TAL Education Group (TAL): Business Model Canvas [Dec-2025 Updated]

You're digging into TAL Education Group (TAL) now, trying to make sense of their business model after the massive regulatory shift. Forget the old playbook; the pivot to non-academic enrichment and AI hardware is clearly working, which is more than many of us expected. Look at the FY2025 numbers: Learning Services still accounted for 68.2% of revenue ($1.53 billion), but the new Learning Content Solutions, including devices, hit $715.4 million. They are playing a long game, backed by a $3.618 billion cash pile as of February 2025. This isn't a pivot; it's a complete rebuild. Dive into the full Business Model Canvas below to see exactly how they are structuring this new enterprise.

TAL Education Group (TAL) - Canvas Business Model: Key Partnerships

You're looking at how TAL Education Group structures its external relationships to fuel its AI-native pivot, which is definitely a key part of their current strategy. These partnerships are crucial for extending reach beyond their core tutoring base.

Licensing technology and content to B2B institutional clients and private schools

TAL Education Group is proactively building an ecosystem for education through strategic investments, which suggests a B2B component for content and technology distribution. While specific licensing revenue figures for fiscal year 2025 aren't explicitly broken out, the overall strategy involves leveraging advantages in proprietary content and tutoring services with external networks. For instance, an earlier strategic investment in Phoenix E-Learning Corporation gave TAL an opportunity to enter the market of digitalizing public schools, where the partner platform already served over 30,000 public schools and had accumulated more than 15 million registered users, with 80% of those users being teachers. This sets a precedent for B2B technology deployment.

Strategic partnerships for cautious international expansion in Southeast Asia and North America

The international footprint is being managed through its subsidiary, Think Academy. Think Academy is dedicated to creating fair and comprehensive educational opportunities, serving more than 5 million K-12 students across 10+ countries. This expansion covers academic subjects both in and out of China. The acquisition of Epic Kids in September 2025 for $95 million signals a direct move into the North American market, specifically targeting digital library assets for young readers.

Collaboration with hardware manufacturers for AI-powered learning devices

The success of TAL Education Group's AI-driven transformation heavily relies on its hardware ecosystem, including devices like the Xbook and xPad. A major partnership is evident with the Thinkpal Tablet, a product unveiled at CES 2025, which is powered by the Microsoft Azure OpenAI Model. This collaboration is central to democratizing access to self-directed, tech-enhanced education. The learning device segment is a strategic focus, contributing to a 50.4% year-over-year revenue surge to $619.4 million in Q2 2025 (for the AI-related segments, as per one report). The Thinkpal Tablet itself is priced at $249, or $339 when bundled with a keyboard.

Acquisition of children's reading platform assets

TAL Education Group completed a notable acquisition in the content space. In September 2025, TAL Education Group acquired Epic Kids for $95 million in bankruptcy court. This move was designed to expand TAL's presence in the educational technology sector, specifically targeting digital reading assets for young learners. This transaction occurred shortly before the summer break for schools in the United States.

E-commerce platforms for distribution of learning devices during peak seasons

Distribution channels are clearly important for moving hardware and digital solutions. The growth in Q3 of fiscal year 2025 was partly attributed to strong sales during the e-commerce peak season. The Thinkpal Tablet, for example, was made available for pre-order at shop.thethinkacademy.com. This focus on online sales channels helps capture demand from households seeking tech-enhanced education.

Here's a quick look at some key figures related to TAL Education Group's scale and recent financial performance, which underpins the strength of these partnerships:

The operational efficiency TAL is achieving is also telling. For the first six months of fiscal year 2026, the gross margin reached 54.5%. Furthermore, the company is actively managing its capital, holding approximately $3.5 billion in cash, cash equivalents, short-term investments and restricted cash as of August 31, 2025.

The partnerships are supported by internal technological achievements, such as the recognition of projects like MathGPT AI Learning and Xueersi Smart Learning Devices Tablet as standard application cases by authoritative bodies in 2025.

• AI Thinkie 'One-on-One' received certification from the MIIT Industrial Culture Development Center.
• Xueersi Smart Learning Devices Tablet selected as a 'Standard Application Case' by the Ministry of Education Standards Committee for 2025.
• The company's non-GAAP income from operations for Q2 FY2026 was $133.0 million.

Finance: draft 13-week cash view by Friday.

