10q10k10q10k.net

What changed in Jianzhi Education Technology Group Co Ltd's 20-F — 2024 vs 2025

vs

Paragraph-level year-over-year comparison of Jianzhi Education Technology Group Co Ltd's 2024 and 2025 20-F annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+431 added−423 removedSource: 20-F (2026-04-13) vs 20-F (2025-04-30)

Top changes in Jianzhi Education Technology Group Co Ltd's 2025 20-F

431 paragraphs added · 423 removed · 348 edited across 5 sections

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

166 edited+51 added−20 removed649 unchanged
Biggest changeAs of December 31, 2024 Parent Subsidiaries WFOE and its subsidiaries The VIEs Eliminations Consolidated Total RMB US$ RMB US$ RMB US$ RMB US$ RMB US$ RMB US$ (in thousands) Cash — — 1,408 193 9,941 1,361 1,113 152 — — 12,462 1,760 Total current assets 1,038 143 7,184 984 50,642 6,937 13,913 1,905 — — 72,777 9,969 Investment in subsidiaries and VIE’s — — 28,190 3,862 — — — (28,190 ) (3,862 ) — — Total non-current assets — — 35,280 4,833 18,995 2,602 2,845 390 (28,190 ) (3,862 ) 28,930 3,963 Amounts due from subsidiaries, the VIE and its subsidiaries 124,534 17,060 — — — — — — (124,534 ) (17,060 ) — — Total assets 125,572 17,203 42,464 5,817 69,637 9,539 16,758 2,295 (152,724 ) (20,922 ) 101,707 13,932 Deficits in investment in subsidiaries and VIE’s subsidiaries 101,812 13,948 — — — — — — (101,812 )) (13,948 ) — — Amounts due to the parent company and its subsidiaries — — 2,929 401 121,605 16,659 — — (124,543 ) (17,060 ) — — Total current liabilities 175 24 — — 46,679 6,395 24,192 3,314 — — 71,046 9,733 Total non-current liabilities — — — — 388 53 300 41 — — 688 94 Total liabilities 101,987 13,972 2,929 401 168,672 23,107 24,492 3,355 (226,346 ) (31,008 ) 71,734 9,827 Total liabilities, mezzanine equity and shareholders’ (deficit) equity 125,572 17,203 42,464 5,817 69,637 9,539 16,758 2,295 (152,724 ) (20,922 ) 101,707 13,932 For the Year Ended December 31, 2024 Parent Subsidiaries WFOE and its subsidiaries The VIEs Eliminations Consolidated Total RMB US$ RMB US$ RMB US$ RMB US$ RMB US$ RMB US$ (in thousands) Total revenues — — — — 204,359 27,996 44,473 6,093 — — 248,832 34,089 Cost of revenues — — — — (179,965 ) (24,656 ) (22,026 ) (3,018 ) — — (201,991 ) (27,674 ) Total operating expenses (41,063 ) (5,625 ) (951 ) (130 ) (13,484 ) (1,847 ) (11,724 ) (1,606 ) — — (67,221 ) (9,208 ) Share of loss of subsidiaries, VIEs and VIEs’ subsidiaries 7,549 1,034 — — — — — — (7,549 ) (1,034 ) — — Net (loss) income (33,514 ) (4,591 ) (1,511 ) (207 ) 11,145 1,527 (1,938 ) (272 ) (7,549 ) (1,034 ) (33,412 ) (4,577 ) 7 For the Year Ended December 31, 2024 Parent Subsidiaries WFOE and its subsidiaries The VIEs Eliminations Consolidated Total RMB US$ RMB US$ RMB US$ RMB US$ RMB US$ RMB US$ (in thousands) Net cash (used in) provided by operating activities (5,180 ) (710 ) (3,126 ) (428 ) 15,880 2,176 2,934 402 — — 10,508 1,440 Net cash provided by (used in) investing activities 4,772 654 (2,970 ) (407 ) (14,001 ) (1,918 ) (4,520 ) (619 ) — — (16,719 ) (2,290 ) Net cash (used in) provided by financing activities — — (7,219 ) (989 ) 7,980 1,093 — — — — 761 104 As of December 31, 2023 Parent Subsidiaries WFOE and its subsidiaries The VIEs Eliminations Consolidated Total RMB RMB RMB RMB RMB RMB (in thousands) Cash 324 14,658 496 2,698 — 18,176 Total current assets 1,328 14,702 88,761 17,558 — 122,349 Investment in subsidiaries and VIE’s — 27,270 — — (27,270 ) — Total non-current assets — 35,905 5,886 14,817 (227,270 ) 29,338 Amounts due from subsidiaries, the VIE and its subsidiaries 85,581 — — — (85,851 ) — Total assets 86,909 50,607 94,647 32,375 (112,851 ) 151,687 Deficits in investment in subsidiaries and VIE’s subsidiaries 109,361 — — — (109,361 ) — Amounts due to the parent company and its subsidiaries — 3,225 81,128 1,228 (85,851 ) — Total current liabilities 1,053 21,579 108,214 31,749 — 162,595 Total non-current liabilities — — 2,903 3,407 — 6,310 Total liabilities 110,414 24,804 192,245 36,384 (194,942 ) 168,905 Total liabilities, mezzanine equity and shareholders’ (deficit) equity 86,909 50,607 94,647 32,375 (112,851 ) 151,687 8 For the Year Ended December 31, 2024 Parent Subsidiaries WFOE and its subsidiaries The VIEs Eliminations Consolidated Total RMB RMB RMB RMB RMB RMB (in thousands) Total revenues — — 349,047 91,618 (128 ) 440,537 Cost of revenues — — (340,837 ) (83,637 ) 128 (424,346 ) Total operating expenses (63,473 ) (44,756 ) (197,702 ) (93,024 ) — (398,955 ) Share of loss of subsidiaries, VIEs and VIEs’ subsidiaries (310,028 ) — — — 310,028 — Net loss (373,501 ) (45,986 ) (189,413 ) (83,941 ) 310,028 (382,813 ) Subsidiaries WFOE and its subsidiaries The VIEs Eliminations Consolidated Total RMB RMB RMB RMB RMB RMB (in thousands) Net cash (used in) provided by operating activities (8,682 ) 3,751 27,702 (7,611 ) — 15,160 Net cash (used in) provided by investing activities (21,898 ) 13,378 (28,118 ) (18,528 ) — (55,166 ) Net cash (used in) provided by financing activities (7,798 ) 550 — — — (7,248 ) The following table represents the roll-forward of the investments/(deficits in investments) in our subsidiaries, the VIE Entity and the VIE Entity’s subsidiaries: RMB (in thousands) As of December 31, 2023 (109,361 ) Share of loss of subsidiaries, the VIE Entity and the VIE Entity’s subsidiaries 7,549 As of December 31, 2024 (101,812 ) A. [Reserved] B.
Biggest changeAs of December 31, 2025 Parent Subsidiaries WFOE and its subsidiaries The VIEs Eliminations Consolidated Total RMB US$ RMB US$ RMB US$ RMB US$ RMB US$ RMB US$ (in thousands) Cash 1,978 283 108 15 89 13 5,993 857 - - 8,168 1,168 Total current assets 2,970 425 36,861 5,272 10,807 1,546 34,729 4,964 - - 85,367 12,207 Investment in subsidiaries and VIE’s - - 26,954 3,854 - - - - (26,954 ) (3,854 ) - - Total non-current assets - - 26,954 3,854 19,164 2,740 749 107 (26,954 ) (3,854 ) 19,912 2,847 Amounts due from subsidiaries, the VIE and its subsidiaries 150,738 21,555 - - - - 28,182 4,030 (178,920 ) (25,585 ) - - Total assets 153,708 21,980 63,815 9,126 29,971 4,286 63,660 9,101 -205,874 (29,439 ) 105,279 15,054 Deficits in investment in subsidiaries and VIE’s subsidiaries 105,230 15,048 - - - - - - (105,230 ) (15,048 ) - - Amounts due to the parent company and its subsidiaries - - 2,861 409 176,059 25,176 - - (178,920 ) (25,585 ) - - Total current liabilities 167 24 - - 12,855 1,839 38,071 5,444 - - 51,092 7,306 Total non-current liabilities - - - - - - 48 7 - - 48 7 Total liabilities 105,397 15,072 2,861 409 188,914 27,015 38,119 5,451 (284,150 ) (40,633 ) 51,140 7,313 Total liabilities and shareholders’ equity 153,708 21,980 63,815 9,126 29,971 4,286 63,660 9,101 205,874 -29,439 105,279 15,054 For the Year Ended December 31, 2025 Parent Subsidiaries WFOE and its subsidiaries The VIEs Eliminations Consolidated Total RMB US$ RMB US$ RMB US$ RMB US$ RMB US$ RMB US$ (in thousands) Total revenues - - - - 51,616 7,381 18,563 2,654 - - 70,179 10,035 Cost of revenues - - - - (50,818 ) (7,267 ) (6,942 ) (993 ) - - (57,760 ) (8,260 ) Total operating expenses (12,321 ) (1,762 ) (3,615 ) (517 ) 52,155 7,456 (6,862 ) (981 ) - - 29,357 4,196 Share of loss of subsidiaries, VIEs and VIEs’ subsidiaries (3,418 ) (489 ) - - - - - - 3,418 489 - - Net (loss) income (15,739 ) (2,251 ) (3,594 ) (514 ) (5,758 ) (821 ) 5,373 768 3,418 489 (16,300 ) (2,329 ) 7 For the Year Ended December 31, 2025 Parent Subsidiaries WFOE and its subsidiaries The VIEs Eliminations Consolidated Total RMB US$ RMB US$ RMB US$ RMB US$ RMB US$ RMB US$ (in thousands) Net cash (used in) provided by operating activities (1,827 ) (261 ) (4,367 ) (624 ) (8,982 ) (1,321 ) 5,431 777 - - (9,745 ) (1,429 ) Net cash (used in) provided by investing activities (31,630 ) (4,523 ) 3,192 456 475 69 (551 ) (79 ) - - (28,514 ) (4,077 ) Net cash provided by (used in) financing activities 35,434 4,930 - - (1,400 ) (200 ) - - - - 34,034 4,730 As of December 31, 2024 Parent Subsidiaries WFOE and its subsidiaries The VIEs Eliminations Consolidated Total RMB RMB RMB RMB RMB RMB (in thousands) Cash - 1,408 9,941 1,113 - 12,462 Total current assets 1,038 7,184 50,642 13,913 - 72,777 Investment in subsidiaries and VIE’s - 28,190 - - (28,190 ) - Total non-current assets - 35,280 18,995 2,845 (28,190 ) 28,930 Amounts due from subsidiaries, the VIE and its subsidiaries 124,534 - - - (124,534 ) - Total assets 125,572 42,464 69,637 16,758 (152,724 ) 101,707 Deficits in investment in subsidiaries and VIE’s subsidiaries 101,812 - - - (101,812 ) - Amounts due to the parent company and its subsidiaries - 2,929 121,605 - (124,543 ) - Total current liabilities 175 - 46,679 24,192 - 71,046 Total non-current liabilities - - 388 300 - 688 Total liabilities 101,987 2,929 168,672 24,492 (226,346 ) 71,734 Total liabilities and shareholders’ equity 125,572 42,464 69,637 16,758 (152,724 ) 101,707 8 For the Year Ended December 31, 2024 Parent Subsidiaries WFOE and its subsidiaries The VIEs Eliminations Consolidated Total RMB RMB RMB RMB RMB RMB (in thousands) Total revenues - - 204,359 44,473 - 248,832 Cost of revenues - - (179,965 ) (22,026 ) - (201,991 ) Total operating expenses (41,063 ) (951 ) (13,484 ) (11,724 ) - (67,221 ) Share of loss of subsidiaries, VIEs and VIEs’ subsidiaries 7,549 - - - (7,549 ) - Net (loss) income (33,514 ) (1,511 ) 11,145 (1,938 ) (7,549 ) (33,412 ) For the Year Ended December 31, 2024 Parent Subsidiaries WFOE and its subsidiaries The VIEs Eliminations Consolidated Total RMB RMB RMB RMB RMB RMB (in thousands) Net cash (used in) provided by operating activities (5,180 ) (3,126 ) 15,880 2,934 - 10,508 Net cash provided by (used in) investing activities 4,772 (2,970 ) (14,001 ) (4,520 ) - (16,719 ) Net cash (used in) provided by financing activities - (7,219 ) 7,980 - - 761 The following table represents the roll-forward of the investments/(deficits in investments) in our subsidiaries, the VIE Entity and the VIE Entity’s subsidiaries: RMB (in thousands) As of December 31, 2024 (101,812 ) As of December 31, 2025 (105,230 ) 9 A. [Reserved] B.
There are substantial uncertainties regarding the interpretation and application of current and future PRC laws, regulations, and rules relating to the agreements that establish the VIE structure for the majority of our and the VIEs’ operations in China, including potential future actions by the PRC government, which could affect the enforceability of our contractual arrangements with Beijing Sentu and, consequently, significantly affect the financial condition and results of operations of Jianzhi Education.
There are substantial uncertainties regarding the interpretation and application of current and future PRC laws, regulations, and rules relating to the agreements that establish the VIE structure for the majority of our and the VIEs’ operations in China, including potential future actions by the PRC government, which could affect the enforceability of our contractual arrangements with Beijing Sentu and, consequently, significantly affect the financial condition and results of operations of Jianzhi Education.
Only if we meet the aforementioned conditions for consolidation of Beijing Sentu and its subsidiaries under U.S. GAAP, we will be deemed as the primary beneficiary of Beijing Sentu and its subsidiaries, and Beijing Sentu and its subsidiaries will be treated as our consolidated affiliated entities for accounting purposes.
Only if we meet the aforementioned conditions for consolidation of Beijing Sentu and its subsidiaries under U.S. GAAP, we will be deemed as the primary beneficiary of Beijing Sentu and its subsidiaries, and Beijing Sentu and its subsidiaries will be treated as our consolidated affiliated entities for accounting purposes.
As such, Jianzhi Beijing, our WFOE, entered into the Contractual Arrangements with Beijing Sentu, the VIE Entity, and its shareholders.
As such, Jianzhi Beijing, our WFOE, entered into the Contractual Arrangements with Beijing Sentu, the VIE Entity, and its shareholders.
These agreements include: (i) an exclusive business cooperation agreement, which enables us to receive substantially all of the economic benefits of Beijing Sentu, (ii) powers of attorney and an equity pledge agreement, which provide us with control over Beijing Sentu, and (iii) an exclusive option agreement, which provides us with the option to purchase all of the equity interests in Beijing Sentu.
These agreements include: (i) an exclusive business cooperation agreement, which enables us to receive substantially all of the economic benefits of Beijing Sentu, (ii) powers of attorney and an equity pledge agreement, which provide us with control over Beijing Sentu, and (iii) an exclusive option agreement, which provides us with the option to purchase all of the equity interests in Beijing Sentu.
The conditions we have satisfied for consolidation of Beijing Sentu and its subsidiaries under U.S.
The conditions we have satisfied for consolidation of Beijing Sentu and its subsidiaries under U.S.
GAAP include that (i) we control Beijing Sentu through power to govern the activities which most significantly impact Beijing Sentu’s economic performance, (ii) we are contractually obligated to absorb losses of Beijing Sentu that could potentially be significant to Beijing Sentu, and (iii) we are entitled to receive benefits from Beijing Sentu that could potentially be significant to Beijing Sentu.
GAAP include that (i) we control Beijing Sentu through power to govern the activities which most significantly impact Beijing Sentu’s economic performance, (ii) we are contractually obligated to absorb losses of Beijing Sentu that could potentially be significant to Beijing Sentu, and (iii) we are entitled to receive benefits from Beijing Sentu that could potentially be significant to Beijing Sentu.
Only if we meet the aforementioned conditions for consolidation of Beijing Sentu and its subsidiaries under U.S. GAAP, we will be deemed as the primary beneficiary of Beijing Sentu and its subsidiaries, and Beijing Sentu and its subsidiaries will be treated as our consolidated affiliated entities for accounting purposes.
Only if we meet the aforementioned conditions for consolidation of Beijing Sentu and its subsidiaries under U.S. GAAP, we will be deemed as the primary beneficiary of Beijing Sentu and its subsidiaries, and Beijing Sentu and its subsidiaries will be treated as our consolidated affiliated entities for accounting purposes.
GAAP include that (i) we control Beijing Sentu through power to govern the activities which most significantly impact Beijing Sentu’s economic performance, (ii) we are contractually obligated to absorb losses of Beijing Sentu that could potentially be significant to Beijing Sentu, and (iii) we are entitled to receive benefits from Beijing Sentu that could potentially be significant to Beijing Sentu.
GAAP include that (i) we control Beijing Sentu through power to govern the activities which most significantly impact Beijing Sentu’s economic performance, (ii) we are contractually obligated to absorb losses of Beijing Sentu that could potentially be significant to Beijing Sentu, and (iii) we are entitled to receive benefits from Beijing Sentu that could potentially be significant to Beijing Sentu.
We are a holding company and the investors will have ownership in a holding company that does not directly own all of its operation in China. We rely on our WFOE and the VIEs for the operation in PRC.
We are a holding company and the investors will have ownership in a holding company that does not directly own all of its operation in China. We rely on our WFOE and the VIEs for the operation in PRC.
Pursuant to the Measures, critical information infrastructure operators that intend to purchase internet products and services and online platform operators engaging in data processing activities that affect or may affect national security must be subject to cybersecurity review.
Pursuant to the Measures, critical information infrastructure operators that intend to purchase internet products and services and online platform operators engaging in data processing activities that affect or may affect national security must be subject to cybersecurity review.
The Measures further stipulate that if an online platform operator possesses the personal information of more than one million users and intends to list in a foreign country, it shall proactively apply to the Office of Cybersecurity Review for cybersecurity review.
The Measures further stipulate that if an online platform operator possesses the personal information of more than one million users and intends to list in a foreign country, it shall proactively apply to the Office of Cybersecurity Review for cybersecurity review.
However, regulatory requirements on cybersecurity and data security in the PRC are constantly evolving and can be subject to varying interpretations or significant changes, which may result in uncertainties about the scope of our responsibilities in that regard.
However, regulatory requirements on cybersecurity and data security in the PRC are constantly evolving and can be subject to varying interpretations or significant changes, which may result in uncertainties about the scope of our responsibilities in that regard.
In the event that we and the VIEs are subject to any mandatory cybersecurity review and other specific actions required by the CAC, we and the VIEs face uncertainty as to whether any clearance or other required actions can be timely completed, or at all.
In the event that we and the VIEs are subject to any mandatory cybersecurity review and other specific actions required by the CAC, we and the VIEs face uncertainty as to whether any clearance or other required actions can be timely completed, or at all.
Given such uncertainty, we and the VIEs may be further required to suspend our and the VIEs’ relevant business, shut down our and the VIEs’ website, or face other penalties, which could materially and adversely affect our and the VIEs’ business, financial condition, and results of operations, and/or the value of our ADSs or could significantly limit or completely hinder our and the VIEs’ ability to offer or continue to offer securities to investors.
Given such uncertainty, we and the VIEs may be further required to suspend our and the VIEs’ relevant business, shut down our and the VIEs’ website, or face other penalties, which could materially and adversely affect our and the VIEs’ business, financial condition, and results of operations, and/or the value of our ADSs or could significantly limit or completely hinder our and the VIEs’ ability to offer or continue to offer securities to investors.
In addition, if any of these events causes us unable to direct the activities of the VIEs or lose the right to receive their economic benefits, we and the VIEs’ may not be able to consolidate the VIEs into our consolidated financial statements in accordance with U.S.
In addition, if any of these events causes us unable to direct the activities of the VIEs or lose the right to receive their economic benefits, we and the VIEs’ may not be able to consolidate the VIEs into our consolidated financial statements in accordance with U.S.
Further implementations and interpretations of or amendments to the HFCA Act or the related regulations, or a PCAOB’s determination of its lack of sufficient access to inspect or investigate our auditor, might pose regulatory risks to and impose restrictions on us because of our operations in mainland China. A potential consequence is that our ADSs are delisted by the exchange.
Further implementations and interpretations of or amendments to the HFCA Act or the related regulations, or a PCAOB’s determination of its lack of sufficient access to inspect or investigate our auditor, might pose regulatory risks to and impose restrictions on us because of our operations in mainland China. A potential consequence is that our ADSs are delisted by the exchange.
On September 6, 2024, the NDRC and MOFCOM issued the Special Administrative Measures for Access of Foreign Investment (Negative List) (2024 Edition) (the “ Negative List 2024 ”), which came into effect on November 1, 2024.
On September 6, 2024, the NDRC and MOFCOM issued the Special Administrative Measures for Access of Foreign Investment (Negative List) (2024 Edition) (the “ Negative List 2024 ”), which came into effect on November 1, 2024.
Pursuant to the Overseas Listing Trial Measures , domestic companies that seek to offer or list securities overseas, both directly and indirectly, should fulfill the filing procedure and report relevant information to the CSRC.
Pursuant to the Overseas Listing Trial Measures , domestic companies that seek to offer or list securities overseas, both directly and indirectly, should fulfill the filing procedure and report relevant information to the CSRC.
These regulatory authorities may impose fines and penalties on our operations in China, limit our ability to pay dividends outside of China, limit our operating privileges in China, delay or restrict the repatriation of the proceeds from our offshore offerings into China or take other actions that could materially and adversely affect our business, reputation, financial condition, results of operations, prospects, as well as the trading price of the ADSs.
These regulatory authorities may impose fines and penalties on our operations in China, limit our ability to pay dividends outside of China, limit our operating privileges in China, delay or restrict the repatriation of the proceeds from our offshore offerings into China or take other actions that could materially and adversely affect our business, reputation, financial condition, results of operations, prospects, as well as the trading price of the ADSs.
We have followed and intend to continue to follow home country practice with respect to certain corporate governance matters and not to comply with certain Nasdaq corporate governance requirements, including the requirements that (i) a nominating and corporate governance committee be established that is composed entirely of independent directors, (ii) a compensation committee be established that is composed entirely of independent directors, and (iii) an annual meeting of shareholders be held no later than one year after the end of the issuer’s fiscal year-end.
We have followed and intend to continue to follow home country practice with respect to certain corporate governance matters and not to comply with certain Nasdaq corporate governance requirements, including the requirements that (i) a nominating and corporate governance committee be established that is composed entirely of independent directors, (ii) a compensation committee be established that is composed entirely of independent directors, and (iii) an annual meeting of shareholders be held no later than one year after the end of the issuer’s fiscal year-end.
Negative publicity, regardless of merits, could be related to a wide variety of matters, including but not limited to: ● alleged misconduct or other improper activities committed by our and the VIEs’ end users or our and the VIEs’ shareholders, affiliates, directors, officers, instructors and other employees and other full-time and part-time workers supplied by third parties, including misrepresentation made by our and the VIEs’ employees or full-time and part-time workers supplied by third parties during sales and marketing activities, and other fraudulent activities to artificially inflate the popularity of our and the VIEs’ products and services; ● false or malicious allegations or rumors about us or our and the VIEs’ business, shareholders, affiliates, directors, officers, instructors and other employees and tutors and other workers supplied by third parties; ● complaints by the VIEs’ college student users about and the VIEs’ education content offerings; ● refund disputes of subscription fees between us and the VIEs’ end users; ● security breaches of private user or transaction data; ● employment-related claims relating to alleged employment discrimination, wage and hour violations; and ● governmental and regulatory investigations or penalties resulting from our and the VIEs’ failure to comply with applicable laws, regulations and policies, including those to be adopted by the government for applying more stringent social, ethical and environmental standards 23 In addition to traditional media, there has been an increasing use of social media platforms and similar technologies in China, including instant messaging applications, social media websites and other forms of internet-based communications that provide individuals with access to a broad audience of consumers and other interested persons.
