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Stock Alert: GSX Techedu Tumbles 11% On SEC Probe

Shares of GSX Techedu Inc. (GSX) are falling more than 11 percent or $10.70 in Wednesday's morning trade at $83.99 after the China-based online tutoring service provider disclosed an investigation by the U.S. Securities and Exchange Commission.

Wednesday, GSX Techedu said that following several short-seller reports about the company between February and July 2020, the SEC's Division of Enforcement requested the company to produce certain financial and operating records dating from January 1, 2017.

GSX Techedu reported increase in its second-quarter earnings by 13.4 percent to RMB18.6 million from RMB16.3 million in the prior-year quarter. Net income per ADS was RMB0.07 for the quarter, up from RMB0.04 last year. Adjusted net income per ADS was RMB0.29.

Net revenues surged 366.6 percent to RMB1.65 billion from RMB353.7 million last year. GSX Techedu has traded in a range of $11.72 to $141.78 in the past 52 weeks.

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