TAL Education Group (TAL) - Canvas Business Model: Key Activities

Intensive Research and Development (R&D) in Artificial Intelligence (AI) and smart learning is a core activity for TAL Education Group. Management emphasizes continued investments in AI and product R&D to drive long-term growth. The company strategically acquired children's reading platform assets for US$95.5 million in May 2025. The learning device business is currently loss-making due to R&D, BOM, and go-to-market investments.

Developing and updating non-academic enrichment content, particularly through the Peiyou small classes, is a major operational focus. For the first six months of fiscal year 2026, the gross profit margin for the combined business was reported at 56.1%. The Peiyou Small Class Enrichment programs maintained a retention rate of around 80% in the first quarter of fiscal year 2026. The Learning Services and Others segment, led by Peiyou small-class enrichment, contributed $1.53 billion, representing 68.2% of total revenue for the full fiscal year 2025.

Operating online live courses and on-demand digital learning platforms is another key activity. For the second quarter of fiscal year 2026, net revenues were US$861.4 million, up 39.1% year-over-year. The company reported net revenues of US$575.0 million for the first quarter of fiscal year 2026, a 38.8% increase from the prior year period. The Learning Content Solutions segment generated $715.4 million in fiscal year 2025.

Manufacturing, marketing, and selling AI-powered learning devices, such as the XBook, is a strategic growth area. New learning device models, including the P4, S4, and T4, helped reach a wider audience in the first quarter of fiscal year 2026. Selling and marketing expenses for the first quarter of fiscal year 2026 totaled US$180.8 million, a year-over-year increase of 47.7%.

Managing a diversified portfolio of B2C and B2B educational services is reflected in the overall financial structure. TAL Education Group reported net revenues of US$2,250.2 million for the fiscal year 2025, a 51.0% increase from fiscal year 2024. The company returned to profitability in fiscal year 2025, posting a net income attributable to TAL of US$84.6 million, compared to a net loss of US$3.6 million in fiscal year 2024. The balance sheet remained strong as of August 31, 2025, with US$1,542.2 million of cash and cash equivalents and US$1,706.6 million of short-term investments.

• Peiyou Small Class Retention Rate: around 80% (Q1 FY2026).
• Non-GAAP Net Income: US$149.5 million (FY2025).
• Deferred Revenue: US$671.2 million (as of February 28, 2025).
• Selling and Marketing Expenses: US$180.8 million (Q1 FY2026).
• Strategic Acquisition Cost: $95.5 million (May 2025).

TAL Education Group (TAL) - Canvas Business Model: Key Resources

You're looking at the core assets TAL Education Group is relying on as of late 2025. It's a mix of deep pockets, proprietary tech, and a recognized name that survived major regulatory shifts.

The financial foundation is solid, which helps fund the pivot. As of February 28, 2025, TAL Education Group held US$3.618 billion in cash, cash equivalents, and short-term investments. That's a substantial war chest for innovation and shareholder returns, like the new one-year $0.6 billion repurchase program initiated in late July 2025.

The shift to an AI-native platform is central to their resource base. They've got proprietary models like MathGPT integrated into their ecosystem. This tech isn't just theoretical; their Xueersi AI Thinkie 1-on-1 Super Educational Intelligence product passed the Trustworthy AI Education Agent Evaluation by CAICT in August 2025, achieving a 4+ rating, the highest level in the industry. Also, the MathGPT AI Learning system was selected as a 'Typical Case of Artificial Intelligence + Application Scenarios'.

Staffing levels reflect this tech focus. The total employee count as of February 28, 2025, reached 23,000, marking a 53.33% increase from the 15,000 employees reported the prior year. This growth supports both R&D and the expansion of their new business lines.

Brand equity remains a resource, even after the K-12 restructuring. The company is recognized as a leading provider, and the acronym 'TAL' itself stands for 'Tomorrow Advancing Life.' This trust is now being channeled into new areas, with analysts noting that sustained investment in brand-building is fueling optimism for future share capture.

Here's a quick look at some of those hard numbers defining these resources:

The non-academic and enrichment content library is a key driver in the current revenue mix. The Peiyou enrichment small classes were noted as the largest revenue contributors within the learning services business in Q3 FY2025. This focus on non-core academics is a direct result of strategic resource allocation.

The key components underpinning the new value proposition include:

• Proprietary AI tools like MathGPT.
• AI-powered learning devices such as Xbook and xPad.
• Diversification into online enrichment and STEAM offerings.
• A focus on intelligent evaluation and precise guided learning.

