business and facilitates the application of the latest technology to improve teaching delivery,student learning experience,and operational efficiency.

About Non-GAAP Financial Measures

The Company uses gross billings,non-GAAP gross profit,non-GAAP income from operations and non-GAAP net income,each a non-GAAP financial measure,in evaluating its operating results and for financial and operational decision-making purposes.

The Company defines gross billings for a specific period as the total amount of cash received for the sale of course offerings in such period,net of the total amount of refunds in such period. The Company's management uses gross billings as a performance measurement because the Company generally bills its students for the entire course fee at the time of sale of its course offerings and recognizes revenue proportionally as the classes are delivered over usually no more than 60 classes for K-12 courses. For some courses,the Company continues to provide students with 12 months to 36 months access to the pre-recorded audio-video courses after the online live courses are delivered. The Company believes that gross billings provides valuable insight into the sales of its course packages and the performance of its business. As gross billings has material limitations as an analytical metrics and may not be calculated in the same manner by all companies,it may not be comparable to other similarly titled measures used by other companies.

Non-GAAP gross profit,non-GAAP income from operations and non-GAAP net income exclude share-based compensation expenses,and such adjustment excludes the impact on income tax. GSX believes that these non-GAAP financial measures provide meaningful supplemental information regarding its performance and liquidity by excluding share-based expenses that may not be indicative of its operating performance from a cash perspective. GSX believes that both management and investors benefit from these non-GAAP financial measures in assessing its performance and when planning and forecasting future periods. These non-GAAP financial measures also facilitate management's internal comparisons to GSX's historical performance. A limitation of using non-GAAP measures is that these non-GAAP measures exclude share-based compensation charges that have been and will continue to be for the foreseeable future a significant recurring expense in the Company's business.

The presentation of these non-GAAP financial measures is not intended to be considered in isolation from or as a substitute for the financial information prepared and presented in accordance with GAAP. For more information on these non-GAAP financial measures,please see the table captioned "Reconciliations of non-GAAP measures to the most comparable GAAP measures" set forth at the end of this release.

The accompanying tables have more details on the reconciliations between GAAP financial measures that are most directly comparable to non-GAAP financial measures.

Exchange Rate

The Company's business is primarily conducted in China and the significant majority of revenues generated are denominated in Renminbi ("RMB"). This announcement contains currency conversions of RMB amounts into U.S. dollars ("USD") solely for the convenience of the reader. Unless otherwise noted,all translations from RMB to USD are made at a rate of RMB7.0651 to USD1.00,the effective noon buying rate for June 30,2020 as set forth in the H.10 statistical release of the Federal Reserve Board. No representation is made that the RMB amounts could have been,or could be,converted,realized or settled into USD at that rate on June 30,or at any other rate.

For further information,please contact:

GSX Techedu Inc.

Ms. Sandy Qin,CFA

E-mail: ir@genshuixue.com

Christensen

In China

Mr. Eric Yuan

Phone: +86-10-5900-1548

E-mail: Eyuan@christensenir.com

In US

Ms. Linda Bergkamp

Phone: +1-480-614-3004

Email: lbergkamp@christensenir.com

GSX Techedu Inc.

Unaudited condensed consolidated balance sheets

(In thousands of RMB and USD,except for share,per share and per ADS data)

As of

December 31,

As of June 30,

2019

2020

2020

RMB

RMB

USD

ASSETS

Current assets

Cash and cash equivalents

73,967

225,281

31,886

Short-term investments

1,473,452

2,144,386

303,518

Inventory

8,822

69,068

9,776

Prepaid expenses and other current assets

252,660

539,761

76,399

Total current assets

1,808,901

2,978,496

421,579

Non-current assets

Operating lease right-of-use assets

264,909

558,976

79,118

Property,equipment and software,net

81,860

555,031

78,560

Land use rights,net

-

29,385

4,159

Long-term investments

1,188,286

572,223

80,993

Deferred tax assets

30,716

160,405

22,704

Rental deposit

18,719

33,838

4,789

Other non-current assets

1,141

1,332

189

Total ASSETS

3,394,532

4,889,686

692,091

LIABILITIES

Current liabilities

Accrued expenses and other current liabilities

(including accrued expenses and other current

liabilities of the consolidated VIE without

recourse to the Group of RMB188,975 and

RMB347,164 as of December 31,2019 and

June 30,respectively)

228,753

697,917

98,784

Deferred revenue,current portion of the

consolidated VIE without recourse to the Group

1,331,962

1,957,955

277,130

Current portion of operating lease liabilities of

the consolidated VIE without recourse to the

Group

59,982

102,209

14,467

Income tax payable of the consolidated VIE

without recourse to the Group

16,093

-

-

Amounts due to related parties (including

amounts due to related parties of the

consolidated VIE without recourse to the Group

of RMB460 and nil as of December 31,2019

and June 30,respectively)

460

-

-

Total Current liabilities

1,637,250

2,758,081

390,381

GSX Techedu Inc.

