Datasea Reports Fiscal Year 2026 Results with Gross Profit Up 70.1% and Gross Margin Increased to 10.2% Despite Lower Revenue

Zhixin Liu, Chief Executive Officer of Datasea

“Fiscal 2026 was an important year in the evolution of Datasea's business model. Our reported revenue declined during the year. However, we believe revenue alone does not fully reflect the progress made in the underlying quality of our business. Cost of revenues declined faster than revenue, gross profit increased approximately 70%, and gross margin improved from 3.41% to 10.21%. These results reflect the financial impact of our efforts to improve our business mix and focus more closely on profitability and sustainable value creation.”

Zhixin Liu, Chief Executive Officer of Datasea

“We also continued to improve operating efficiency. Selling and general and administrative expenses declined substantially, while we simultaneously increased research and development spending by approximately 180%. This reflects an important shift in how we allocate capital and operating resources — reducing lower-efficiency expenditures while continuing to invest aggressively in technologies and products that we believe can support Datasea's long-term growth.”

Zhixin Liu, Chief Executive Officer of Datasea

“Importantly, these changes translated into a meaningful improvement in our bottom line. Operating loss narrowed by approximately 55%, net loss narrowed by approximately 57%, and operating cash flow turned positive for the fiscal year. While we have not yet reached profitability, we believe the significant narrowing of losses, together with higher gross margins and improved operating cash flow, represents meaningful progress toward a more balanced and sustainable earnings model.”