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China's New Oriental Education Q1 revenue rises 23%, confirms guidance

By Reuters News


Overview

  • China education provider's fiscal Q1 revenue rose 23.1% yr/yr

  • Adjusted operating income grew 21.2% yr/yr

  • Company announced new ordinary cash dividend and $200 mln share buyback program for FY2027


Outlook

  • Company confirms FY2027 revenue between $6.45 bln and $6.68 bln, up 14%-18% y/y

  • Company says teaching and product quality improvements are expected to drive growth in FY2027

  • Company plans continued investment in AI to boost product competitiveness and operational efficiency in FY2027


Result Drivers

  • NEW BUSINESS INITIATIVES - Co said revenue growth was mainly driven by new educational business initiatives and East Buy private label products and livestreaming e-commerce

  • COST OPTIMIZATION - Co said cost optimization and operational efficiency initiatives contributed to results

  • LEARNING CENTER UTILIZATION - Co attributed margin expansion in core education and East Buy to improved utilization of learning centers


Company press release:


Key Details

Metric

Beat/Miss

Actual

Consensus Estimate

Q1 Revenue

$1.87 bln

Q1 Adjusted Operating Income

$406.76 mln

Q1 Operating Income

$374.66 mln


Analyst Coverage

  • The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 13 "strong buy" or "buy", 1 "hold" and no "sell" or "strong sell"

  • The average consensus recommendation for the miscellaneous educational service providers peer group is "buy"

  • Wall Street's median 12-month price target for New Oriental Education & Technology Group Inc. is HK$59.50, about 29% above its October 27 closing price of HK$46.14

  • The stock recently traded at 12 times the next 12-month earnings vs. a P/E of 11 three months ago


Reuters Recommended Reads

  • Oct 27 - China's Hengrui Pharma nine-month profit rises on out-licensing gains

  • Oct 27 - WH Group's nine-month revenue rises 0.6%, profit drops 12.9%

  • Oct 26 - Guangdong Land nine-month revenue drops 20% on lower property sales


For questions concerning the data in this report, contact Estimates.Support@lseg.com. For any other questions or feedback, contact reuters.support@thomsonreuters.com.


(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)

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