Unaudited condensed consolidated balance sheets

(In thousands of RMB and USD,

As of June 30,

2019

2020

2020

RMB

RMB

USD

Non-current liabilities

Deferred revenue,non-current portion of the

consolidated VIE without recourse to the

Group

5,674

3,148

446

Non-current portion of operating lease liabilities

of the consolidated VIE without recourse to the

Group

194,228

438,695

62,093

Deferred tax liabilities of the consolidated VIE

without recourse to the Group

25

74,111

10,490

Other payables

-

63,934

9,049

TOTAL LIABILITIES

1,837,177

3,337,969

472,459

SHAREHOLDERS' EQUITY

Ordinary shares

106

106

15

Treasury stock,at cost

(86,739)

(235,482)

(33,330)

Additional paid-in capital

1,899,059

1,862,105

263,564

Accumulated other comprehensive income

17,829

31,273

4,426

Statutory reserve

6,921

6,921

980

Accumulated deficit

(279,821)

(113,206)

(16,023)

TOTAL SHAREHOLDERS' EQUITY

1,557,355

1,551,717

219,632

TOTAL LIABILITIES AND TOTAL

SHAREHOLDERS' EQUITY

3,091

GSX Techedu Inc.

Unaudited condensed consolidated statements of operations

(In thousands of RMB and USD,per share and per ADS data)

For the three months ended June 30,

For the six months ended June 30,

2019

2020

2020

2019

2020

2020

RMB

RMB

USD

RMB

RMB

USD

Net Revenues:

353,679

1,314

233,587

622,834

2,894

417,247

Online K-12 Courses

270,968

196,029

474,057

354,568

Adult courses education services

76,371

36,853

137,557

61,508

Other services

6,427

4,975

705

10,632

8,280

1,171

Cost of revenues

(101,189)

(360,661)

(51,048)

(183,234)

(643,911)

(91,140)

Gross profit

252,490

1,289,653

182,539

439,600

2,303,983

326,107

Operating expenses

Selling expenses

(169,048)

(1,204,803)

(170,529)

(268,567)

(1,962,037)

(277,708)

Research and development expenses

(41,128)

(139,878)

(19,798)

(71,570)

(239,288)

(33,869)

General and administrative expenses

(26,088)

(105,744)

(14,967)

(40,510)

(171,500)

(24,274)

Total operating expenses

(236,264)

(1,450,425)

(205,294)

(380,647)

(2,372,825)

(335,851)

Income(Loss) from operations

16,226

(160,772)

(22,755)

58,953

(68,842)

(9,744)

Interest income

2,580

274

39

3,641

519

73

Realized gains from investments

1,410

23,885

3,381

1,465

36,238

5,129

Other income

91

87,722

12,416

624

149,653

21,182

Income(Loss) before provision for income

tax and loss from equity method

investments

20,307

(48,891)

(6,919)

64,683

117,568

16,640

Income tax (expenses)/benefits

(4,539)

68,520

9,698

(14,557)

50,528

7,152

Income(Loss) from equity method investments

606

(1,002)

(142)

139

(1,481)

(210)

Net income

16,374

18,627

2,637

50,265

166,615

23,582

Less: Series A convertible redeemable preferred

shares redemption value accretion

7,039

-

-

16,772

-

-

Less: Undistributed earnings allocated to the

participating preferred shares

1,682

-

-

4,212

-

-

Net income attributable to GSX Techedu

Inc.'s ordinary shareholders

7,653

18,637

29,281

166,582

Net income per ordinary share

Basic

0.06

0.12

0.02

0.27

1.05

0.15

Diluted

0.06

0.11

0.02

0.25

0.99

0.14

Net income per ADS

Basic

0.04

0.08

0.01

0.18

0.70

0.10

Diluted

0.04

0.07

0.01

0.17

0.66

0.09

Weighted average shares used in net income

per share

Basic

120,701,922

159,135,290

159,290

106,542,125

159,124,542

159,542

Diluted

129,617,224

167,718,073

167,073

115,457,427

167,759,386

167,386

Note: Three ADS represents two ordinary shares.

GSX Techedu Inc.

Reconciliations of non-GAAP measures to the most comparable GAAP measures

(In thousands of RMB and USD,

2019

2020

2020

2019

2020

2020

RMB

RMB

USD

RMB

RMB

USD

Net revenues

353,247

Less: other revenues(1)

-

999

141

-

999

141

Add: VAT and surcharges

23,121

99,332

14,060

36,051

176,904

25,039

Add: ending deferred revenue

503,655

1,961,103

277,576

503,576

Add: ending refund liability

20,136

82,696

11,705

20,705

Less: beginning deferred revenue

291,355

1,338,791

189,494

272,041

1,636

189,330

Less: beginning refund liability

9,863

52,659

7,453

11,167

54,567

7,723

Gross billings (non-GAAP)

599,373

2,996

339,840

899,468

3,395

534,373

Note (1): Include miscellaneous revenues generated from services other than courses.

For the three months ended June 30,

2019

2020

2020

2019

2020

2020

RMB

RMB

USD

RMB

RMB

USD

Gross profit

252,107

Share-based compensation

expense in cost of revenues

4,437

15,744

2,228

4,860

29,588

4,188

Non-GAAP gross profit

256,927

1,305,397

184,767

444,460

2,333,571

330,295

Income(Loss) from operations

16,755)

58,953

(68,842)

(9,744)

Share-based compensation

expenses

14,861

54,085

7,655

18,683

96,838

13,707

Non-GAAP income(loss)

from operations

31,087

(106,687)

(15,100)

77,636

27,996

3,963

Net income

16,637

50,265

166,615

23,582

Share-based compensation

expenses

14,707

Non-GAAP net income

31,235

72,712

10,292

68,948

263,453

37,289