Gaotu Techedu Inc. (GOTU) saw its shares soar 5.17% during Thursday's pre-market trading session, outperforming the broader market. The surge in GOTU stock price came amid a rally in Chinese American Depositary Receipts (ADRs) driven by strong earnings reports from e-commerce giant Alibaba Group and video streaming platform Bilibili.
The rally in Chinese tech stocks was fueled by Alibaba's better-than-expected third-quarter revenue, propelled by robust year-end shopping sales and the company's successful strategy to attract cost-conscious consumers. Meanwhile, Bilibili reported its first profitable quarter on a GAAP basis, with earnings and revenue surpassing analyst expectations.
The positive earnings from Alibaba and Bilibili have boosted investor sentiment towards Chinese tech stocks, including Gaotu Techedu, an education technology company. The strong performance of these industry leaders has fueled optimism about the broader Chinese tech sector's growth prospects, driving up demand for related stocks.
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