
United States Processed Meat Market Growth Trends Report 2025-2033: Consumer Demand for Convenience, Demand from Food Service Industry, Intense Competition, Rising Raw Material Costs
The 'United States Processed Meat Market Size and Share Analysis - Growth Trends and Forecast Report 2025-2033" report has been added to ResearchAndMarkets.com's offering.
United States Processed Meat market is expected to reach US$ 168.5 billion by 2033 from US$ 117.9 billion in 2024, with a CAGR of 4.05% from 2025 to 2033
Market sales are increased by elements including accessibility, price, ease of use, and palatable flavor. There are numerous variations of the same product and ongoing innovation in the processed meat sector. In the processed category, clean-label and all-natural products are still popular. Popular claims on labels for processed meat products include low-sodium, low-fat, low-calorie, no MSG, and free of additives and preservatives.
The market for processed meat is extensively used in institutional and retail contexts. Due to consumer preferences for shopping at supermarkets, hypermarkets, and online, retail sales are significant. Additionally, demand is driven by the food service business, specifically the HoReCa sector.
In order to meet the needs of animals for protein, vitamins, or minerals, forage-based diets are strategically supplemented by technology-driven meat manufacturers in the United States. With a nearly 30% market share in 2022, the US ranks among the world's top producers of beef. In 2022, the nation's beef production increased by 354.9 million pounds to 28.4 billion pounds. Missouri, Texas, Oklahoma, and Ohio are the leading beef-producing states in the United States. About 2.9 million cattle were killed in Ohio in 2022, making it one of the top beef-producing states in the country. Additionally, Ohio produced 2% more beef in 2022 than it did in 2021.
Additionally, Cargill Inc. acquired two meat facilities from longtime partner Ahold Delhaize USA in February 2024. To increase its production and supply merchants in the Northeast region of the nation with supermarket-case-ready beef and pork, the company has made investments in two processing facilities.
Growth Drivers for the United States Processed Meat Market
Rising Consumer Demand for Convenience
The market for processed meat in the United States is expanding due in large part to rising customer desire for convenience. Customers are looking for products that require little cooking time and rapid preparation because their lives are becoming more and more hectic. Processed meats that are ready to eat, such cold cuts, sausages, and deli meats, meet this need well and offer a convenient option for meals and snacks.
Furthermore, frozen processed beef products are becoming more and more well-liked due to their extended shelf life and ease of meal preparation. The need for quick, easy food options has increased as more people work longer hours and value convenience. As a result of this change, processed meat sales have increased in supermarkets, convenience stores, and online marketplaces, bolstering the U.S. market's ongoing growth.
Increased Disposable Income
The US processed meat business is expanding as a result of customers' increased ability to spend more on high-end goods due to their increased disposable income. Consumers are willing to spend more for premium processed meats, like organic, grass-fed, and gourmet varieties, when family earnings improve.
Consumer desires for quality and transparency in food sources are expanding, and these high-end items are perceived as healthier, more sustainable, and better tasting. Additionally, consumers are more likely to experiment with specialized meats like premium cuts, cured meats, and artisanal sausages as their discretionary income increases. This tendency is especially prevalent among wealthy, health-conscious consumers who are prepared to spend money on high-end foods, which is driving up demand for upscale processed beef products and opening up new markets.
Demand from Food Service Industry
One of the main factors propelling the processed meat market in the United States is the expanding demand from the food service sector. Processed meats are widely employed in a variety of menu items, such as sandwiches, burgers, wraps, salads, and breakfast options, as the fast-food and restaurant industries continue to grow. Popular processed meats including deli meats, bacon, sausage, and ham are used extensively in quick-service and fast-casual restaurants since they are essential to many restaurant recipes.
Additionally, because processed meats are simple to handle, store, and cook in big numbers, the growing popularity of delivery and takeout services has increased the use of processed meats. The food service industry's increasing reliance on processed meats fosters market expansion and opens up new business prospects for producers.
Challenges in the United States Processed Meat Market
Intense Competition
The increased popularity of plant-based meat substitutes is a major factor driving the fierce competition in the US processed meat sector. Customers who are worried about the health hazards of processed meats, such as their high sodium content, preservatives, and saturated fats, are drawn to these substitutes, which are frequently promoted as better and more ecologically friendly options.
Products derived from plants, such as soy, pea protein, and mushrooms, are thought to address these issues and satisfy consumers' growing need for cruelty-free and sustainable food sources. In order to stand out from the competition and hold onto market share, traditional processed meat companies are under pressure to innovate, whether through cleaner labels, healthier formulations, or new product offers. In order to remain competitive in a changing market, meat producers are being forced to reconsider their tactics due to the trend toward plant-based diets.
Beef's popularity and versatility may drive dominance in processed meats
Beef could be a dominant meat type in the U.S. processed meat market. This is because of its enormous reputation and adaptable utilization. With a wealthy flavor profile and diverse applications, beef merchandise attracts a broad purchaser base. Its adaptability in various processed meat forms, such as sausages, burgers, and deli meats, makes it a staple in American diets. Further, the established beef enterprise infrastructure ensures steady supply and quality, further solidifying beef's prominent role in the United States processed meat market.
Chilled processed meat's freshness and convenience may lead market dominance
Chilled processed meat holds the potential for the largest share of the United States processed meat. This is because of its freshness, enchantment, and convenience. With purchasers increasingly prioritizing convenience without compromising quality, chilled processed meat products provide stability in shelf life and freshness. These merchandises undergo minimal processing, retaining natural flavors and textures, which resonates nicely with health-aware consumers. Further, the extensive availability of refrigeration infrastructure guarantees the accessibility and preservation of chilled processed meat. This is contributing to its dominance in the U.S. processed meat market.