Negative publicity, regardless of merits, could be related to a wide variety of matters, including but not limited to: ● alleged misconduct or other improper activities committed by our and the VIEs’ end users or our and the VIEs’ shareholders, affiliates, directors, officers, instructors and other employees and other full-time and part-time workers supplied by third parties, including misrepresentation made by our and the VIEs’ employees or full-time and part-time workers supplied by third parties during sales and marketing activities, and other fraudulent activities to artificially inflate the popularity of our and the VIEs’ products and services; ● false or malicious allegations or rumors about us or our and the VIEs’ business, shareholders, affiliates, directors, officers, instructors and other employees and tutors and other workers supplied by third parties; ● complaints by the VIEs’ college student users about and the VIEs’ education content offerings; ● refund disputes of subscription fees between us and the VIEs’ end users; ● security breaches of private user or transaction data; ● employment-related claims relating to alleged employment discrimination, wage and hour violations; and ● governmental and regulatory investigations or penalties resulting from our and the VIEs’ failure to comply with applicable laws, regulations and policies, including those to be adopted by the government for applying more stringent social, ethical and environmental standards In addition to traditional media, there has been an increasing use of social media platforms and similar technologies in China, including instant messaging applications, social media websites and other forms of internet-based communications that provide individuals with access to a broad audience of consumers and other interested persons.
In addition, the depositary and any of its agents also disclaim any liability for (i) any failure to carry out any instructions to vote, the manner in which any vote is cast or the effect of any vote or failure to determine that any distribution or action may be lawful or reasonably practicable or for allowing any rights to lapse in accordance with the provisions of the deposit agreement, (ii) the failure or timeliness of any notice from us, the content of any information submitted to it by us for distribution to you or for any inaccuracy of any translation thereof, (iii) any investment risk associated with the acquisition of an interest in the deposited securities, the validity or worth of the deposited securities or the credit-worthiness of any third party, (iv) any tax consequences that may result from ownership of ADSs, ordinary shares or deposited securities, or (v) any acts or omissions made by a successor depositary whether in connection with a previous act or omission of the depositary or in connection with any matter arising wholly after the removal or resignation of the depositary, provided that in connection with the issue out of which such potential liability arises the depositary performed its obligations without gross negligence or willful misconduct while it acted as depositary.
In addition, the depositary and any of its agents also disclaim any liability for (i) any failure to carry out any instructions to vote, the manner in which any vote is cast or the effect of any vote or failure to determine that any distribution or action may be lawful or reasonably practicable or for allowing any rights to lapse in accordance with the provisions of the deposit agreement, (ii) the failure or timeliness of any notice from us, the content of any information submitted to it by us for distribution to you or for any inaccuracy of any translation thereof, (iii) any investment risk associated with the acquisition of an interest in the deposited securities, the validity or worth of the deposited securities or the credit-worthiness of any third party, (iv) any tax consequences that may result from ownership of ADSs, Class A ordinary shares or deposited securities, or (v) any acts or omissions made by a successor depositary whether in connection with a previous act or omission of the depositary or in connection with any matter arising wholly after the removal or resignation of the depositary, provided that in connection with the issue out of which such potential liability arises the depositary performed its obligations without gross negligence or willful misconduct while it acted as depositary.
Our currently effective memorandum and articles of association and the deposit agreement provide that the United States District Court for the Southern District of New York (or, if the United States District Court for the Southern District of New York lacks subject matter jurisdiction over a particular dispute, the state courts in New York County, New York) is the exclusive judicial forum within the U.S. for the resolution of any complaint asserting a cause of action arising out of or relating in any way to the federal securities laws of the United States, and any suit, action or proceeding arising out of or relating in any way to the ADSs or the deposit agreement, which could limit the ability of holders of our ordinary shares, the ADSs or other securities to obtain a favorable judicial forum for disputes with us, our directors and officers, the depositary, and potentially others.
Our currently effective memorandum and articles of association and the deposit agreement provide that the United States District Court for the Southern District of New York (or, if the United States District Court for the Southern District of New York lacks subject matter jurisdiction over a particular dispute, the state courts in New York County, New York) is the exclusive judicial forum within the U.S. for the resolution of any complaint asserting a cause of action arising out of or relating in any way to the federal securities laws of the United States, and any suit, action or proceeding arising out of or relating in any way to the ADSs or the deposit agreement, which could limit the ability of holders of our Class A ordinary shares, the ADSs or other securities to obtain a favorable judicial forum for disputes with us, our directors and officers, the depositary, and potentially others.
The deposit agreement governing the ADSs representing our ordinary shares provides that, subject to the depositary’s right to require a claim to be submitted to arbitration, the federal or state courts in the City of New York have exclusive jurisdiction to hear and determine claims arising under the deposit agreement and in that regard, to the fullest extent permitted by law, ADS holders waive the right to a jury trial of any claim they may have against us or the depositary arising out of or relating to our ordinary shares, the ADSs or the deposit agreement, including any claim under the U.S. federal securities laws.
The deposit agreement governing the ADSs representing our Class A ordinary shares provides that, subject to the depositary’s right to require a claim to be submitted to arbitration, the federal or state courts in the City of New York have exclusive jurisdiction to hear and determine claims arising under the deposit agreement and in that regard, to the fullest extent permitted by law, ADS holders waive the right to a jury trial of any claim they may have against us or the depositary arising out of or relating to our Class A ordinary shares, the ADSs or the deposit agreement, including any claim under the U.S. federal securities laws.
In addition, under our currently effective memorandum and articles of association, for the purposes of determining those shareholders who are entitled to attend and vote at any general meeting, our directors may close our register of members and/or fix in advance a record date for such meeting, and such closure of our register of members or the setting of such a record date may prevent you from withdrawing the ordinary shares underlying your ADSs and becoming the registered holder of such shares prior to the record date, so that you would not be able to attend the general meeting or to vote directly.
In addition, under our currently effective memorandum and articles of association, for the purposes of determining those shareholders who are entitled to attend and vote at any general meeting, our directors may close our register of members and/or fix in advance a record date for such meeting, and such closure of our register of members or the setting of such a record date may prevent you from withdrawing the Class A ordinary shares underlying your ADSs and becoming the registered holder of such shares prior to the record date, so that you would not be able to attend the general meeting or to vote directly.
Under the deposit agreement for the ADSs, if you do not vote, the depositary will give us a discretionary proxy to vote our ordinary shares underlying your ADSs at shareholders’ meetings unless: ● we have instructed the depositary that we do not wish a discretionary proxy to be given; ● we have informed the depositary that there is substantial opposition as to a matter to be voted on at the meeting; ● a matter to be voted on at the meeting may have a material adverse impact on shareholders; or ● the voting at the meeting is to be made on a show of hands.
Under the deposit agreement for the ADSs, if you do not vote, the depositary will give us a discretionary proxy to vote our Class A ordinary shares underlying your ADSs at shareholders’ meetings unless: ● we have instructed the depositary that we do not wish a discretionary proxy to be given; ● we have informed the depositary that there is substantial opposition as to a matter to be voted on at the meeting; ● a matter to be voted on at the meeting may have a material adverse impact on shareholders; or ● the voting at the meeting is to be made on a show of hands.
The financial condition and results of operations of us and the VIEs may fluctuate due to a number of other factors, many of which are beyond our and the VIEs’ control, including: ● the ability of us and the VIEs to continue to increase the service offerings and expand the customer base; ● general economic and social conditions and government regulations or actions pertaining to the provision of educational content service and other services and IT related solution services; ● increased competition and market perception and acceptance of any of the newly introduced service offerings of us and the VIEs in any given year; ● expansion and related costs in a given period; ● timing of completion dates of various milestones in our IT related solution projects because we recognize revenue from a project upon receipt of the relevant completion certificate for each phase of the project; ● shifts in attitude towards online education services in the PRC; and ● the ability of us and the VIEs to control the cost of revenues and other operating costs, and enhance the operational efficiency. 12 The historical results, growth rates and profitability of us and the VIEs may not be indicative of our and the VIEs’ future performance.
The financial condition and results of operations of us and the VIEs may fluctuate due to a number of other factors, many of which are beyond our and the VIEs’ control, including: ● the ability of us and the VIEs to continue to increase the service offerings and expand the customer base; ● general economic and social conditions and government regulations or actions pertaining to the provision of educational content service and other services and IT related solution services; ● increased competition and market perception and acceptance of any of the newly introduced service offerings of us and the VIEs in any given year; ● expansion and related costs in a given period; ● timing of completion dates of various milestones in our IT related solution projects because we recognize revenue from a project upon receipt of the relevant completion certificate for each phase of the project; ● shifts in attitude towards online education services in the PRC; and ● the ability of us and the VIEs to control the cost of revenues and other operating costs, and enhance the operational efficiency. 13 The historical results, growth rates and profitability of us and the VIEs may not be indicative of our and the VIEs’ future performance.
Risk Factors — Risks Related to the Business and Industry of Us and the VIEs — If we and the VIEs are unable to retain existing customers and/or expand the customer base, we and the VIEs may not be able to maintain growth and our and the VIEs’ revenue may decline, which may materially and adversely affect our and the VIEs’ business, financial condition and results of operations;” 9 ● We and the VIEs are subject to risks associated with brand recognition and market reputation.
Risk Factors - Risks Related to the Business and Industry of Us and the VIEs - If we and the VIEs are unable to retain existing customers and/or expand the customer base, we and the VIEs may not be able to maintain growth and our and the VIEs’ revenue may decline, which may materially and adversely affect our and the VIEs’ business, financial condition and results of operations;” ● We and the VIEs are subject to risks associated with brand recognition and market reputation.
As a result, our expenses associated with share-based compensation may increase, which may have an adverse effect on our results of operations. 19 We and the VIEs may face risks related to natural and other disasters, including severe weather conditions or outbreaks of health epidemics, and other extraordinary events, which could significantly disrupt our and the VIEs’ operations.
As a result, our expenses associated with share-based compensation may increase, which may have an adverse effect on our results of operations. We and the VIEs may face risks related to natural and other disasters, including severe weather conditions or outbreaks of health epidemics, and other extraordinary events, which could significantly disrupt our and the VIEs’ operations.
It is unclear whether non-PRC shareholders of our Company would be able to claim the benefits of any tax treaties between their country of tax residence and the PRC in the event that we are treated as a PRC resident enterprise. Any such tax may reduce the returns on your investment in the ADSs or ordinary shares.
It is unclear whether non-PRC shareholders of our Company would be able to claim the benefits of any tax treaties between their country of tax residence and the PRC in the event that we are treated as a PRC resident enterprise. Any such tax may reduce the returns on your investment in the ADSs or Class A ordinary shares.
Our and the VIEs’ need to significantly increase the number of our and the VIEs’ qualified employees and retain key employees may cause us to materially increase compensation-related costs, including share-based compensation. If we fail to maintain an effective system of internal controls over financial reporting, we may be unable to accurately report our financial results or prevent fraud.
Our and the VIEs’ need to significantly increase the number of our and the VIEs’ qualified employees and retain key employees may cause us to materially increase compensation-related costs, including share-based compensation. 23 If we fail to maintain an effective system of internal controls over financial reporting, we may be unable to accurately report our financial results or prevent fraud.
Some U.S. states, such as Delaware, have more fully developed and judicially interpreted bodies of corporate law than the Cayman Islands. In addition, Cayman Islands companies may not have standing to initiate a shareholder derivative action in a federal court of the United States. 42 The notice of registered office is a matter of public record.
Some U.S. states, such as Delaware, have more fully developed and judicially interpreted bodies of corporate law than the Cayman Islands. In addition, Cayman Islands companies may not have standing to initiate a shareholder derivative action in a federal court of the United States. The notice of registered office is a matter of public record.
If such event occurs, the VIEs may incur more costs to identify and appoint replacement agent or sell the products by themselves, the financial condition and results of operations of us and the VIEs could be adversely affected. The VIEs’ higher education institution customers rely on government funding to pay for the VIEs’ services.
If such event occurs, the VIEs may incur more costs to identify and appoint replacement agent or sell the products by themselves, the financial condition and results of operations of us and the VIEs could be adversely affected. 27 The VIEs’ higher education institution customers rely on government funding to pay for the VIEs’ services.
When a general meeting is convened, you may not receive sufficient advance notice of the meeting to withdraw the ordinary shares underlying your ADSs and become the registered holder of such shares to allow you to attend the general meeting and to vote directly with respect to any specific matter or resolution to be considered and voted upon at the general meeting.
When a general meeting is convened, you may not receive sufficient advance notice of the meeting to withdraw the Class A ordinary shares underlying your ADSs and become the registered holder of such shares to allow you to attend the general meeting and to vote directly with respect to any specific matter or resolution to be considered and voted upon at the general meeting.
As a result, you may not be afforded the same protections or information, which would be made available to you, were you investing in a U.S. domestic issuer. We are an emerging growth company within the meaning of the Securities Act and may take advantage of certain reduced reporting requirements.
As a result, you may not be afforded the same protections or information, which would be made available to you, were you investing in a U.S. domestic issuer. 49 We are an emerging growth company within the meaning of the Securities Act and may take advantage of certain reduced reporting requirements.
If the VIEs fail to control the costs in connection with mobile video package products, the overall profit margin, financial condition or results of operation of us and the VIEs may be materially and adversely affected. Our and the VIEs’ business relies heavily on a limited number of promotion companies.
If the VIEs fail to control the costs in connection with mobile video package products, the overall profit margin, financial condition or results of operation of us and the VIEs may be materially and adversely affected. 15 Our and the VIEs’ business relies heavily on a limited number of promotion companies.
Accordingly, in the event that we exercise the option to acquire equity ownership and/or assets of Beijing Sentu, substantial costs may be incurred, which may adversely and materially affect our and the VIEs’ financial performance. 29 Certain terms of the Contractual Arrangements may not be enforceable under PRC laws.
Accordingly, in the event that we exercise the option to acquire equity ownership and/or assets of Beijing Sentu, substantial costs may be incurred, which may adversely and materially affect our and the VIEs’ financial performance. Certain terms of the Contractual Arrangements may not be enforceable under PRC laws.
Key Information — D. Risk Factors — Risks Related to the Business and Industry of Us and the VIEs — We and the VIEs have recorded thin gross profit margins for some of the products;” ● Our and the VIEs’ business relies heavily on a limited number of promotion companies. See “Item 3. Key Information — D.
Key Information - D. Risk Factors - Risks Related to the Business and Industry of Us and the VIEs - We and the VIEs have recorded thin gross profit margins for some of the products;” 10 ● Our and the VIEs’ business relies heavily on a limited number of promotion companies. See “Item 3. Key Information - D.
We also expect to face competition as a result of new entrants to the respective markets. 11 If we and the VIEs are unable to compete successfully against current or future competitors, we and the VIEs may face competitive pressures that could adversely affect the business and results of operations of us and the VIEs.
We also expect to face competition as a result of new entrants to the respective markets. If we and the VIEs are unable to compete successfully against current or future competitors, we and the VIEs may face competitive pressures that could adversely affect the business and results of operations of us and the VIEs.
These capital contributions must be recorded with the Ministry of Commerce, or MOFCOM, or its local counterpart. On March 30, 2015, the SAFE issued the Circular of the SAFE on Reforming the Administrative Approach Regarding the Settlement of the Foreign Exchange Capital of Foreign-invested Enterprises, or SAFE Circular 19, which took effect on June 1, 2015.
These capital contributions must be recorded with the Ministry of Commerce, or MOFCOM, or its local counterpart. 37 On March 30, 2015, the SAFE issued the Circular of the SAFE on Reforming the Administrative Approach Regarding the Settlement of the Foreign Exchange Capital of Foreign-invested Enterprises, or SAFE Circular 19, which took effect on June 1, 2015.
Where any matter is to be put to a vote at a general meeting, then upon receipt of your voting instructions, the depositary will try, as far as is practicable, to vote the underlying ordinary shares which are represented by your ADSs in accordance with your instructions.
Where any matter is to be put to a vote at a general meeting, then upon receipt of your voting instructions, the depositary will try, as far as is practicable, to vote the underlying Class A ordinary shares which are represented by your ADSs in accordance with your instructions.
The depositary for the ADSs will give us a discretionary proxy to vote our ordinary shares underlying your ADSs if you do not vote at shareholders’ meetings, except in limited circumstances, which could adversely affect your interests.
The depositary for the ADSs will give us a discretionary proxy to vote our Class A ordinary shares underlying your ADSs if you do not vote at shareholders’ meetings, except in limited circumstances, which could adversely affect your interests.
Accordingly, holders of ADSs may be unable to participate in our rights offerings and may experience dilution of their holdings as a result. You may be subject to limitations on transfer of your ADSs. Your ADSs are transferable on the books of the depositary.
Accordingly, holders of ADSs may be unable to participate in our rights offerings and may experience dilution of their holdings as a result. 48 You may be subject to limitations on transfer of your ADSs. Your ADSs are transferable on the books of the depositary.
Additionally, the inability of the PCAOB to conduct full inspections of our auditor deprives our investors of the benefits of such inspections.” Risks Related to the Business and Industry of Us and the VIEs We and the VIEs face intense competition within each of the business segments of us and the VIEs.
Additionally, the inability of the PCAOB to conduct full inspections of our auditor deprives our investors of the benefits of such inspections.” 12 Risks Related to the Business and Industry of Us and the VIEs We and the VIEs face intense competition within each of the business segments of us and the VIEs.
Any significant impairment losses charged against our and the VIEs’ other intangible assets could have a material adverse effect on the financial condition and results of operations of us and the VIEs. Goodwill impairment could negatively affect our and the VIEs’ results of operations.
Any significant impairment losses charged against our and the VIEs’ other intangible assets could have a material adverse effect on the financial condition and results of operations of us and the VIEs. 16 Goodwill impairment could negatively affect our and the VIEs’ results of operations.
If we and the VIEs fail to continue to develop, innovate and utilize our and the VIEs’ technologies effectively and on a timely basis, the business, financial performance and prospects of us and the VIEs could be materially and adversely affected. 17 Inability to adequately and promptly respond to changes in professional certification exams, civil service exams, employment and entrepreneurship guidance and other regulatory changes in the PRC could render the VIEs’ educational content services less attractive to end users.
If we and the VIEs fail to continue to develop, innovate and utilize our and the VIEs’ technologies effectively and on a timely basis, the business, financial performance and prospects of us and the VIEs could be materially and adversely affected. 19 Inability to adequately and promptly respond to changes in professional certification exams, civil service exams, employment and entrepreneurship guidance and other regulatory changes in the PRC could render the VIEs’ educational content services less attractive to end users.
Any uninsured business disruptions may result in our and the VIEs’ incurring substantial costs and the diversion of resources, which could have an adverse effect on the results of operations and financial condition of us and the VIEs. 26 Risks Related to Corporate Structure Jianzhi Education is a Cayman Islands holding company operating in China through its subsidiaries and contractual arrangements with Beijing Sentu.
Any uninsured business disruptions may result in our and the VIEs’ incurring substantial costs and the diversion of resources, which could have an adverse effect on the results of operations and financial condition of us and the VIEs. 29 Risks Related to Corporate Structure Jianzhi Education is a Cayman Islands holding company operating in China through its subsidiaries and contractual arrangements with Beijing Sentu.
