New Oriental Education Reports Impressive Q1 Results and Future Growth Strategies
New Oriental Education Reports Impressive Q1 Results and Future Growth Strategies
New Oriental Education & Technology Group Inc., a leading provider of private educational services in China, recently unveiled its financial results for the first fiscal quarter ending August 31, 2025. The company demonstrated a robust performance with total net revenues rising by 6.1% year over year, amounting to $1,523.0 million. This positive trend marks a promising start for New Oriental's fiscal year 2026.
The operating income also saw an increase of 6.0%, reaching $310.8 million. However, net income attributable to New Oriental witnessed a slight decline of 1.9%, totaling $240.7 million. Despite this minor setback, the company's leadership expressed optimism about the overall growth trajectory and the strategic initiatives set in motion to enhance overall performance.
Key Financial Highlights
The following is a snapshot of New Oriental's financial performance in the first fiscal quarter:
- - Net Revenues: $1,522.98 million (up 6.1% from Q1 2025)
- - Operating Income: $310.83 million (up 6.0% from Q1 2025)
- - Net Income: $240.73 million (down 1.9% from Q1 2025)
These results are reflective of several key business segments experiencing growth, particularly in overseas test preparation and domestic educational services for adults and university students. The latter saw a significant year-over-year growth of approximately 14.4%. Furthermore, New Oriental's new educational business initiatives recorded a remarkable revenue increase of 15.3% during the same period.
Strategic Initiatives for Growth
New Oriental's Executive Chairman, Michael Yu, remarked on the optimistic outlook for the current fiscal year. He emphasized the importance of maintaining a strategic focus on the enhancement of core education services while expanding and refining product capabilities. The company plans to continue integrating advanced technologies such as Artificial Intelligence (AI) into its educational ecosystem, aimed at improving the learning experience for students.
Chenggang Zhou, the company’s Chief Executive Officer, reiterated the commitment to a disciplined approach concerning capacity expansion and operational efficiency. The introduction of AI-powered learning tools is set to revolutionize the company’s approach to education, ensuring students receive enhanced support and engagement through modern technological integration.
Shareholder Return Strategies
In line with its robust performance, New Oriental has announced a shareholder return plan that dedicates at least 50% of net income for the preceding fiscal year to shareholder value. This includes a cash dividend of $0.12 per common share, distributed in two equal installments totaling approximately $190 million. A new share repurchase program worth $300 million further underscores the company's commitment to returning value to its shareholders over the coming year.
Operational Insights
New Oriental's operating costs have also shown an increase, reflecting a rise in revenues.
- - Total Operating Expenses: $1,212.2 million (up 6.1% from Q1 2025)
- - Cost of Revenues: $637.8 million (up 9.3%)
- - Operating Margin: Maintained at 20.4%
Despite the challenges posed by the ongoing slowdown in overseas markets, New Oriental's efforts toward cost optimization have resulted in an improvement in non-GAAP operating margin, reaching 22.0%. This margin aligns with the company's ambitions for sustainable growth and operational efficiency.
Looking ahead, New Oriental anticipates net revenues in the second quarter of FY 2026 to range between $1,132.1 million and $1,163.3 million, which represents an expected year-over-year increase of 9% to 12%. The company maintains its forecast for total net revenues for FY 2026, anticipating significant growth across its offerings.
Conclusion
New Oriental Education continues to demonstrate resilience and commitment to growth in the educational sector. Its focus on enhancing services, leveraging technology, and maintaining shareholder value positions the company strategically for ongoing success. As the fiscal year progresses, the educational landscape in China looks set for significant transformation, with New Oriental at the forefront of this evolution.
Topics Other）
【About Using Articles】
You can freely use the title and article content by linking to the page where the article is posted.
※ Images cannot be used.
【About Links】
Links are free to use.