QuantaSing Group Ltd

Total revenue in Q3 fiscal 2026 was RMB 164.7 million, down from RMB 177.3 million in the prior quarter, while gross profit was RMB 56.9 million and gross margin was 34.5%, up 350 basis points from 31% in the prior quarter. Net loss was RMB 34.1 million versus RMB 25.4 million in the prior quarter, and adjusted net loss was RMB 22.9 million versus RMB 16.1 million. Basic and diluted net loss per share was RMB 0.21, and adjusted net loss per share was RMB 0.14. For Q4 fiscal 2026, management expects pop toy business revenue of RMB 130 million to RMB 140 million, and it revised full-year fiscal 2026 revenue guidance to RMB 600 million to RMB 610 million.

Peng Li emphasized that the company is focused on building durable IP value rather than chasing short-term sales. He said the strategy is centered on strengthening core IPs, launching new products over a 3- to 6-month cadence, expanding D2C stores and roboshops, and growing offline and online touchpoints. His tone was confident but measured, stressing that the company is optimizing operations and capital allocation while managing through a challenging market.

Tim Xie said Q3 results exceeded expectations on both revenue and gross margin despite softer industry demand. He cited revenue of RMB 164.7 million, gross profit of RMB 56.9 million, and gross margin of 34.5%, noting that margin improved by 350 basis points from 31% in the prior quarter due to strategic cost structure refinements. He also broke out operating expenses of RMB 100.8 million, including sales and marketing of RMB 57.7 million, R&D of RMB 9.5 million, and G&A of RMB 33.6 million, and said the company is revising guidance to reflect near-term market realities.

Analysts asked about shifts in pop toy consumer demand and competition, and management said the market is moving back toward emotional consumption and away from scarcity-driven buying as supply grew too quickly. They said competition is shifting from grabbing territory to full-chain IP operations, with a growing emphasis on owned IPs because licensed IP revenue can be vulnerable to churn and non-renewals. Management also addressed how it will sustain momentum for successful IPs, saying it will use ongoing products, content, events, partnerships, and offline touchpoints to extend IP life cycles. On category expansion, they said they will extend from existing IPs into merchandise and lifestyle products selectively, and are exploring AI/smart-companion ideas but have no concrete plans yet.