These factors may cause the conversion of the VIEs’ trial users to paying users to further decrease, which may adversely affect the prospects, business, financial condition, results of operations and reputation of us and the VIEs. 20 Customers may decide not to continue subscribing to or licensing the VIEs’ educational content for a number of reasons, including a perceived lack of improvement in their professional skills or general dissatisfaction with the VIEs’ educational content offerings, which may adversely affect the business, financial condition, results of operations and reputation of us and the VIEs.
These factors may cause the conversion of the VIEs’ trial users to paying users to further decrease, which may adversely affect the prospects, business, financial condition, results of operations and reputation of us and the VIEs. 22 Customers may decide not to continue subscribing to or licensing the VIEs’ educational content for a number of reasons, including a perceived lack of improvement in their professional skills or general dissatisfaction with the VIEs’ educational content offerings, which may adversely affect the business, financial condition, results of operations and reputation of us and the VIEs.
Any similar scrutiny on us, regardless of its lack of merit, could cause the market price of our ADSs to fall, divert management resources and energy, cause us to incur expenses in defending ourselves against rumors, and increase the premiums we pay for director and officer insurance. 36 The Holding Foreign Companies Accountable Act, or the HFCA Act, and the related regulations are evolving quickly.
Any similar scrutiny on us, regardless of its lack of merit, could cause the market price of our ADSs to fall, divert management resources and energy, cause us to incur expenses in defending ourselves against rumors, and increase the premiums we pay for director and officer insurance. 40 The Holding Foreign Companies Accountable Act, or the HFCA Act, and the related regulations are evolving quickly.
The failure to comply with these laws and regulations may delay, or possibly prevent, us to conduct business, accept foreign investments, or listing overseas. 32 The occurrence of any of these events may materially and adversely affect our and the VIEs’ business and prospects and may result in a material change in our and the VIEs’ operations and/or the value of our ADSs or could significantly limit or completely hinder our and the VIEs’ ability to offer or continue to offer securities to investors.
The failure to comply with these laws and regulations may delay, or possibly prevent, us to conduct business, accept foreign investments, or listing overseas. 35 The occurrence of any of these events may materially and adversely affect our and the VIEs’ business and prospects and may result in a material change in our and the VIEs’ operations and/or the value of our ADSs or could significantly limit or completely hinder our and the VIEs’ ability to offer or continue to offer securities to investors.
Risk Factors — Risks Related to Doing Business in China.” 6 VIE Consolidation Schedule The following table sets forth the summary consolidating balance sheets data as of December 31, 2023 and 2024 of (i) the parent company, Jianzhi Education Technology Group Company Limited, (ii) its subsidiaries, which include Jianzhi Education Group Company Limited, Jianzhi Education Technology (HK) Company Limited, Hong Kong Sentu Education Technology Ltd., and Jianzhi.
Risk Factors - Risks Related to Doing Business in China.” 6 VIE Consolidation Schedule The following table sets forth the summary consolidating balance sheets data as of December 31, 2024 and 2025 of (i) the parent company, Jianzhi Education Technology Group Company Limited, (ii) its subsidiaries, which include Jianzhi Education Group Company Limited, Jianzhi Education Technology (HK) Company Limited, Hong Kong Sentu Education Technology Ltd., and Jianzhi.
Risk Factors — Risks Related to Corporate Structure — We rely on contractual arrangements with Beijing Sentu and its shareholders for our and the VIEs’ operations in China, which may not be as effective in providing operational control as direct ownership, and Beijing Sentu’s shareholders may fail to perform their obligations under the contractual arrangements;” 10 ● Shareholders of Beijing Sentu may have conflicts of interest with us.
Risk Factors - Risks Related to Corporate Structure - We rely on contractual arrangements with Beijing Sentu and its shareholders for our and the VIEs’ operations in China, which may not be as effective in providing operational control as direct ownership, and Beijing Sentu’s shareholders may fail to perform their obligations under the contractual arrangements;” 11 ● Shareholders of Beijing Sentu may have conflicts of interest with us.
Preferred shares could be issued quickly with terms calculated to delay or prevent a change in control of our Company or make removal of management more difficult.
Preferred shares could be issued with terms calculated to delay or prevent a change in control of our Company or make removal of management more difficult.
(iii) WFOE and its subsidiaries, which include Jianzhi Century Technology (Beijing) Co., Ltd., Beijing Sentu Lejiao Information Technology Co., Ltd. and Sentu Shuzhi Technology (Beijing) Co., Ltd., and (iv) the VIE Entity, Beijing Sentu Education Technology Co., Ltd., and its subsidiaries including Shanghai Ang’you Internet Technology Co., Ltd., Guangzhou Xingzhiqiao Information Technology Co., Ltd., Guangzhou Lianhe Information Education Technology Co., Ltd. and Wuhan Crossboarder Information Co., Ltd., and the summary of the consolidating statement of operations and cash flows for the years ended December 31, 2023 and 2024.
(iii) WFOE and its subsidiaries, which include Jianzhi Century Technology (Beijing) Co., Ltd., Beijing Sentu Lejiao Information Technology Co., Ltd. and Sentu Shuzhi Technology (Beijing) Co., Ltd., and (iv) the VIE Entity, Beijing Sentu Education Technology Co., Ltd., and its subsidiaries including Shanghai Ang’you Internet Technology Co., Ltd., Guangzhou Xingzhiqiao Information Technology Co., Ltd., Guangzhou Lianhe Information Education Technology Co., Ltd. and Wuhan Crossboarder Information Co., Ltd., and the summary of the consolidating statement of operations and cash flows for the years ended December 31, 2024 and 2025.
If we were to be or become a PFIC for any taxable year during which a United States Holder (as defined in “Item 10. Additional Information — E. Taxation — United States Federal Income Tax Considerations”) holds the ADSs or ordinary shares, certain adverse U.S. federal income tax consequences could apply to such United States Holder. See “Item 10.
If we were to be or become a PFIC for any taxable year during which a United States Holder (as defined in “Item 10. Additional Information - E. Taxation - United States Federal Income Tax Considerations”) holds the ADSs or Class A ordinary shares, certain adverse U.S. federal income tax consequences could apply to such United States Holder.
As a result, to the extend we follow home country practice, our shareholders may be afforded less protection than they otherwise would under rules and regulations applicable to U.S. domestic issuers. 45 There can be no assurance that we will not be classified as a passive foreign investment company, or PFIC, for U.S. federal income tax purposes for any taxable year, which could result in adverse U.S. federal income tax consequences to United States Holders of the ADSs or ordinary shares.
As a result, to the extend we follow home country practice, our shareholders may be afforded less protection than they otherwise would under rules and regulations applicable to U.S. domestic issuers. 50 There can be no assurance that we will not be classified as a passive foreign investment company, or PFIC, for U.S. federal income tax purposes for any taxable year, which could result in adverse U.S. federal income tax consequences to United States Holders of the ADSs or Class A ordinary shares.
We and the VIEs have recorded thin gross profit margins for some of the products. Certain profitable business also has less profitable components and our and the VIEs’ overall profitability can fluctuate due to product mix. The VIEs’ mobile video package business has recorded lower margins over the years ended December 31, 2023 and 2024.
We and the VIEs have recorded thin gross profit margins for some of the products. Certain profitable business also has less profitable components and our and the VIEs’ overall profitability can fluctuate due to product mix. The VIEs’ mobile video package business has recorded lower margins over the years ended December 31, 2024 and 2025.
During the years ended December 31, 2022 and 2023 , the VIEs have received several written letters issued by local human resources and social security bureau confirming that no acts of violation in labor laws and regulations have been found and no administrative penalties have been imposed by relevant PRC governmental authorities.
During the years ended December 31, 2023 and 2024, the VIEs have received several written letters issued by local human resources and social security bureau confirming that no acts of violation in labor laws and regulations have been found and no administrative penalties have been imposed by relevant PRC governmental authorities.
In addition, non-resident enterprise shareholders (including our ADS holders) may be subject to PRC tax on gains realized on the sale or other disposition of ADSs or ordinary shares, if such income is treated as sourced from within China.
In addition, non-resident enterprise shareholders (including our ADS holders) may be subject to PRC tax on gains realized on the sale or other disposition of ADSs or Class A ordinary shares, if such income is treated as sourced from within China.
Our and the VIEs’ historical financial and operating results may not be indicative of the future performance and our and the VIEs’ financial and operating results may be difficult to forecast. During the years ended December 31, 2023 and 2024, IT related solution services accounted for a large part of the revenue from us and the VIEs.
Our and the VIEs’ historical financial and operating results may not be indicative of the future performance and our and the VIEs’ financial and operating results may be difficult to forecast. During the years ended December 31, 2024 and 2025, IT related solution services accounted for a large part of the revenue from us and the VIEs.
The VIEs have applied for such letter for the year ended December 31, 2024 and expect to receive it soon. The VIEs have not received any notification from the PRC governmental authorities requiring us to pay any outstanding amount of the social insurance and housing provident fund contributions.
The VIEs have applied for such letter for the year ended December 31, 2025 and expect to receive it soon. The VIEs have not received any notification from the PRC governmental authorities requiring us to pay any outstanding amount of the social insurance and housing provident fund contributions.
These reserve funds and staff welfare and bonus funds are not distributable as cash dividends. 31 Risks Related to Doing Business in China The PRC government has significant authority to exert influence on the China operations of an offshore holding company, such as us.
These reserve funds and staff welfare and bonus funds are not distributable as cash dividends. 34 Risks Related to Doing Business in China The PRC government has significant authority to exert influence on the China operations of an offshore holding company, such as us.
For the year ended December 31, 2022, Guangzhou Xingzhiqiao terminated business partnership with a major customer and we and the VIEs provided full impairment of RMB7.7 million against goodwill. For the years ended December 31, 2023 and 2024, respectively, we and the VIEs did not accrue any goodwill impairment.
For the year ended December 31, 2022, Guangzhou Xingzhiqiao terminated business partnership with a major customer and we and the VIEs provided full impairment of RMB7.7 million against goodwill. For the years ended December 31, 2024 and 2025, respectively, we and the VIEs did not accrue any goodwill impairment.
You will not be able to directly exercise your right to vote with respect to the underlying ordinary shares represented by your ADSs, unless you cancel the ADSs and withdraw the shares and become the registered holder of such shares prior to the record date for the general meeting.
You will not be able to directly exercise your right to vote with respect to the underlying Class A ordinary shares represented by your ADSs, unless you cancel the ADSs and withdraw the shares and become the registered holder of such shares prior to the record date for the general meeting.
The general credit terms we and the VIEs granted to customers for the three years ended December 31, 2024 ranged from 10 to 180 days for customers of our IT related solution services, and from 20 to 180 days for customers of the VIEs’ educational content service and other services.
The general credit terms we and the VIEs granted to customers for the three years ended December 31, 2025 ranged from 10 to 180 days for customers of our IT related solution services, and from 20 to 180 days for customers of the VIEs’ educational content service and other services.
During the years ended December 31, 2022, 2023 and 2024, the VIEs entered into promotion and distribution agreements with a third party agent to promote and sell certain of the VIEs’ educational content to higher education institutions and public libraries.
During the years ended December 31, 2023, 2024 and 2025, the VIEs entered into promotion and distribution agreements with a third party agent to promote and sell certain of the VIEs’ educational content to higher education institutions and public libraries.
This means that you may not be able to exercise your right to direct how the ordinary shares underlying your ADSs are voted and you may have no legal remedy if the ordinary shares underlying your ADSs are not voted as you requested.
This means that you may not be able to exercise your right to direct how the Class A ordinary shares underlying your ADSs are voted and you may have no legal remedy if the Class A ordinary shares underlying your ADSs are not voted as you requested.
GAAP financial statements. Based on the historical value of our and the VIEs’ assets and composition of our and the VIEs’ income, and our historical market capitalization, we believe we were not a PFIC for the taxable year ending December 31, 2024.
GAAP financial statements. Based on the historical value of our and the VIEs’ assets and composition of our and the VIEs’ income, and our historical market capitalization, we believe we were not a PFIC for the taxable year ending December 31, 2025.
We expect our costs and expenses to maintain stable or slightly increase in absolute amounts as we enhanced cost and expenses control in 2024, which may further increase in the future as we aim to continue to grow our business.
We expect our costs and expenses to maintain stable or slightly increase in absolute amounts as we enhanced cost and expenses control in 2025, which may further increase in the future as we aim to continue to grow our business.
These developments could also harm the brand and reputation of us and the VIEs, which would negatively impact our and the VIEs’ ability to expand the business of us and the VIEs. 13 The business of us and the VIEs is heavily dependent on the brand recognition and market reputation of us and the VIEs.
These developments could also harm the brand and reputation of us and the VIEs, which would negatively impact our and the VIEs’ ability to expand the business of us and the VIEs. 14 The business of us and the VIEs is heavily dependent on the brand recognition and market reputation of us and the VIEs.
You will only be able to exercise the voting rights attached to the ordinary shares underlying by your ADSs indirectly by giving voting instructions to the depositary in accordance with the provisions of the deposit agreement.
You will only be able to exercise the voting rights attached to the Class A ordinary shares underlying by your ADSs indirectly by giving voting instructions to the depositary in accordance with the provisions of the deposit agreement.
According to the National Bureau of Statistics of China, the year-over-year percent change in the consumer price index was an increase of 1.8% in December 2022, a decrease of 0.3% in December 2023 and an increase of 0.2% in December 2024. The PRC overall economy and the average wage in the PRC are expected to continue to grow.
According to the National Bureau of Statistics of China, the year-over-year percent change in the consumer price index was a decrease of 0.3% in December 2023, an increase of 0.2% in December 2024 and an increase of 0.8% in December 2025. The PRC overall economy and the average wage in the PRC are expected to continue to grow.
According to SAT Circular 82, an offshore incorporated enterprise controlled by a PRC enterprise or a PRC enterprise group will be regarded as a PRC tax resident by virtue of having its “de facto management body” in China and will be subject to PRC enterprise income tax on its global income only if all of the following conditions are met: (i) the primary location of the day-to-day operational management is in China; (ii) decisions relating to the enterprise’s financial and human resource matters are made or are subject to approval by organizations or personnel in China; (iii) the enterprise’s primary assets, accounting books and records, company seals, and board and shareholder resolutions, are located or maintained in China; and (iv) at least 50% of voting board members or senior executives habitually reside in China. 46 We believe that we are not a PRC resident enterprise for PRC tax purposes.
According to SAT Circular 82, an offshore incorporated enterprise controlled by a PRC enterprise or a PRC enterprise group will be regarded as a PRC tax resident by virtue of having its “de facto management body” in China and will be subject to PRC enterprise income tax on its global income only if all of the following conditions are met: (i) the primary location of the day-to-day operational management is in China; (ii) decisions relating to the enterprise’s financial and human resource matters are made or are subject to approval by organizations or personnel in China; (iii) the enterprise’s primary assets, accounting books and records, company seals, and board and shareholder resolutions, are located or maintained in China; and (iv) at least 50% of voting board members or senior executives habitually reside in China.
Our management has not completed an assessment of the effectiveness of our internal control over financial reporting, and our independent registered public accounting firm has not conducted an audit of the effectiveness of our internal controls over financial reporting. 21 A material weakness in our internal control over financial reporting was identified as of December 31, 2022, 2023 and 2024.
Our management has not completed an assessment of the effectiveness of our internal control over financial reporting, and our independent registered public accounting firm has not conducted an audit of the effectiveness of our internal controls over financial reporting. A material weakness in our internal control over financial reporting was identified as of December 31, 2023, 2024 and 2025.
Under the deposit agreement, you may vote only by giving voting instructions to the depositary, as the holder of the ordinary shares underlying your ADSs.
Under the deposit agreement, you may vote only by giving voting instructions to the depositary, as the holder of the Class A ordinary shares underlying your ADSs.
In 2023 and 2024, we and the VIEs paid up all previous outstanding contributions and made full contribution to the social insurance plans and housing provident fund. As of the date of this annual report, we and the VIEs have made full contribution to the social insurance plans and housing provident fund.
In 2025, we and the VIEs paid up all previous outstanding contributions and made full contribution to the social insurance plans and housing provident fund. As of the date of this annual report, we and the VIEs have made full contribution to the social insurance plans and housing provident fund.
As the Contractual Arrangements that establish the structure for operating our and the VIEs’ business in the PRC have not been tested in any of the PRC courts, if the Contractual Arrangements are found to be in violation of any existing or any PRC laws or regulations in the future, or the PRC government finds that we, or any of the VIEs fail to obtain or maintain any of the required permits or approvals, the relevant PRC regulatory authorities, including the MIIT, MOFCOM and STA, would have broad discretion in dealing with such violations, including: ● revoking the business and operating licenses; ● discontinuing or restricting the operations; ● imposing fines or confiscating any of the income from us and the VIEs that they deem to have been obtained through illegal operations; ● requiring us to restructure our and the VIEs’ operations in such a way as to compel us to establish new entities, re-apply for the necessary licenses or relocate our and the VIEs’ business, staff and assets; ● imposing additional conditions or requirements with which we and the VIEs may not be able to comply; ● restricting or prohibiting the use of proceeds from the public offerings or other financing activities to finance our and the VIEs’ business and operations in the PRC; or ● taking other regulatory or enforcement actions that could be harmful to our and the VIEs’ business.
As the Contractual Arrangements that establish the structure for operating our and the VIEs’ business in the PRC have not been tested in any of the PRC courts, if the Contractual Arrangements are found to be in violation of any existing or any PRC laws or regulations in the future, or the PRC government finds that we, or any of the VIEs fail to obtain or maintain any of the required permits or approvals, the relevant PRC regulatory authorities, including the MIIT, MOFCOM and STA, would have broad discretion in dealing with such violations, including: ● revoking the business and operating licenses; ● discontinuing or restricting the operations; ● imposing fines or confiscating any of the income from us and the VIEs that they deem to have been obtained through illegal operations; ● requiring us to restructure our and the VIEs’ operations in such a way as to compel us to establish new entities, re-apply for the necessary licenses or relocate our and the VIEs’ business, staff and assets; ● imposing additional conditions or requirements with which we and the VIEs may not be able to comply; ● restricting or prohibiting the use of proceeds from the public offerings or other financing activities to finance our and the VIEs’ business and operations in the PRC; or ● taking other regulatory or enforcement actions that could be harmful to our and the VIEs’ business. 30 Any of these actions could cause significant disruption or result in a material change to our and the VIEs’ business operations, and may materially and adversely affect our and the VIEs’ business, financial condition and results of operations.
In 2022 and 2023, trade receivables decrease mainly due to the facts that we and the VIEs took intensified measure to collect the trade receivables. As a result, we have successfully collected the majority of trade receivables from our and the VIE’s major clients.
In 2024 and 2025, trade receivables decrease mainly due to the facts that we and the VIEs took intensified measure to collect the trade receivables. As a result, we have successfully collected the majority of trade receivables from our and the VIE’s major clients.
On December 23, 2022, the Accelerating Holding Foreign Companies Accountable Act was enacted, which amended the HFCAA by requiring the SEC to prohibit an issuer’s securities from trading on any U.S. stock exchanges if its auditor is not subject to PCAOB inspections for two consecutive years instead of three, such that the number of consecutive non-inspection years required for triggering the prohibitions under the HFCAA is reduced from three years to two, and therefore the ADSs could be prohibited from trading in the United States as early as 2024.
On December 23, 2022, the Accelerating Holding Foreign Companies Accountable Act was enacted, which amended the HFCAA by requiring the SEC to prohibit an issuer’s securities from trading on any U.S. stock exchanges if its auditor is not subject to PCAOB inspections for two consecutive years instead of three, such that the number of consecutive non-inspection years required for triggering the prohibitions under the HFCAA is reduced from three years to two, and therefore the ADSs could be prohibited from trading in the United States as early as 2024. 41 The SEC may propose additional rules or guidance that could impact us if our auditor is not subject to PCAOB inspection.

