Youdao, Inc. (NYSE: DAO) Surpasses Earnings and Revenue Estimates

Font: Financial Modeling Prep  • Nov 20, 2025

• Youdao, Inc. (NYSE:DAO) reported an EPS of $0.011, beating the estimated EPS.
• The company achieved a net revenue of $228.8 million, exceeding estimates and reflecting a 3.6% increase year-over-year.
• Youdao's strategic investments in Youdao Lingshi and online marketing services have led to significant growth, with online marketing services experiencing a 51.1% increase in net revenues.

Youdao, Inc. (NYSE: DAO), a subsidiary of NetEase, is a leading provider of intelligent learning solutions. The company focuses on AI-powered solutions for learning and advertising. On November 20, 2025, DAO reported its earnings before the market opened, showcasing an earnings per share (EPS) of $0.011, surpassing the estimated EPS of -$0.00007.

In the third quarter of 2025, Youdao achieved a net revenue of approximately $228.8 million, exceeding the estimated revenue of about $225.6 million. This reflects a 3.6% increase compared to the same period in 2024. The company's operating profit for the first three quarters of 2025 grew nearly 150% year-over-year, driven by its "AI-Native" strategy.

Youdao's strategic investments in Youdao Lingshi and online marketing services have unlocked long-term growth potential. Youdao Lingshi experienced over 40% year-over-year growth in gross billings. Meanwhile, online marketing services saw a 51.1% year-over-year increase in net revenues, reaching a record RMB739.7 million.

The company's financial metrics provide further insights into its performance. DAO's price-to-earnings (P/E) ratio is approximately 33.83, indicating the market's valuation of its earnings. The price-to-sales ratio stands at about 1.37, suggesting how much investors are willing to pay per dollar of sales.

Despite a negative debt-to-equity ratio of -0.89, which may indicate a unique financial structure, Youdao has maintained profitability for five consecutive quarters. The current ratio of 0.55 highlights the company's ability to cover its short-term liabilities with its short-term assets, reflecting its operational efficiency.