Key Highlights

● Nasdaq's notice covers 31 consecutive business days below $1.00.

● The company has until March 29, 2027 to regain compliance.

● It sold ATA Testing Authority on June 30, 2026 for RMB1.

● Each American Depositary Share represents two common shares.

ATA Creativity Global (NASDAQ:AACG), whose American Depositary Shares trade on the Nasdaq under the symbol AACG, announced on 2 October 2026 that it had received a bid deficiency notice from Nasdaq. The letter, dated 29 September 2026, said the closing bid price of the depositary shares had been below $1.00 for 31 consecutive business days, so the company no longer met Nasdaq Listing Rule 5550(a)(2). Each American Depositary Share represents two common shares.

The company said the notice has no immediate effect on the listing. It has until 29 March 2027, a 180-day period, to regain compliance. To do so, the closing bid price must be at least $1.00 for a minimum of ten consecutive business days, as confirmed in writing by Nasdaq.

What Happens If the Price Does Not Recover

If the deadline passes without a cure, the company may be eligible for a further 180 calendar days. Eligibility requires meeting the market value of publicly held shares requirement and all other initial listing standards except the bid price, and giving written notice of an intention to cure the deficiency, by reverse share split if necessary. The announcement did not set out a specific plan, so any reverse split is a possibility described by the rules and not a decision by the board.

A Company in Transition

The notice follows a major restructuring. Shareholders approved the plan at an extraordinary general meeting on 5 June 2026. On 30 June 2026, the company completed the sale of ATA Testing Authority (Holdings) Limited, with its subsidiaries and variable interest entity, together with a 69.0417 per cent interest in Beijing Huanqiuyimeng Education Consultation Corp., to Robox Holding Limited. The consideration was a nominal RMB1. The company says it continues to operate its education business through a subsidiary in mainland China.

Shareholders also approved a private placement under a subscription agreement dated 6 May 2026. A summary of the proxy materials says it covers 45,306,792 common shares.

Latest Full-year Results

The most recent annual figures come from a summary of the company's results for the year ended 31 December 2025, published on 26 March 2026. They are historical and cover the business as it stood before the June disposal. Net revenue for the year was RMB268.1 million, and the fourth quarter contributed RMB89.1 million, down 11.7 per cent. Gross margin for the year was 48.6 per cent, against 52.7 per cent in 2024.

The full-year net loss was RMB48.0 million, compared with RMB36.1 million a year earlier. The fourth quarter alone showed a net loss of RMB26.3 million, which included a one-off goodwill impairment of RMB33.9 million. Cash and equivalents at 31 December 2025 were RMB85.2 million. Management said it planned to optimise its service portfolio, expand online courses and pursue higher-fee, higher-margin services.

A Listing Deadline and a Slimmed-Down Business Run in Parallel

Two threads now run together. The listing question is mechanical but serious, because failure to cure could ultimately lead to delisting proceedings under Nasdaq's rules. The business question is whether the slimmed-down group can generate sustainable earnings after disposing of its testing operations; the historical figures above do not answer that, and an unaudited pro forma statement was filed separately.

The dates to watch are the compliance deadline of 29 March 2027 and any later disclosure about the private placement, the education business or a share consolidation.