… 157 more changes not shown on this page.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

86 edited+11 added−19 removed214 unchanged
Biggest changeThe amendment mainly includes, among others, (i) the establishment of a telecommunications business integrated administration online platform; (ii) provisions allowing the holder of a telecommunications business license (including the IDC license) to authorize a company, of which such license holder holds at least 51% of the equity interests indirectly, to engage in the relevant telecommunications business; and (iii) the cancellation of the requirement of an annual inspection of telecommunications business licenses, instead requiring license holders to complete an annual report. 60 Pursuant to the Provisions on Administration of Foreign Invested Telecommunications Enterprises (the “ FITE Regulation ”) promulgated by the PRC State Council on December 11, 2001 and amended on September 10, 2008, February 6, 2016 and March 29, 2022, respectively, the ultimate foreign equity ownership in a value-added telecommunications services provider shall not exceed 50%, except for online data processing and transaction processing businesses (operating e-commerce business) which may be 100% owned by foreign investors.
Biggest changePursuant to the Provisions on Administration of Foreign Invested Telecommunications Enterprises (the “ FITE Regulation ”) promulgated by the PRC State Council on December 11, 2001 and amended on September 10, 2008, February 6, 2016 and March 29, 2022, respectively, the ultimate foreign equity ownership in a value-added telecommunications services provider shall not exceed 50%, except for online data processing and transaction processing businesses (operating e-commerce business) which may be 100% owned by foreign investors.
The Registered Shareholders shall return any amount of purchase price they received in the event that Jianzhi Beijing acquires the equity interests in Beijing Sentu. 67 The Registered Shareholders and Beijing Sentu have jointly and severally further undertaken to Jianzhi Beijing that, without the prior written consent of Jianzhi Beijing, they shall not (i) in any manner supplement, change or amend the constitutional documents of Beijing Sentu, increase or decrease its share capital, or change the structure of its registered capital in other manner; (ii) sell, pledge, transfer or otherwise dispose of any assets, business or lawful revenue or create encumbrance over Beijing Sentu; (iii) incur, inherit, guarantee or assume any debt, except for debts incurred in the ordinary course of business other than payables incurred by a loan and for debts disclosed to and agreed in writing by Jianzhi Beijing; (iv) cause Beijing Sentu to execute any material contract with a value above RMB100,000, except the contracts executed in the ordinary course of business; (v) cause Beijing Sentu to provide any person with any loan, credit or guarantee; (vi) cause or permit Beijing Sentu to merge, consolidate with, acquire or invest in any person, or sell assets of Beijing Sentu with a value above RMB100,000; (vii) cause Beijing Sentu to enter into any transaction which may have substantial impact on the assets, liabilities, business operation, shareholding structure and other legal rights of Beijing Sentu, except the contracts executed in the ordinary course of business; and (viii) in any manner distribute dividends to their shareholders, provided that upon the written request of Jianzhi Beijing, Beijing Sentu shall immediately distribute all distributable profits to its shareholders.
The Registered Shareholders shall return any amount of purchase price they received in the event that Jianzhi Beijing acquires the equity interests in Beijing Sentu. 79 The Registered Shareholders and Beijing Sentu have jointly and severally further undertaken to Jianzhi Beijing that, without the prior written consent of Jianzhi Beijing, they shall not (i) in any manner supplement, change or amend the constitutional documents of Beijing Sentu, increase or decrease its share capital, or change the structure of its registered capital in other manner; (ii) sell, pledge, transfer or otherwise dispose of any assets, business or lawful revenue or create encumbrance over Beijing Sentu; (iii) incur, inherit, guarantee or assume any debt, except for debts incurred in the ordinary course of business other than payables incurred by a loan and for debts disclosed to and agreed in writing by Jianzhi Beijing; (iv) cause Beijing Sentu to execute any material contract with a value above RMB100,000, except the contracts executed in the ordinary course of business; (v) cause Beijing Sentu to provide any person with any loan, credit or guarantee; (vi) cause or permit Beijing Sentu to merge, consolidate with, acquire or invest in any person, or sell assets of Beijing Sentu with a value above RMB100,000; (vii) cause Beijing Sentu to enter into any transaction which may have substantial impact on the assets, liabilities, business operation, shareholding structure and other legal rights of Beijing Sentu, except the contracts executed in the ordinary course of business; and (viii) in any manner distribute dividends to their shareholders, provided that upon the written request of Jianzhi Beijing, Beijing Sentu shall immediately distribute all distributable profits to its shareholders.
If the outcomes of these regulatory actions or legal proceedings are adverse to us, it could have a material adverse effect on the business, results of operations, and financial condition of us and the VIEs.” Licenses and Approvals The following table sets forth licenses and approvals that our WFOE and the VIEs have obtained for our and the VIEs’ operations in China as of the date of this annual report.
If the outcomes of these regulatory actions or legal proceedings are adverse to us, it could have a material adverse effect on the business, results of operations, and financial condition of us and the VIEs.” 68 Licenses and Approvals The following table sets forth licenses and approvals that our WFOE and the VIEs have obtained for our and the VIEs’ operations in China as of the date of this annual report.
To further expand the business operations, in October 2017, Beijing Sentu acquired 51% equity interests of Guangzhou Xingzhiqiao Information Technology Co., Ltd., or Guangzhou Xingzhiqiao, and in August 2018, acquired the remaining 49% equity interests of Guangzhou Xingzhiqiao. In March 2018, Jianzhi Education Technology Group Company Limited was incorporated in the Cayman Islands as an exempted company with limited liability.
To further expand the business operations, in October 2017, Beijing Sentu acquired 51% equity interests of Guangzhou Xingzhiqiao Information Technology Co., Ltd., or Guangzhou Xingzhiqiao, and in August 2018, acquired the remaining 49% equity interests of Guangzhou Xingzhiqiao. 54 In March 2018, Jianzhi Education Technology Group Company Limited was incorporated in the Cayman Islands as an exempted company with limited liability.
To promote the employability of graduates, we and the VIEs invited experts in different industries to give free online streaming seminars on entrepreneurship to college students and provided them with internship opportunities with us. 57 Data Privacy and Security We and the VIEs are committed to protecting our and the VIEs’ users’ personal information and privacy.
To promote the employability of graduates, we and the VIEs invited experts in different industries to give free online streaming seminars on entrepreneurship to college students and provided them with internship opportunities with us. Data Privacy and Security We and the VIEs are committed to protecting our and the VIEs’ users’ personal information and privacy.
The Overseas Listing Archives Rules provide, among others, that before providing or disclosing any document or material which involve state secrets or state agencies’ work secrets, domestic companies shall apply to the competent government authorities for approval and file with the secrecy administration authorities for record. C.
The Overseas Listing Archives Rules provide, among others, that before providing or disclosing any document or material which involve state secrets or state agencies’ work secrets, domestic companies shall apply to the competent government authorities for approval and file with the secrecy administration authorities for record. 77 C.
In September 2018, the entire equity interests in Beijing Sentu Lejiao Information Technology Co., Ltd., or Sentu Lejiao, was transferred to Jianzhi Beijing such that our Company indirectly held the equity interests in Sentu Lejiao. 47 In June 2021, Sentu Shuzhi Education Technology (Beijing) Co., Ltd., or Sentu Shuzhi, was established in the PRC as a wholly-owned subsidiary of Sentu Lejiao.
In September 2018, the entire equity interests in Beijing Sentu Lejiao Information Technology Co., Ltd., or Sentu Lejiao, was transferred to Jianzhi Beijing such that our Company indirectly held the equity interests in Sentu Lejiao. In June 2021, Sentu Shuzhi Education Technology (Beijing) Co., Ltd., or Sentu Shuzhi, was established in the PRC as a wholly-owned subsidiary of Sentu Lejiao.
VIE Entity’s Principal Subsidiary Permit to Produce and Distribute Radio or Television Programmes Shanghai Municipal Administration of Radio and Television March 6, 2023 March 31, 2025* SP License Ministry of Industry and Information Technology of the People’s Republic of China July 7, 2023 July 7, 2028 ICP License Shanghai Communications Administration February 25, 2023 May 9, 2028 Note: *: The renewal of the license is underway. 59 Regulations This section sets forth a summary of the most significant rules and regulations that affect the business activities of us and the VIEs in China.
VIE Entity’s Principal Subsidiary Permit to Produce and Distribute Radio or Television Programmes Shanghai Municipal Administration of Radio and Television March 6, 2023 March 31, 2025* SP License Ministry of Industry and Information Technology of the People’s Republic of China July 7, 2023 July 7, 2028 ICP License Shanghai Communications Administration February 25, 2023 May 9, 2028 Note: *: The renewal of the license is underway. 69 Regulations This section sets forth a summary of the most significant rules and regulations that affect the business activities of us and the VIEs in China.
Similarly, the VIEs conduct internal review of such materials and only upload those which the VIEs believe are informative and attractive. 54 Suppliers and Customers Suppliers Our and the VIEs’ suppliers primarily consist of software suppliers, IT equipment providers and advertising companies.
Similarly, the VIEs conduct internal review of such materials and only upload those which the VIEs believe are informative and attractive. Suppliers and Customers Suppliers Our and the VIEs’ suppliers primarily consist of software suppliers, IT equipment providers and advertising companies.
The VIEs have launched 10 products, such as Light Class selected course monthly subscriptions, Light Class workplace VIP monthly subscriptions and Light Class quarterly subscriptions. Other Services Other services include the VIEs’ mobile media services. The VIEs actively explore commercial monetization models.
The VIEs have launched 10 products, such as Light Class selected course monthly subscriptions, Light Class workplace VIP monthly subscriptions and Light Class quarterly subscriptions. 60 Other Services Other services include the VIEs’ mobile media services. The VIEs actively explore commercial monetization models.
For our and the VIEs’ mobile media services, we and the VIEs maintain the cooperative relationships with China Unicom’s Guangdong subsidiary and Guangzhou 5G Information Technology Co., Ltd., or Guangzhou 5G, primarily through our and the VIEs’ proprietary technologies and comprehensive customer services. 55 Sales of our and the VIEs’ products such as Sentu Academy and certain IT related solution services such as software development and system integration projects may be designated to us by other contractors.
For our and the VIEs’ mobile media services, we and the VIEs maintain the cooperative relationships with China Unicom’s Guangdong subsidiary and Guangzhou 5G Information Technology Co., Ltd., or Guangzhou 5G, primarily through our and the VIEs’ proprietary technologies and comprehensive customer services. 64 Sales of our and the VIEs’ products such as Sentu Academy and certain IT related solution services such as software development and system integration projects may be designated to us by other contractors.
The VIEs cooperate with China United Network Communications Group Company Limited, or China Unicom, to offer such Light Class products to their mobile users. ● The VIEs also offer the Light Class products through WeChat.
The VIEs cooperate with China United Network Communications Group Company Limited, or China Unicom, to offer such Light Class products to their mobile users. 57 ● The VIEs also offer the Light Class products through WeChat.
(ii) the VIEs have selected some video content relating to artificial intelligence and big data from Sentu Academy educational content database, and formed 6 products totaling approximately 22.5 hours including reward points redemption product under cooperation with China Telecom. As of December 31, 2024, the VIEs’ courses were redeemed approximately 15.9 million times.
(ii) the VIEs have selected some video content relating to artificial intelligence and big data from Sentu Academy educational content database, and formed 6 products totaling approximately 22.5 hours including reward points redemption product under cooperation with China Telecom. As of December 31, 2025, the VIEs’ courses were redeemed approximately 15.9 million times.
As of December 31, 2024, the VIEs’ educational content database contained over 42,114 online videos and video courses, totaling approximately 11,324 hours, of which more than 87.0% of the videos were independently developed by us. We and the VIEs incurred impairment of RMB197.5 million (US$27.8 million) against purchased educational contents in 2023.
As of December 31, 2025, the VIEs’ educational content database contained over 42,114 online videos and video courses, totaling approximately 11,324 hours, of which more than 87.0% of the videos were independently developed by us. We and the VIEs incurred impairment of RMB197.5 million (US$27.8 million) against purchased educational contents in 2023.
During the three years ended December 31, 2024, we also leveraged the expertise and know-how to provide IT related solutions to other institutional customers, such as government institutions and major state-owned enterprises, primarily including technology development companies, to establish comprehensive intelligent management and service platforms and improve their intranet.
During the three years ended December 31, 2025, we also leveraged the expertise and know-how to provide IT related solutions to other institutional customers, such as government institutions and major state-owned enterprises, primarily including technology development companies, to establish comprehensive intelligent management and service platforms and improve their intranet.
As of December 31, 2024, of the over 42,114 online videos of the VIEs’ educational content database, over 32,700 of such videos with a total running time of approximately 10,000 hours were developed specifically for sale by us. We did not provide impairment against purchased educational contents for the year ended December 31, 2024.
As of December 31, 2025, of the over 42,114 online videos of the VIEs’ educational content database, over 32,700 of such videos with a total running time of approximately 10,000 hours were developed specifically for sale by us. We did not provide impairment against purchased educational contents for the year ended December 31, 2025.
Customers generally pay a one-time licensing fee to receive such products and the VIEs are not responsible for updating licensed materials. Customers may subsequently choose to purchase updated licensed content at additional cost. As of December 31, 2024, the VIEs have provided services to 30 libraries in the aggregate.
Customers generally pay a one-time licensing fee to receive such products and the VIEs are not responsible for updating licensed materials. Customers may subsequently choose to purchase updated licensed content at additional cost. As of December 31, 2025, the VIEs have provided services to 30 libraries in the aggregate.
Risk Factors — If we and the VIEs fail to protect our and the VIEs’ intellectual property rights, our and the VIEs’ brand and business may suffer” in this document for details. During the three years ended December 31, 2024, we and the VIEs were not a party to any material disputes relating to intellectual property infringement or misappropriation.
Risk Factors - If we and the VIEs fail to protect our and the VIEs’ intellectual property rights, our and the VIEs’ brand and business may suffer” in this document for details. During the three years ended December 31, 2025, we and the VIEs were not a party to any material disputes relating to intellectual property infringement or misappropriation.
As of December 31, 2024, “Fish Learning” selected mobile video package contains over 11,46 videos relating to employment, totaling 105.0 hours. From October 2017 through December 31, 2024, the VIEs received a total of approximately 31.4 million monthly subscription purchases of the VIEs’ “Fish Learning” mobile video package via Tianyi Video.
As of December 31, 2025, “Fish Learning” selected mobile video package contains over 11,46 videos relating to employment, totaling 105.0 hours. From October 2017 through December 31, 2025, the VIEs received a total of approximately 31.4 million monthly subscription purchases of the VIEs’ “Fish Learning” mobile video package via Tianyi Video.
Business Overview — Properties and Facilities” and “Item 4. Information on the Company — B. Business Overview — Intellectual Property”. 69 ITEM 4A. UNRESOLVED STAFF COMMENTS None.
Business Overview - Properties and Facilities” and “Item 4. Information on the Company - B. Business Overview - Intellectual Property”. ITEM 4A. UNRESOLVED STAFF COMMENTS None.
As of December 31, 2024, the VIEs offered online learning platform services to approximately 2,000 higher education institutions in China. ● The VIEs also license to institutional customers, primarily public libraries and video websites, specific content from Sentu Academy chosen by them.
As of December 31, 2025, the VIEs offered online learning platform services to approximately 2,000 higher education institutions in China. ● The VIEs also license to institutional customers, primarily public libraries and video websites, specific content from Sentu Academy chosen by them.
In total, as of December 31, 2024, the VIEs had over 42,114 videos relating to employment and entrepreneurship as well as IT related training and other subjects, totaling approximately 11,324 hours. The VIEs’ self-developed content forms an important part of the VIEs’ content database.
In total, as of December 31, 2025, the VIEs had over 42,114 videos relating to employment and entrepreneurship as well as IT related training and other subjects, totaling approximately 11,324 hours. The VIEs’ self-developed content forms an important part of the VIEs’ content database.
Information technology training database : The VIEs’ information technology training database aims to develop vocational education and integrates extensive learning resources and offers approximately 2,000 online information technology related training video courses. As of December 31, 2024, the VIEs had provided online learning platform subscription services to approximately 2,000 universities and colleges .
Information technology training database : The VIEs’ information technology training database aims to develop vocational education and integrates extensive learning resources and offers approximately 2,000 online information technology related training video courses. As of December 31, 2025, the VIEs had provided online learning platform subscription services to approximately 2,000 universities and colleges .
As of December 31, 2024, the VIEs provided services to 30 libraries. ● B2C Model ● The VIEs select employability skills and workplace etiquette related content from the educational content database of Sentu Academy, totaling 105.0 hours as of December 31, 2024, and package them as the “Fish Learning” education database.
As of December 31, 2025, the VIEs provided services to 30 libraries. ● B2C Model ● The VIEs select employability skills and workplace etiquette related content from the educational content database of Sentu Academy, totaling 105.0 hours as of December 31, 2025, and package them as the “Fish Learning” education database.
As of December 31, 2024, WeChat users can choose to purchase 10 products such as Light Learning Monthly Premium Subscription, Light Career Annual VIP Subscription and Light Class Membership Annual Subscription. and (iv) the VIEs also conduct sales of Light Class through the VIEs’ WeChat Official Account.
As of December 31, 2025, WeChat users can choose to purchase 10 products such as Light Learning Monthly Premium Subscription, Light Career Annual VIP Subscription and Light Class Membership Annual Subscription. and (iv) the VIEs also conduct sales of Light Class through the VIEs’ WeChat Official Account.
We and the VIEs did not experience strikes or significant labor disputes which have had or are likely to have a material and adverse effect on our and the VIEs’ business operation during the three years ended December 31, 2024.
We and the VIEs did not experience strikes or significant labor disputes which have had or are likely to have a material and adverse effect on our and the VIEs’ business operation during the three years ended December 31, 2025.
As of December 31, 2024, our and the VIEs’ educational content library consisted of over 42,114 online videos and video courses totaling approximately 11,324 hours, of which more than 87.0% were self-developed.
As of December 31, 2025, our and the VIEs’ educational content library consisted of over 42,114 online videos and video courses totaling approximately 11,324 hours, of which more than 87.0% were self-developed.
Quiz bank for professional certification exams : The quiz bank for professional certification exams is committed to assisting users to prepare for professional certification exams. 51 Quiz bank for civil service exams : The quiz bank for PRC civil service exams is a professional examination database developed specifically for civil service examinations administered by national, provincial and local governments in the PRC.
Quiz bank for professional certification exams : The quiz bank for professional certification exams is committed to assisting users to prepare for professional certification exams. 59 Quiz bank for civil service exams : The quiz bank for PRC civil service exams is a professional examination database developed specifically for civil service examinations administered by national, provincial and local governments in the PRC.
The special mobile video package comprises 6 products related to artificial intelligence and big data, in total of approximately 22.5 hours as of December 31, 2024.
The special mobile video package comprises 6 products related to artificial intelligence and big data, in total of approximately 22.5 hours as of December 31, 2025.
The average fee the VIEs received for every monthly subscription purchase remained stable at RMB9.2 during the years ended December 31, 2023 and 2024, respectively.
The average fee the VIEs received for every monthly subscription purchase remained stable at RMB9.2 during the years ended December 31, 2024 and 2025, respectively.
Registered individual users of such institutional customers can then access the resources directly from the VIEs’ online platform. As of December 31, 2023 and 2024, the VIEs had 751 and 771 paying subscribers, respectively, to the VIEs’ online learning platforms. Subscription terms normally range from one to two years.
Registered individual users of such institutional customers can then access the resources directly from the VIEs’ online platform. As of December 31, 2024 and 2025, the VIEs had 771 and 797 paying subscribers, respectively, to the VIEs’ online learning platforms. Subscription terms normally range from one to two years.
Violations of such SAFE regulations could result in administrative penalties. 63 Under the Circular of the SAFE on Foreign Exchange Administration of the Overseas Investment and Financing and Round-trip Investment by Domestic Residents via Special Purpose Vehicles , or the SAFE Circular 37 , issued by the SAFE and effective on July 4, 2014, and Circular on Further Simplifying and Improving Policies for the Foreign Exchange Administration for Direct Investment , or the SAFE Circular No. 13 , effective from June 1, 2015, PRC residents are required to register with the local SAFE branch or a qualified bank prior to the establishment or control of an offshore special purpose vehicle, or SPV, which is defined as offshore enterprises directly established or indirectly controlled by PRC residents for offshore equity financing of the enterprise assets or interests they hold in China.
Under the Circular of the SAFE on Foreign Exchange Administration of the Overseas Investment and Financing and Round-trip Investment by Domestic Residents via Special Purpose Vehicles , or the SAFE Circular 37 , issued by the SAFE and effective on July 4, 2014, and Circular on Further Simplifying and Improving Policies for the Foreign Exchange Administration for Direct Investment , or the SAFE Circular No. 13 , effective from June 1, 2015, PRC residents are required to register with the local SAFE branch or a qualified bank prior to the establishment or control of an offshore special purpose vehicle, or SPV, which is defined as offshore enterprises directly established or indirectly controlled by PRC residents for offshore equity financing of the enterprise assets or interests they hold in China.
As of December 31, 2024, we have launched 10 products through WeChat, such as Light Class selected courses monthly subscriptions, Light Class workplace VIP monthly subscriptions and Light Class quarterly subscriptions. 49 We are also fully committed to the digitalization and informatization of the education sector in China.
As of December 31, 2025, we have launched 10 products through WeChat, such as Light Class selected courses monthly subscriptions, Light Class workplace VIP monthly subscriptions and Light Class quarterly subscriptions. (1) As of December 31, 2025 We are also fully committed to the digitalization and informatization of the education sector in China.
As of December 31, 2024, we and the VIEs maintained an experienced team, consisting of 22 professionals specialized in educational content and software development. These educational content development professionals regularly organize and update educational content of the VIEs’ products. The VIEs develop new content using a variety of sources and methods.
As of December 31, 2025, we and the VIEs maintained an experienced team, consisting of 14 professionals specialized in educational content and software development. These educational content development professionals regularly organize and update educational content of the VIEs’ products. The VIEs develop new content using a variety of sources and methods.
Organizational Structure” for our latest corporate structure. Our principal executive office is located at 15/F, Tower A, Yingdu Building, Zhichun Road, Haidian District, Beijing, 100086, the People’s Republic of China. Our registered office in the Cayman Islands is Cricket Square, Hutchins Drive, P.O. Box 2681, Grand Cayman, KY1-1111, Cayman Islands.
See “Item 3. Key Information -- C. Organizational Structure” for our latest corporate structure. Our principal executive office is located at 15/F, Tower A, Yingdu Building, Zhichun Road, Haidian District, Beijing, 100086, the People’s Republic of China. Our registered office in the Cayman Islands is Cricket Square, Hutchins Drive, P.O. Box 2681, Grand Cayman, KY1-1111, Cayman Islands.
As of December 31, 2024, we and the VIEs had 8 sales and marketing service personnel based in our and the VIEs’ major regional markets, including Beijing, Hebei, Jiangsu, Guangdong, Anhui and certain places in Northeast China.
As of December 31, 2025, we and the VIEs had 9 sales and marketing service personnel based in our and the VIEs’ major regional markets, including Beijing, Hebei, Jiangsu, Guangdong, Anhui and certain places in Northeast China.
During the years ended December 31, 2022, 2023 and 2024, subscription and licensing fees for Sentu Academy accounted for approximately 100.0%, 100.0% and 94.9%, respectively, of the total revenue from online learning platform products, and accounted for approximately 25.6%, 86.5% and 94.9%, respectively, of the VIEs’ total revenue from educational content services.
During the years ended December 31, 2023, 2024 and 2025, subscription and licensing fees for Sentu Academy accounted for approximately 100.0%, 94.9% and 59.9%, respectively, of the total revenue from online learning platform products, and accounted for approximately 86.5%, 94.9% and 59.9%, respectively, of the VIEs’ total revenue from educational content services.
In September 2023, Beijing Sentu acquired 51% equity interests of Wuhan Crossboarder. On February 15, 2024, the Company announced a change in ADS to ordinary share ratio from each ADS representing two ordinary shares to each ADS representing six ordinary shares. Such ADS ratio change became effective on February 20, 2024. See “Item 3. Key Information –– C.
In September 2023, Beijing Sentu acquired 51% equity interests of Wuhan Crossboarder. On February 15, 2024, the Company announced a change in ADS to ordinary share ratio from each ADS representing two ordinary shares to each ADS representing six ordinary shares. Such ADS ratio change became effective on February 20, 2024.
On the same day, the CSRC held a press conference for the release of the Overseas Listing Trial Measures and issued the Notice on Administration for the Filing of Overseas Offering and Listing by Domestic Companies, which, among others, clarifies that (1) domestic companies that have been listed on a foreign stock exchange prior to the effective date of the Overseas Listing Trial Measures are not required to go through the filing procedure immediately but may be required to go through the filing procedure if future fund raising activities are involved; (2) a six-month transition period will be granted to domestic companies which, prior to the effective date of the Overseas Listing Trial Measures, have already obtained the approval from overseas regulatory authorities or stock exchanges (such as the completion of hearing in the market of Hong Kong or the completion of registration in the market of the United States), but have not completed the indirect overseas listing; if domestic companies fail to complete the overseas listing within such six-month transition period, they are required to file with the CSRC according to the requirements; and (3) the CSRC will solicit opinions from relevant regulatory authorities and complete the filing of the overseas listing of companies with contractual arrangements which duly meet the compliance requirements, and support the development and growth of these companies by enabling them to utilize two markets and two kinds of resources. 65 On February 24, 2023, the CSRC jointly with other government authorities issued the Provisions on Strengthening Confidentiality and Archives Administration of Overseas Securities Offering and Listing by Domestic Companies, or the Overseas Listing Archives Rules, as a supporting rule to the Overseas Listing Trial Measures, which came into effect on March 31, 2023.
On the same day, the CSRC held a press conference for the release of the Overseas Listing Trial Measures and issued the Notice on Administration for the Filing of Overseas Offering and Listing by Domestic Companies , which, among others, clarifies that (1) domestic companies that have been listed on a foreign stock exchange prior to the effective date of the Overseas Listing Trial Measures are not required to go through the filing procedure immediately but may be required to go through the filing procedure if future fund raising activities are involved; (2) a six-month transition period will be granted to domestic companies which, prior to the effective date of the Overseas Listing Trial Measures , have already obtained the approval from overseas regulatory authorities or stock exchanges (such as the completion of hearing in the market of Hong Kong or the completion of registration in the market of the United States), but have not completed the indirect overseas listing; if domestic companies fail to complete the overseas listing within such six-month transition period, they are required to file with the CSRC according to the requirements; and (3) the CSRC will solicit opinions from relevant regulatory authorities and complete the filing of the overseas listing of companies with contractual arrangements which duly meet the compliance requirements, and support the development and growth of these companies by enabling them to utilize two markets and two kinds of resources.
We and the VIEs maintain a strong and efficient team for research and development of educational content and software. As of December 31, 2024, our and the VIEs’ R&D team included 22 employees, and we and the VIEs owned 172 proprietary software copyrights.
We and the VIEs maintain a strong and efficient team for research and development of educational content and software. As of December 31, 2025, our and the VIEs’ R&D team included 14 employees, and we and the VIEs owned 173 proprietary software copyrights.
As of December 31, 2024, we and the VIEs had a content and software development team of 22 professionals, and 172 copyrights of software used in providing design and development of customized IT system service to our customers.
As of December 31, 2025, we and the VIEs had a content and software development team of 14 professionals, and 173 copyrights of software used in providing design and development of customized IT system service to our customers.
We believe that the principal competitive factors in China’s IT related solution services market, educational content market and mobile media services market include (i) brand awareness and reputation; (ii) scope and diversity of online course offerings; (iii) product pricing; (iv) interactive, engaging and customized learning experience; (v) technology support and content development capabilities; (vi) ease of deployment and use of the course delivery format; (vii) expertise in sales and marketing, and customer acquisition and retention; and (viii) proven track record of performance.
We and the VIEs compete with competitors for users’ engagement, diversity of educational content, advanced technologies, and sales and marketing effectiveness, among other things. 67 We believe that the principal competitive factors in China’s IT related solution services market, educational content market and mobile media services market include (i) brand awareness and reputation; (ii) scope and diversity of online course offerings; (iii) product pricing; (iv) interactive, engaging and customized learning experience; (v) technology support and content development capabilities; (vi) ease of deployment and use of the course delivery format; (vii) expertise in sales and marketing, and customer acquisition and retention; and (viii) proven track record of performance.