The market is pricing in this quality, as TAL trades at a premium compared to some peers, with a forward EV/Sales ratio of 1.60 times in Q3 FY2025 analysis. That's a tangible measure of the perceived value of these key resources. Finance: draft 13-week cash view by Friday.

TAL Education Group (TAL) - Canvas Business Model: Value Propositions

You're looking at the core offerings TAL Education Group presents to the market now that the landscape has fundamentally shifted. The value proposition centers on technology integration and diversification away from the old K-12 model, though enrichment programs remain central.

Holistic development programs for children aged 6-15 under new regulations

TAL Education Group continues to serve the K-12 segment through enrichment learning, which is now a primary driver. The Peiyou enrichment small classes are noted as the largest revenue contributors within the learning services business. This segment, which includes these enrichment programs, is part of the broader Learning Services and Others segment that generated $1.53 billion, accounting for 68.2% of total revenue in Fiscal Year 2025.

• Customer acceptance of enrichment learning is increasing.
• Focus on high-quality products and innovative teaching methods.

AI-powered learning devices offering intelligent grading and personalized recommendations

The AI-powered learning devices, such as the Xbook and xPad, are a cornerstone of the strategy, driving significant growth. For the second quarter of Fiscal Year 2026 (ended August 31, 2025), the company reported net revenues of $861.4 million, with AI-related segments contributing disproportionately to this growth. User engagement is high, evidenced by an 80% weekly active user rate across the AI ecosystem. The company maintains a strong cash position, with $1.54 billion in cash and equivalents as of August 31, 2025, supporting these technology investments.

Here's a quick look at the financial performance reflecting this pivot:

Career-enhancing skills training for adult learners (e.g., Learnable coding bootcamps)

TAL Education Group is expanding its offerings to adult learners through career-enhancing skills training. While specific enrollment numbers for TAL's internal programs like Learnable aren't public, the market context shows strong demand; the global number of professionals taking tech bootcamps was projected to reach up to 380,000 by 2025. This signals a viable market for job-ready skills training.

High-quality digital content and smart education solutions for institutional clients

The Learning Content Solutions segment represents a key value stream, providing digital content and smart education tools to institutions. This segment generated $715.4 million in revenue for Fiscal Year 2025. This shows a substantial business line focused on B2B or institutional technology sales, separate from direct-to-consumer learning services.

Flexible, digital-first delivery with online live and on-demand courses

The entire model is underpinned by digital flexibility, which supports both the enrichment programs and the AI device usage. The company's deferred revenue balance, which reflects prepayments for services, stood at $822.7 million as of August 31, 2025, indicating strong forward bookings for these flexible learning solutions. The company also extended its share repurchase program with $490.7 million remaining authorization through April 30, 2026, signaling management's confidence in the long-term value generated by these digital offerings.

• Non-GAAP gross margin for Q2 FY2026 was 57.0%.
• Net income attributable to TAL for Q2 FY2026 was $124.1 million.
• Total cash, cash equivalents, and short-term investments were $3.25 billion as of August 31, 2025 ($1.54B cash + $1.71B short-term investments).

Finance: draft 13-week cash view by Friday.

TAL Education Group (TAL) - Canvas Business Model: Customer Relationships

You're looking at how TAL Education Group maintains its connection with customers after its major pivot; it's all about digital stickiness and institutional partnerships now. The relationship strategy is clearly segmented to address different user needs, moving far beyond the old model.

Automated, personalized learning paths driven by AI technology

The core of the individual customer relationship is built around AI-driven personalization. This isn't just a feature; it's the engine for engagement. The company's proprietary tools, like the MathGPT AI Learning system, which was recognized as a 'Typical Case of Artificial Intelligence + Application Scenarios' in 2025, are designed to create a closed-loop learning experience from preparation to post-class review. This tech focus is what keeps users coming back.

The stickiness of this automated relationship is measurable:

• Weekly active user rate across the AI ecosystem is reported at 80%.
• The company made a $200 million investment in digital infrastructure by 2025 to power these systems.

High-touch service for B2B institutional clients licensing content

For institutional clients, the relationship shifts from direct consumer support to a high-touch B2B service model, licensing their technology and content solutions. This segment represents a significant, though perhaps less visible, part of the customer base. To give you a sense of its scale in the previous period, this B2B arm contributed approximately 30% to total revenue in Fiscal Year 2024, showing a successful diversification effort.

