Eunice Liu's questions to Gaotu Techedu Inc (GOTU) leadership • Q1 2025
Question
Eunice Liu from Goldman Sachs asked for an explanation for the negative operating cash flow in Q1, which was more than double the outflow from the prior year's first quarter.
Answer
CFO Nan Shen clarified that the larger cash outflow was primarily due to the payment of 2024 annual bonuses and increased labor costs from hiring more teachers to support business expansion. Shen expressed confidence that this investment will yield larger cash inflows later in the year, projecting that the full-year 2025 operating cash inflow will be at least triple that of 2024. This confidence underpins the new $100 million share repurchase program.