Hypermarkets and supermarkets drive significant sales in the processed meat market
Hypermarkets and supermarkets are among the leading sections of the United States processed meat market. This is because of their massive reach and various product offerings. These retail giants offer a wide selection of processed meat products under one roof, imparting comfort and range to purchasers. Also, their strategic locations and efficient supply chain control ensure regular availability and competitive pricing. The extensive client base and promotional activities further bolster their dominance, making hypermarkets and supermarkets the preferred destination for processed meat purchases in the U.S.
Company Analysis: Overview, Recent Developments, Revenue Analysis
Hormel Foods
Tyson Foods
Conagra Brands Inc.
General Mills
Kraft Heinz Company
Cargill, Incorporated
Pilgrim's Pride Corp.
Key Attributes:
Report Attribute Details
No. of Pages 70
Forecast Period 2024 - 2033
Estimated Market Value (USD) in 2024 $117.9 Billion
Forecasted Market Value (USD) by 2033 $168.5 Billion
Compound Annual Growth Rate 4.0%
Regions Covered United States
Key Topics Covered:
1. Introduction
2. Research Methodology
3. Executive Summary
4. Market Dynamics
4.1 Growth Drivers
4.2 Challenges
5. Unites States Processed Meat Market
6. Market Share
6.1 By Meat Types
6.2 By Processed Types
6.3 By Distribution Channels
7. Meat Types
7.1 Poultry
7.2 Beef
7.3 Pork
7.4 Others
8. Processed Types
8.1 Frozen
8.2 Chilled
8.3 Canned
9. Distribution Channels
9.1 Hypermarkets and Supermarket
9.2 Convenience Stores
9.3 Online Retail Stores
9.4 Others
10. Porter's Five Forces
10.1 Bargaining Power of Buyer
10.2 Bargaining Power of Supplier
10.3 Threat of New Entrants
10.4 Rivalry among Existing Competitors
10.5 Threat of Substitute Products
11. SWOT Analysis
11.1 Strengths
11.2 Weaknesses
11.3 Opportunities
11.4 Threats
12. Key Players Analysis
For more information about this report visit https://www.researchandmarkets.com/r/md0ppy
About ResearchAndMarkets.com
ResearchAndMarkets.com is the world's leading source for international market research reports and market data. We provide you with the latest data on international and regional markets, key industries, the top companies, new products and the latest trends.
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SOURCE: Research and Markets
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PUB: 04/11/2025 04:43 AM/DISC: 04/11/2025 04:43 AM

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In some cases, forward-looking information can be identified by the use of forward-looking terminology such as "plans", "expects", "budget", "scheduled", "estimates", "outlook", "target", "forecasts", "projection", "potential", "prospects", "strategy", "intends", "anticipates", "seek", "believes", "opportunity", "guidance", "aim", "goal" or variations of such words and phrases or statements that certain future conditions, actions, events or results "may", "could", "would", "should", "might", "will", "can", or negative versions thereof, "be taken", "occur", "continue" or "be achieved", and other similar expressions. Statements containing forward-looking information are not historical facts, but instead represent management's expectations, estimates and projections regarding future events or circumstances. This forward-looking information relates to the Company's future financial outlook and anticipated events or results and includes, but is not limited to, statements under the heading "Financial Outlook" and information regarding the Company's financial position, financial results, business strategy, performance, achievements, prospects, objectives, opportunities, business plans and growth strategies. Forward-looking information is based on certain assumptions, expectations and projections, and analyses made by the Company in light of management's experience and perception of historical trends, current conditions and expected future developments and other factors it believes are appropriate, including the following: the Company's ability to win business from new customers and expand business from existing customers; the timing of new customer wins and expansion decisions by existing customers; the Company's ability to generate revenue and expand its business while controlling costs and expenses; the Company's ability to manage growth effectively; the Company's assumptions regarding the principal competitive factors in our markets; the Company's ability to hire and retain personnel effectively; the effects of foreign currency exchange rate fluctuations on our operations; the ability to seek out, enter into and successfully integrate acquisitions, including the acquisition of H5P Group AS ("H5P"); business and industry trends, including the success of current and future product development initiatives; positive social development and attitudes toward the pursuit of higher education; the Company's ability to maintain positive relationships with its customer base and strategic partners; the Company's ability to adapt and develop solutions that keep pace with continuing changes in technology, education and customer needs; the Company's ability to predict future learning trends and technology; the ability to patent new technologies and protect intellectual property rights; the Company's ability to comply with security, cybersecurity and accessibility laws, regulations and standards; the assumptions underlying the judgments and estimates impacting on financial statements; certain accounting matters, including the impact of changes in or the adoption of new accounting standards; the Company's ability to retain key personnel; the factors and assumptions discussed under the "Financial Outlook" section of the Annual MD&A and that the list of factors referenced in the following paragraph, collectively, do not have a material impact on the Company. Although the Company believes that the assumptions underlying such forward-looking information were reasonable when made, they are inherently uncertain and are subject to significant risks and uncertainties and may prove to be incorrect. The Company cautions investors that forward-looking information is not a guarantee of the future and that actual results may differ materially from those made in or suggested by the forward-looking information contained in