The service here involves deploying comprehensive smart education solutions, such as the MathGPT AI Learning platform, which targets campuses and teaching communities directly. This requires dedicated support to integrate the technology effectively, a clear departure from the self-service model.

Community building and engagement through enrichment class formats

Customer engagement is also fostered through non-academic enrichment classes, which have proven to be a strong growth driver in the current environment. The Peiyou enrichment small classes, for instance, were noted as the largest revenue contributors within the learning services business as of Q3 2025. This format inherently builds a community feel, supported by increasing customer acceptance of enrichment learning.

The PAYU Small Class Enrichment Programs continued their development path, fueled by higher enrollments, which suggests a healthy, recurring community relationship is being maintained, even as the company prioritizes technology.

Direct-to-consumer sales and support for learning device purchasers

For customers buying physical or integrated learning devices, like the XBook or upgraded xPad, the relationship is cemented through product ownership and ongoing digital support. While the learning device business is still described as being in its 'early stage' as of Q2 FY2026, it is a strategic focus area showing both year-over-year and quarter-over-quarter growth.

The sales channel for this is heavily skewed toward direct interaction:

• Direct-to-Consumer (DTC) online sales generated 85% of the company's Q4 2024 revenue, indicating a strong, direct relationship with the end-user.
• Support involves AI-powered features like intelligent grading and personalized recommendations built into the devices to improve user engagement.

Self-service and subscription model for on-demand digital content

The subscription and on-demand component is critical for recurring revenue and customer retention, often tied to the AI platform access. The health of this model is reflected in the deferred revenue balance, which represents unearned revenue from subscriptions and prepaid services. As of August 31, 2025, the deferred revenue balance stood at $822.7 million, up from $671.2 million at the end of February 2025. This increase signals strong forward commitment from customers purchasing digital access or bundled services.

Here's a quick look at the scale of the business supporting these relationships as of the second quarter of fiscal year 2026 (ended August 31, 2025):

The overall financial health, with non-GAAP net income attributable to TAL reaching $135.8 million in Q2 FY2026, shows that these customer relationship strategies are translating into profitable engagement. You need to watch how the deferred revenue growth tracks against marketing expenses, which rose by 85.6% to $226.4 million in Q3 FY2025, to ensure customer acquisition costs remain sustainable for this new model.

TAL Education Group (TAL) - Canvas Business Model: Channels

You're looking at how TAL Education Group (TAL) gets its smart learning solutions and services to the customer as of late 2025. The strategy clearly leans heavily on digital delivery, but the physical footprint still matters for their core enrichment offering.

Proprietary online learning platforms and mobile applications

The online platforms are central to TAL Education Group's current growth, especially given the focus on AI-powered products. The company reported net revenues soaring to $861.4 million for the second quarter of fiscal year 2025, up 39.1% year-over-year, a significant portion of which is driven by these digital channels and related content solutions. The overall Trailing Twelve Month (TTM) revenue as of August 31, 2025, reached $2.65 billion. The company's commitment to technology is evident in the strong engagement metrics from its learning devices, which tie directly into the online ecosystem; the average weekly active rate among all learning device users was approximately 80% in Q2 2025, with average data usage time exceeding an hour per active device. Furthermore, the company's Learning Content Solutions segment generated $715.4 million in the full fiscal year ending February 28, 2025, reflecting the monetization of digital content and devices.

Key online channel performance indicators include:

• Net revenues for Q3 FY2025 reached $606.4 million, a 62.4% year-over-year increase.
• Selling and marketing spend increased by approximately 56% to US$181.9 million in Q2 FY2025 to build these digital channels.
• The company maintains a strong cash position, with $1.54 billion in cash and equivalents as of the end of Q2 2025.

E-commerce platforms for direct sales of learning devices

Direct sales, heavily influenced by e-commerce, are a major driver for the learning device business, which the company noted is still in its early stages of development but seeing significant growth. The introduction of lower-Average Selling Price (ASP) devices like the Xbook and upgrades to the xPad are specifically mentioned as driving device sales. While this segment is expanding its user base, it was noted that the device business was currently loss-making due to Research and Development, Bill of Materials, and go-to-market investments. The company's overall selling and marketing expenses in Q3 FY2025 rose by 85.6% to $226.4 million, partly to fuel the promotion of these hardware products through direct channels. The Learning Content Solutions segment, which encompasses these devices, is a key component of the overall revenue mix.

