Author: Sha Lajiang
Compile: Sunny
Source: GPLP
Tal exposed its employees’ illegal behavior and Gen Sheixue was accused of data fraud. 51Talk (COE.NYSE), an online education enterprise, was involved in the storm of teaching quality.
On March 15, 2020, many students complained about 51Talk in multiple media platforms and microblogs. 51Talk was criticized by students in terms of teaching quality, the telephone sales caused harassment, and the maximum amount of liquidated damages for refunds was 25% of the tuition fees.
According to the feedback rate and multiple index models of timeliness and satisfaction, 51Talk obtained 11 consumption ratings in 2019, all of which are “no order is
recommended”.
Founded in 2011, 51Talk is a subsidiary of Beijing Dasheng Zhixing Technology Co. Ltd., which was listed on the NYSE in 2016. Since its listing, although its revenue has
continued to grow, it has been in a loss state.
From 2015 to 2019, 51Talk achieved revenue of 155 million yuan, 418 million yuan, 848 million yuan, 1146 million yuan and 1483 million yuan respectively, with revenue growth
of 196.26%, 170.43%, 102.73%, 35.09% and 29.50% ,respectively.
From 2015 to 2019, 51Talk’s net losses were RMB 327 million, RMB 515 million, RMB 581 million, RMB 417 million and RMB 99.5 million respectively, with a cumulative loss of RMB 1.94 billion.
According to the financial report of the fourth quarter of 2019 issued by 51Talk, the revenue is 398 million yuan, up 33.49% year on year, and the net profit is 1.5 million
yuan, achieving the first profit in a single quarter.
In fact, the competition in the online education industry is very fierce at present, which
is considered as an important reason for 51Talk’s loss.
As the market competition intensifies, 51Talk’s marketing expenses have been high. During 2014 to 2018, 51Talk’s marketing expenses were RMB 113 million, RMB 326
million, RMB 613 million, RMB 881 million and RMB 954 million respectively. Except for 2018, the marketing expenses in other years are higher than their revenue in the same period. In recent years ,the marketing pressure what 51Talk has faced is not “generally large”.
