Sunlands Technology Group (NYSE:STG) announced its unaudited financial results for the fourth quarter and full year ended December 31, 2025, revealing a strategic transition from rapid scale to a quality-driven operational model.
The company reported full-year net revenues of RMB2,019.9 million, a slight increase from RMB1,990.2 million in 2024, while net income rose to RMB365.6 million, up from RMB342.1 million in the previous year.
The fourth quarter reflected the ongoing challenges of this structural shift, with net revenues falling to RMB470.2 million compared to RMB483.5 million in the prior-year period.
Net income for the quarter also saw a contraction to RMB38.4 million, down from RMB57.8 million, as the company navigated a material decline in new student enrollments.
For the full year, new enrollments totaled 579,788, a decrease from the record 674,649 seen in 2024, contributing to a lower deferred revenue balance of RMB585.3 million by year-end.
Despite the enrollment headwinds, Sunlands successfully optimized its cost structure.
Cost of revenues fell as the company streamlined its degree-oriented teaching staff to focus on its rapidly growing interest-based learning segment.
These non-degree programs, which cater heavily to the "silver demographic" (learners aged 15 to 75), now represent a significant majority of total revenue.
To support this pivot, the company increased its product development spending, specifically expanding its headcount of specialized R&D personnel to enhance its live-streaming platform and course variety.
Looking ahead, management remains cautious but optimistic for the start of the new fiscal year, providing a first-quarter 2026 revenue outlook of RMB420 million to RMB440 million.