this press release. Whether actual results, performance or achievements will conform to the Company's expectations and predictions is subject to a number of known and unknown risks, uncertainties and other factors, including but not limited to the risks identified herein, including "Summary of Factors Affecting Our Performance" of the Annual MD&A, or in the "Risk Factors" section of the Company's most recently filed annual information form, in each case filed under the Company's profile on SEDAR+ at If any of these risks or uncertainties materialize, or if assumptions underlying the forward-looking information prove incorrect, actual results might vary materially from those anticipated in the forward-looking information. Given these risks and uncertainties, investors are cautioned not to place undue reliance on forward-looking information, including any financial outlook. Any forward-looking information that is contained in this press release speaks only as of the date of such statement, and the Company undertakes no obligation to update any forward-looking information or to publicly announce the results of any revisions to any of those statements to reflect future events or developments, except as required by applicable securities laws. Comparisons of results for current and any prior periods are not intended to express any future trends or indications of future performance, unless specifically expressed as such, and should only be viewed as historical data. About D2L Inc. (TSX: DTOL) D2L is transforming the way the world learns—helping learners of all ages achieve more than they dreamed possible. Working closely with customers all over the world, D2L is supporting millions of people learning online and in person. Our global workforce is dedicated to making the best learning products to leave the world better than they found it. Learn more at D2L Consolidated Interim Statements of Financial Position(In U.S. dollars) As at April 30, 2025 and January 31, 2025(Unaudited)April 30, 2025 January 31, 2025 Assets Current assets:Cash and cash equivalents $ 92,526,834 $ 99,184,514Trade and other receivables 24,372,457 26,430,586Uninvoiced revenue 2,969,131 2,756,998Prepaid expenses 7,789,390 7,564,837Deferred commissions 5,139,987 5,106,976 132,797,799 141,043,911 Non-current assets:Other receivables 400,458 422,589Prepaid expenses 314,523 308,235Deferred income taxes 15,872,360 18,115,730Right-of-use assets 8,026,078 7,450,545Property and equipment 7,049,725 7,125,272Deferred commissions 6,954,101 6,909,439Loan receivable from associate 9,295,669 9,123,399Intangible assets 17,852,622 17,135,529Goodwill 27,019,307 25,286,222Total assets $ 225,582,642 $ 232,920,871 Liabilities and Shareholders' EquityCurrent liabilities:Accounts payable and accrued liabilities $ 35,417,661 $ 30,504,085Deferred revenue 85,411,389 97,454,306Lease liabilities 1,545,432 1,201,604Contingent consideration 5,005,457 4,927,193 127,379,939 134,087,188 Non-current liabilities:Deferred income taxes 4,031,858 4,110,030Lease liabilities 10,391,849 9,977,941 14,423,707 14,087,971 141,803,646 148,175,159 Shareholders' equity:Share capital: 367,125,848 367,487,956Additional paid-in capital 45,380,347 48,263,266Accumulated other comprehensive loss (4,696,131) (7,456,599)Deficit (324,031,068) (323,548,911)83,778,996 84,745,712 Related party transactions Investment in associate Total liabilities and shareholders' equity $ 225,582,642 $ 232,920,871 D2L Consolidated Interim Statements of Comprehensive Income (Loss)(In U.S. dollars) For the three months ended April 30, 2025 and 2024(Unaudited)2025 2024Revenue:Subscription and support $ 47,735,572 $ 42,953,475Professional services and other 5,099,599 5,541,417 52,835,171 48,494,892 Cost of revenue:Subscription and support 11,840,420 11,946,610Professional services and other 3,964,545 3,870,868 15,804,965 15,817,478 Gross profit 37,030,206 32,677,414 Expenses:Sales and marketing 13,668,739 12,904,939Research and development 11,459,714 12,290,771General and administrative 8,386,362 8,099,431 33,514,815 33,295,141 Income (loss) from operations 3,515,391 (617,727) Interest and other income (expenses):Interest expense (220,129) (160,660)Interest income 717,052 1,084,045Other income 315,059 59,476Foreign exchange gain 1,536,516 230,781 2,348,498 1,213,642 Income before income taxes 5,863,889 595,915 Income taxes expense (recovery):Current 571,177 50,745Deferred 2,024,408 (27,096) 2,595,585 23,649 Income for the period 3,268,304 572,266 Other comprehensive gain (loss):Foreign currency translation gain (loss) 2,760,468 (795,690) Comprehensive income (loss) $ 6,028,772 $ (223,424) Earnings per share – basic $ 0.06 $ 0.01 Earnings per share – diluted 0.06 0.01Weighted average number of common shares – basic 54,689,330 54,015,602 Weighted average number of common shares – diluted 56,137,363 55,723,344D2L Consolidated Interim Statements of Changes in Shareholders' Equity(In U.S. dollars) For the three months ended April 30, 2025 and 2024(Unaudited)Share Capital Additional paid-in capital Accumulated other comprehensive loss Deficit TotalShares AmountBalance, January 31, 2025 54,653,174 $ 367,487,956 $ 48,263,266 $ (7,456,599) $ (323,548,911) $ 84,745,712 Issuance of Subordinate Voting Shares on exercise of options 13,734 120,279 (88,253) — — 32,026 Issuance of Subordinate Voting Shares on settlement of restricted share units 370,200 1,328,952 (5,292,603) — — (3,963,651) Stock-based compensation — — 3,213,041 — — 3,213,041 Reduction in excess tax benefit on stock-based compensation — — (715,104) — — (715,104) Repurchase of share capital for cancellation under NCIB (168,800) (1,811,339) — — — (1,811,339) Share repurchase commitment under the ASPP — — — — (3,750,461) (3,750,461) Other comprehensive income — — — 2,760,468 — 2,760,468 Income for the period — — — — 3,268,304 3,268,304 Balance, April 30, 2025 54,868,308 $ 367,125,848 $ 45,380,347 $ (4,696,131) $ (324,031,068) $ 83,778,996 Balance, January 31, 2024 53,978,085 $ 364,830,884 $ 47,485,107 $ (4,998,317) $ (350,437,401) $ 56,880,273 Issuance of Subordinate Voting Shares on exercise of options 206,299 1,739,261 (900,761) — — 838,500 Issuance of Subordinate Voting Shares on settlement of restricted share units 194,483 965,967 (2,587,799) — — (1,621,832) Stock-based compensation — — 2,332,754 — — 2,332,754 Repurchase of share capital for