TAL Education Group (NYSE:TAL) Q3 2023 Earnings Call Transcript

In terms of the strategy in introduction €“ I think I mentioned this on a few calls over the past quarters, I think we are continuing to €“ led to building that world-class content. We continue to infuse more technology such as an AI into our product. And we also ensure there’s an integrated experience for our customers across all these form factors. So Liping I hope that answers your question.

Liping Zhao: Yes. Understood.

Operator: Thank you. We will take our next question. Our next question comes from the line of Felix Liu from UBS. Please go ahead. Your line is open.

Felix Liu: Good evening. Thank you, Alex. Thank you, Jackson for taking my question. My question is on the COVID outbreak that happened in China recently. How does that impact our business in the February quarter? And given offline activities have largely resumed in many cities in China now, how should we think about the online and offline strategy from here? And would you expect a reacceleration of our offline expansion? Thank you.

Jackson Ding: Felix, thanks for the question. Regarding the first part of your question, the impact of the epidemic, I would say historically we carefully manage that impact through offering an online option to students who enrolled in our offline classes, when the epidemic caused inconvenience. In the last €“ and looking forward and obviously, as the impact of COVID starts to diminish in China, we’ll offer a balance and hybrid online and offline learning experience to our learners. We do see both online and offline offerings as important components in the learning experience we provide to our learners and they each have their own merit. The second part of the question asked a bit about offline expansion plan and future outlook.

I would just say with regard to our offline learning centers, for the last two consecutive quarters we increased the number of our learning centers by both single-digit increase in the last two quarters and we currently have somewhere between a 100 and 200 learning centers. In the next few quarters to come, we’ll continue to slowly but gradually increase the number of our learning centers. Felix, I hope that answers your question.

Felix Liu: Got it. Thank you very much.

Operator: Thank you. We will take our next question. Our next question comes from the line of DS Kim from JPMorgan. Please go ahead. Your line is open.

DS Kim: Hi, Alex. Hi, Jackson. Happy New Year. I was actually going to ask about profitability but both of you have already provided a great insight, so thanks for that. May I then follow-up with quick housekeeping questions, perhaps three if I may ask. First one is, what was this $32 million other expenses this quarter in the below OP line? Just curious any details there? And can you remind us on the nature of the restricted cash on our balance sheet, which was quite sizable, I think at a $450 million total including non-current? I remember this was somewhat related to some financial products, wealth management products and whatnot but just wanted some clarification or elaboration would be really appreciated. Thank you very much.

Jackson Ding: Got it. Yes, this is Jackson. Thanks for the question. I heard — the second part of the question is loud and clear with regard to restricted cash. And just to confirm that the first part of your question was related to other — that $32 million of other expense?