TAL Education Group Announces Unaudited Financial Results for the Second Fiscal Quarter Ended August 31, 2024 and Issues Notice of Annual General Meeting
BEIJING, Oct. 24, 2024 /PRNewswire/ -- TAL Education Group (NYSE: TAL) ("TAL" or the "Company"), a smart learning solutions provider in China, today announced its unaudited financial results for the second quarter of fiscal year 2025 ended August 31, 2024 and issued notice of Annual General Meeting.
Highlights for the Second Quarter of Fiscal Year 2025
-- Net revenues were US$619.4 million, compared to net revenues of US$411.9
million in the same period of the prior year.
-- Income from operations was US$47.6 million, compared to income from
operations of US$31.8 million in the same period of the prior year.
-- Non-GAAP income from operations, which excluded share-based compensation
expenses, was US$64.5 million, compared to non-GAAP income from
operations of US$52.7 million in the same period of the prior year.
-- Net income attributable to TAL was US$57.4 million, compared to net
income attributable to TAL of US$37.9 million in the same period of the
prior year.
-- Non-GAAP net income attributable to TAL, which excluded share-based
compensation expenses, was US$74.3 million, compared to non-GAAP net
income attributable to TAL of US$58.8 million in the same period of the
prior year.
-- Basic and diluted net income per American Depositary Share ("ADS") were
both US$0.09. Non-GAAP basic and diluted net income per ADS, which
excluded share-based compensation expenses, were both US$0.12. Three
ADSs represent one Class A common share.
-- Cash, cash equivalents and short-term investments totaled US$3,454.3
million as of August 31, 2024, compared to US$3,303.3 million as of
February 29, 2024.
Highlights for the Six Months Ended August 31, 2024
-- Net revenues were US$1,033.5 million, compared to net revenues of
US$687.4 million in the same period of the prior year.
-- Income from operations was US$30.3 million, compared to loss from
operations of US$26.0 million in the same period of the prior year.
-- Non-GAAP income from operations, which excluded share-based compensation
expenses, was US$65.4 million, compared to non-GAAP income from
operations of US$20.4 million in the same period of the prior year.
-- Net income attributable to TAL was US$68.8 million, compared to net loss
attributable to TAL of US$7.1 million in the same period of the prior
year.
-- Non-GAAP net income attributable to TAL, which excluded share-based
compensation expenses, was US$103.9 million, compared to non-GAAP net
income attributable to TAL of US$39.3 million in the same period of the
prior year.
-- Basic and diluted net income per ADS were both US$0.11. Non-GAAP basic
and diluted net income per ADS, which excluded share-based compensation
expenses, were both US$0.17.
Financial Data----Second Quarter and First Six Months of Fiscal Year 2025
(In US$ thousands, except per ADS data and percentages)
Three Months Ended
August 31,
2023 2024 Pct. Change
Net revenues 411,931 619,361 50.4 %
Income from operations 31,790 47,622 49.8 %
Non-GAAP income from operations 52,673 64,520 22.5 %
Net income attributable to TAL 37,902 57,431 51.5 %
Non-GAAP net income attributable to TAL 58,785 74,329 26.4 %
Net income per ADS attributable to TAL - basic 0.06 0.09 50.6 %
Net income per ADS attributable to TAL - diluted 0.06 0.09 50.7 %
Non-GAAP net income per ADS attributable to 0.10 0.12 25.7 %
TAL - basic
Non-GAAP net income per ADS attributable to 0.10 0.12 25.8 %
TAL - diluted
Six Months Ended
August 31,
2023 2024 Pct. Change
Net revenues 687,371 1,033,548 50.4 %
(Loss)/Income from operations (25,983) 30,292 (216.6 %)
Non-GAAP income from operations 20,413 65,396 220.4 %
Net (loss)/income attributable to TAL (7,135) 68,833 (1,064.7 %)
Non-GAAP net income attributable to TAL 39,261 103,937 164.7 %
Net (loss)/income per ADS attributable to TAL - (0.01) 0.11 (1,085.2 %)
basic
Net (loss)/income per ADS attributable to TAL - (0.01) 0.11 (1,068.4 %)
diluted
Non-GAAP net income per ADS attributable to 0.06 0.17 170.3 %
TAL - basic
Non-GAAP net income per ADS attributable to 0.06 0.17 169.9 %
TAL - diluted
"In this quarter we achieved year-on-year revenue growth of 50.4%. AI learning device was one of the faster growing business lines. We are excited about the opportunity to provide for our customers more accessibility to quality learning contents through these AI-power devices," said Alex Peng, TAL's President & Chief Financial Officer.