Physical learning centers for Peiyou enrichment small classes

The Peiyou small-class enrichment remains a core offering, falling under the larger Learning Services and Others segment, which contributed $1.53 billion, or 68.2% of total net revenues for the fiscal year ended February 28, 2025. Customer acceptance and enrollment growth in these enrichment programs are cited as key drivers. While the most recent specific count of physical centers is from February 28, 2021, at 1,098 centers across 110 cities, the continued outsized contribution of the Learning Services segment in 2025 suggests a substantial, though possibly more measured, physical presence remains. The company emphasizes a measured center expansion approach alongside technology investment. Deferred revenue, which often reflects pre-paid tuition for these services, stood at approximately RMB5,117.6 million as of the Q2 FY2025 earnings release.

Direct sales teams targeting B2B institutional clients

Information on the scale of direct sales teams targeting B2B institutional clients is not explicitly detailed with revenue figures in the latest reports, but the business model evolution suggests this channel is integrated within the broader 'smart learning solutions' strategy. The company is positioned as a leading smart learning solutions provider in China, which implies institutional sales are part of its reach. The total employee count supporting these operations across all channels was 23,000 as of August 31, 2025. The company's overall market share in the K-12 education technology market was reported at 2.19% in 2023, indicating the scale of its overall market penetration.

International partnerships for content distribution in new markets

The search results confirm TAL Education Group serves Mainland China and Hong Kong, and the company is focused on leveraging AI and content expansion. Specific financial figures tied directly to revenue generated solely through international partnerships for content distribution are not itemized separately in the provided 2025 financial summaries. The strategy does mention expanding its portfolio by acquiring assets, such as children's reading platform assets for $95.5 million in May 2025, which supports content expansion that could feed into new markets or partnerships. The company's strong cash position of $1.77 billion in cash and equivalents as of February 28, 2025, provides the capital base for such strategic international channel development.

Here's a quick look at the financial scale supporting these channels for the latest reported periods:

Finance: draft 13-week cash view by Friday.

TAL Education Group (TAL) - Canvas Business Model: Customer Segments

The customer segments for TAL Education Group reflect a strategic pivot following regulatory shifts, moving from a pure B2C K-12 model to a diversified base.

The core B2C segment, parents of primary and middle school students seeking enrichment programs, is supported by the Learning Services and Others segment, which contributed $1.53 billion, or 68.2% of total net revenues for the fiscal year ended February 28, 2025.

Adult learners and career professionals aged 22-35 seeking upskilling represent a rapidly growing new customer base. This group is estimated to contribute over 20% of revenue by 2025.

Institutional clients, including private schools and educational platforms (B2B), are served through the Learning Content Solutions segment, which generated $715.4 million in fiscal year 2025. Revenue from digital content solutions specifically saw growth of over 150% year-over-year in the first quarter of fiscal year 2025.

The overall consumer base now spans China's wider income and geographical spread, a key component of the Growth Strategy. The company employed 23,000 people as of 2025.

The table below summarizes the financial contribution and growth indicators for the primary revenue-driving segments as of fiscal year 2025:

The shift in customer acquisition reflects this diversification, with monthly churn under 15% by early 2025 and customer acquisition costs reduced by 30% since 2022.

For international users in Southeast Asia and North America, specific financial figures are not separately itemized in the primary segment revenue reports, but the company offers learning solutions in and out of China.

Key operational metrics related to customer engagement and scale include:

• Total Net Revenues (FY2025): $2.25 billion.
• Net Income (FY2025): $84.6 million.
• Non-GAAP Income from Operations (FY2025): $61.8 million.
• Cash, Cash Equivalents, and Short-Term Investments (as of Feb 28, 2025): $3,618.4 million.
• Deferred Revenue (as of Feb 28, 2025): $671.2 million.

The growth in the enrichment sector is noted, with Peiyou enrichment small classes being the largest revenue contributor within learning services.

TAL Education Group (TAL) - Canvas Business Model: Cost Structure

You're looking at the core expenses that drive TAL Education Group (TAL) as they push their AI-powered learning solutions. Honestly, understanding where the money goes is key to seeing if their new strategy is working, so let's break down the hard numbers from their latest reports.

