On August 14, Sunlands Online Education Group (STG.US), a leading domestic adult online education company, released its unaudited financial results for the second quarter and first half of 2025. The financial report shows that the company continues its high-quality development trajectory, achieving revenue of 1.027 billion yuan and net profit of 202 million yuan in the first half of the year. The second quarter performance was particularly outstanding, with revenue reaching 539 million yuan, up 9.5% year-over-year, and net profit of 127 million yuan, up 54% year-over-year, achieving double growth in both revenue and profit. These results not only demonstrate the company's mature profit model and operational resilience in the adult education sector, but also validate the strategic effectiveness of its diversification transformation.

**Cost Reduction and Efficiency Enhancement Deepens, AI Technology Drives High-Quality Growth**

Currently, the adult education industry has entered a period of deep structural adjustment. The uncertainty of the external environment combined with the trend toward stock-based internal competition has fundamentally changed the growth logic for enterprises. The past model of relying on single-track, extensive investment to achieve scale expansion is giving way to a new paradigm centered on refined operations, cost structure optimization, and technology-driven growth. Against this backdrop, companies that can first establish capabilities driven by both "profit quality + user value" will have better opportunities to maintain stable footing and accumulate strength amid cyclical fluctuations.

Sunlands Online Education Group's Q2 2025 financial report provides a representative observation sample for the industry. During the reporting period, the company achieved revenue of 539 million yuan, up 9.5% year-over-year, and net profit of 127 million yuan, up 54% year-over-year, with net profit margin increasing from 16.7% in the same period last year to 23.5%. In an environment of slowing overall growth and rising cost pressures, Sunlands Online Education Group still achieved double growth in revenue and profit.

The further improvement in profitability stems from Sunlands Online Education Group's continuous optimization of its operational system over the years. On the cost side, the company has continuously iterated around three core areas: market investment, teaching and research, and organizational management. At the market level, by focusing on customer acquisition channels with high retention and high conversion rates, and introducing dynamic budget allocation mechanisms, customer acquisition costs have been significantly reduced. In terms of teaching and research, the company has accelerated the modular and standardized reconstruction of course content, leveraged automation tools to improve content production efficiency, and promoted the transformation of the teaching and research system from labor-intensive to intelligence-driven. In terms of organizational structure, the company has deepened flat management reforms, focused on key position resource allocation and responsibility penetration, and improved management execution.

Additionally, AI technology has become an important driving force for improving the company's operational efficiency and profit indicators. Sunlands did not begin its technology layout only after the AI wave emerged; it had already emphasized the construction of underlying technology systems before going public, continuously investing in self-developed tools, big data platforms, and teaching systems, accumulating data assets from tens of billions of learning behaviors of tens of millions of users. With the leap in language understanding and reasoning capabilities of large models such as DeepSeek, these data assets accumulated over many years have been effectively activated and transformed into intelligent foundations for teaching content generation, learning path planning, and user behavior prediction.

AI applications have achieved multi-point breakthroughs at Sunlands, including AI recommendation chat, intelligent voice interaction, student emotion recognition, and automatic homework grading, promoting simultaneous improvement in operational efficiency and user experience, ultimately effectively enhancing performance. For example, the AI-assisted chat system launched on the sales side has not only improved student consultation experience but also freed up sales staff energy, allowing them to focus on high-value refined marketing. This tool has improved sales-side operational efficiency by over 50%, increased the number of students each person can serve by over 30%, and combined with deep learning models, achieved a leap from mechanical responses to intelligent, personalized communication. Meanwhile, the system can identify emotional fluctuations and learning concerns in real-time during student communications, and generate highly personalized learning recommendations based on sales staff characteristics, significantly improving conversion rates.

In teaching and research, AI applications also play a role. Using AI tools, teaching videos can automatically generate transcripts with time stamps and student interest data, helping instructors optimize courseware content and teaching pace. Automated homework grading covers over 70% of assignments, improving grading speed by more than 8 times with 95% accuracy, significantly reducing repetitive work burdens for class advisors and accelerating student feedback efficiency.