Mr. Peng added: "As for learning services, we will prudently manage our learning center network, balancing operating efficiency and growth rate. Our primary objective for learning service is to offer quality learning experience to our learners both online and offline."
Financial Results for the Second Quarter of Fiscal Year 2025
Net Revenues
In the second quarter of fiscal year 2025, TAL reported net revenues of US$619.4 million, representing a 50.4% increase from US$411.9 million in the second quarter of fiscal year 2024.
Operating Costs and Expenses
In the second quarter of fiscal year 2025, operating costs and expenses were US$572.0 million, representing a 49.5% increase from US$382.8 million in the second quarter of fiscal year 2024. Non-GAAP operating costs and expenses, which excluded share-based compensation expenses, were US$555.1 million, representing a 53.4% increase from US$361.9 million in the second quarter of fiscal year 2024.
Cost of revenues increased by 59.8% to US$270.6 million from US$169.4 million in the second quarter of fiscal year 2024. Non-GAAP cost of revenues, which excluded share-based compensation expenses, increased by 60.7% to US$268.8 million, from US$167.3 million in the second quarter of fiscal year 2024.
Selling and marketing expenses increased by 56.4% to US$181.9 million from US$116.3 million in the second quarter of fiscal year 2024. Non-GAAP selling and marketing expenses, which excluded share-based compensation expenses, increased by 61.6% to US$177.9 million, from US$110.1 million in the second quarter of fiscal year 2024.
General and administrative expenses increased by 23.1% to US$119.5 million from US$97.1 million in the second quarter of fiscal year 2024. Non-GAAP general and administrative expenses, which excluded share-based compensation expenses, increased by 28.3% to US$108.3 million, from US$84.4 million in the second quarter of fiscal year 2024.
Total share-based compensation expenses allocated to the related operating costs and expenses decreased by 19.1% to US$16.9 million in the second quarter of fiscal year 2025 from US$20.9 million in the same period of fiscal year 2024.
Gross Profit
Gross profit increased by 43.8% to US$348.7 million from US$242.5 million in the second quarter of fiscal year 2024.
Income/(Loss) from Operations
Income from operations was US$47.6 million in the second quarter of fiscal year 2025, compared to income from operations of US$31.8 million in the second quarter of fiscal year 2024. Non-GAAP income from operations, which excluded share-based compensation expenses, was US$64.5 million, compared to Non-GAAP income from operations of US$52.7 million in the same period of the prior year.
Other Income/(Expense)
Other income was US$20.5 million for the second quarter of fiscal year 2025, compared to other income of US$5.0 million in the second quarter of fiscal year 2024.
Impairment Loss on Long-term Investments
Impairment loss on Long-term investment was US$4.9 million for the second quarter of fiscal year 2025, compared to US$30.8 million for the same period of fiscal year 2024.
Income Tax Benefit/(Expense)
Income tax expense was US$25.6 million in the second quarter of fiscal year 2025, compared to US$10.0 million of income tax benefit in the second quarter of fiscal year 2024.
Net Income/(Loss) attributable to TAL Education Group
Net income attributable to TAL was US$57.4 million in the second quarter of fiscal year 2025, compared to net income attributable to TAL of US$37.9 million in the second quarter of fiscal year 2024. Non-GAAP net income attributable to TAL, which excluded share-based compensation expenses, was US$74.3 million, compared to Non-GAAP net income attributable to TAL of US$58.8 million in the second quarter of fiscal year 2024.
Basic and Diluted Net Income/(Loss) per ADS
Basic and diluted net income per ADS were both US$0.09 in the second quarter of fiscal year 2025. Non-GAAP basic and diluted net income per ADS, which excluded share-based compensation expenses, were both US$0.12 in the second quarter of fiscal year 2025.
Cash Flow
Net cash used in operating activities for the second quarter of fiscal year 2025 was US$0.6 million.
Cash, Cash Equivalents, and Short-Term Investments
As of August 31, 2024, the Company had US$2,085.9 million of cash and cash equivalents and US$1,368.4 million of short-term investments, compared to US$2,208.7 million of cash and cash equivalents and US$1,094.6 million of short-term investments as of February 29, 2024.
