QuantaSing Group Limited Faces Q3 Fiscal 2025 Earnings Miss and Growth Challenges

Jun 6, 2025 6:00 PM - Stuart Mooney

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QuantaSing Group Limited (QSG) Reports Q3 Fiscal 2025 Earnings Miss, Faces Revenue and Growth Challenges

QuantaSing Group Limited (NASDAQ: QSG), a leading provider of online learning and lifestyle solutions in China, announced its unaudited financial results for the third quarter of fiscal year 2025, ending March 31, 2025. The company reported an earnings per share (EPS) of $0.056, missing analyst expectations of $0.18. Revenue for the quarter was $82.99 million, falling significantly short of the consensus forecast of $83.14 million, highlighting ongoing struggles to meet revenue targets.

The company's core segment, individual online learning services, saw gross billings of $71 million, reflecting a 5.6% decline from the second quarter of fiscal 2025 and a substantial 47.5% decrease compared to the third quarter of fiscal 2024. This significant year-over-year drop underscores challenges in the company's primary business, potentially impacting future growth prospects.

Analysts have revised their expectations for QuantaSing's full-year 2025 performance, projecting revenue of approximately $481.93 million, a sharp decline from earlier estimates of $523.43 million. For fiscal year 2026, revenue is forecasted to increase slightly to $511.52 million, representing a 6.09% growth from the 2025 projection.

The company's price-to-earnings (P/E) ratio of approximately 6.22 suggests a low valuation relative to its earnings, potentially appealing to value investors. The price-to-sales (P/S) ratio of about 0.71 indicates that the market values the company's sales at less than one times its revenue. Additionally, a low debt-to-equity ratio of 0.072 reflects minimal reliance on debt financing, and a current ratio of approximately 1.82 demonstrates the company's ability to cover short-term liabilities with its assets.

QuantaSing's recent performance has prompted mixed analyst sentiment. The consensus recommendation from one brokerage firm is a “Hold,” with an average 12-month price target of $2.10, suggesting limited upside potential from the current stock price of approximately $6.26 as of April 29, 2025.

The company's strategic shift toward the silver economy and diversification into consumer goods, such as a $1.5 million investment in Shenzhen Yiqi Culture for pop toys and IP commercialization, has sparked some investor optimism. However, the significant revenue shortfall and declining core business performance highlight the need for QuantaSing to address operational challenges to restore growth momentum.

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