ATA Creativity Global (AACG) Q4 2025 earnings summary

Executive summary

• Q4 2025 net revenues declined 11.7% year-over-year, with normalized student demand and a net loss driven by a one-time goodwill impairment charge; research-based learning and other educational services grew due to more projects and institutional partnerships.

• FY 2025 net revenues remained flat, but net loss widened due to increased competition and lower portfolio training revenues; operational efficiency initiatives and new program launches were implemented.

• Portfolio training remained the main revenue contributor, accounting for 68.8% of Q4 net revenues, while project-based programs grew to 74.9% of total credit hours delivered.

• Cost-saving initiatives led to a 15.7% reduction in operating expenses, excluding the goodwill impairment.

• Student enrollment normalized in 2025 after a surge in 2024, reflecting post-pandemic stabilization.

Financial highlights

• Q4 2025 net revenue was RMB 89.1 million ($12.7M), down 11.7% year-over-year; gross profit was RMB 30.2 million ($7.2M), with gross margin at 56.4%, down from 63.1%.

• Q4 2025 net loss was RMB 26.3 million ($3.8M), compared to net income of RMB 13.3 million ($1.9M) in Q4 2024, mainly due to a one-time goodwill impairment charge.

• FY 2025 net revenue was RMB 268.1 million ($38.3M), flat year-over-year; gross profit was RMB 130.3 million ($18.6M), with gross margin at 48.6%, down from 52.7%.

• FY 2025 net loss was RMB 48 million ($6.9M), compared to RMB 36.1 million ($5.2M) in 2024.

• Cash and cash equivalents at year-end were RMB 85.2 million ($12.2M), up from the prior year.

Outlook and guidance

• 2026 strategy focuses on maintaining leadership in creative arts education, leveraging teaching expertise, expanding global partnerships, and optimizing service portfolios for higher margins.

• Operational initiatives include cost savings, expanding online offerings, consolidating campuses, and improving classroom utilization.

• Q1 2026 pipeline includes the Finland Sustainable Design & Art Research Program and a hybrid-format competition winter camp.

• Long-term strategy emphasizes higher fee, higher margin services, innovation, and disciplined cost management.