Through deep integration of AI in various key areas, Sunlands has not only significantly reduced costs and improved per-capita output but also effectively improved profit structure. Against the backdrop of slowing industry growth and intensifying competition, this technology-driven operational model has built solid competitive barriers for the company and laid a solid foundation for future sustained growth and innovation.

**Strategic Upgrade Shows Results, Interest Education and Senior Segments Become New Growth Engines**

China's adult education industry is experiencing deep transformation driven by demand upgrades. According to Frost & Sullivan reports, China's adult learning market size shows a continuous upward trend, expected to reach 1.04 trillion yuan by 2027 with a compound growth rate of 12.6%. Among this, the personal interest learning market size will grow rapidly at a compound growth rate of 14.1%, reaching 296.4 billion yuan by 2027. Behind this trend is the significant enhancement of adult self-improvement awareness and the increasingly rich selection of personal interest courses on the supply side.

Adapting to this change, Sunlands Online Education Group took the lead in completing strategic transformation. Since 2020, the company has upgraded its course structure from "rigid demand-driven" to "diversified-driven," restructuring its business system into three major modules: "academic education + vocational skills + interest cultivation." The diversified layout not only disperses the volatility risk of single categories but also allows the platform to cover users across the full life cycle from 20 to 75 years old, significantly broadening long-term growth space.

In Q2 2025, the company's non-academic business revenue accounted for 78% of total revenue, with interest education growing into the second growth curve driving performance. In the interest education segment, Sunlands encourages students to establish active and lasting connections through work displays, online communities, and offline activities through diversified course layouts and social design, enhancing learning participation and sense of belonging. Meanwhile, courses emphasize practical value, promoting students to integrate learned knowledge and skills into daily life, achieving continuous transformation of results. This series of measures not only extends user life cycles and improves repurchase rates but also enhances students' long-term loyalty, forming a sustainable virtuous cycle.

In course products targeting primarily senior groups, Sunlands' business model has also been validated. The platform's paid senior user base has exceeded one million, covering first, second, and third-tier cities nationwide, with the core demographic being retired teachers, civil servants, and employees of public institutions and enterprises aged 50 to 75 - groups that are generally economically stable with high cultural literacy and strong demand for spiritual and cultural life.

Based on deep insights into this group's learning habits and psychological characteristics, Sunlands has built a "content + social + companionship" three-in-one service closed loop: In product design, age-friendly interfaces, slow-paced explanations, and AI teaching assistant one-click Q&A functions have been developed, significantly lowering usage barriers. In service operations, a "learning companion" mechanism has been launched, providing full-process support from course consultation and learning planning to post-class interaction through class advisor teams. In content systems, layered courses from beginner to advanced have been created to meet personalized needs at different stages, ensuring systematic and progressive learning paths.

These measures have brought quantifiable results: senior users have a course completion rate of up to 80%, most courses have repurchase rates exceeding 60%, and satisfaction exceeds 90%, all significantly higher than industry averages. Meanwhile, through high-frequency, low-price product pools and layered community operations, Sunlands has successfully upgraded from "single-point customer acquisition, one-time conversion" to "continuous companionship, multiple transactions," forming a healthier and more sustainable cash flow structure.

From completion rates and repurchase rates to community activity and user-generated content, Sunlands has validated the real effectiveness of its products and services with a complete data chain. This user-outcome-centered operational logic is not only an investment in long-term brand reputation but also constitutes solid barriers against price wars and traffic competition.

After more than twenty years of deep cultivation, Sunlands Online Education Group is reshaping the value formula of adult education: Under the demand-driven new era, learning has transcended knowledge transmission to become a core carrier of emotional bonds and identity recognition. Based on this concept, the company extends user lifetime value (LTV) to encompass long-term development journeys including knowledge accumulation, social interaction, and self-realization by building continuous, three-dimensional user growth ecosystems.

In the future, the company will not only provide high-quality educational content but also create learning environments that stimulate intrinsic motivation and enhance social belonging, promoting adult education toward a comprehensive, ecosystem-based new stage. As Sunlands Online Education Group management stated: "Against the backdrop of accelerating industry iteration, we are more firmly focused on user value and long-term growth, building sustainable growth models with cycle-transcending capabilities through technology-driven, content upgrades, and service refinement. We believe this will create better learning experiences for students and bring sustained returns to shareholders."