If the VIEs require financial support from us or our wholly owned subsidiary in the future and we find it necessary to use foreign currency-denominated capital to provide such financial support, we shall be subject to statutory limits and restrictions described above.
If the VIEs require financial support from us or our wholly owned subsidiary in the future and we find it necessary to use foreign currency-denominated capital to provide such financial support, we shall be subject to statutory limits and restrictions described above. Violations of such SAFE regulations could result in administrative penalties.
We recorded net loss of RMB RMB196.6 million, 382.8 million and RMB33.8 million (US$4.6 million) for the years ended December 31, 2022, 2023 and 2024, respectively. 50 Services Provided by Us and the VIEs Educational Content Services and Other Services Educational Content Services Since being established, leveraging the strong capability to develop independent proprietary education and training courses and the ability to integrate educational content resources in the industry, the VIEs have integrated a comprehensive and multi-dimensional digital educational content database.
We recorded net loss of RMB382.8 million, RMB33.4 million and RMB16.3 million (US$2.3 million) for the years ended December 31, 2023, 2024 and 2025, respectively. 58 Services Provided by Us and the VIEs Educational Content Services and Other Services Educational Content Services Since being established, leveraging the strong capability to develop independent proprietary education and training courses and the ability to integrate educational content resources in the industry, the VIEs have integrated a comprehensive and multi-dimensional digital educational content database.
Information on our and the VIEs’ leased properties as of December 31, 2024 is summarized below. Location Space (in square meters) Lease Term (years) Beijing 461 2.17 Wuhan 318.0 3 Shanghai 352.5 1 Guangzhou 16.0 1 Total 1147.5 58 We and the VIEs lease our and the VIEs’ premises under lease agreements from independent third parties.
Information on our and the VIEs’ leased properties as of December 31, 2025 is summarized below. Location Space (in square meters) Lease Term (years) Beijing 461 2.17 Wuhan 144 2 Shanghai 0 0 Guangzhou 16 1 Total 621 We and the VIEs lease our and the VIEs’ premises under lease agreements from independent third parties.
The software used in providing design and development of customized IT systems mainly include: Sentu Desktop Virtualization Software and Sentu Online Learning Software. For the years ended December 31, 2022, 2023 and 2024, revenue derived from IT related solution services accounted for 59.4%, 83.7% and 88.0%, respectively, of our and the VIEs’ total revenue.
The software used in providing design and development of customized IT systems mainly include: Sentu Desktop Virtualization Software and Sentu Online Learning Software. For the years ended December 31, 2024 and 2025 , revenue derived from IT related solution services accounted for 88.0% and 74.1%, respectively, of our and the VIEs’ total revenue.
The VIEs generate revenue from advertisements based on the posting period or on the number of times viewers click on these advertisements and download the sponsor’s application to their phones or the number of days such advertisements are placed in the VIEs’ “Fish Learning” platform. ● Mobile Application Content Data Business System Services through SDK: The VIEs have developed a mobile application content data business system which is also known as “Mobile Application Content Oriented Data Business System Software,” containing a built-in software development kit (SDK), through which mobile applications and content providers can provide their users access to targeted data plans provided by China Unicom. 52 IT Related Solution Services We have developed a number of software applications to provide our software or customized intelligent solutions tailored to meet the specific needs of educational institutions and other institutional customers.
The VIEs generate revenue from advertisements based on the posting period or on the number of times viewers click on these advertisements and download the sponsor’s application to their phones or the number of days such advertisements are placed in the VIEs’ “Fish Learning” platform. ● Mobile Application Content Data Business System Services through SDK: The VIEs have developed a mobile application content data business system which is also known as “Mobile Application Content Oriented Data Business System Software,” containing a built-in software development kit (SDK), through which mobile applications and content providers can provide their users access to targeted data plans provided by China Unicom.
In addition, we are able to customize the software for clients according to their specific needs, for example, by including online programming modules which provide a virtual space for students of programming to practice relevant skills while viewing videos or course materials on the same screen.
In addition, we are able to customize the software for clients according to their specific needs, for example, by including online programming modules which provide a virtual space for students of programming to practice relevant skills while viewing videos or course materials on the same screen. This can effectively help students facilitate better practice and master IT skills more quickly.
Such conditions include that (i) we control Beijing Sentu through power to govern the activities which most significantly impact Beijing Sentu’s economic performance, (ii) we are contractually obligated to absorb losses of Beijing Sentu that could potentially be significant to Beijing Sentu, and (iii) we are entitled to receive benefits from Beijing Sentu that could potentially be significant to Beijing Sentu.
Such conditions include that (i) we control Beijing Sentu through power to govern the activities which most significantly impact Beijing Sentu’s economic performance, (ii) we are contractually obligated to absorb losses of Beijing Sentu that could potentially be significant to Beijing Sentu, and (iii) we are entitled to receive benefits from Beijing Sentu that could potentially be significant to Beijing Sentu. 78 The following is a summary of the Contractual Arrangements by and among Jianzhi Beijing, Beijing Sentu, and the shareholders of Beijing Sentu.
For data or statistical content relating to employment and entrepreneurship, the VIEs compile, monitor and analyze data from leading recruitment websites and, through the VIEs’ analysis, provide job seekers with accurate and timely information on job openings and industry trends and other relevant data.
Business Overview - Research and Development Procedures” in this section for further details. 62 For data or statistical content relating to employment and entrepreneurship, the VIEs compile, monitor and analyze data from leading recruitment websites and, through the VIEs’ analysis, provide job seekers with accurate and timely information on job openings and industry trends and other relevant data.
In the opinion of our PRC legal counsel, DeHeng Law Offices ● the ownership structures of the VIEs and our WFOE in China, both currently are not in violation of applicable PRC laws and regulations currently in effect; and ● the contractual arrangements among our WFOE, Beijing Sentu and its shareholders governed by PRC law are currently valid and binding in accordance with applicable PRC laws and regulations currently in effect and do not result in any violation of the applicable PRC laws or regulations currently in effect.
In the opinion of our PRC legal counsel, DeHeng Law Offices, ● the ownership structures of the VIEs and our WFOE in China, both currently are not in violation of applicable PRC laws and regulations currently in effect; and ● the contractual arrangements among our WFOE, Beijing Sentu and its shareholders governed by PRC law are currently valid and binding in accordance with applicable PRC laws and regulations currently in effect and do not result in any violation of the applicable PRC laws or regulations currently in effect. 81 However, our PRC legal counsel, DeHeng Law Offices, has also advised us that there are substantial uncertainties regarding the interpretation and application of current or future PRC laws and regulations.
Failure to comply with the registration procedures set forth in the SAFE Circular 37 and SAFE Circular No. 13 or making misrepresentation on or failure to disclose controllers of the foreign-invested enterprise that is established through round-trip investment, may result in restrictions being imposed on the foreign exchange activities of our PRC subsidiaries, including payment of dividends and other distributions, such as proceeds from any reduction in capital, share transfer or liquidation, to its offshore parent or affiliate, and the capital inflow from the offshore parent, and may also subject our beneficial owners who are PRC residents to penalties under PRC foreign exchange administration regulations.
Failure to comply with the registration procedures set forth in the SAFE Circular 37 and SAFE Circular No. 13 or making misrepresentation on or failure to disclose controllers of the foreign-invested enterprise that is established through round-trip investment, may result in restrictions being imposed on the foreign exchange activities of our PRC subsidiaries, including payment of dividends and other distributions, such as proceeds from any reduction in capital, share transfer or liquidation, to its offshore parent or affiliate, and the capital inflow from the offshore parent, and may also subject our beneficial owners who are PRC residents to penalties under PRC foreign exchange administration regulations. 75 Regulations on Loans by Foreign Companies to their PRC Subsidiaries Former Foreign Debt Mechanism Loans made by foreign investors as shareholders in foreign invested enterprises established in China are considered to be foreign debts and are mainly regulated by the Administrative Regulations of the PRC on Foreign Exchange , the Interim Provisions on the Management of Foreign Debts , the Statistical Monitoring of Foreign Debts Tentative Provisions , and the Administrative Measures for Registration of Foreign Debts .
Upon the occurrence and during the continuance of an event of default (as defined in the Equity Pledge Agreements), Jianzhi Beijing shall have the right to (i) require the Registered Shareholders to immediately pay any amount payable under the Contractual Arrangements; or (ii) to exercise all such rights as a secured party under any applicable PRC law and the Equity Pledge Agreement, including without limitations, being paid in priority with the equity interests. 68 The said equity pledge under the Equity Pledge Agreement takes effect upon the completion of registration with the relevant administrative department of industry and commerce and shall remain valid until after all the contractual obligations of the Registered Shareholders and Beijing Sentu under the relevant Contractual Arrangements have been fully performed and all the outstanding debts of the Registered Shareholders and/or Beijing Sentu under the relevant Contractual Arrangements have been fully paid. ● Individual Registered Shareholders’ Undertakings Pursuant to the Individual Registered Shareholders’ Undertakings, each of the Individual Registered Shareholders has irrevocably undertaken that, including without limitation to, (i) any of his/her equity interests in Beijing Sentu and all rights attached hereto shall not be revoked, prejudiced, invalidated or otherwise adversely affected by death, loss of or restriction on capacity of the Individual Registered Shareholders or other similar events.
The said equity pledge under the Equity Pledge Agreement takes effect upon the completion of registration with the relevant administrative department of industry and commerce and shall remain valid until after all the contractual obligations of the Registered Shareholders and Beijing Sentu under the relevant Contractual Arrangements have been fully performed and all the outstanding debts of the Registered Shareholders and/or Beijing Sentu under the relevant Contractual Arrangements have been fully paid. 80 ● Individual Registered Shareholders’ Undertakings Pursuant to the Individual Registered Shareholders’ Undertakings, each of the Individual Registered Shareholders has irrevocably undertaken that, including without limitation to, (i) any of his/her equity interests in Beijing Sentu and all rights attached hereto shall not be revoked, prejudiced, invalidated or otherwise adversely affected by death, loss of or restriction on capacity of the Individual Registered Shareholders or other similar events.
The Administrative Measures on Telecommunications Business Operating Licenses or the Licenses Measures , issued on March 1, 2009 and newly amended on July 3, 2017, which set forth more specific provisions regarding the types of licenses required to operate VATS, the qualifications and procedures for obtaining such licenses and the administration and supervision of such licenses.
Information services provided via cable networks, mobile networks, or Internet fall within class II value-added telecommunications services. 70 The Administrative Measures on Telecommunications Business Operating Licenses or the Licenses Measures , issued on March 1, 2009 and newly amended on July 3, 2017, which set forth more specific provisions regarding the types of licenses required to operate VATS, the qualifications and procedures for obtaining such licenses and the administration and supervision of such licenses.
As all application execution takes place on the remote operating system with only display, keyboard and mouse information communicated with local client devices, our institutional customers can build their cloud reading rooms or cloud classrooms without purchasing traditional desktop computer for each user.
As all application execution takes place on the remote operating system with only display, keyboard and mouse information communicated with local client devices, our institutional customers can build their cloud reading rooms or cloud classrooms without purchasing traditional desktop computer for each user. 61 Sentu Online Learning Software Sentu Online Learning Software is another software product designed based on the technology of Cloud Desktop with a dual-screen mode.
PBOC Notice No. 9 provides that within a transition period of one year from January 12, 2017, the foreign invested enterprises may choose to adopt either Former Foreign Debt Mechanism or the PBOC No. 9 Foreign Debt Mechanism, at their own discretion. 64 Based on the foregoing, if we provide funding to our wholly foreign owned subsidiaries through shareholder loans, the balance of such loans shall not exceed the Total Investment and Registered Capital Balance and we will need to register such loans with SAFE or its local branches in the event that the Former Foreign Debt Mechanism applies, or the balance of such loans shall be subject to the Risk-Weighted Approach and the Net Asset Limits and we will need to file the loans with SAFE in its information system in the event that the PBOC No. 9 Foreign Debt Mechanism applies.
Based on the foregoing, if we provide funding to our wholly foreign owned subsidiaries through shareholder loans, the balance of such loans shall not exceed the Total Investment and Registered Capital Balance and we will need to register such loans with SAFE or its local branches in the event that the Former Foreign Debt Mechanism applies, or the balance of such loans shall be subject to the Risk-Weighted Approach and the Net Asset Limits and we will need to file the loans with SAFE in its information system in the event that the PBOC No. 9 Foreign Debt Mechanism applies.
By contrast, approval from or registration with appropriate regulatory authorities is required where RMB is to be converted into foreign currency and remitted out of China to pay capital account items, such as activities which may be conducted by our PRC subsidiaries in the future, including direct overseas investment, repayment of foreign currency-denominated loans, repatriation of investment and investment in securities outside of China.
By contrast, approval from or registration with appropriate regulatory authorities is required where RMB is to be converted into foreign currency and remitted out of China to pay capital account items, such as activities which may be conducted by our PRC subsidiaries in the future, including direct overseas investment, repayment of foreign currency-denominated loans, repatriation of investment and investment in securities outside of China. 74 On March 30, 2015, the SAFE issued the Circular of the SAFE on Reforming the Administrative Approach Regarding the Settlement of the Foreign Exchange Capital of Foreign-invested Enterprises, or SAFE Circular 19, which took effect on June 1, 2015.
Leveraging our and the VIEs’ strong capabilities in developing proprietary professional development training content and IT related solutions and success in consolidating educational content and software resources within the industry, we and the VIEs have successfully built up a comprehensive, multi-dimensional digital educational content database and are able to provide customized technological support for educational institutions and other institutional customers.
We, together with the VIEs, then initiated end-user business and started providing products to individual customers, and acquired companies in Shanghai and Guangzhou to facilitate further expansion in the end-user market. 56 Leveraging our and the VIEs’ strong capabilities in developing proprietary professional development training content and IT related solutions and success in consolidating educational content and software resources within the industry, we and the VIEs have successfully built up a comprehensive, multi-dimensional digital educational content database and are able to provide customized technological support for educational institutions and other institutional customers.
Under these regulations, an owner of the network dissemination rights with respect to written works, performance or audio or video recordings who believes that information storage, search or link services provided by an Internet service provider infringe his or her rights may require that the Internet service provider delete, or disconnect the links to, such works or recordings. 61 Patent Law According to the Patent Law of the PRC (Revised in 2020), the patent administrative department under the State Council is responsible for the administration of patent-related work in the PRC.
Under these regulations, an owner of the network dissemination rights with respect to written works, performance or audio or video recordings who believes that information storage, search or link services provided by an Internet service provider infringe his or her rights may require that the Internet service provider delete, or disconnect the links to, such works or recordings.
Trademark Law Trademarks are protected by the Trademark Law of the PRC which was adopted in 1982 and subsequently amended in 1993, 2001, 2013 and 2019 respectively as well as by the Implementation Regulations of the PRC Trademark Law adopted by the State Council in 2002 and as most recently amended on April 29, 2014.
A patent is valid for twenty years in the case of an invention and ten years in the case of utility models and designs. 72 Trademark Law Trademarks are protected by the Trademark Law of the PRC which was adopted in 1982 and subsequently amended in 1993, 2001, 2013 and 2019 respectively as well as by the Implementation Regulations of the PRC Trademark Law adopted by the State Council in 2002 and as most recently amended on April 29, 2014.
For the years ended December 31, 2022, 2023 and 2024, revenue from the provision of such solutions reached RMB300.8 million, RMB368.8 million and RMB218.76 million (US$30.40 million), respectively representing 59.5%, 83.7% and 88.0%, respectively of our and the VIEs’ total revenue for those periods.
For the years ended December 31, 2023, 2024 and 2025, revenue from the provision of such solutions reached RMB368.8 million, RMB209.1 million and RMB51.8 million (US$7.4 million), respectively representing 83.7%, 88.0% and 74.1%, respectively of our and the VIEs’ total revenue for those periods.
Moreover, according to the Administrative Measures for the Review and Registration of Medium and Long-Term Foreign Debt of Enterprises issued by the NDRC on January 5, 2023, or Order 56, any foreign debt, including but not limited to senior bonds, perpetual securities, capital bonds, medium-term notes, convertible bonds, exchangeable bonds, finance leases and commercial loans, provided by foreign entities to PRC entities with a term of more than 1 year must be filed and registered with the NDRC.
Moreover, according to the Administrative Measures for the Review and Registration of Medium and Long-Term Foreign Debt of Enterprises issued by the NDRC on January 5, 2023, or Order 56, any foreign debt, including but not limited to senior bonds, perpetual securities, capital bonds, medium-term notes, convertible bonds, exchangeable bonds, finance leases and commercial loans, provided by foreign entities to PRC entities with a term of more than 1 year must be filed and registered with the NDRC. 76 Regulations on Dividend Distribution The principal laws and regulations regulating the dividend distribution of dividends by foreign-invested enterprises in the PRC include the Company Law of the PRC, as amended in 1999, 2004, 2005, 2013, 2018 and 2023, and the Foreign Investment Law , which came into effect on January 1, 2020.
Resident enterprises are defined as enterprises that are established in China in accordance with PRC laws, or that are established in accordance with the laws of a foreign country (region) but where actual management functions are conducted in China.
Under the EIT Law and its implementing regulations, both resident enterprises and non-resident enterprises are subject to tax in the PRC. Resident enterprises are defined as enterprises that are established in China in accordance with PRC laws, or that are established in accordance with the laws of a foreign country (region) but where actual management functions are conducted in China.
Additionally, we expect to face competition as a result of new entrants to the post-secondary and vocational education market in China, including established education service providers that had not previously offered educational content online. We and the VIEs compete with competitors for users’ engagement, diversity of educational content, advanced technologies, and sales and marketing effectiveness, among other things.
Additionally, we expect to face competition as a result of new entrants to the post-secondary and vocational education market in China, including established education service providers that had not previously offered educational content online.
On December 6, 2007, the State Council enacted the Regulations for the Implementation of the Law on Enterprise Income Tax , which came into effect on January 1, 2008 and was amended on April 23, 2019. Under the EIT Law and its implementing regulations, both resident enterprises and non-resident enterprises are subject to tax in the PRC.
On December 6, 2007, the State Council enacted the Regulations for the Implementation of the Law on Enterprise Income Tax , which came into effect on January 1, 2008 and was amended on April 23, 2019 and Decmber 6, 2024.
Set forth below is a summary of typical clauses contained in the contracts that the VIEs enter into with the VIEs’ major customers regarding the provision of audio and video services. ● Term: The term of the contracts that the VIEs enter into with the VIEs’ major customers is typically one year and those contracts are normally subject to annual review and will be renewed upon mutual consent. ● Product quality: The VIEs are typically obligated to deliver the selected or bespoke products and/or services to the VIEs’ customers within an agreed period of time.
Historically, the contributions made by our and the VIEs’ customers to our and the VIEs’ revenue generation are not evenly distributed; instead, a handful of customers have generated much more revenues for us than the others, making them our and the VIEs’ major customers on whom our and the VIEs’ business operations are perceptibly dependent. 63 Set forth below is a summary of typical clauses contained in the contracts that the VIEs enter into with the VIEs’ major customers regarding the provision of audio and video services. ● Term: The term of the contracts that the VIEs enter into with the VIEs’ major customers is typically one year and those contracts are normally subject to annual review and will be renewed upon mutual consent. ● Product quality: The VIEs are typically obligated to deliver the selected or bespoke products and/or services to the VIEs’ customers within an agreed period of time.
We are a company registered in the Cayman Islands. Our PRC subsidiary, Jianzhi Beijing, is considered a foreign-invested enterprise. To comply with PRC laws and regulations, the VIEs primarily conduct business in China through Beijing Sentu, and its subsidiaries, based on a series of Contractual Arrangements.
To comply with PRC laws and regulations, the VIEs primarily conduct business in China through Beijing Sentu, and its subsidiaries, based on a series of Contractual Arrangements.
Our and the VIEs’ commitment to all our and the VIEs’ stakeholders and the society as a whole are the foundation upon which we and the VIEs build-in our and the VIEs’ values to establish a sustainable ecosystem.
Our and the VIEs’ commitment to all our and the VIEs’ stakeholders and the society as a whole are the foundation upon which we and the VIEs build-in our and the VIEs’ values to establish a sustainable ecosystem. 66 Since being established, we and the VIEs have established various social and governance initiatives to comprehensively improve our and the VIEs’ corporate governance and benefit society.
As of December 31, 2024, most of our and the VIEs’ employees were in Beijing, Shanghai and Wuhan, China. 56 The following table sets forth a breakdown of our and the VIEs’ employees by function as of December 31, 2024: Function Number of Employees Percentage Management 7 15 % Sales and marketing 8 17 % Operation and production 1 2 % Administrative 4 9 % Finance staff 4 9 % Technology, products, research and development 22 48 % Total 46 100 % Our and the VIEs’ success depends on our and the VIEs’ ability to attract, retain and motivate qualified employees.
The following table sets forth a breakdown of our and the VIEs’ employees by function as of December 31, 2025: Function Number of Employees Percentage Management 5 12 % Sales and marketing 9 21 % Operation and production 7 17 % Administrative 3 7 % Finance staff 4 10 % Technology, products, research and development 14 33 % Total 42 100 % Our and the VIEs’ success depends on our and the VIEs’ ability to attract, retain and motivate qualified employees.
The revenue from us and the VIEs was RMB505.7 million for the year ended December 31, 2022. The revenue from us and the VIEs decreased to RMB440.5 million for the year ended December 31, 2023. The revenue from us and the VIEs decreased to RMB248.8 million (US$34.1 million) for the year ended December 31, 2024.
The revenue from us and the VIEs decreased to RMB440.5 million for the year ended December 31, 2023. The revenue from us and the VIEs decreased to RMB248.8 million for the year ended December 31, 2024. The revenue from us and the VIEs decreased to RMB70.2 million (US$10.0 million) for the year ended December 31, 2025.
We and the VIEs promote diversity and inclusion through efforts to integrate people with disabilities by providing them with equitable job opportunities.
We and the VIEs give back to the communities through a series of initiatives to effectuate our and the VIEs’ mission. We and the VIEs promote diversity and inclusion through efforts to integrate people with disabilities by providing them with equitable job opportunities.
The VIEs outsource the production of video content the VIEs develop to Independent Third Parties. See the paragraph headed “Item 4. Information on the Company — B. Business Overview — Research and Development Procedures” in this section for further details.
The VIEs outsource the production of video content the VIEs develop to Independent Third Parties. See the paragraph headed “Item 4. Information on the Company - B.
Existing funding channels shall be used as a whole to strengthen the construction of online education platforms and demonstration applications; (v) banks and other financial institutions are encouraged to develop financial products that meet the characteristics of online education and social capital will be guided to support the development of online education through various channels such as venture capital fund, angel investment and capital market financing; and (vi) in areas such as online education, the pilot application of the 5 th generation mobile networks (5G) industry will be accelerated, the coordinated development of 4G, 5G, and Narrow Band Internet of Things (NB-IoT) will be promoted, and the construction of cloud computing infrastructure that supports big data applications and massive information processing will be accelerated.
Existing funding channels shall be used as a whole to strengthen the construction of online education platforms and demonstration applications; (v) banks and other financial institutions are encouraged to develop financial products that meet the characteristics of online education and social capital will be guided to support the development of online education through various channels such as venture capital fund, angel investment and capital market financing; and (vi) in areas such as online education, the pilot application of the 5 th generation mobile networks (5G) industry will be accelerated, the coordinated development of 4G, 5G, and Narrow Band Internet of Things (NB-IoT) will be promoted, and the construction of cloud computing infrastructure that supports big data applications and massive information processing will be accelerated. 71 Regulations on Intellectual Property Rights Regulations on Copyright The Copyright Law of the PRC , or the Copyright Law , which took effect on June 1, 1991 and was amended in 2001, 2010 and 2020, provides that Chinese citizens, legal persons, or other organizations shall, whether published or not, own copyright in their copyrightable works, which include, among others, works of literature, art, natural science, social science, engineering technology and computer software.
The Notice 39 further changes the VAT tax rate of 16% and 10% into 13% and 9%. 62 Regulations on Employment and Social Welfare Employment Pursuant to the PRC Labor Law (as amended in 2018) and the PRC Labor Contract Law (as amended in 2012), a written labor contract shall be executed by an employer and an employee when the employment relationship is established.
The VAT tax rates generally applicable are simplified as 13%, 9%, 6% and 0%, and the VAT rate of applied when the VAT payable is calculated through the simple tax computation method is 3%. 73 Regulations on Employment and Social Welfare Employment Pursuant to the PRC Labor Law (as amended in 2018) and the PRC Labor Contract Law (as amended in 2012), a written labor contract shall be executed by an employer and an employee when the employment relationship is established.
This database includes video courses, industry reports and case studies, among other materials, primarily focusing on employment, entrepreneurship and IT related skills. Such educational content encompasses a variety of tools including self-evaluation, skill improvement, and job and industry recommendations for college students, which cater to the needs of the VIEs’ target customers.
Such educational content encompasses a variety of tools including self-evaluation, skill improvement, and job and industry recommendations for college students, which cater to the needs of the VIEs’ target customers.
The patent administration departments of provincial, autonomous region or municipal governments are responsible for administering patent law within their respective jurisdictions.
Patent Law According to the Patent Law of the PRC (Revised in 2020), the patent administrative department under the State Council is responsible for the administration of patent-related work in the PRC. The patent administration departments of provincial, autonomous region or municipal governments are responsible for administering patent law within their respective jurisdictions.
Since being established, we and the VIEs have established various social and governance initiatives to comprehensively improve our and the VIEs’ corporate governance and benefit society. We and the VIEs have been actively supporting and participating in socially responsible programs that reflect our and the VIEs’ core values.
We and the VIEs have been actively supporting and participating in socially responsible programs that reflect our and the VIEs’ core values. Our and the VIEs’ major social and corporate governance initiatives include: Social Responsibility Initiatives We and the VIEs endeavor to make meaningful contributions to the greater social good.
It is uncertain whether any new PRC laws or regulations relating to variable interest entity structures will be adopted or if adopted, what they would provide.
Accordingly, the PRC regulatory authorities may ultimately take a view contrary to or otherwise different from the opinion of our PRC legal counsel. It is uncertain whether any new PRC laws or regulations relating to variable interest entity structures will be adopted or if adopted, what they would provide.
Xiaoling Tang, a prior management member of Shanghai Ang’you, an entity controlled by Beijing Sentu, the VIE Entity.
Xiaoling Tang, a prior management member of Shanghai Ang’you, an entity controlled by Beijing Sentu, the VIE Entity. (2) 49% equity interest in Wuhan Crossboarder is owned by Zhangmei Technology Co., Ltd.
(2) 49% equity interest in Wuhan Crossboarder is owned by Zhangmei Technology Co., Ltd. 66 Contractual Arrangements with Beijing Sentu and Its Shareholders Current PRC laws and regulations impose certain restrictions or prohibitions on foreign ownership of companies that engage in radio and television program production and operation business and value-added telecommunication business.
Contractual Arrangements with Beijing Sentu and Its Shareholders Current PRC laws and regulations impose certain restrictions or prohibitions on foreign ownership of companies that engage in radio and television program production and operation business and value-added telecommunication business. We are a company registered in the Cayman Islands. Our PRC subsidiary, Jianzhi Beijing, is considered a foreign-invested enterprise.