Deferred Revenue
As of August 31, 2024, the Company's deferred revenue balance was US$517.6 million, compared to US$428.3 million as of February 29, 2024.
Financial Results for the First Six Months of Fiscal Year 2025
Net Revenues
For the first six months of fiscal year 2025, TAL reported net revenues of US$1,033.5 million, representing a 50.4% increase from US$687.4 million in the first six months of fiscal year 2024.
Operating Costs and Expenses
In the first six months of fiscal year 2025, operating costs and expenses were US$1,004.1 million, representing a 38.5% increase from US$724.8 million in the first six months of fiscal year 2024. Non-GAAP operating costs and expenses, which excluded share-based compensation expenses, were US$969.0 million, representing a 42.8% increase from US$678.5 million in the first six months of fiscal year 2024.
Cost of revenues increased by 52.4% to US$470.6 million from US$308.9 million in the first six months of fiscal year 2024. Non-GAAP cost of revenues, which excluded share-based compensation expenses, increased by 53.2% to US$466.5 million from US$304.4 million in the first six months of fiscal year 2024 .
Selling and marketing expenses increased by 42.3% to US$304.3 million from US$213.9 million in the first six months of fiscal year 2024. Non-GAAP selling and marketing expenses, which excluded share-based compensation expenses, increased by 47.7% to US$296.0 million from US$200.4 million in the first six months of fiscal year 2024.
General and administrative expenses increased by 13.4% to US$229.2 million from US$202.0 million in the first six months of fiscal year 2024. Non-GAAP general and administrative expenses, which excluded share-based compensation expenses, increased by 18.9% to US$206.6 million from US$173.7 million in the first six months of fiscal year 2024.
Total share-based compensation expenses allocated to the related operating costs and expenses decreased by 24.3% to US$35.1 million in the first six months of fiscal year 2025 from US$46.4 million in the same period of fiscal year 2024.
Gross Profit
Gross profit increased by 48.7% to US$562.9 million from US$378.5 million in the first six months of fiscal year 2024.
Income/(Loss) from Operations
Income from operations was US$30.3 million in the first six months of fiscal year 2025, compared to loss from operations of US$26.0 million in the same period of the prior year. Non-GAAP income from operations, which excluded share-based compensation expenses, was US$65.4 million, compared to US$20.4 million Non-GAAP income from operations in the same period of the prior year.
Other Income/(Expense)
Other income was US$33.6 million for the first six months of fiscal year 2025, compared to other expense of US$1.8 million in the same period of the prior year.
Impairment Loss on Long-term Investments
Impairment loss on long-term investments was US$8.7 million for the first six months of fiscal year 2025, compared to US$30.8 million for the first six months of fiscal year 2024.
Income Tax Benefit/(Expense)
Income tax expense was US$27.9 million in the first six months of fiscal year 2025, compared to US$6.5 million of income tax benefit in the first six months of fiscal year 2024.
Net Income/(Loss) Attributable to TAL Education Group
Net income attributable to TAL was US$68.8 million in the first six months of fiscal year 2025, compared to net loss attributable to TAL of US$7.1 million in the first six months of fiscal year 2024. Non-GAAP net income attributable to TAL, which excluded share-based compensation expenses, was US$103.9 million, compared to US$39.3 million Non-GAAP income attributable to TAL in the same period of the prior year.
Cash Flow
Net cash provided by operating activities for the first six months of fiscal year 2025 was US$246.2 million.
Basic and Diluted Net Income/(Loss) per ADS
Basic and diluted net income per ADS were both US$0.11 in the first six months of fiscal year 2025. Non-GAAP basic and diluted net income per ADS, which excluded share-based compensation expenses, were both US$0.17 in the first six months of fiscal year 2025.
Share Repurchase
In April 2024, the Company's board of directors authorized to extend its share repurchase program launched in April 2021 by 12 months. Pursuant to the extended share repurchase program, the Company may repurchase up to approximately US$503.8 million of its common shares through April 30, 2025. As of August 31, 2024, the Company has repurchased 499,933 common shares at an aggregate consideration of approximately US$13.1 million under the share repurchase program.
