Liulishuo ("LAIX" or the "Company") is an artificial intelligence (AI) company in China that creates and delivers products and services to popularize English learning, recently announces its fourth-quarter and full-year 2020 unaudited financial results ended Dec.31, 2020. 

For Q4 2020,

The net revenues were RMB235.5 million(US$ 36.1 million), a 1.8% increase from RMB231.4 million for Q4 2019, and the net loss was RMB34.7 million (US$5.3 million), which decreased by 83.1% from RMB205.6 for Q4 2019.

The total operating expenses were RMB215.2 million(US$33.0 million), dropped by 41.5% from RMB367.7 million for Q4 2019, mainly due to stringent cost control in user acquisition expenditures and the optimization of the operational structure, according to the report. Break it down, compared to Q4 2019, Sales and marketing expenses were RMB150.4 million, shrank by 43.6% from RMB266.9 million, Research and development expenses were RMB37.2 million, reduced by 30.1% from RMB53.2 million, and General and administrative expenses were RMB27.6 million, declined by 42.0%.

 For the full year of 2020, 

Compared to the entire year of 2019, the net revenues were RMB972.6 million(US$149.1 million), a 4.9% decrease from RMB1,023.2 million, and the cost of revenues was 277million, an increase of 1.4%. According to the report, "the change was primarily attributable to the increase in content-related costs and salaries and benefits for certain full-time employees due to the expansion of business in the first half of 2020 and partially offset by the decrease in IT service due to the stringent cost control." As a result, the gross profit margin slightly fell to 71.5% from 73.3% for the full year of 2019.

The total operating expenses were RMB1,103.1(US$169.1 million) million dropped by 17.5% from RMB1,336.8 million for the year of 2019. The report indicates that the changes were primarily due to stringent cost control in advertising and user acquisition expenditures and the optimization of the operational structure. 

The net loss was RMB394.8 million (US$60.5 million), reduced by 31.3% from RMB574.8 million for the full year of 2019.

The operating cash outflow was RMB302.6 million (US$46.4 million), compared with RMB148.2 million for the full year of 2019, primarily due to a decrease in gross billings("Gross billings" for a certain period refer to the total amount of cash received from the sale of course packages in that period net of the total amount of cash refunds paid to users in the same period). 

Approximately 2.4 million users paid for the Company's courses and services for 2020, a 25% decrease from 2019. 

For Q1 2021, the Company expects the net revenues to be between RMB180 million to RMB200 million, representing a decrease of approximately 21.2% to 12.4% year-over-year. 

Dr. Yi Wang, Chairman and Chief Executive Officer of LAIX commented, "We saw a steady flow of positive effects on our streamlined operations after the business adjustments began in the second quarter of 2020. This is also reflected in our net loss, which was reduced to RMB34.7 million in the fourth quarter of 2020, a 50.9% decrease from the previous quarter, and is expected to improve further in the first quarter of 2021. Looking ahead, we aim to further execute on our growth initiatives, bring our value proposition to the market and maximize long-term value to all our stakeholders."