cancellation under NCIB (131,380) (1,021,919) — — — (1,021,919) Share repurchase commitment under the ASPP — — — — 284,181 284,181 Other comprehensive loss — — — (795,690) — (795,690) Income for the period — — — — 572,266 572,266 Balance, April 30, 2024 54,247,487 $ 366,514,193 $ 46,329,301 $ (5,794,007) $ (349,580,954) $ 57,468,533 D2L Consolidated Interim Statements of Cash Flows(In U.S. dollars) For the three months ended April 30, 2025 and 2024(Unaudited)2025 2024 Operating activities:Income for the period $ 3,268,304 $ 572,266Items not involving cash: Depreciation of property and equipment 392,558 436,493 Depreciation of right-of-use assets 347,334 286,692 Amortization of intangible assets 557,631 27,967 Gain on disposal of property and equipment (16,825) (45,803) Stock-based compensation 3,213,041 2,332,754 Net interest income (496,923) (923,385) Income tax expense 2,595,585 23,649 Fair value gain on loan receivable from associate (172,270) —Changes in operating assets and liabilities: Trade and other receivables 3,684,970 (2,528,272) Uninvoiced revenue (133,791) 168,438 Prepaid expenses 153,112 2,116,314 Deferred commissions 369,573 (191,409) Accounts payable and accrued liabilities (1,189,037) (6,008,716) Deferred revenue (14,399,467) (12,109,523) Right-of-use assets and lease liabilities — (43,743)Interest received 710,627 1,077,425Interest paid (1,633) (12,633)Income taxes paid (738,303) (4,239)Cash flows used in operating activities (1,855,514) (14,825,725) Financing activities:Payment of lease liabilities (487,522) (405,727)Proceeds from exercise of stock options 32,026 838,500Taxes paid on settlement of restricted share units (3,963,651) (1,621,832)Repurchase of share capital for cancellation under NCIB (1,811,339) (1,021,919)Cash flows used in financing activities (6,230,486) (2,210,978) Investing activities:Purchase of property and equipment (1,737) (171,869)Proceeds from disposal of property and equipment 16,825 45,803Cash flows from (used in) investing activities 15,088 (126,066) Effect of exchange rate changes on cash and cash equivalents 1,413,232 (929,583) Decrease in cash and cash equivalents (6,657,680) (18,092,352) Cash and cash equivalents, beginning of period 99,184,514 116,943,499 Cash and cash equivalents, end of period $ 92,526,834 $ 98,851,147 Non-IFRS Financial Measures and Reconciliation of Non-IFRS Financial Measures The information presented within this press release refers to certain non-IFRS financial measures (including non-IFRS ratios) including Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Gross Profit, Adjusted Gross Margin, Free Cash Flow, Free Cash Flow Margin, and Constant Currency Revenue. These measures are not recognized measures under IFRS and do not have a standardized meaning prescribed by IFRS. Non-IFRS financial measures should not be considered in isolation nor as a substitute for analysis of the Company's financial information reported under IFRS and are unlikely to be comparable to similar measures presented by other issuers. Rather, these measures are provided as additional information to complement those IFRS measures by providing further understanding of the Company's results of operations, financial performance and liquidity from management's perspective and thus highlight trends in its core business that may not otherwise be apparent when relying solely on IFRS measures. The Company believes that securities analysts, investors and other interested parties frequently use non-IFRS financial measures in the evaluation of the Company. The Company's management also uses non-IFRS financial measures to facilitate operating performance comparisons from period to period, to prepare annual operating budgets and forecasts, and to assess our ability to meet our capital expenditures and working capital requirements. Adjusted EBITDA and Adjusted EBITDA Margin Adjusted EBITDA is defined as income (loss), excluding interest, taxes, depreciation and amortization (or EBITDA), adjusted for stock-based compensation, foreign exchange gains and losses, non-recurring expenses, transaction-related costs, fair value adjustment of acquired deferred revenue, income (loss) from equity accounted investee, change in fair value on the loan receivable from associate, impairment charges and other income and losses. Adjusted EBITDA Margin is calculated as Adjusted EBITDA expressed as a percentage of total revenue. For an explanation of management's use of Adjusted EBITDA and Adjusted EBITDA Margin see "Non-IFRS and Other Financial Measures – Non-IFRS Financial Measures and Non-IFRS Financial Ratios – Adjusted EBITDA and Adjusted EBITDA Margin" section in the Company's Interim MD&A, which section is incorporated by reference herein. The following table reconciles Adjusted EBITDA to income for the period, and discloses Adjusted EBITDA Margin, for the periods indicated: (in thousands of U.S. dollars, except for percentages) Three months ended April 30 2025 2024Income for the period 3,268 572Stock-based compensation 3,213 2,333Foreign exchange gain (1,537) (231)Non-recurring expenses(1) 471 821Transaction-related costs(2) 440 672Fair value adjustment of acquired deferred revenue(3) 225 —Change in fair value of loan receivable from associate(4) (172) —Net interest income (497) (923)Income tax expense 2,596 24Depreciation and amortization 1,298 751Adjusted EBITDA 9,305 4,019Adjusted EBITDA Margin 17.6 % 8.3 %Notes: (1) These expenses relate to non-recurring activities, such as certain legal fees incurred that are not indicative of continuing operations, and changes of workforce or technology whereby certain functions were realigned to optimize operations. (2) These expenses include post-combination compensation costs from the acquisition of H5P, and was partially offset by a gain recognized from the reduction in the second anniversary payment owed to the selling shareholders of Connected Shopping Ltd ("Connected Shopping"), a company acquired in Fiscal 2024, which was recorded through Other income. In the prior fiscal year, these expenses included post-combination compensation, legal, professional and other fees related to the acquisition activities of H5P, Connected Shopping, and the divestiture of our majority ownership stake in SkillsWave. These expenses would not have been incurred if not for these transactions and are not considered to be indicative