TAL to Hold Annual General Meeting on November 15, 2024
The Company announced that it will hold its annual general meeting of shareholders (the "AGM") at TAL Building No.1, Courtyard No. 9, Qixin Middle Street, Changping District, Beijing, China, on November 15, 2024 at 3:00PM (Beijing time). No proposal will be submitted to shareholders for approval at the AGM. Instead, the AGM will serve as an open forum for shareholders and beneficial owners of the Company's ADSs to discuss Company's affairs with management.
The board of directors of the Company has fixed the close of business on November 4, 2024 (Eastern Standard Time) as the record date (the "Record Date"). Holders of record of the Company's common shares at the close of business on the Record Date are entitled to notice of the AGM and any adjournment or postponement thereof. Beneficial owners of the Company's ADSs are welcome to attend the AGM in person.
The notice of the AGM is available on the Investor Relations section of the Company's website at https://ir.100tal.com/. The Company has filed its annual report on Form 20-F (the "Annual Report"), which includes the Company's audited financial statements for the fiscal year ended February 29, 2024, with the U.S. Securities and Exchange Commission (the "SEC"). The Company's Annual Report can be accessed on the Investor Relations section of its website at https://ir.100tal.com, as well as on the SEC's website at http://www.sec.gov.
Conference Call
The Company will host a conference call and live webcast to discuss its financial results for the second fiscal quarter of fiscal year 2025 ended August 31, 2024 at 8:00 a.m. Eastern Time on October 24, 2024 (8:00 p.m. Beijing time on October 24, 2024).
Please note that you will need to pre-register for conference call participation at
https://register.vevent.com/register/BIb77ca114970c4bd1bfe7d1770af84eac.
Upon registration, you will receive an email containing participant dial-in numbers and unique Direct Event Passcode. This information will allow you to gain immediate access to the call. Participants may pre-register at any time, including up to and after the call start time.
A live and archived webcast of the conference call will be available on the Investor Relations section of TAL's website at https://ir.100tal.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, TAL Education Group'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 provide competitive learning services and products; the Company's ability to continue to recruit, train and retain talents; the Company's ability to improve the content of current course offerings and 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 TAL Education Group undertakes no duty to update such information or any forward-looking statement, except as required under applicable law.
About TAL Education Group
TAL Education Group is a smart learning solutions provider in China. The acronym "TAL" stands for "Tomorrow Advancing Life", which reflects our vision to promote top learning opportunities for students through both high-quality teaching and content, as well as leading edge application of technology in the education experience. TAL Education Group offers comprehensive learning solutions to students from all ages through diversified class formats. Our learning solutions mainly cover enrichment learnings programs and some academic subjects in and out of China. Our ADSs trade on the New York Stock Exchange under the symbol "TAL".
About Non-GAAP Financial Measures
In evaluating its business, TAL considers and uses the following measures defined as non-GAAP financial measures by the SEC as supplemental metrics to review and assess its operating performance: non-GAAP operating costs and expenses, non-GAAP cost of revenues, non-GAAP selling and marketing expenses, non-GAAP general and administrative expenses, non-GAAP income from operations, non-GAAP net income attributable to TAL, non-GAAP basic and non-GAAP diluted net income per ADS. To present each of these non-GAAP measures, the Company excludes share-based compensation expenses. The presentation of these non-GAAP financial measures is not intended to be considered in isolation 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.
TAL 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. TAL 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 TAL's historical performance and liquidity. TAL computes its non-GAAP financial measures using the same consistent method from quarter to quarter and from period to period. TAL believes these non-GAAP financial measures are useful to investors in allowing for greater transparency with respect to supplemental information used by management in its financial and operational decision making. 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. Management compensates for these limitations by providing specific information regarding the GAAP amounts excluded from each non-GAAP measure. The accompanying tables have more details on the reconciliations between GAAP financial measures that are most directly comparable to non-GAAP financial measures.