… 36 more changes not shown on this page.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

69 edited+12 added−21 removed63 unchanged
Biggest changeRisk Factors — Risks Related to Doing Business in China — PRC regulation of loans and direct investment by offshore holding companies to PRC entities may delay or prevent us from using the proceeds of financing activities to make loans to our PRC subsidiaries or VIE or to make additional capital contributions to Jianzhi Beijing, which could materially and adversely affect our and the VIEs’ liquidity and our and the VIEs’ ability to fund and expand our and the VIEs’ business operations.” Cash Flows The following table sets forth a summary of our and the VIEs’ cash flows for the years presented: For the Years Ended December 31, 2022 2023 2024 2024 RMB RMB RMB US$ Net cash provided by operating activities 94,222,109 15,159,956 10,508,470 1,439,654 Net cash used in investing activities (218,486,639 ) (55,165,530 ) (16,718,685 ) (2,290,451 ) Net cash provided by (used in) financing activities 126,561,795 (7,247,688 ) 760,947 104,249 Effect of exchange rate changes on cash held in foreign currencies 1,491,231 373,943 (263,492 ) (35,841 ) Net increase (decrease) in cash 3,788,496 (46,879,319 ) (5,617,097 ) (769,539 ) Cash at beginning of the year 61,266,782 65,055,278 18,175,959 2,490,096 Cash at end of the year 65,055,278 18,175,959 12,461,382 1,707,202 83 Operating Activities Net cash provided by operating activities for the year ended December 31, 2024 was RMB10.6 million (US$1.5 million), primarily attributable to (i) net loss of RMB33.8 million (US$4.6 million), adjusted for adding back of share-based compensation expenses of RMB36.4 million (US$5.0 million); and (ii) an increase in accounts receivable of RMB32.4 million (US$4.4 million) as we generated IT related services in November 2024 which was not uncollected as of December 31, 2024; (iii) a decrease in short-term prepayments of RMB77.6 million (US$10.6 million), and a decrease in contract liabilities of RMB80.7 million (US$11.1 million).
Biggest changeRisk Factors — Risks Related to Doing Business in China — PRC regulation of loans and direct investment by offshore holding companies to PRC entities may delay or prevent us from using the proceeds of financing activities to make loans to our PRC subsidiaries or VIE or to make additional capital contributions to Jianzhi Beijing, which could materially and adversely affect our and the VIEs’ liquidity and our and the VIEs’ ability to fund and expand our and the VIEs’ business operations.” Cash Flows The following table sets forth a summary of our and the VIEs’ cash flows for the years presented: For the Years Ended December 31, 2023 2024 2025 2025 RMB RMB RMB US$ Net cash provided by (used in) operating activities 15,159,956 10,508,470 (9,745,382 ) (1,429,409 ) Net cash used in investing activities (55,165,530 ) (16,718,685 ) (28,513,974 ) (4,077,444 ) Net cash provided by (used in) financing activities (7,247,688 ) 760,947 34,034,375 4,729,803 Effect of exchange rate changes on cash held in foreign currencies 373,943 (265,309 ) (68,028 ) 163,158 Net decrease in cash (46,879,319 ) (5,714,577 ) (4,293,009 ) (613,892 ) Cash at beginning of the year 65,055,278 18,175,959 12,461,382 1,781,954 Cash at end of the year 18,175,959 12,461,382 8,168,373 1,168,062 Operating Activities Net cash used in operating activities for the year ended December 31, 2025 was RMB9.7 million (US$1.4 million), primarily attributable to (i) net loss of RMB16.3 million (US$2.3 million), adjusted for adding back of share-based compensation expenses of RMB10.2 million (US$1.4 million) and reversal of credit losses against doubtful accounts of RMB 1.6 million (US$0.2 million); and (ii) a decrease in accounts receivable of RMB15.3 million (US$2.2 million) which was in line with a decrease of revenues for the year ended December 31, 2025; (iii) a decrease of accounts payable of RMB 15.5 million (US$2.2 million) which was in line with decrease of accounts receivable; and (iv) a decrease of other payables of RMB 1.3 million (US$0.2 million). 93 Net cash provided by operating activities for the year ended December 31, 2024 was RMB10.6 million, primarily attributable to (i) net loss of RMB33.8 million, adjusted for adding back of share-based compensation expenses of RMB36.4 million; and (ii) an increase in accounts receivable of RMB32.4 million as we generated IT related services in November 2024 which was not uncollected as of December 31, 2024; (iii) a decrease in short-term prepayments of RMB77.6 million, and a decrease in contract liabilities of RMB80.7 million.
We had an income tax expenses for the year of 2023 because our profit-generating subsidiaries and VIE’s subsidiaries utilized net operating loss carried forwards in 2023. For the year ended December 31, 2024, the income tax benefits primarily generated from deferred tax benefits of net operating losses.
We had an income tax expenses for the year of 2023 because our profit-generating subsidiaries and VIE’s subsidiaries utilized net operating loss carried forwards in 2023. For the year ended December 31, 2024, the income tax expenses primarily generated from deferred tax benefits of net operating losses.
For the years ended December 31, 2022, 2023 and 2024, the VIEs delivered a diverse, comprehensive range of educational content primarily through (i) selling subscriptions of the VIEs’ online learning platforms, in particular Sentu Academy, to higher education institutions and other institutional customers under a B2B2C model; (ii) licensing select content in Sentu Academy to institutional customers based on their needs and preferences under a B2B2C model; (iii) offering educational content in mobile video packages directly to end users under a B2C model, including (a) offering the VIEs’ Fish Learning mobile video package via the platform of Tianyi Video; (b) offering courses in a mobile video package to be redeemed by mobile users of China Telecom using their reward points, which was terminated in 2023; and (c) offering the VIEs’ new mobile video package, Light Class, via a subscription account on WeChat and through cooperation with China Unicom’s subsidiaries.
For the years ended December 31, 2023, 2024 and 2025, the VIEs delivered a diverse, comprehensive range of educational content primarily through (i) selling subscriptions of the VIEs’ online learning platforms, in particular Sentu Academy, to higher education institutions and other institutional customers under a B2B2C model; (ii) licensing select content in Sentu Academy to institutional customers based on their needs and preferences under a B2B2C model; (iii) offering educational content in mobile video packages directly to end users under a B2C model, including (a) offering the VIEs’ Fish Learning mobile video package via the platform of Tianyi Video; (b) offering courses in a mobile video package to be redeemed by mobile users of China Telecom using their reward points, which was terminated in 2023; and (c) offering the VIEs’ new mobile video package, Light Class, via a subscription account on WeChat and through cooperation with China Unicom’s subsidiaries.
The Company provides advertising services to customers on its mobile application in the form of pop-up ads and banners, and generates revenue from advertisements based on the posting period or based on the number of times viewers click on these advertisements etc. The decrease in subscriptions form end customers resulted in decreased advertising services. 76 ● IT related solution services.
The Company provides advertising services to customers on its mobile application in the form of pop-up ads and banners, and generates revenue from advertisements based on the posting period or based on the number of times viewers click on these advertisements etc. The decrease in subscriptions form end customers resulted in decreased advertising services. ● IT related solution services.
Critical Accounting Estimates Quantitative and Qualitative Disclosures about Market Risk Foreign Exchange Risk Foreign currency risk is the risk of loss resulting from changes in foreign currency exchange rates. Fluctuations in exchange rates between the RMB and other currencies in which we and the VIEs conduct business may affect our and the VIEs’ financial position and results of operations.
E. Critical Accounting Estimates Quantitative and Qualitative Disclosures about Market Risk Foreign Exchange Risk Foreign currency risk is the risk of loss resulting from changes in foreign currency exchange rates. Fluctuations in exchange rates between the RMB and other currencies in which we and the VIEs conduct business may affect our and the VIEs’ financial position and results of operations.
The details were as the following: For the year ended December 31, 2023 2024 2024 RMB RMB US$ (in thousands) Impairment of long-term prepayments 155,307 — — Impairment of intangible assets 4,642 — — Impairment of educational contents 197,467 — — Total 357,416 — — Impairment of long-term prepayments: As of December 31, 2023, we and the VIEs reviewed the long-term prepayments for educational content.
The details were as the following: For the year ended December 31, 2023 2024 RMB RMB (in thousands) Impairment of long-term prepayments 155,307 — Impairment of intangible assets 4,642 — Impairment of educational contents 197,467 — Total 357,416 — Impairment of long-term prepayments: As of December 31, 2023, we and the VIEs reviewed the long-term prepayments for educational content.
We did not provided impairment against intangible assets for the year ended December 31, 2024. Impairment of educational contents: For the years ended December 31, 2023, because certain contents were obsolete, we and the VIEs assessed that it is not likely that end customers would subscribe for related educational contents.
We did not provided impairment against intangible assets for the year ended December 31, 2024. 91 Impairment of educational contents: For the years ended December 31, 2023, because certain contents were obsolete, we and the VIEs assessed that it is not likely that end customers would subscribe for related educational contents.
We and the VIEs determine the pricing of our and the VIEs’ products and services primarily based on cost of revenues, market demand for the products and services of us and the VIEs and pricing of our and the VIEs’ competitors. With technical developments in educational content services and IT related solution services, more competitors may enter into this market.
We and the VIEs determine the pricing of our and the VIEs’ products and services primarily based on cost of revenues, market demand for the products and services of us and the VIEs and pricing of our and the VIEs’ competitors. 83 With technical developments in educational content services and IT related solution services, more competitors may enter into this market.
They may be exempted from income tax on their foreign-derived income and there are no withholding taxes in Hong Kong on remittance of dividends. 75 China Effective from January 1, 2008, the PRC’s statutory, EIT rate is 25%.
They may be exempted from income tax on their foreign-derived income and there are no withholding taxes in Hong Kong on remittance of dividends. China Effective from January 1, 2008, the PRC’s statutory, EIT rate is 25%.
We expect that changes in our and the VIEs’ product and service mix may continue to affect revenue contribution percentages from our and the VIEs’ operating segments as well as our and the VIEs’ gross and net profit margins. 71 KEY COMPONENTS OF RESULTS OF OPERATIONS Net Revenues We and the VIEs derived revenue primarily from (i) provision of educational content service and other services; and (ii) provision of IT related solution services.
We expect that changes in our and the VIEs’ product and service mix may continue to affect revenue contribution percentages from our and the VIEs’ operating segments as well as our and the VIEs’ gross and net profit margins. 84 KEY COMPONENTS OF RESULTS OF OPERATIONS Net Revenues We and the VIEs derived revenue primarily from (i) provision of educational content service and other services; and (ii) provision of IT related solution services.
Organizational Structure.” All of our and the VIEs’ revenues have been, and we expect they are likely to continue to be, in the form of Renminbi.
Organizational Structure.” 92 All of our and the VIEs’ revenues have been, and we expect they are likely to continue to be, in the form of Renminbi.
IT related solution services. For the years ended December 31, 2022, 2023 and 2024, WFOE and its subsidiaries and VIEs derived revenue from IT related solution services through providing (i) design and development of customized IT system service, (ii) procurement and assembling of equipment, and (iii) technological support and maintenance service.
For the years ended December 31, 2023, 2024 and 2025, WFOE and its subsidiaries and VIEs derived revenue from IT related solution services through providing (i) design and development of customized IT system service, (ii) procurement and assembling of equipment, and (iii) technological support and maintenance service.
Trend Information Other than as disclosed elsewhere in this annual report, we are not aware of any trends, uncertainties, demands, commitments or events for the year ended December 31, 2024 that are reasonably likely to have a material adverse effect on our net revenues, income, profitability, liquidity or capital resources, or that would cause reported financial information not necessarily to be indicative of future operating results or financial conditions. 85 E.
Trend Information Other than as disclosed elsewhere in this annual report, we are not aware of any trends, uncertainties, demands, commitments or events for the year ended December 31, 2025 that are reasonably likely to have a material adverse effect on our net revenues, income, profitability, liquidity or capital resources, or that would cause reported financial information not necessarily to be indicative of future operating results or financial conditions.
Net revenue from the educational content service and other services decreased by RMB32.0 million from RMB RMB71.7 million for the year ended December 31, 2023 to RMB39.7 million (US$5.4 million) for the year ended December 31, 2024. The decrease was primarily due to a decrease of RMB31.55 million in other services which was primarily mobile media advertising services.
Net revenue from the educational content service and other services decreased by RMB32.0 million from RMB RMB71.7 million for the year ended December 31, 2023 to RMB39.7 million (for the year ended December 31, 2024. The decrease was primarily due to a decrease of RMB31.55 million in other services which was primarily mobile media advertising services.
Recently Issued Accounting Pronouncements A list of recently issued accounting pronouncements that are relevant to us is included in note 2 to our consolidated financial statements included elsewhere in this Form 20-F. 86
Recently Issued Accounting Pronouncements A list of recently issued accounting pronouncements that are relevant to us is included in note 2 to our consolidated financial statements included elsewhere in this Form 20-F. 96
The decrease of cost of revenues was primarily attributable to the decrease of RMB57.4 million (US$7.9 million) in amortization of educational contents as we impaired educational contents in 2023, and decrease of RMB35.8 million (US$4.9 million) in material costs used for educational content service and other services with decreased subscriptions from end customers and decreased orders from high schools, and a decrease of RMB129.1 million (US$17.7 million) in purchase of IT equipment for IT related solution services.
The decrease of cost of revenues was primarily attributable to the decrease of RMB57.4 million in amortization of educational contents as we impaired educational contents in 2023, and decrease of RMB35.8 million in material costs used for educational content service and other services with decreased subscriptions from end customers and decreased orders from high schools, and a decrease of RMB129.1 million in purchase of IT equipment for IT related solution services.
The significant changes in short-term prepayments and contract liabilities were mainly due to decreased procurement and assembling of equipment projects in the year of 2024; and (iv) an increase of accounts payable of RMB 26.0 million (US$3.6 million) which was in line with the increase in accounts receivable.
The significant changes in short-term prepayments and contract liabilities were mainly due to decreased procurement and assembling of equipment projects in the year of 2024; and (iv) an increase of accounts payable of RMB 26.0 million which was in line with the increase in accounts receivable.
Investing Activities Net cash used in investing activities was RMB16.7 million (US$2.3 million) for the year ended December 31, 2024, primarily due to purchase of educational contents of RMB18.2 million (US$2.5 million) and purchase of short-term investments of RMB11.5 million (US$1.6 million), partially offset by proceeds from redemption of short-term investments of RMB11.2 million (US$1.5 million) and refund of long-term prepayments of RMB 1.8 million (US$0.2 million) from a supplier.
Net cash used in investing activities was RMB16.7 million for the year ended December 31, 2024, primarily due to purchase of educational contents of RMB18.2 million and purchase of short-term investments of RMB11.5 million, partially offset by proceeds from redemption of short-term investments of RMB11.2 million and refund of long-term prepayments of RMB 1.8 million from a supplier.
In addition, for the same periods, the VIEs also derived revenue from other services primarily from (i) promotion service on the Fish Learning platform; (ii) provision of mobile application content data business system services; and (iii) provision of technical support services for a mobile paid-content platform of China Unicom mainly accessible from a subscription account on WeChat.
In addition, for the same periods, the VIEs also derived revenue from other services primarily from (i) promotion service on the Fish Learning platform; (ii) provision of mobile application content data business system services; and (iii) provision of technical support services for a mobile paid-content platform of China Unicom mainly accessible from a subscription account on WeChat. 85 IT related solution services.
Serviced fee represents fees we and the VIEs paid in relation to bidding for projects and customer services. 74 General and Administrative Expenses .
Serviced fee represents fees we and the VIEs paid in relation to bidding for projects and customer services. 86 General and Administrative Expenses .
In 2022, 2023 and 2024, our and the VIEs’ revenue contribution percentages from the two operating segments varied significantly year over year.
In 2023, 2024 and 2025, our and the VIEs’ revenue contribution percentages from the two operating segments varied significantly year over year.
Cost of Revenues Our and the VIEs’ cost of revenue decreased by 52.4% from RMB B424.3 million for the year ended December 31, 2023 to RMB202.0 million (US$27.7 million) for the year ended December 31, 2024.
Cost of Revenues Our and the VIEs’ cost of revenue decreased by 52.4% from RMB B424.3 million for the year ended December 31, 2023 to RMB202.0 million for the year ended December 31, 2024.
Net revenue from IT related solution services decreased by RMB159.7 million (US$21.9 million), or 43.3% from RMB368.8 million for the year ended December 31, 2023 to RMB209.1 million (US$28.6 million) for the year ended December 31, 2024. The decrease was primarily caused by decreased cloud-based customers in 2024 in design and development of customized IT system.
Net revenue from IT related solution services decreased by RMB159.7 million, or 43.3% from RMB368.8 million for the year ended December 31, 2023 to RMB209.1 million for the year ended December 31, 2024. The decrease was primarily caused by decreased cloud-based customers in 2024 in design and development of customized IT system.
This decrease was primarily driven by the net effects of a decrease of RMB32.0 million (US$4.4 million) in revenue generated from educational content services and other services and a decrease of RMB 159.7 million (US$21.9 million) in net revenues from the provision of IT related solution services. ● Educational content service and other services.
This decrease was primarily driven by the net effects of a decrease of RMB32.0 million in revenue generated from educational content services and other services and a decrease of RMB 159.7 million in net revenues from the provision of IT related solution services. ● Educational content service and other services.
For the years ended December 31, 2022, 2023 and 2024, our and the VIEs’ cost of revenues represented approximately 101.0%, 96.3% and 81.2% of our and the VIEs’ total revenue, respectively. Our and the VIEs’ costs of revenues consist primarily of inventory cost, staff costs, video content costs, depreciation expenses and other direct costs of providing these services or goods.
For the years ended December 31, 2023, 2024 and 2025, our and the VIEs’ cost of revenues represented approximately 96.3%, 81.2% and 82.3% of our and the VIEs’ total revenue, respectively. Our and the VIEs’ costs of revenues consist primarily of inventory cost, staff costs, video content costs, depreciation expenses and other direct costs of providing these services or goods.
Income tax (expenses) benefit We and the VIEs reported income tax expenses of RMB0.2 million for the year ended December 31, 2023 and income tax benefits of RMB12.85 million (US$1.76 million) for the year ended December 31, 2024.
Income tax (expenses) benefit We and the VIEs reported income tax expenses of RMB0.2 million for the year ended December 31, 2023 and income tax expenses of RMB12.85 million for the year ended December 31, 2024.
Our subsidiaries are mainly operating in mainland China with most of the transactions settled in RMB. We consider that our and the VIEs’ business in mainland China is not exposed to any significant foreign exchange risk as there are no significant financial assets or liabilities of these subsidiaries denominated in the currencies other than the respective functional currency.
We consider that our and the VIEs’ business in mainland China is not exposed to any significant foreign exchange risk as there are no significant financial assets or liabilities of these subsidiaries denominated in the currencies other than the respective functional currency.
Compared with the decrease in revenues growth, the higher percentage of decrease in cost of revenues was mainly attributable to the higher gross profit we earned from educational contents in 2024 as compared with that in 2023.
Compared with the decrease in revenues growth, the lower percentage of decrease in cost of revenues was mainly attributable to the lower gross profit we earned from educational contents in 2025 as compared with that in 2025.
For the years ended December 31, 2022, 2023 and 2024, revenue derived from educational content service and other services accounted for 40.6%, 16.3% and 12.0%, respectively, of our and the VIEs’ total revenue, and revenue derived from IT related solution services accounted for 59.4%, 83.7% and 88.0%, respectively, of our and the VIEs’ total revenue.
For the years ended December 31, 2023, 2024 and 2025, revenue derived from educational content service and other services accounted for 16.3%, 12.0% and 25.9%, respectively, of our and the VIEs’ total revenue, and revenue derived from IT related solution services accounted for 83.7%, 88.0% and 74.1%, respectively, of our and the VIEs’ total revenue.
This increase was primarily due to an increase of RMB 53.8 million in share-based compensation as we adopted share incentive plan in the year of 2024 and issued 48,000,000 ordinary shares to our management, employees and directors, partially offset by a decrease of RMB3.3 million in professional expenses and a decrease of RMB 1.6 million in salary and welfare expenses due to resignation of administrative department employees. 77 Research and Development Expenses: Our and the VIEs’ research and development expenses decreased from RMB11.8 million for the year ended December 31, 2023 to RMB 5.7 million (US$0.8 million) for the year ended December 31, 2024.
This increase was primarily due to an increase of RMB 53.8 million in share-based compensation as we adopted share incentive plan in the year of 2024 and issued 48,000,000 ordinary shares to our management, employees and directors, partially offset by a decrease of RMB3.3 million in professional expenses and a decrease of RMB 1.6 million in salary and welfare expenses due to resignation of administrative department employees.
Sales and Marketing Expenses: Our and the VIEs’ sales and marketing expenses decreased from RMB7.6 million for the year ended December 31, 2023 to RMB 6.9 million (US$0.9 million). This decrease was mainly driven by n decrease of RMB0.7 million in salary and welfare expenses due to resignation of salespersons with decrease in IT related solution services.
This decrease was mainly driven by n decrease of RMB0.7 million in salary and welfare expenses due to resignation of salespersons with decrease in IT related solution services. General and Administrative Expenses: Our and the VIEs’ general and administrative expenses increased from RMB22.2 million for the year ended December 31, 2023 to RMB 54.6 million.
For the years ended December 31, 2022, 2023 and 2024, our and the VIEs’ revenue was RMB505.7 million, RMB440.5 million and RMB248.8 million (US$34.1 million), respectively. The following table sets forth a breakdown of our and the VIEs’ revenue by business segments for the years indicated.
For the years ended December 31, 2023, 2024 and 2025, our and the VIEs’ revenue was RMB440.5 million, RMB248.8 million and RMB 70.2 million (US$10.0 million), respectively. The following table sets forth a breakdown of our and the VIEs’ revenue by business segments for the years indicated.
The foreign currency risk we have assumed mainly comes from movements in the HKD/RMB exchange rate. We and our major overseas intermediate holding companies’ functional currency is U.S. dollar. We and the VIEs are mainly exposed to foreign exchange risk arising from our and the VIEs’ cash and loans to subsidiaries dominated in RMB.
The foreign currency risk we have assumed mainly comes from movements in the HKD/RMB exchange rate. We and our major overseas intermediate holding companies’ functional currency is U.S. dollar.
Gross (Loss) Profit As a result of the foregoing, our and the VIEs’ reported a gross profit of RMB16.2 million and RMB 46.8 million (US$6.4 million) for the year ended December 31, 2023 and 2024, respectively.
Gross (Loss) Profit As a result of the foregoing, our and the VIEs’ reported a gross profit of RMB46.8 million and RMB 12.4 million (US$1.8 million) for the year ended December 31, 2024 and 2025, respectively.
Operating expenses Our and the VIEs’ total operating expenses increased from RMB399.0 million for the year ended December 31, 2023 to RMB 83.5 million (US$11.4 million) for the year ended December 31, 2024.
Operating expenses Our and the VIEs’ total operating expenses increased from RMB399.0 million for the year ended December 31, 2023 to RMB 83.5 million for the year ended December 31, 2024. Sales and Marketing Expenses: Our and the VIEs’ sales and marketing expenses decreased from RMB7.6 million for the year ended December 31, 2023 to RMB 6.9 million.
FACTORS AFFECTING RESULTS OF OPERATIONS The business, financial condition and results of operations of us and the VIEs have been, and are expected to continue to be, affected by a number of factors, which primarily include the following: We, together with the VIEs, operate in China’s educational content service and mobile media service market, and IT related solution services market.
We, together with the VIEs, then initiated end-user business and started providing products to individual customers, and acquired companies in Shanghai and Guangzhou to facilitate further expansion in the end-user market. 82 Factors Affecting Results of Operations The business, financial condition and results of operations of us and the VIEs have been, and are expected to continue to be, affected by a number of factors, which primarily include the following: We, together with the VIEs, operate in China’s educational content service and mobile media service market, and IT related solution services market.
Research and Development Expenses: Our and the VIEs’ research and development expenses decreased from RMB15.6 million for the year ended December 31, 2022 to RMB11.8 million (US$1.7 million) for the year ended December 31, 2023.
Research and Development Expenses: Our and the VIEs’ research and development expenses decreased from RMB11.8 million for the year ended December 31, 2023 to RMB 5.7 million for the year ended December 31, 2024.
For the year ended December 31, 2023, our and the VIEs’ net cash used in financing activities was RMB7.2 million, which mainly represented repayments of loans to related parties of RMB7.2 million.
For the year ended December 31, 2023, our and the VIEs’ net cash used in financing activities was RMB7.2 million, which mainly represented repayments of loans to related parties of RMB7.2 million. 94 Capital Expenditure Our and the VIEs’ capital expenditures are incurred mainly to purchase educational video content and tangible assets.