of expenses associated with the Company's continuing operations. (3) At the date of acquisition, the Company recognized a fair value adjustment on the opening deferred revenue balance acquired as part of the H5P acquisition as required under IFRS 3, Business Combinations. This adjustment is not reflective of ordinary operations and is expected to be substantially completed by the end of Fiscal 2026. (4) On a quarterly basis, the Company determines the fair value of the loan advanced to SkillsWave. The adjustments to the fair value of the loan are not reflective of the Company's main business operations and will not impact the Company's future results beyond the maturity date of the loan on June 28, 2029. Adjusted Gross Profit and Adjusted Gross Margin Adjusted Gross Profit is defined as gross profit excluding related stock-based compensation expenses and amortization from acquired intangible assets, specifically acquired technology. Adjusted Gross Margin is calculated as Adjusted Gross Profit expressed as a percentage of total revenue. For an explanation of management's use of Adjusted Gross Profit and Adjusted Gross Margin see "Non-IFRS and Other Financial Measures – Non-IFRS Financial Measures and Non-IFRS Financial Ratios – Adjusted Gross Profit and Adjusted Gross Margin" section in the Company's Interim MD&A, which section is incorporated by reference herein. The following table reconciles Adjusted Gross Profit to gross profit, and discloses Adjusted Gross Margin, for the periods indicated: (in thousands of U.S. dollars, except for percentages) Three months ended April 30 2025 2024 Gross profit for the period 37,030 32,677 Stock-based compensation 206 146 Amortization from acquired intangible assets 431 16 Adjusted Gross Profit 37,667 32,839 Adjusted Gross Margin 71.3 % 67.7 % Free Cash Flow and Free Cash Flow MarginFree Cash Flow is defined as cash flows from (used in) operating activities less net additions to property and equipment. Free Cash Flow Margin is calculated as Free Cash Flow expressed as a percentage of total revenue. For an explanation of management's use of Free Cash Flow and Free Cash Flow Margin see "Non-IFRS and Other Financial Measures – Non-IFRS Financial Measures and Non-IFRS Financial Ratios – Free Cash Flow and Free Cash Flow Margin" section in the Company's Interim MD&A, which section is incorporated by reference herein. The following table reconciles Free Cash Flow to cash flow used in operating activities, and discloses Free Cash Flow Margin, for the periods indicated: (in thousands of U.S. dollars, except for percentages) Three months ended April 30 2025 2024 Cash flow used in operating activities (1,856) (14,826) Net disposal (additions) to property and equipment 15 (126) Free Cash Flow (1,841) (14,952) Free Cash Flow Margin -3.5 % -30.8 % Constant Currency Revenue Constant Currency Revenue is defined as our total revenue with foreign-currency-denominated revenues translated at the historical exchange rates from the comparable prior period into our U.S. dollar functional currency. For an explanation of management's use of Constant Currency Revenue see "Non-IFRS and Other Financial Measures – Non-IFRS Financial Measures and Non-IFRS Financial Ratios – Constant Currency Revenue" section in the Company's Interim MD&A, which section is incorporated by reference herein. The following table reconciles our Constant Currency Revenue to revenue, for the periods indicated: (in thousands of U.S. dollars) Three months ended April 30 2025 2024 Total revenue for the period 52,835 48,495 Negative impact of foreign exchange rate changes over the prior period 773 — Constant Currency Revenue 53,608 48,495 Key Performance IndicatorsManagement uses a number of metrics, including the key performance indicators identified below, to help us evaluate our business, measure our performance, identify trends affecting our business, formulate business plans and make strategic decisions. Our key performance indicators may be calculated in a manner different than similar key performance indicators used by other issuers. These metrics are estimated operating metrics and not projections, nor actual financial results, and are not indicative of current or future performance. Annual Recurring Revenue and Constant Currency Annual Recurring Revenue: We define Annual Recurring Revenue ("ARR") as the annualized equivalent value of subscription revenue from all existing customer contracts as at the date being measured, exclusive of the implementation period. Our calculation of ARR assumes that customers will renew their contractual commitments as those commitments come up for renewal. We believe ARR provides a reasonable, real-time measure of performance in a subscription-based environment and provides us with visibility for potential growth in our cash flows. We believe that increasing ARR reflects the continued strength of our business and the successful execution of our strategy. Increasing ARR will continue to be our focus on a go-forward basis. We define Constant Currency Annual Recurring Revenue as foreign-currency-denominated ARR translated at the historical exchange rates from the comparable prior period into our U.S. dollar functional at April 30 (in millions of U.S. dollars, except percentages) 2025 2024 Change $ $ % ARR 206.2 190.3 8.4 % Constant Currency Annual Recurring Revenue 206.8 190.3 8.7 % SOURCE D2L Inc. View original content to download multimedia: Sign in to access your portfolio
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17 Education & Technology Group Inc. Announces First Quarter 2025 Unaudited Financial Results