For further information, please contact:
Jackson Ding
Investor Relations
TAL Education Group
Tel: +86 10 5292 6669-8809
Email: ir@tal.com
TAL EDUCATION GROUP
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands of U.S. dollars)
As of As of
February
29, August 31,
2024 2024
ASSETS
Current assets
Cash and cash equivalents $2,208,756 $2,085,891
Restricted cash-current 167,656 251,072
Short-term investments 1,094,593 1,368,446
Inventory 68,328 82,372
Amounts due from related parties-current 343 394
Prepaid expenses and other current assets 159,498 167,538
Total current assets 3,699,174 3,955,713
Restricted cash-non-current 81,064 43,991
Property and equipment, net 405,319 463,595
Deferred tax assets 4,620 4,061
Rental deposits 16,947 20,406
Intangible assets, net 1,988 1,848
Land use rights, net 189,049 189,763
Amounts due from related parties-non-current 59 60
Long-term investments 284,266 299,330
Long-term prepayments and other non-current assets 14,359 25,585
Operating lease right-of-use assets 231,104 336,573
Total assets $4,927,949 $5,340,925
LIABILITIES AND EQUITY
Current liabilities
Accounts payable $127,321 $167,317
Deferred revenue-current 400,286 485,391
Amounts due to related parties-current 96 111
Accrued expenses and other current liabilities 491,911 555,292
Short-term debt - 6,347
Operating lease liabilities, current portion 62,604 79,584
Total current liabilities 1,082,218 1,294,042
Deferred revenue-non-current 27,993 32,171
Deferred tax liabilities 2,360 3,662
Operating lease liabilities, non-current portion 176,614 262,357
Total liabilities 1,289,185 1,592,232
Equity
Class A common shares 152 153
Class B common shares 49 49
Additional paid-in capital 4,256,957 4,264,582
Statutory reserve 165,138 164,490
Accumulated deficit (694,270) (624,789)
Accumulated other comprehensive loss (65,928) (46,630)
Total TAL Education Group's equity 3,662,098 3,757,855
Noncontrolling interests (23,334) (9,162)
Total equity 3,638,764 3,748,693
Total liabilities and equity $4,927,949 $5,340,925
TAL EDUCATION GROUP
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands of U.S. dollars, except share, ADS, per share and per ADS data)
For the Three Months Ended For the Six Months Ended
August 31,
August 31
,
2023 2024 2023 2024
Net revenues $411,931 $619,361 $687,371 $1,033,548
Cost of revenues (note 1) 169,382 270,632 308,895 470,640
Gross profit 242,549 348,729 378,476 562,908
Operating expenses (note 1)
Selling and marketing 116,268 181,900 213,925 304,328
General and administrative 97,106 119,499 202,029 229,181
Total operating expenses 213,374 301,399 415,954 533,509
Government subsidies 2,615 292 11,495 893
Income/(loss) from operations 31,790 47,622 (25,983) 30,292
Interest income, net 20,976 20,397 43,957 42,919
Other income/(expense) 5,032 20,466 (1,813) 33,617
Impairment loss on long-term
investments
(30,761) (4,925) (30,761) (8,692)
Income/(loss) before income tax 27,037 83,560 (14,600) 98,136
benefit/(expense) and
income/(loss) from equity
method investments
Income tax benefit/(expense) 10,018 (25,635) 6,499 (27,930)
Income/(loss) from equity method 779 (587) 708 (1,572)
investments
Net income/(loss) 37,834 57,338 (7,393) 68,634
Add: Net loss attributable to 68 93 258 199
noncontrolling interests
Total net income/(loss) $37,902 $57,431 $(7,135) $68,833
attributable to TAL
Education Group
Net income/(loss) per common
share
Basic $0.19 $0.28 $(0.03) $0.34
Diluted 0.19 0.28 (0.03) 0.34
Net income/(loss) per ADS (note 2)
Basic $0.06 $0.09 $(0.01) $0.11
Diluted 0.06 0.09 (0.01) 0.11
Weighted average shares used in
calculating net income/(loss)
per common share
Basic 200,565,383 201,768,916 205,942,678 201,668,024
Diluted 203,859,192 204,949,839 205,942,678 205,166,141
Note1: Share-based compensation expenses are included in the operating costs and expenses as follows:
For the Three Months For the Six Months
Ended August 31, Ended August 31,
2023 2024 2023 2024
Cost of revenues $2,081 $1,793 $4,490 $4,155
Selling and marketing expenses 6,134 3,953 13,562 8,328
General and administrative expenses 12,668 11,152 28,344 22,621
Total $20,883 $16,898 $46,396 $35,104
Note 2: Three ADSs represent one Class A common Share.
