Hongen fully de-educates under the crisis of preschool education app outage
Behind Hong En's tearing off the "education" label is the further contraction of preschool online education supervision
Our reporter Xie Ruolin
On June 21, Hong En released its unaudited quarterly report for the quarter ended March 31, 2022.
The report shows that after adjustment, the company achieved a net profit of 15.1 million yuan in the first quarter, a year-on-year increase of 6.1%.
Hongen, formerly known as Hongen Education, changed its name in a low-key manner in the first half of this year, changing the positioning of "educational enterprise" into a technology and educational product enterprise, which mainly includes Hongen Literacy, Hongen Thinking (formerly Hongen Mathematics) and so on.
However, the compliance requirements for preschool education apps are like the sword of Damocles, which always hangs on Hong En's head.
On May 9 this year, the Beijing Municipal Education Commission and other three departments issued the "Notice on Further Doing a Good Job in the Filing and Management of Educational Mobile Internet Applications" (hereinafter referred to as the "Notice"), making it clear that the pre-school online training and education mobile application filing will no longer be accepted. Applications that have been filed will be withdrawn.
Xiong Bingqi, president of the 21st Century Education Research Institute, told the "Securities Daily" reporter that this also means that all educational apps for children between the ages of 3 and 6 must be removed from the shelves and stop operating.
In other words, neither kindergartens nor out-of-school early childhood education institutions are allowed to educate and train children online.
Hong En increases investment in international market
According to the financial report, in the first quarter, Hong En achieved revenue of 242.7 million yuan, a year-on-year increase of 7.1%; net profit was 13.1 million yuan, an increase of 83.6% year-on-year.
After adjustment, Hong En achieved a net profit of 15.1 million yuan in the first quarter, a year-on-year increase of 6.1%.
At the user level, the average MAU (monthly active users) of Hong En in the first quarter reached 18.39 million, a year-on-year increase of 14.1%, and the number of paying users was 1.61 million, a slight decrease of 4.35% year-on-year.
As of March 31, 2022, Hong En had cash, cash equivalents and term deposits of RMB 794.1 million, and deferred revenue and advances to customers of RMB 317.9 million.
Dai Peng, Director and CEO of Hong En said: "During the reporting period, we provided parents with more interesting tools for parenting by optimizing the product matrix, and promoted the all-round development of children. At the same time, we also increased investment in the international market. We believe that overseas The business will help Hong En to further extend its market reach and become a new growth engine in the future."
Hong En is trying to get rid of the label of "education". In addition to changing the company name and product name, the expression of the company's income structure has also changed. At this time last year, Hong En's main income was "learning services" and "learning materials and equipment income." ”, the 2021 annual report shows that the company’s revenue consists of “online subscription revenue” and “offline product and other revenue”.
Preschool education apps must be discontinued
Behind Hong En's tearing off the "education" label is the further contraction of pre-school online education supervision.
The "Notice on Further Doing a Good Job in the Filing and Management of Educational Mobile Internet Applications" clearly states that "teaching staff, students, and parents are the main users, and education and learning are the main application scenarios to serve school education, teaching and management, and student learning. Internet mobile applications for life and home-school interaction” need to be filed.
At the same time, the application for filing of the online training and education mobile application for the frontier of science will no longer be accepted, and those that have been filed will be revoked.
How to judge whether it is an educational mobile Internet application that needs to be filed?
In the policy interpretation of the "Notice", the Beijing Municipal Education Commission stated that it is not developed for the education system, but widely used by the education system is not an educational mobile application, such as WeChat, etc.; mobile Internet applications that provide services for continuing education are also It belongs to educational mobile applications, such as "Shangde Self-Exam", but social examinations are not counted, such as related Internet applications for training driver's licenses and civil servants; general-purpose Internet tools do not belong to educational mobile applications, such as "Youdao Dictionary" ”, but specialized tools belong to educational mobile applications, such as Youdao Children’s Dictionary.
According to the information on Hongen's official website, the company has 13 applications, including Hongen Literacy, Hongen Thinking, Hongen ABC, Hongen Pinyin, Hongen 100,000 Questions, etc.
Should these products be preschool mobile apps, or general-purpose internet tools?
A brokerage analyst told reporters that although Hongen's products help preschoolers to literate, learn English, and learn mathematics, there is no teacher teaching, and it should not be counted as an educational mobile application.
"Hongen was born earlier, and it is different from the popular training institutions in recent years with clear goals. It cannot be generalized. If it is not within the scope of the curriculum standard, it is close to universality. As for the specific category of Hongen's products, there is still uncertainty. It needs to be clarified by the relevant departments." Chu Zhaohui, a researcher at the Chinese Academy of Educational Sciences, told reporters.
(Securities Daily)