BEIJING, June 11, 2025 (GLOBE NEWSWIRE) -- 17 Education & Technology Group Inc. (NASDAQ: YQ) ('17EdTech' or the 'Company'), a leading education technology company in China, today announced its unaudited financial results for the first quarter of 2025. First Quarter 2025 Highlights1 Net revenues were RMB21.7 million (US$3.0 million), compared with net revenues of RMB25.5 million in the first quarter of 2024. Gross margin was 36.2%, compared with 38.4% in the first quarter of 2024. Net loss was RMB30.9 million (US$4.3 million), compared with net loss of RMB56.1 million in the first quarter of 2024. Net loss as a percentage of net revenues was negative 142.8% in the first quarter of 2025, compared with negative 219.9% in the first quarter of 2024. Adjusted net loss2 (non-GAAP), which excluded share-based compensation expenses of RMB8.5 million (US$1.2 million), was RMB22.4 million (US$3.1 million), compared with adjusted net loss (non-GAAP) of RMB42.7 million in the first quarter of 2024. Adjusted net loss (non-GAAP) as a percentage of net revenues was negative 103.4% in the first quarter of 2025, compared with negative 167.4% adjusted net loss (non-GAAP) as a percentage of net revenues in the first quarter of 2024. 1 For a reconciliation of non-GAAP numbers, please see the table captioned 'Reconciliations of non-GAAP measures to the most comparable GAAP measures' at the end of this press release. 2 Adjusted net loss represents net loss excluding share-based compensation expenses. Mr. Andy Liu, Founder, Chairman and Chief Executive Officer of the Company commented, 'We are pleased to report a strong performance in the first quarter of 2025. This quarter has marked significant progress and innovation, particularly with the successful trial and implementation of our AI-powered product upgrades, facilitating teaching and learning efficiency by delivering intelligent, adaptive solutions that enhance daily instructional decision-making, providing personalized learning experiences for students.' Mr. Michael Du, Director and Chief Financial Officer of the Company commented, 'In the first quarter of 2025, we have seen a strong growth in both new contract acquisitions and the expansion of our existing customer base. Our SaaS subscriptions have risen as more schools and educational organizations recognize the value of our AI-powered solutions. As we improved operating efficiency, the operating expenses reduced by 42.6% compared to the same quarter last year, resulting in a 44.8% reduction in net loss on a GAAP basis. Looking ahead, we will remain vigilant in monitoring our financial performance and making strategic decisions to ensure the long-term success and sustainability of our development.' First Quarter 2025 Unaudited Financial ResultsNet revenues for the first quarter of 2025 were RMB21.7 million (US$3.0 million), representing a year-over-year decrease of 15.0% from RMB25.5 million in the first quarter of 2024. This was mainly due to the reduction in net revenues from district-level projects as we prioritize our resources on school-based projects and an increasing number of contracts under SaaS subscription model which requires longer period of revenue of revenues for the first quarter of 2025 was RMB13.8 million (US$1.9 million), representing a year-over-year decrease of 11.9% from RMB15.7 million in the first quarter of 2024, which was largely in line with the decrease of net revenues during the profit for the first quarter of 2025 was RMB7.8 million (US$1.1 million), compared with RMB9.8 million in the first quarter of 2024. Gross margin for the first quarter of 2025 was 36.2%, compared with 38.4% in the first quarter of following table sets forth a breakdown of operating expenses by amounts and percentages of revenue during the periods indicated (in thousands, except for percentages): For the three months ended March 31, 2024 2025 Year- RMB % RMB USD % over-year Sales and marketing expenses 18,787 73.7 % 13,013 1,793 60.1 % -30.7 % Research and development expenses 19,081 74.8 % 12,592 1,735 58.1 % -34.0 % General and administrative expenses 34,845 136.6 % 16,101 2,219 74.3 % -53.8 % Total operating expenses 72,713 285.1 % 41,706 5,747 192.5 % -42.6 % Total operating expenses for the first quarter of 2025 were RMB41.7 million (US$5.7 million), including RMB8.5 million (US$1.2 million) of share-based compensation expenses, representing a year-over-year decrease of 42.6% from RMB72.7 million in the first quarter of 2024. Sales and marketing expenses for the first quarter of 2025 were RMB13.0 million (US$1.8 million), including RMB2.1 million (US$0.3 million) of share-based compensation expenses, representing a year-over-year decrease of 30.7% from RMB18.8 million in the first quarter of 2024. This was mainly due to efficiency improvements in marketing and sales work force and expenses compared with the same period last year. Research and development expenses for the first quarter of 2025 were RMB12.6 million (US$1.7 million), including RMB2.4 million (US$0.3 million) of share-based compensation expenses, representing a year-over-year decrease of 34.0% from RMB19.1 million in the first quarter of 2024. The decrease was primarily due to the decrease in the share-based compensation and efficiency improvements in our research and development work force and expenses compared with the same period last year. General and administrative expenses for the first quarter of 2025 were RMB16.1 million (US$2.2 million), including RMB4.1 million (US$0.6 million) of share-based compensation expenses, representing a year-over-year decrease of 53.8% from RMB34.8 million in the first quarter of 2024. The increase was primarily due to the decrease in the share-based compensation and staff optimization in line with business from operations for the first quarter of 2025 was RMB33.9 million (US$4.7 million), compared with RMB62.9 million in the first quarter of 2024. Loss from operations as a percentage of net revenues for the first quarter of 2025 was negative 156.3%, compared with negative 246.7% in the first quarter of loss for the first quarter of 2025 was RMB30.9 million (US$4.3 million), compared with net loss of RMB56.1 million in the first quarter of 2024. Net loss as a percentage of net revenues was negative 142.8% in the first quarter of 2025, compared with negative 219.9% in the first quarter of net loss (non-GAAP) for the first quarter of 2025 was RMB22.4 million (US$3.1 million), compared with adjusted net loss (non-GAAP) of RMB42.7 million in the first quarter of 2024. Adjusted net loss (non-GAAP) as a percentage of net revenues was negative 103.4% in the first quarter of 2025, compared with negative 167.4% of adjusted net loss (non-GAAP) as a percentage of net revenues in the first quarter of 2024. Please refer to the table captioned 'Reconciliations of non-GAAP measures to the most comparable GAAP measures' at the end of this press release for a reconciliation of net loss under U.S. GAAP to adjusted net loss (non-GAAP).Cash and cash equivalents, restricted cash and term deposit were RMB333.3 million (US$45.9 million) as of March 