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TAL EDUCATION GROUP
UNAUDITED CONDENSED CONSOLIDATED
STATEMENTS OF
COMPREHENSIVE INCOME/(LOSS)
(In thousands of U.S. dollars)
For the Three Months For the Six Months
Ended Ended
August 31, August 31,
2023 2024 2023 2024
Net income/(loss) $37,834 $57,338 $(7,393) $68,634
Other comprehensive (20,782) 24,744 (44,595) 17,164
(loss)/income, net of tax
Comprehensive
income/(loss) 17,052 82,082 (51,988) 85,798
Add: Comprehensive (452) 2,378 (913) 2,333
(income)/loss attributable to
noncontrolling interests
Comprehensive
income/(loss) $16,600 $84,460 $(52,901) $88,131
attributable to TAL
Education Group
TAL EDUCATION GROUP
UNAUDITED CONDENSED CONSOLIDATED
STATEMENTS OF
CASH FLOWS
(In thousands of U.S. dollars)
For the Three Months
Ended For the Six Months Ended
August 31, August 31,
2023 2024 2023 2024
Net cash (used in)/provided by $(42,721) $(576) $82,795 $246,217
operating activities
Net cash provided by/(used in) 181,887 (193,669) 342,802 (318,304)
investing activities
Net cash used in financing (82,271) (6,799) (233,508) (6,794)
activities
Effect of exchange rate (5,406) 3,576 (9,916) 2,359
changes
Net increase/(decrease) in 51,489 (197,468) 182,173 (76,522)
cash, cash equivalents and
restricted cash
Cash, cash equivalents and $2,425,591 $2,578,422 $2,294,907 $2,457,476
restricted cash at the
beginning of period
Cash, cash equivalents and $2,477,080 $2,380,954 $2,477,080 $2,380,954
restricted cash at the end
of period
TAL EDUCATION GROUP
Reconciliation of Non-GAAP Measures to the Most Comparable GAAP Measures
(In thousands of U.S. dollars, except share, ADS, per share and per ADS data)
For the Three Months For the Six Months
Ended August 31,
Ended August 31,
2023 2024 2023 2024
Cost of revenues $169,382 $270,632 $308,895 $470,640
Share-based compensation expense 2,081 1,793 4,490 4,155
in cost of revenues
Non-GAAP cost of revenues 167,301 268,839 304,405 466,485
Selling and marketing expenses 116,268 181,900 213,925 304,328
Share-based compensation expense 6,134 3,953 13,562 8,328
in selling and marketing expenses
Non-GAAP selling and marketing 110,134 177,947 200,363 296,000
expenses
General and administrative
expenses
97,106 119,499 202,029 229,181
Share-based compensation expense 12,668 11,152 22,621
in general and administrative expenses
28,344
Non-GAAP general and
administrative expenses
84,438 108,347 173,685 206,560
Operating costs and expenses 382,756 572,031 724,849 1,004,149
Share-based compensation expense
in operating costs and expenses
20,883 16,898 46,396 35,104
Non-GAAP operating costs and
expenses
361,873 555,133 678,453 969,045
Income/(loss) from operations 31,790 47,622 (25,983) 30,292
Share based compensation expenses 20,883 16,898 46,396 35,104
Non-GAAP income from
operations (note 3)
52,673 64,520 20,413 65,396
Net income/(loss) attributable to
TAL Education Group
37,902 57,431 (7,135) 68,833
Share based compensation expenses 20,883 16,898 46,396 35,104
Non-GAAP net income $58,785 $74,329 $39,261 $103,937
attributable to TAL Education
Group (note 3)
Net income/(loss) per ADS
Basic $0.06 $0.09 $(0.01) $0.11
Diluted 0.06 0.09 (0.01) 0.11
Non-GAAP Net income per ADS
Basic $0.10 $0.12 $0.06 $0.17
Diluted 0.10 0.12 0.06 0.17
ADSs used in calculating net
income/(loss) per ADS
Basic 601,696,149 605,306,748 617,828,034 605,004,072
Diluted 611,577,576 614,849,517 617,828,034 615,498,423
ADSs used in calculating Non-
GAAP net income per ADS
Basic 601,696,149 605,306,748 617,828,034 605,004,072
Diluted 611,577,576 614,849,517 627,500,331 615,498,423
Note 3: The tax effect of share-based compensation expenses was immaterial in the second quarter and
in the first six months of fiscal year 2025.
SOURCE TAL Education Group