Year ended December 31, 2024 compared to year ended December 31, 2023 For the Years Ended December 31, 2023 2024 RMB % RMB US$ % (in thousands, except for share, per share data and percentages) Net revenues 440,537 100.0 248,831 34,090 100.0 Cost of revenues (424,346 ) (96.3 ) (201,991 ) (27,673 ) (81.2 ) Gross (loss) profit 16,191 3.7 46,840 6,417 18.8 Operating expenses: Sales and marketing expenses 7,590 1.7 6,873 942 2.8 General and administrative expenses 22,187 5.0 70,886 9,712 28.5 Research and development expenses 11,761 2.7 5,775 791 2.3 Impairment of other non-current assets 357,416 81.2 - - 0.0 Total operating expenses 398,954 90.6 83,464 11,436 33.5 Loss from operations (382,763 ) (86.9 ) (36,624 ) (5,019 ) (14.7 ) Other income: Total other income, net 161 0.0 55 7 0.0 Loss before income tax (382,602 ) (86.9 ) (36,569 ) (5,012 ) (14.7 ) Income tax (expense) benefits (211 ) (0.0 ) 12,853 1,701 1.1 Net loss (382,813 ) (86.9 ) (33,841 ) (4,638 ) (13.6 ) Net Revenues Our and the VIEs’ revenue decreased by 43.5% from RMB440.5 million for the year ended December 31, 2023 to RMB248.8 million (US$34.1 million) for the year ended December 31, 2024.
Net loss As a result of the foregoing, we and the VIEs reported net loss of RMB 33.4 million and RMB 16.3 million (US$2.3 million) for the years ended December 31, 2024 and 2025, respectively. 89 Year ended December 31, 2024 compared to year ended December 31, 2023 For the Years Ended December 31, 2023 2024 RMB % RMB % (in thousands, except for share, per share data and percentages) Net revenues 440,537 100.0 248,831 100.0 Cost of revenues (424,346 ) (96.3 ) (201,991 ) (81.2 ) Gross (loss) profit 16,191 3.7 46,840 18.8 Operating expenses: Sales and marketing expenses 7,590 1.7 6,873 2.8 General and administrative expenses 22,187 5.0 54,574 21.9 Research and development expenses 11,761 2.7 5,775 2.3 Impairment of other non-current assets 357,416 81.2 - 0.0 Total operating expenses 398,954 90.6 67,222 27.0 Loss from operations (382,763 ) (86.9 ) (20,382 ) (8.2 ) Other income: Total other income, net 161 0.0 (177 ) (0.1 ) Loss before income tax (382,602 ) (86.9 ) (20,559 ) (8.3 ) Income tax expense (211 ) (0.0 ) (12,854 ) (5.2 ) Net loss (382,813 ) (86.9 ) (33,413 ) (13.5 ) Net Revenues Our and the VIEs’ revenue decreased by 43.5% from RMB440.5 million for the year ended December 31, 2023 to RMB248.8 million for the year ended December 31, 2024.
Compared with the decrease in revenues growth, the higher percentage of decrease in cost of revenues was mainly attributable to the higher gross profit we earned from IT solution services in 2023 as compared with that in 2022. 79 Gross (Loss) Profit As a result of the foregoing, our and the VIEs’ reported a gross profit of RMB16.2 million (US$2.3 million) for the year ended December 31, 2023, and a gross loss of RMB5.5 million for the year ended December 31, 2022.
Compared with the decrease in revenues growth, the higher percentage of decrease in cost of revenues was mainly attributable to the higher gross profit we earned from educational contents in 2024 as compared with that in 2023. 90 Gross (Loss) Profit As a result of the foregoing, our and the VIEs’ reported a gross profit of RMB16.2 million and RMB 46.8 million for the year ended December 31, 2023 and 2024, respectively.
In accordance with the implementation rules of EIT Law, a qualified HNTE is eligible for a preferential tax rate of 15% with HNTE certificate effective for a period of three years and a SE is entitled to a two-year income tax exemption starting from the first profit making year, followed by a reduction of half the applicable tax rate for the subsequent three years, and SMEs are entitled to a reduced EIT rate of 20%, 75% reduction of taxable income for the first RMB3,000,000 taxable income, and no reduction for the remaining taxable income for the year ended December 31, 2023 and 2024, 87.5% reduction of taxable income for the first RMB1,000,000 taxable income and 25% reduction of taxable income between RMB1,000,000 and RMB3,000,000, and no reduction for the remaining taxable income for the year ended December 31, 2022.
In accordance with the implementation rules of EIT Law, a qualified HNTE is eligible for a preferential tax rate of 15% with HNTE certificate effective for a period of three years and a SE is entitled to a two-year income tax exemption starting from the first profit making year, followed by a reduction of half the applicable tax rate for the subsequent three years, and SMEs are entitled to a reduced EIT rate of 20%, 75% reduction of taxable income for the first RMB3,000,000 taxable income, and no reduction for the remaining taxable income for the year ended December 31, 2023, 2024 and 2025 87 RESULTS OF OPERATIONS The following table sets forth a summary of our (including the VIEs’) consolidated results of operations for the years indicated, both in absolute amounts and as percentages of total income from us and the VIEs.
The following table sets forth the components of our and the VIEs’ operating expenses by amounts and percentages of our and the VIEs’ net revenues for the years presented: For the Years Ended December 31, 2022 2023 2024 RMB % RMB % RMB US$ % (in thousands, except percentages) Operating expenses: – Sales and marketing expenses 7,088 1.4 7,590 1.7 6,873 942 2.8 – General and administrative expenses 53,216 10.5 22,187 5.0 54,574 7,477 21.9 – Research and development expenses 15,569 3.1 11,761 2.7 5,775 791 2.3 – Impairment of goodwill 7,712 1.5 - 0.0 - - 0.0 – Impairment of other non-current assets 118,322 23.4 357,416 81.2 - - 0.0 Total 201,907 39.9 398,954 90.6 83,464 11,436 33.5 Sales and Marketing Expenses .
The following table sets forth the components of our and the VIEs’ operating expenses by amounts and percentages of our and the VIEs’ net revenues for the years presented: For the Years Ended December 31, 2023 2024 2025 RMB % RMB % RMB US$ % (in thousands, except percentages) Operating expenses: – Sales and marketing expenses 7,590 1.7 6,873 2.8 5,717 818 8.1 – General and administrative expenses 22,187 5.0 54,574 21.9 20,421 2,918 29.1 – Research and development expenses 11,761 2.7 5,775 2.3 3,220 461 4.6 – Impairment of other non-current assets 357,416 81.2 - 0.0 - - 0.0 Total 398,954 90.6 67,221 33.5 29,358 4,197 41.8 Sales and Marketing Expenses .
General and Administrative Expenses: Our and the VIEs’ general and administrative expenses increased from RMB22.2 million for the year ended December 31, 2023 to RMB 70.9 million (US$9.7 million).
General and Administrative Expenses: Our and the VIEs’ general and administrative expenses decreased from RMB54.6 million for the year ended December 31, 2024 to RMB 20.4 million (US$2.9 million).
Furthermore, capital account transactions, which include foreign direct investment in and loans to our PRC subsidiaries, must be approved by and/or registered with SAFE, its local branches and certain local banks. 82 As a Cayman Islands exempted company and offshore holding company, we are permitted under PRC laws and regulations to provide funding to our PRC subsidiaries only through loans or capital contributions, subject to the approval, filings or registration of government authorities and limits on the amount of capital contributions and loans.
As a Cayman Islands exempted company and offshore holding company, we are permitted under PRC laws and regulations to provide funding to our PRC subsidiaries only through loans or capital contributions, subject to the approval, filings or registration of government authorities and limits on the amount of capital contributions and loans.
For the Years Ended December 31, 2022 2023 2024 RMB RMB RMB US$ (in thousands) Educational content service and other services – Educational content service –B2B2C 51,482 28,615 31,587 4,327 –B2C 149,692 4,453 1,693 232 – Other services 3,741 38,670 6,449 884 Subtotal 204,915 71,738 39,729 5,443 IT related solution services – Design and development of customized IT system 71,438 243,330 20,308 2,782 – Procurement and assembling of equipment 228,366 125,413 186,261 25,518 – Technological support and maintenance 1,005 56 2,533 347 Subtotal 300,809 368,799 209,102 28,647 Total revenues 505,724 440,537 248,831 34,090 The following table sets forth a breakdown of our and the VIEs’ revenue by service type for the years indicated.
For the Years Ended December 31, 2023 2024 2025 RMB RMB RMB US$ (in thousands) Educational content service and other services – Educational content service –B2B2C 28,615 31,587 8,336 1,192 –B2C 4,453 1,693 5,896 843 – Other services 38,670 6,449 3,964 567 Subtotal 71,738 39,729 18,196 2,602 IT related solution services – Design and development of customized IT system 243,330 20,308 2,576 368 – Procurement and assembling of equipment 125,413 186,261 49,307 7,051 – Technological support and maintenance 56 2,533 100 14 Subtotal 368,799 209,102 51,983 7,433 Total revenues 440,537 248,831 70,179 10,035 The following table sets forth a breakdown of our and the VIEs’ revenue by service type for the years indicated.
Cost of Revenues Our and the VIEs’ cost of revenue decreased by 17.0% from RMB511.3 million for the year ended December 31, 2022 to RMB424.3 million (US$59.8 million) for the year ended December 31, 2023.
Cost of Revenues Our and the VIEs’ cost of revenue decreased by 71.4% from RMB 202.0 million for the year ended December 31, 2024 to RMB57.8 million (US$8.3 million) for the year ended December 31, 2025.
Additionally, we believe that our and the VIEs’ results of operations and financial condition are affected by company-specific factors, including the factors discussed below, many of which are beyond our and the VIEs’ control. 70 Demand for Online Educational Content Compared to traditional in-person classroom teaching, we believe online education is superior as it breaks down the time and location barriers of traditional offline education and offers students a more flexible, convenient and cost-effective alternative.
Demand for Online Educational Content Compared to traditional in-person classroom teaching, we believe online education is superior as it breaks down the time and location barriers of traditional offline education and offers students a more flexible, convenient and cost-effective alternative.
Our and the VIEs’ cost of revenues was RMB511.3 million, RMB424.3 million and RMB 202.0 million(US$27.7 million) for the years ended December 31, 2022, 2023 and 2024, respectively. 73 For the Years Ended December 31, 2022 2023 2024 RMB RMB RMB US$ (in thousands) Cost of revenues: Educational content service and other services 233,129 100,812 7,582 1,039 IT related solution services 278,136 323,534 194,409 26,634 Total 511,265 424,346 201,991 27,673 Operating Expenses Our and the VIEs’ operating expenses consist of sales and marketing expenses, research and development expenses, and general and administrative expenses.
For the Years Ended December 31, 2023 2024 2025 RMB RMB RMB US$ (in thousands) Cost of revenues: Educational content service and other services 100,812 7,582 7,184 1,027 IT related solution services 323,534 194,409 50,576 7,232 Total 424,346 201,991 57,760 8,259 Operating Expenses Our and the VIEs’ operating expenses consist of sales and marketing expenses, research and development expenses, and general and administrative expenses.
This increase was mainly driven by a decrease of RMB3.2 million in outsourced labor costs, because the VIEs further reduced its expenditures on development of new educational contents.
The decrease was mainly driven by a decrease of RMB0.3 million in outsourced labor costs, because the VIEs further reduced its expenditures on development of new educational contents and a decrease of RMB 2.2 million in salary and welfare expenses due to resignation of research and development department staff.
This decrease was primarily driven by the net effects of a decrease of RMB133.2 million (US$18.8 million) in revenue generated from educational content services and other services, partially net off by an increase of RMB68.0 million in net revenues from the provision of IT related solution services. ● Educational content service and other services.
This decrease was primarily driven by a decrease of RMB21.4 million (US$3.1 million) in revenue generated from educational content services and other services and a decrease of RMB 157.3 million (US$22.3 million) in net revenues from the provision of IT related solution services. ● Educational content service and other services.
Our and the VIEs’ cash primarily consist of cash, investments in interest bearing demand deposits accounts and time deposits with terms of and less than three months. As of December 31, 2023, our and the VIEs’ accounts receivable was RMB4.9 million, representing a decrease of RMB12.3 million (US$1.7 million) from RMB17.2 million as of December 31, 2022.
As of December 31, 2025, our and the VIEs’ cash were RMB6.0 million (US$0.9 million). Our and the VIEs’ cash primarily consist of cash, investments in interest bearing demand deposits accounts and time deposits with terms of and less than three months.
The increase was primarily because we and the VIEs generated RMB 28 million in IT services in the November 2024 which was within credit term as of December 31, 2024. The turnover days for accounts receivable for the year ended December 31, 2023 and 2024 was 40 days and 86 days, respectively.
As of December 31, 2024, our and the VIEs’ accounts receivable was RMB36.5 million, representing an increase of RMB31.6 million from RMB4.9 million as of December 31, 2023. The increase was primarily because we and the VIEs generated RMB 28.0 million in IT services in the November 2024 which was within credit term as of December 31, 2024.
Net cash used in investing activities was RMB218.5 million for the year ended December 31, 2022, primarily due to (i) purchase of short-term investments of RMB3.9 million, (ii) purchase of RMB176.6 million of educational content, and (iii) RMB46.2 million in prepayments for educational content, and (iv) loans of RMB 3.0 million made to a third party, partially offset by proceeds from redemption of short-term investments of RMB11.2 million. 84 Financing Activities For the year ended December 31, 2024, our and the VIEs’ net cash provided by financing activities was RMB0.8 million (US$0.1 million), which mainly provided by proceeds of RMB 7.0 million (US$1.0 million) from borrowing from a third party, proceeds from borrowings of RMB 1.1 million (US$0.2 million) from related parties, partially offset by repayments of loans to related parties of RMB7.4 million (US$1.0 million).
For the year ended December 31, 2024, our and the VIEs’ net cash provided by financing activities was RMB0.8 million, which mainly provided by proceeds of RMB 7.0 million from borrowing from a third party, proceeds from borrowings of RMB 1.1 million from related parties, partially offset by repayments of loans to related parties of RMB7.4 million.
We also expect that cash generated from our and the VIEs’ operation activities and financing activities will meet our and the VIEs’ capital expenditure needs in the foreseeable future. Off-balance Sheet Commitment and Arrangements We and the VIEs have not entered into any financial guarantees or other commitments to guarantee the payment obligations of any third parties.
Off-balance Sheet Commitment and Arrangements We and the VIEs have not entered into any financial guarantees or other commitments to guarantee the payment obligations of any third parties.
For the Years Ended December 31, 2022 2023 2024 RMB RMB RMB US$ (in thousands) Revenue from educational content service and other services – Subscription revenue 59,217 16,385 15,156 2,076 – Licensing revenue 141,597 16,683 18,124 2,483 – Other services revenue 3,741 38,670 6,449 884 Subtotal 204,915 71,738 39,729 5,443 Revenue from IT related solution services 300,809 368,799 209,102 28,647 Total 505,724 440,537 248,831 34,090 72 Educational content service and other services.
For the Years Ended December 31, 2023 2024 2025 RMB RMB RMB US$ (in thousands) Revenue from educational content service and other services – Subscription revenue 16,385 15,156 14,053 2,010 – Licensing revenue 16,683 18,124 179 25 – Other services revenue 38,670 6,449 3,964 567 Subtotal 71,738 39,729 18,196 2,602 Revenue from IT related solution services 368,799 209,102 51,983 7,433 Total 440,537 248,831 70,179 10,035 Educational content service and other services.
Liquidity and Capital Resource To date, we and the VIEs have financed our and the VIEs’ operating and investing activities primarily through cash generated from operating activities. As of December 31, 2024, our and the VIEs’ cash were RMB12.5 million (US$1.7 million), respectively.
Net loss As a result of the foregoing, we and the VIEs reported net loss of RMB382.8 million and RMB33.4 million for the years ended December 31, 2023 and 2024, respectively. B. Liquidity and Capital Resource To date, we and the VIEs have financed our and the VIEs’ operating and investing activities primarily through cash generated from operating activities.
Net revenue from the educational content service and other services decreased by RMB133.2 million (US$18.8 million) from RMB204.9 million for the year ended December 31, 2022 to RMB71.7 million (US$10.1 million) for the year ended December 31, 2023.
Net revenue from the educational content service and other services decreased by RMB21.5 million from RMB RMB39.7 million for the year ended December 31, 2024 to RMB18.2 million (US$2.6 million) for the year ended December 31, 2025.
For the years ended December 31, 2022, 2023 and 2024, the total amount of operating expenses, as a percentage of our and the VIEs’ total revenue was approximately 39.9%, 90.6% and 33.5%, respectively. The dramatic increase in operating expense in 2023 was because we provided impairment on obsolete educational contents, licensed copyrights and long-term prepayments for educational contents.
For the years ended December 31, 2023, 2024 and 2025, the total amount of operating expenses, as a percentage of our and the VIEs’ total revenue was approximately 90.6%, 33.5% and 41.8%, respectively.
Capital Expenditure Our and the VIEs’ capital expenditures are incurred mainly to purchase educational video content and tangible assets. We and the VIEs made capital expenditures of RMB176.6 million, RMB55.0 million and RMB 18.2 million (US$2.5 million) on educational contents for the years ended December 31, 2022, 2023 and 2024, respectively.
We and the VIEs made capital expenditures of RMB55.0 million, RMB 18.2 million and RMB 35.4 million (US$5.1 million) on educational contents for the years ended December 31, 2023, 2024 and 2025, respectively. Our and the VIEs’ capital expenditures have been primarily funded by cash generated from our and the VIEs’ operations.
Net revenue from IT related solution services increased by RMB68.0 million (US$9.6 million), or 22.6% from RMB300.8 million for the year ended December 31, 2022 to RMB368.8 million (US$51.9 million) for the year ended December 31, 2023. The increase was primarily attributable to acquisition of new cloud-based customers in 2023 in design and development of customized IT system.
Net revenue from IT related solution services decreased by RMB157.1 million (US$21.7 million), or 75.1% from RMB209.1 million for the year ended December 31, 2024 to RMB52.0 million (US$7.4 million) for the year ended December 31, 2025. The decrease was primarily caused by decreased cloud-based customers in 2025 in design and development of customized IT system.
General and Administrative Expenses: Our and the VIEs’ general and administrative expenses decreased from RMB53.2 million for the year ended December 31, 2022 to RMB22.2 million (US$3.1 million) for the year ended December 31, 2023.
Research and Development Expenses: Our and the VIEs’ research and development expenses decreased from RMB5.7 million for the year ended December 31, 2024 to RMB 3.2 million (US$0.5 million) for the year ended December 31, 2025.
Our and the VIEs’ capital expenditures have been primarily funded by cash generated from our and the VIEs’ operations. We expect to continue to make capital expenditures to support the expected growth of our and the VIEs’ business.
We expect to continue to make capital expenditures to support the expected growth of our and the VIEs’ business. We also expect that cash generated from our and the VIEs’ operation activities and financing activities will meet our and the VIEs’ capital expenditure needs in the foreseeable future.
Sales and Marketing Expenses: Our and the VIEs’ sales and marketing expenses increased from RMB7.1 million for the year ended December 31, 2022 to RMB7.6 million (US$1.1 million) for the year ended December 31, 2023.
Operating expenses Our and the VIEs’ total operating expenses increased from RMB67.2 million for the year ended December 31, 2024 to RMB 29.4 million (US$4.2 million) for the year ended December 31, 2025.
Historically, our PRC subsidiaries have not paid dividends to us, and they will not be able to pay dividends until they generate accumulated profits.
Historically, our PRC subsidiaries have not paid dividends to us, and they will not be able to pay dividends until they generate accumulated profits. Furthermore, capital account transactions, which include foreign direct investment in and loans to our PRC subsidiaries, must be approved by and/or registered with SAFE, its local branches and certain local banks.
For the year ended December 31, 2022, our and the VIEs’ net cash provided by financing activities was RMB126.6 million, which mainly represented proceeds of RMB147.0 million from initial public offering (“IPO”), partially offset by repayments of loans to related parties of RMB17.1 million, deposits of RMB4.3 million made to a redeemable shareholder, and the payment of issuance costs of RMB0.5 million in relation to the IPO.
Financing Activities For the year ended December 31, 2025, our and the VIEs’ net cash provided by financing activities was RMB34.0 million (US$4.7 million), which mainly provided by proceeds of RMB 35.4 million (US$4.9 million) from private placements, partially offset by repayments of loans to related parties of RMB1.4 million (US$0.2 million).
The decrease was primarily because we and the VIEs collected the outstanding balance of RMB12.1 million due from a customer of Guangzhou Xinzhiqiao. As of December 31, 2024, our and the VIEs’ accounts receivable was RMB36.53 million (US$5.2 million), representing an increase of RMB31.62 million (US$4.33 million) from RMB4.9 million as of December 31, 2023.
As of December 31, 2025, our and the VIEs’ accounts receivable was RMB20.3 million (US$2.9 million), representing a decrease of RMB16.2 million (US$2.3 million) from RMB36.5 million as of December 31, 2024, which was primarily attributable to decrease of revenues for the year ended December 31, 2025.
These costs are recorded in the consolidated statements of income and comprehensive income as incurred.
These costs are recorded in the consolidated statements of income and comprehensive income as incurred. Our and the VIEs’ cost of revenues was RMB424.3 million, RMB 202.0 million and RMB 57.8 million (US$8.3 million) for the years ended December 31, 2023, 2024 and 2025, respectively.
Net loss As a result of the foregoing, we and the VIEs reported net loss of RMB382.8 million and RMB19.5 million (US$2.7 million) for the years ended December 31, 2023 and 2024, respectively. 78 Year ended December 31, 2023 compared to year ended December 31, 2022 For the Years Ended December 31, 2022 2023 RMB % RMB US$ % (in thousands, except for share, per share data and percentages) Net revenues 505,724 100.0 440,537 62,048 100.0 Cost of revenues (511,265 ) (101.1 ) (424,346 ) (59,768 ) (96.3 ) Gross (loss) profit (5,541 ) (1.1 ) 16,191 2,280 3.7 Operating expenses: Sales and marketing expenses 7,088 1.4 7,590 1,069 1.7 General and administrative expenses 53,216 10.5 22,187 3,125 5.0 Research and development expenses 15,569 3.1 11,761 1,657 2.7 Impairment of goodwill 7,712 1.5 - - 0.0 Impairment of other non-current assets 118,322 23.4 357,416 50,341 81.2 Total operating expenses 201,907 39.9 398,954 56,192 90.6 Loss from operations (207,448 ) (41.0 ) (382,763 ) (53,912 ) (86.9 ) Other income: Total other income, net (116 ) (0.0 ) 161 23 (0.0 ) Loss before income tax (207,564 ) (41.0 ) (382,602 ) (53,889 ) (86.9 ) Income tax benefits (expense) 10,980 2.2 (211 ) (29 ) (0.0 ) Net loss (196,584 ) (38.8 ) (382,813 ) (53,918 ) (86.9 ) Net Revenues Our and the VIEs’ revenue decreased by 12.9% from RMB505.7 million for the year ended December 31, 2022 to RMB440.5 million (US$62.0 million) for the year ended December 31, 2023.
Year ended December 31, 2025 compared to year ended December 31, 2024 For the Years Ended December 31, 2024 2025 RMB % RMB US$ % (in thousands, except for share, per share data and percentages) Net revenues 248,831 100.0 70,179 10,035 100.0 Cost of revenues (201,991 ) (81.2 ) (57,760 ) (8,260 ) (82.3 ) Gross (loss) profit 46,840 18.8 12,419 1,775 17.7 Operating expenses: Sales and marketing expenses 6,873 2.8 5,717 818 8.1 General and administrative expenses 54,574 21.9 20,421 2,918 29.1 Research and development expenses 5,775 2.3 3,220 461 4.6 Impairment of other non-current assets - 0.0 - - 0.0 Total operating expenses 67,222 27.0 29,358 4,197 41.8 Loss from operations (20,382 ) (8.2 ) (16,939 ) (2,422 ) (23.9 ) Other income: Total other income, net (177 ) (0.1 ) 979 140 1.3 Loss before income tax (20,559 ) (8.3 ) (15,960 ) (2,282 ) (22.7 ) Income tax expense (12,854 ) (5.2 ) (340 ) (49 ) (0.5 ) Net loss (33,413 ) (13.5 ) (16,300 ) (2,331 ) (23.2 ) Net Revenues Our and the VIEs’ revenue decreased by 71.8% from RMB248.8 million for the year ended December 31, 2024 to RMB70.2 million (US$10.0 million) for the year ended December 31, 2025.
Our and the VIEs’ gross profit margin changed from negative 1.1% for the year ended December 31, 2022 to 3.7% for the year ended December 31, 2023.
Our and the VIEs’ gross profit margin changed from 18.8% for the year ended December 31, 2024 to 17.7% for the year ended December 31, 2025. The change was mainly decreased revenues earned from IT related solution services which generated lower gross profit as compared with educational services.
Removed
We, together with the VIEs, then initiated end-user business and started providing products to individual customers, and acquired companies in Shanghai and Guangzhou to facilitate further expansion in the end-user market.
Added
Additionally, we believe that our and the VIEs’ results of operations and financial condition are affected by company-specific factors, including the factors discussed below, many of which are beyond our and the VIEs’ control.
Removed
RESULTS OF OPERATIONS The following table sets forth a summary of our (including the VIEs’) consolidated results of operations for the years indicated, both in absolute amounts and as percentages of total income from us and the VIEs.
Added
The decrease in operating expense in 2024 and 2025 was because we provided impairment on obsolete educational contents, licensed copyrights and long-term prepayments for educational contents for the year ended December 31, 2023.
Removed
The decrease was primarily due to: (i) a decrease of RMB112.3 million (US$15.8 million), or 100% in revenue from offering selected mobile video package to end mobile users under a B2C model through our cooperation with a subsidiary of China Telecom, primarily because the VIEs terminated corporation with China Telecom, and (ii) a decrease of revenues by RMB23.3 million (US$3.3 million) in Fish Learning.
Added
The decrease was primarily due to a decrease of RMB18.1 million in licensing service fees and a decrease of RMB 2.5 million in other services.
Removed
Such decrease in revenues were primarily because we did not provide new and attractive contents on the platform leading to decreased subscriptions form end customers. ● IT related solution services.
Added
The decrease in licensing service fee was primarily due to our termination with China Telecom, from which we generated revenues of RMB 18.2 million for the year ended December 31, 2024 The decrease in other services was primarily due to a decrease in mobile media advertising services.
Removed
The decrease of cost of revenues was primarily attributable to the decrease of RMB32.0 million (US$4.5 million) in amortization of educational contents as we impaired educational contents in 2023 and 2022, and decrease of RMB132.9 million (US$18.7 million) in material costs used for educational content service and other services with decreased subscriptions from end customers and decreased orders from high schools, partially offset by an increase of RMB65.4 million (US$9.2 million) in purchase of IT equipment for IT related solution services.
Added
The Company provides advertising services to customers on its mobile application in the form of pop-up ads and banners, and generates revenue from advertisements based on the posting period or based on the number of times viewers click on these advertisements etc. The decrease in subscriptions from end customers resulted in decreased advertising services. 88 ● IT related solution services.
Removed
The change was mainly due to an increase in the gross profits margin for IT related solution services for the year ended December 31, 2023, because we were primarily engaged in IT design and development services for customers in 2023, as compared with procurement and assembling equipment projects in 2022.

