Scandal-tainted Chinese online tutoring company GSX Techedu has reported staggering growth in both net revenue and net profit in the first quarter of 2020, as the coronavirus pandemic increased demand for remote learning.
In the first three months of this year, GSX more than tripled its net revenue to 1.3 billion yuan ($183 million), compared with the same period last year, according to the company’s earnings report released Wednesday. Its net profits for the quarter also ballooned, increasing 336.6% year-on year, to 148 million yuan.
The number of paid students enrolled in GSX’s courses grew 307% year-on-year to 774,000, the majority of whom were first-time paying students, GSX founder, chairman and CEO Chen Xiangdong said in a statement.
The Covid-19 health crisis, which effectively broke out in late-January across China, presented an unprecedented chance for the country’s online education services providers to grow their businesses as students were stuck at home due to the virus-induced lockdowns.
In the earnings report, GSX also projected that its second-quarter net revenue will reach between 1.53 billion yuan and 1.56 billion yuan.
In April, short seller Citron Research accused U.S.-listed GSX of inflating its 2019 revenue by up to 70% in “the most blatant Chinese stock fraud since 2011.” GSX has consistently denied the fraud allegations.
The Beijing-based company was also in a legal spat last month with its major rival VIPKid, which sued GSX for allegedly stealing trade secrets.
Contact reporter Ding Yi (email@example.com)