31, 2025, compared with RMB359.3 million as of December 31, 2024. Conference Call Information The Company will hold a conference call on Tuesday, June 10, 2025 at 9:00 p.m. U.S. Eastern Time (Wednesday, June 11, 2025 at 9:00 a.m. Beijing time) to discuss the financial results for the first quarter of 2025. Please note that all participants will need to preregister for the conference call participation by navigating to Upon registration, you will receive an email containing participant dial-in numbers, and PIN number. To join the conference call, please dial the number you receive, enter the PIN number, and you will be joined to the conference call instantly. Additionally, a live and archived webcast of this conference call will be available at Non-GAAP Financial Measures 17EdTech's management uses adjusted net loss as a non-GAAP financial measure to gain an understanding of 17EdTech's comparative operating performance and future prospects. Adjusted net income (loss) represents net loss excluding share-based compensation expenses and such adjustment has no impact on income tax. Adjusted net income (loss) is used by 17EdTech's management in their financial and operating decision-making as a non-GAAP financial measure; because management believes it reflects 17EdTech's ongoing business and operating performance in a manner that allows meaningful period-to-period comparisons. 17EdTech's management believes that such non-GAAP measure provides useful information to investors and others in understanding and evaluating 17EdTech's operating performance in the same manner as management does, if they so choose. Specifically, 17EdTech believes the non-GAAP measure provides useful information to both management and investors by excluding certain charges that the Company believes are not indicative of its core operating results. The non-GAAP financial measure has limitations. It does not include all items of income and expense that affect 17EdTech's income from operations. Specifically, the non-GAAP financial measure is not prepared in accordance with GAAP, may not be comparable to non-GAAP financial measures used by other companies and, with respect to the non-GAAP financial measure that excludes certain items under GAAP, does not reflect any benefit that such items may confer to 17EdTech. Management compensates for these limitations by also considering 17EdTech's financial results as determined in accordance with GAAP. The presentation of this additional information is not meant to be considered superior to, in isolation from or as a substitute for results prepared in accordance with US GAAP. Exchange Rate Information The Company's business is primarily conducted in China and all of the revenues are denominated in Renminbi ('RMB'). However, periodic reports made to shareholders will include current period amounts translated into U.S. dollars ('USD' or 'US$') using the exchange rate as of balance sheet date, for the convenience of the readers. Translations of balances in the consolidated balance sheets and the related consolidated statements of operations, comprehensive loss, change in shareholders' deficit and cash flows from RMB into USD as of and for the three months ended March 31, 2025 are solely for the convenience of the readers and were calculated at the rate of US$1.00=RMB7.2567 representing the noon buying rate set forth in the H.10 statistical release of the U.S. Federal Reserve Board on March 31, 2025. No representation is made that the RMB amounts could have been, or could be, converted, realized or settled into US$ at that rate on March 31, 2025, or at any other rate. Changes in Board and Management The Company announced that Mr. Jiawei Gan has retired as an independent director of the board of directors of the Company (the 'Board'), and Mr. Gui Jia has been appointed as an independent director and a member of the Audit Committee, the Compensation Committee and the Nominating and Corporate Governance Committee of the Board, both effective immediately. Mr. Gui Jia has over 14 years of experience in fintech and education industries. Since 2016, he has served as co-founder and chief operating officer of Hunan Niutoubang Technology Co., Ltd. ('NewBanker'), a digital wealth management solutions provider. From 2014 to 2016, Mr. Jia served as executive assistant to the chief executive officer of Credit Ease Wealth Management (Beijing) Co., Ltd., a wealth management firm headquartered in Beijing, China. From 2009 to 2013, Mr. Jia held multiple managerial positions in education technology companies such as New Oriental Education and Technology Inc.. Mr. Jia received his bachelor's degree in applied physics in 2007 and his master's degree in condensed matter physics in 2009, both from University of Science and Technology Beijing. The Company further announced that Mr. Michael Chao Du has resigned as a director and Chief Financial Officer. Ms. Sishi Zhou has been appointed as the Acting Chief Financial Officer of the Company, effective immediately. Ms. Sishi Zhou joined the Company in December 2020, and has served as the Company's Finance Director since June 2022, responsible for overall financial operations including financial reporting, business analysis, budgeting, compliance, treasury and taxation. She has also led the strategy department of the Company to manage strategic planning, execute key corporate initiatives and incorporate financial analysis and resource planning. Prior to joining the Company, Ms. Zhou held multiple advisory positions in strategic finance at Shell plc (China), and served as Senior Finance Manager in multiple organizations as well as Senior Auditor at PwC Zhong Tian CPAs LLP. Ms. Zhou received her dual bachelor's degrees in accounting and law from Tsinghua University in 2011 and her MBA from Peking University's Guanghua School of Management in 2023. Mr. Andy Chang Liu, Chairman and Chief Executive Officer of the Company, commented, 'We are pleased to welcome Mr. Gui Jia and Ms. Sishi Zhou to our leadership team. Mr. Jia's profound fintech experience and Ms. Zhou's financial stewardship will be instrumental as we drive forward our next phase of strategic development. We also express our sincere gratitude to both Mr. Michael Chao Du and Mr. Jiawei Gan for their contributions during their tenure with the Company.' About 17 Education & Technology Group Inc. 17 