… 22 more changes not shown on this page.

Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

26 edited+4 added−6 removed52 unchanged
Biggest changeOrdinary Shares Beneficially Owned Number %* Directors and Executive Officers†: Peixuan Wang (1) 54,790,000 32.40 Yong Hu (2) 5,100,000 3.02 Chui Man Lung Everett — — Lau Wai Leung Alfred — — Haribayashi Keikyo — — Huichao Wang — — All Directors and Executive Officers as a Group (6 individuals) 59,890,000 35.41 Principal Shareholders: RongDe Holdings (3) 54,790,000 32.40 ZhongSiZhiDa (4) 20,950,000 12.39 RoseFinch Aquarius (5) 19,160,000 11.33 Dongxing Securities (Hong Kong) (6) 11,110,000 6.57 * For each person and group included in this table, percentage ownership is calculated by dividing the number of shares beneficially owned by such person or group by 169,110,000, being the number of ordinary shares issued and outstanding as of the date of this annual report. ** For each person or group included in this column, percentage of total voting power is calculated by dividing the voting power beneficially owned by such person or group by the voting power of all of our ordinary shares as a single class. † The business address of our directors and executive officers is 15/F, Tower A, Yingdu Building, Zhichun Road, Haidian District, Beijing, 100086, the People’s Republic of China.
Biggest changeOrdinary shares beneficially owned Number of Class A ordinary shares Number of Class B ordinary shares % of total ordinary shares on an as-converted basis % of aggregate voting power* Directors and Executive Officers† Peixuan Wang (1) — 54,790,000 1.93 % 85.56 % Yong Hu (2) 5,100,000 — 0.18 % 0.16 % Longquan Zhu — — — — Lau Wai Leung Alfred — — — — Haribayasi Keikyo — — — — Huichao Wang — — — — All Directors and Executive Officers as a Group (6 individuals) 5,100,000 54,790,000 2.11 % 85.72 % RongDe Holdings (3) — 54,790,000 1.93 % 85.56 % ZhongSiZhiDa (4) — 20,950,000 0.74 % 0.65 % RoseFinch Aquarius (5) — 19,160,000 0.68 % 0.60 % Dongxing Securities (Hong Kong) (6) — 11,110,000 0.39 % 0.35 % * For each person and group included in this column, percentage of voting power is calculated by dividing the voting power beneficially owned by such person or group by the voting power of all of our Class A and Class B ordinary shares as a single class.
Peixuan Wang, our founder, was appointed as the chairwoman of the board on September 18, 2018. Ms. Wang has more than ten years of experience in investment and management and is responsible for the strategic planning of us and the VIEs. From May 2011, Ms.
Ms. Peixuan Wang, our founder, was appointed as the chairwoman of the board on September 18, 2018. Ms. Wang has more than ten years of experience in investment and management and is responsible for the strategic planning of us and the VIEs. From May 2011, Ms.
We have entered into indemnification agreements with our directors and executive officers, pursuant to which we agree to indemnify our directors and executive officers against certain liabilities and expenses incurred by such persons in connection with claims made by reason of their being such a director or executive officer. 88 2024 Equity Incentive Plan We adopted a share incentive plan in August 2024, which we refer to as the 2024 Equity Incentive Plan in this annual report, to motivate, attract and retain directors, employees consultants and other individuals by providing them with equity incentives.
We have entered into indemnification agreements with our directors and executive officers, pursuant to which we agree to indemnify our directors and executive officers against certain liabilities and expenses incurred by such persons in connection with claims made by reason of their being such a director or executive officer. 2024 Equity Incentive Plan We adopted a share incentive plan in August 2024, which we refer to as the 2024 Equity Incentive Plan in this annual report, to motivate, attract and retain directors, employees consultants and other individuals by providing them with equity incentives.
(6) Represents 11,110,000 redeemable ordinary shares held by Dongxing Securities (Hong Kong) Financial Holdings Limited, a Hong Kong company wholly-owned by Dongxing Securities Co., Ltd.*, which in turn is 52.74% owned by China Orient Asset Management Corporation. Dongxing Securities, through its subsidiaries, is primary engaged in provision of investment and financial services in Hong Kong.
(6) Represents 11,110,000 redeemable Class A ordinary shares held by Dongxing Securities (Hong Kong) Financial Holdings Limited, a Hong Kong company wholly-owned by Dongxing Securities Co., Ltd.*, which in turn is 52.74% owned by China Orient Asset Management Corporation. Dongxing Securities, through its subsidiaries, is primary engaged in provision of investment and financial services in Hong Kong.
We may also opt to rely on additional home country practice exemptions in the future. However, we currently intend to comply with the rules of the Nasdaq in lieu of the following home country practice. We have established three committees under the board of directors: an audit committee, a compensation committee and a corporate governance and nominating committee.
We may also opt to rely on additional home country practice exemptions in the future. However, we currently intend to comply with the rules of the Nasdaq in lieu of the following home country practice. 100 We have established three committees under the board of directors: an audit committee, a compensation committee and a corporate governance and nominating committee.
Lau is a member of the American Institute of Certified Public Accountants since July 2013 and also certified as a certified public accountant in Washington State of the United States of America since June 2012. Mr. Lau graduated from the City University of Hong Kong with a bachelor’s degree in business administration in July 2002. 87 Mr.
Lau is a member of the American Institute of Certified Public Accountants since July 2013 and also certified as a certified public accountant in Washington State of the United States of America since June 2012. Mr. Lau graduated from the City University of Hong Kong with a bachelor’s degree in business administration in July 2002. Mr.
(5) Represents 19,160,000 ordinary shares held by RoseFinch Aquarius Limited, a British Virgin Islands company controlled by Mr. Li Meiliang. The registered address of RoseFinch Aquarius Limited is Sertus Incorporations (BVI) Limited, Sertus Chambers, P.O. Box 905, Quastisky Building, Road Town, Tortola, British Virgin Islands.
(5) Represents 19,160,000 Class A ordinary shares held by RoseFinch Aquarius Limited, a British Virgin Islands company controlled by Mr. Li Meiliang. The registered address of RoseFinch Aquarius Limited is Sertus Incorporations (BVI) Limited, Sertus Chambers, P.O. Box 905, Quastisky Building, Road Town, Tortola, British Virgin Islands.
(4) Represents 20,950,000 ordinary shares held by ZhongSiZhiDa Limited, a British Virgin Islands company controlled by Ms. Jingru Li. The registered address of ZhongSiZhiDa Limited is Sertus Incorporations (BVI) Limited, Sertus Chambers, P.O. Box 905, Quastisky Building, Road Town, Tortola, British Virgin Islands.
(4) Represents 20,950,000 Class A ordinary shares held by ZhongSiZhiDa Limited, a British Virgin Islands company controlled by Ms. Jingru Li. The registered address of ZhongSiZhiDa Limited is Sertus Incorporations (BVI) Limited, Sertus Chambers, P.O. Box 905, Quastisky Building, Road Town, Tortola, British Virgin Islands.
The number of beneficial owners of our ADSs in the United States is likely to be much larger than the number of record holders of our ordinary shares in the United States. We are not aware of any arrangement that may, at a subsequent date, result in a change of control of our Company. 92
The number of beneficial owners of our ADSs in the United States is likely to be much larger than the number of record holders of our ordinary shares in the United States. We are not aware of any arrangement that may, at a subsequent date, result in a change of control of our Company.
The policy is filed as an exhibit to this annual report. 89 C. Board Practices Our board of directors consists of 5 directors. A director is not required to hold any shares in our Company by way of qualification.
The policy is filed as an exhibit to this annual report. C. Board Practices Our board of directors consists of 5 directors. A director is not required to hold any shares in our Company by way of qualification.
The compensation committee is responsible for, among other things: ● reviewing and approving, or recommending to the board for its approval, the compensation for our Chief Executive Officer and other executive officers; ● reviewing and recommending to the board for determination with respect to the compensation of our non-employee directors; ● reviewing periodically and approving any incentive compensation or equity plans, programs or similar arrangements; and ● selecting and receiving advice from compensation consultants, legal counsel or other advisors only after taking into consideration all factors relevant to that person’s independence from management. 90 Corporate Governance and Nominating Committee.
The compensation committee is responsible for, among other things: ● reviewing and approving, or recommending to the board for its approval, the compensation for our Chief Executive Officer and other executive officers; ● reviewing and recommending to the board for determination with respect to the compensation of our non-employee directors; ● reviewing periodically and approving any incentive compensation or equity plans, programs or similar arrangements; and ● selecting and receiving advice from compensation consultants, legal counsel or other advisors only after taking into consideration all factors relevant to that person’s independence from management. 101 Corporate Governance and Nominating Committee.
Our officers are appointed by and serve at the discretion of the board of directors, and may be removed by our board of directors. D. Employees See “Item 4. Information on the Company — B. Business Overview — Employees.” E.
Our officers are appointed by and serve at the discretion of the board of directors, and may be removed by our board of directors. 102 D. Employees See “Item 4. Information on the Company - B. Business Overview - Employees.” E.
The exercise price per Share subject to an option may be amended or adjusted in the absolute discretion of the Committee, the determination of which shall be final, binding and conclusive. Administration.
The exercise price per Share subject to an option may be amended or adjusted in the absolute discretion of the Committee, the determination of which shall be final, binding and conclusive. 99 Administration.
Amounts payable or shares issuable pursuant to an award will be delivered only to (or for the account of), and, in the case of shares, registered in the name of, the participant. As of December 31, 2024, we have not granted any awards to our directors and executive officers.
Amounts payable or shares issuable pursuant to an award will be delivered only to (or for the account of), and, in the case of shares, registered in the name of, the participant. As of December 31, 2025, we have not granted any awards to our directors and executive officers.
To our knowledge, as of the date of this annual report, a total of 58,000,000 ordinary shares are held by one record holder in the United States, which was The Bank of New York Mellon, the depositary of our ADS program.
To our knowledge, as of the date of this annual report, a total of 406,000,000 Class A ordinary shares are held by one record holder in the United States, which was The Bank of New York Mellon, the depositary of our ADS program.
(1) Represents 54,790,000 ordinary shares held by RongDe Holdings Limited, a British Virgin Islands company wholly-owned by Ms. Peixuan Wang. (2) Represents 5,100,000 ordinary shares held by Mr. Yong Hu. (3) Represents 54,790,000 ordinary shares held by RongDe Holdings Limited, a British Virgin Islands company wholly-owned by Ms. Peixuan Wang.
(1) Represents 54,790,000 Class B ordinary shares held by RongDe Holdings Limited, a British Virgin Islands company wholly-owned by Ms. Peixuan Wang. 103 (2) Represents 5,100,000 Class A ordinary shares held by Mr. Yong Hu. (3) Represents 54,790,000 Class A ordinary shares held by RongDe Holdings Limited, a British Virgin Islands company wholly-owned by Ms. Peixuan Wang.
We have adopted a charter for each of the three committees. Each committee’s members and functions are described below. Audit Committee. Our audit committee consists of Man Lung Everett Chui, Wai Leung Alfred Lau and Keikyo Haribayashi, and is chaired by Man Lung Everett Chui.
We have adopted a charter for each of the three committees. Each committee’s members and functions are described below. Audit Committee. Our audit committee consists of Longquan Zhu, Wai Leung Alfred Lau and Keikyo Haribayashi, and is chaired by Keikyo Haribayashi.
Our corporate governance and nominating committee consists of Peixuan Wang, Man Lung Everett Chui and Wai Leung Alfred Lau, and is chaired by Peixuan Wang. Man Lung Everett Chui and Wai Leung Alfred Lau satisfy the “independence” requirements of Rule 5605(a)(2) of the Nasdaq Listing Rules.
Our corporate governance and nominating committee consists of Peixuan Wang, Longquan Zhu and Wai Leung Alfred Lau, and is chaired by Peixuan Wang. Longquan Zhu and Wai Leung Alfred Lau satisfy the “independence” requirements of Rule 5605(a)(2) of the Nasdaq Listing Rules.
Man Lung Everett Chui, Wai Leung Alfred Lau and Keikyo Haribayashi satisfy the “independence” requirements of Rule 5605(a)(2) of the Nasdaq Listing Rules and meet the independence standards under Rule 10A-3 under the Exchange Act.
Longquan Zhu, Wai Leung Alfred Lau and Keikyo Haribayashi satisfy the “independence” requirements of Rule 5605(a)(2) of the Nasdaq Listing Rules and meet the independence standards under Rule 10A-3 under the Exchange Act.
Our board of directors has also determined that Man Lung Everett Chui qualifies as an “audit committee financial expert.” The audit committee oversees our accounting and financial reporting processes and the audits of the financial statements of our Company.
Our board of directors has also determined that Keikyo Haribayashi qualifies as an “audit committee financial expert.” The audit committee oversees our accounting and financial reporting processes and the audits of the financial statements of our Company.
Compensation Committee. Our compensation committee consists of Man Lung Everett Chui, Wai Leung Alfred Lau and Yong Hu and is chaired by Man Lung Everett Chui. Man Lung Everett Chui, Wai Leung Alfred Lau satisfies the “independence” requirements of Rule 5605(a)(2) of the Nasdaq Listing Rules.
Compensation Committee. Our compensation committee consists of Longquan Zhu, Wai Leung Alfred Lau and Yong Hu and is chaired by Longquan Zhu. Longquan Zhu and Wai Leung Alfred Lau satisfy the “independence” requirements of Rule 5605(a)(2) of the Nasdaq Listing Rules.
Wang graduated from Chongqing Jiaotong University with a bachelor’s degree in accounting in 2003. B. Compensation Compensation of Directors and Executive Officers For the year ended December 31, 2024, we paid an aggregate of RMB0.9 million (US$0.1 million) in cash and benefits to our executive officers and we did not pay any compensation to our non-executive directors.
Wang graduated from Chongqing Jiaotong University with a bachelor’s degree in accounting in 2003. B. Compensation Compensation of Directors and Executive Officers For the year ended December 31, 2025, we did not pay any cash or benefits to our executive officers and we did not pay any compensation to our non-executive directors.
Each executive officer has agreed to hold, both during and after the employment agreement expires or is earlier terminated, in strict confidence and not to use or disclose to any person, corporation or other entity without written consent, any confidential information or trade secrets.
An executive officer may terminate his or her employment at any time with written notice sixty days prior. 98 Each executive officer has agreed to hold, both during and after the employment agreement expires or is earlier terminated, in strict confidence and not to use or disclose to any person, corporation or other entity without written consent, any confidential information or trade secrets.
The calculations in the table below are based on 169,110,000 ordinary shares issued and outstanding as of the date of this annual report. 91 Beneficial ownership is determined in accordance with the rules and regulations of the SEC.
The calculations in the table below are based on 2,834,962,800 ordinary shares, including 2,780,172,800 Class A ordinary shares and 54,790,000 Class B ordinary shares, issued and outstanding as of the date of this annual report. Beneficial ownership is determined in accordance with the rules and regulations of the SEC.
Chui graduated from University of Southampton with a bachelor’s degree in business economics & accounting in July 1986. Mr. Wai Leung Alfred Lau was appointed as an independent non-executive Director on September 18, 2018. Prior to that, Mr.
Zhu obtained a bachelor’s degree in engineering from Wuhan University. 97 Mr. Wai Leung Alfred Lau was appointed as an independent non-executive Director on September 18, 2018. Prior to that, Mr.
Directors and Executive Officers Age Position/Title Peixuan Wang 50 Chairwoman of the Board Yong Hu 49 Director and Chief Executive Officer Man Lung Everett Chui 60 Independent Director Wai Leung Alfred Lau 44 Independent Director Keikyo Haribayashi 57 Independent Director Huichao Wang 46 Chief Financial Officer Ms.
Directors and Executive Officers Age Position/Title Peixuan Wang 51 Chairwoman of the Board Yong Hu 50 Director and Chief Executive Officer Longquan Zhu 45 Independent Director Wai Leung Alfred Lau 45 Independent Director Keikyo Haribayashi 58 Independent Director Huichao Wang 47 Chief Financial Officer * Mr. Man Lung Everett Chui ceased to be our independent director since January 5, 2026.
Removed
Man Lung Everett Chui was appointed as an independent non-executive Director on September 18, 2018. Mr. Chui founded Cen-1 Partners Limited in July 2008 and served as its director since then. Prior to that, Mr.
Added
Longquan Zhu serves as an independent director of the Company. Mr. Zhu has over twenty years of experience in information technology and enterprise management, with a profound professional background and extensive practical expertise in software development, IT services, digital solutions, and related fields. In April 2008, Mr.
Removed
Chui worked as financial controller, company secretary and a member of the management committee of Yau Lee Holdings Limited (HKEX: 0406) from February 1995 to June 2008. From October 1987 to May 1993, Mr. Chui worked as assistant manager at KPMG Peat Marwick. Mr.
Added
Zhu founded Eastsoft Inc. and has served as the core executive person, overseeing long-term strategic planning, technology roadmaps, operational management, and the implementation of major projects. Mr. Zhu also possesses practical experience in corporate governance, internal controls, and risk management, with a deep understanding of compliance management and business model development for technology enterprises. Mr.
Removed
Chui is currently an independent non-executive director, a member of audit committee, remuneration committee and nomination committee of EcoGreen International Group Limited (a company listed on the Main Board of the Stock Exchange (stock code: 2341)), an independent non-executive director, chairman of the audit committee and member of remuneration committee of SRE Group Limited (a company listed on the Main Board of the Stock Exchange (stock code: 1207)), an independent non-executive director, a chairman of the Audit Committee, a chairman of the Compensation Committee and the member of the Corporate Governance and Nominating Committee of Jianzhi Education Technology Group Co Ltd (a company listed on the NASDAQ (stock code: JZ)).
Added
In respect of matters requiring a shareholder vote, each Class A ordinary share will be entitled to one vote and each Class B ordinary share will be entitled to 50 votes. Each Class B ordinary share is convertible into one class A ordinary share at any time by the holder thereof.
Removed
He is also acting as Company Secretary of Lingbao Gold Group Company Limited (a company listed on the Main Board of the Stock Exchange (stock code: 3330)), Vital Innovations Holdings Limited (a company listed on the Main Board of the Stock Exchange (stock code: 6133)) and Hang Yick Holdings Company Limited (a company listed on the Main Board of the Stock Exchange (stock code: 1894)).
Added
Class A ordinary shares are not convertible into Class B ordinary shares under any circumstances. † The business address of our directors and executive officers is 15/F, Tower A, Yingdu Building, Zhichun Road, Haidian District, Beijing, 100086, the People’s Republic of China.
Removed
Mr. Chui has been a member of the Hong Kong Institute of Certified Public Accountants since January 1991 and has been a fellow member of the Chartered Association of Certified Accountants since January 1996. He has been a fellow member of the Institute of Chartered Accountants in England and Wales since January 2018. Mr.
Removed
An executive officer may terminate his or her employment at any time with written notice sixty days prior.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

1 edited+5 added−9 removed1 unchanged
Biggest changeDirectors, Senior Management and Employees — B. Compensation — Equity Incentive Plan.” Employment Agreements and Indemnification Agreements See “Item 6. Directors, Senior Management and Employees — B. Compensation — Employment Agreements and Indemnification Agreements.” C. Interest of Experts and Counsel Not applicable. 93
Biggest changeCompensation - Employment Agreements and Indemnification Agreements.” C. Interest of Experts and Counsel Not applicable.
Removed
Organizational Structure.” Transaction with Company Affiliate During the year ended December 31, 2021, our chairwomen of board of directors, Peixuan Wang, paid off professional fees on behalf of the Company in the amount of RMB2,485,486 and the Company repaid the payment in the same year.
Added
Organizational Structure.” 104 Transaction with Company Affiliate Name Relationship December 31, 2024 December 31, 2025 RMB RMB Due from related parties Peixuan Wang (a) Chairwomen of the Company 1,044,676 998,871 Shiyu Liu (b) Supervisor of Beijing Sentu and Ang’you 329,098 — Junjun Hao (b) Executive direct and manager of Sentu Lejiao 438,797 — Others (b) 110,903 — Total amount due from related parties 1,923,474 998,871 Due to related parties Beijing Sentu Cloud Creative Education Technology Co., Ltd.
Removed
In addition, the Company, its wholly-owned subsidiaries, the VIE and the VIE’s subsidiaries advanced RMB2.5 million to Peixuan Wang for payments of professional fees. During the year ended December 31, 2022, Peixuan Wang returned RMB1.4 million to the Company.
Added
(c) Controlled by Huidong Niu 1,400,000 — Junjun Hao (b) Executive direct and manager of Sentu Lejiao 318,099 16,549 Others 199,379 88,048 Total amount due to related parties 1,917,478 104,597 (a) As of December 31, 2024 and 2025, the balance due from Ms. Peixuan Wang represented the excess payment of professional fees to Ms.
Removed
As of December 31, 2023 and 2024, the Company had a balance of due from a related party of RMB1.0 million and RMB1.0 million (US$143 thousand).
Added
Peixuan Wang over the actual payments made by the related party on behalf of the Company. (b) As of December 31, 2024, the balance due from the three related parties represented advances to management for daily operating expenses. During the year ended December 31, 2025, the outstanding balances were settled with expenses incurred.
Removed
As of December 31, 2022 and December 31, 2023, the Company, its wholly-owned subsidiaries, VIE and VIE’s subsidiaries had balance due to Xinyutong Kezhiyong Enterprise Management Center in the amount of approximately RMB24.7 million and RMB24.7 million, respectively, representing the outstanding payables to Xinyu Tongkezhiyong Enterprise Management Center for the purchase of 51% equity interest of Xingzhiqiao on September 30, 2017 and 49% equity interest of Xingzhiqiao on August 31, 2018.
Added
(c) As of December 31, 2024, the balance due to the two related parties represented borrowings from these two related parties, which were interest free and repayable on demand. For the years ended December 31, 2023, 2024 and 2025, the Company borrowed RMB 452, RMB 1,121,435 and RMB nil from related parties, respectively.
Removed
During the year ended December 31, 2024, the balance due has been repaid. On May 18, 2021 and July 26, 2021, the Company’s subsidiary and Rongde entered into two loan agreements, pursuant to which the Company’s subsidiary borrowed an aggregation of approximately RMB47.2 million from Rongde. The borrowings are interest free.
Added
For the years ended December 31, 2023, 2024 and 2025, the Company repaid borrowings of RMB 7,248,140, RMB 7,360,488 and RMB 1,400,000 to related parties, respectively. Share Incentive Plan See “Item 6. Directors, Senior Management and Employees - B. Compensation - Equity Incentive Plan.” Employment Agreements and Indemnification Agreements See “Item 6. Directors, Senior Management and Employees - B.
Removed
The proceeds from borrowings are for the working capital needs in operations. During the year ended December 31, 2022, the Company and its wholly-owned subsidiaries repaid approximately RMB20.0 million to Rongde. As of December 31, 2023, the remaining balance was RMB21.9 million. During the year ended December 31, 2024, the related party waived the liabilities owed by the Company.
Removed
On August 24, 2022, the Company’s subsidiary and Rongde entered into an additional loan agreement, pursuant to which the Company’s subsidiary borrowed approximately RMB13.7 million from Rongde. The borrowing is interest free and is due in August 2023. The proceeds from borrowings are for the working capital needs in operations.
Removed
During the year ended December 31, 2024, the related party waived the liabilities owed by the Company. The Company calculated the present value of the loan to be RMB13.9 million and RMB14.9 million (US$2.1 million) by using its incremental rate of 3.45%, respectively.
Removed
The difference between the present value and the cash received was RMB0.5 million and RMB0.5 million (US$0.1 million), respectively, which was considered as a contribution from the principal shareholder and recorded as additional paid-in capital since the transaction was occurred between entities under common control. 【Company to update】 Share Incentive Plan See “Item 6.