Cost of Revenues

The direct costs tied to delivering their learning services and content saw a significant jump in the first quarter of fiscal year 2026. This line item captures the bulk of the spending on teaching staff, content delivery, and platform hosting.

• Cost of Revenues for Q1 FY2026 reached US$259.6 million.
• This represented a year-over-year increase of 29.8% compared to Q1 FY2025.
• The Non-GAAP Cost of Revenues, which strips out share-based compensation, was US$258.9 million, showing an increase of 31.0%.

Compensation for Teaching Staff and Content Creators

The compensation for your key personnel-the teachers and content developers-is largely embedded within the Cost of Revenues. We can estimate the share-based portion of this compensation by looking at the difference between the GAAP and Non-GAAP figures for the period.

Plus, the total share-based compensation expense allocated across all operating costs saw a notable reduction, defintely signaling a shift in compensation strategy or vesting schedules.

• Total share-based compensation expense for Q1 FY2026 was US$10.8 million.
• This was a decrease of 40.9% from the US$18.2 million recorded in Q1 FY2025.

Selling and Marketing expenses

TAL Education Group is spending heavily to push its new product lines, especially the AI-powered learning devices, into the market. This is a clear investment in customer acquisition and brand visibility.

The Non-GAAP figure, which excludes share-based compensation, shows an even sharper increase of 50.5%, meaning cash outlay for marketing was aggressive.

Significant R&D expenditure on AI and technology development

Investment in the technology backbone, which is central to their value proposition, is a critical cost. Based on the latest full-year data available covering the period ending May 31, 2025, the reported figure is what it is.

• Research and Development Expenses for the twelve months ending May 31, 2025, were reported as $0M.

The company narrative, however, strongly emphasizes continued investment in AI and digital platforms like the 'Genius Tutor' AI platform, suggesting that while the reported R&D line item might be zero for that specific period, technology development costs are being absorbed elsewhere or the reporting structure has changed significantly post-restructuring.

Costs related to manufacturing and inventory of learning devices

While the learning devices business saw year-over-year revenue growth, driven by the launch of three new models in May 2025 (P4, S4, and T4), the specific costs for manufacturing and inventory are not itemized separately from the Cost of Revenues.

For context on the scale of the content/device segment, the Learning Content Solutions segment generated $715.4 million in net revenues for the full fiscal year 2025. The non-GAAP operating loss reported for the learning devices business in Q1 2026 suggests that the cost of goods sold and associated operating expenses are currently outpacing the segment's revenue generation.

Finance: draft 13-week cash view by Friday.

TAL Education Group (TAL) - Canvas Business Model: Revenue Streams

You're looking at the money coming in for TAL Education Group as of late 2025, based on their full fiscal year 2025 results. Honestly, the shift in their revenue mix shows a clear pivot toward technology-enabled offerings, which is what we expected after the regulatory changes.

The total net revenues for the fiscal year ended February 28, 2025, hit $2,250.2 million, a significant jump of 51.0% from the $1,490.4 million reported in fiscal year 2024. This growth is powered by two primary segments.

Here's a quick breakdown of the main revenue streams based on the FY2025 figures:

The Learning Services and Others segment remains the largest contributor, pulling in $1.53 billion, which is 68.2% of the total revenue for FY2025. This bucket covers the core service delivery.

The Learning Content Solutions (including devices) segment generated $715.4 million in FY2025. This is where the technology integration really shows up in the top line, and it's definitely a key area for future scaling.

We need to look closer at what drives these segments, especially the technology adoption. The revenue streams feeding into this model include:

• Tuition fees from non-academic enrichment small classes.
• Licensing fees from B2B sales of digital content and smart solutions.
• Sales of AI-powered learning devices, which is a key growth driver.

Regarding the AI-powered learning devices, while the direct sales revenue isn't isolated in the top-line segment split, the momentum is clear from the deferred revenue figure. As of November 30, 2024 (end of Q3 FY2025), the deferred revenue associated with these products reached $825.6 million. That's a substantial amount of future recognized revenue, showing strong upfront customer commitment for these solutions.

To be fair, the $715.4 million for Learning Content Solutions in FY2025 likely bundles the device sales and the B2B licensing, but the deferred revenue number gives you a better sense of the pipeline for the device sales specifically. If onboarding takes too long, that deferred revenue recognition could slow down, so keep an eye on service delivery timelines.