Education & Technology Group Inc. is a leading education technology company in China, offering smart in-school classroom solution that delivers data-driven teaching, learning and assessment products to teachers, students and parents. Leveraging its extensive knowledge and expertise obtained from in-school business over the past decade, the Company provides teaching and learning SaaS offerings to facilitate the digital transformation and upgrade at Chinese schools, with a focus on improving the efficiency and effectiveness of core teaching and learning scenarios such as homework assignments and in-class teaching. The product utilizes the Company's technology and data insights to provide personalized and targeted learning and exercise content that is aimed at improving students' learning efficiency. Safe Harbor Statement This announcement contains forward-looking statements. These statements are made under the 'safe harbor' provisions of the United States Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as 'will,' 'expects,' 'anticipates,' 'future,' 'intends,' 'plans,' 'believes,' 'estimates' and similar statements. Statements that are not historical facts, including statements about 17EdTech's beliefs and expectations, are forward-looking statements. 17EdTech may also make written or oral forward-looking statements in its periodic reports to the SEC, in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: 17EdTech's growth strategies; its future business development, financial condition and results of operations; its ability to continue to attract and retain users; its ability to carry out its business and organization transformation, its ability to implement and grow its new business initiatives; the trends in, and size of, China's online education market; competition in and relevant government policies and regulations relating to China's online education market; its expectations regarding demand for, and market acceptance of, its products and services; its expectations regarding its relationships with business partners; general economic and business conditions; and assumptions underlying or related to any of the foregoing. Further information regarding these and other risks is included in 17EdTech's filings with the SEC. All information provided in this press release is as of the date of this press release, and 17EdTech does not undertake any obligation to update any forward-looking statement, except as required under applicable law. For investor and media inquiries, please contact: 17 Education & Technology Group Inc. Ms. Lara ZhaoInvestor Relations ManagerE-mail: ir@ EDUCATION & TECHNOLOGY GROUP INC. UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands of RMB and USD, except for share and per ADS data, or otherwise noted) As ofDecember 31, As of March 31, 2024 2025 2025 RMB RMB USD ASSETS Current assets Cash and cash equivalents 234,144 270,406 37,263 Restricted cash 49 49 7 Term deposits 125,108 62,854 8,662 Accounts receivable 67,097 60,160 8,290 Prepaid expenses and other current assets 82,513 82,407 11,356 Total current assets 508,911 475,876 65,578 Non-current assets Property and equipment, net 26,410 27,362 3,771 Right-of-use assets 11,768 12,529 1,727 Other non-current assets 2,428 2,417 333 TOTAL ASSETS 549,517 518,184 71,409 LIABILITIES Current liabilities Accrued expenses and other current liabilities 104,422 100,795 13,890 Deferred revenue and customer advances, current 40,397 36,851 5,078 Operating lease liabilities, current 6,798 5,772 795 Total current liabilities 151,617 143,418 19,763 As ofDecember 31, As of March 31, 2024 2025 2025 RMB RMB USD Non-current liabilities Operating lease liabilities, non-current 4,261 6,050 834 TOTAL LIABILITIES 155,878 149,468 20,597 SHAREHOLDERS' EQUITY Class A ordinary shares 241 243 33 Class B ordinary shares 81 81 11 Treasury stock (34 ) (36 ) (5 ) Additional paid-in capital 11,070,615 11,078,177 1,526,614 Accumulated other comprehensive income 86,410 84,869 11,695 Accumulated deficit (10,763,674 ) (10,794,618 ) (1,487,536 ) TOTAL SHAREHOLDERS' EQUITY 393,639 368,716 50,812 TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 549,517 518,184 71,409 17 EDUCATION & TECHNOLOGY GROUP INC. UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands of RMB and USD, except for share and per ADS data, or otherwise noted) For the three months ended March 31, 2024 2025 2025 RMB RMB USD Net revenues 25,501 21,668 2,986 Cost of revenues (15,699 ) (13,835 ) (1,907 ) Gross profit 9,802 7,833 1,079 Operating expenses (Note 1) Sales and marketing expenses (18,787 ) (13,013 ) (1,793 ) Research and development expenses (19,081 ) (12,592 ) (1,735 ) General and administrative expenses (34,845 ) (16,101 ) (2,219 ) Total operating expenses (72,713 ) (41,706 ) (5,747 ) Loss from operations (62,911 ) (33,873 ) (4,668 ) Interest income 5,137 2,676 369 Foreign currency exchange gain(loss) 160 (67 ) (9 ) Other income, net 1,537 320 44 Loss before provision for income tax and loss from equity method investments (56,077 ) (30,944 ) (4,264 ) Income tax expenses — — — Net loss (56,077 ) (30,944 ) (4,264 ) Net loss available to ordinary shareholders of 17 (56,077 ) (30,944 ) (4,264 ) Education & Technology Group Inc. Net loss per ordinary share Basic and diluted (0.14 ) (0.07 ) (0.01 ) Net loss per ADS (Note 2) Basic and diluted (7.00 ) (3.50 ) (0.50 ) Weighted average shares used in calculating net loss per ordinary share Basic and diluted 387,566,725 462,312,173 462,312,173 Note 1: Share-based compensation expenses were included in the operating expenses as follows: For the three months ended March 31, 2024 2025 2025 RMB RMB USD Share-based compensation expenses: Sales and marketing expenses 2,026 2,093 288 Research and development expenses 3,780 2,397 330 General and administrative expenses 7,582 4,056 559 Total 13,388 8,546 1,177 Note 2: Each one ADS represents fifty Class A ordinary shares. 17 EDUCATION & TECHNOLOGY GROUP INC. Reconciliations of non-GAAP measures to the most comparable GAAP measures (In thousands of RMB and USD, except for share, per share and per ADS data) For the three months ended March 31, 2024 2025 2025 RMB RMB USD Net Loss (56,077 ) (30,944 ) (4,264 ) Share-based compensation 13,388 8,546 1,177 Income tax effect — — — Adjusted net loss (42,689 ) (22,398 ) (3,087 )Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data