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May 31, 2025
New Oriental Q4 2025 Earnings Report
New Oriental reported a 9.4% increase in total net revenues for the fourth fiscal quarter of 2025, reaching US$1,243.2 million, driven by growth in educational new business initiatives. Despite an operating loss of US$8.7 million, non-GAAP operating income significantly increased by 116.3% to US$81.7 million. Net income attributable to New Oriental decreased by 73.7% to US$7.1 million, while non-GAAP net income increased by 59.4% to US$98.1 million.
Key Takeaways
New Oriental concluded fiscal year 2025 with healthy top-line growth in Q4, driven by strong performance in its core educational businesses and new initiatives. While GAAP net income saw a significant decrease, non-GAAP profitability improved substantially, reflecting effective cost management and strategic investments in technology and new educational offerings. The company also announced a new shareholder return plan, committing at least 50% of net income to shareholders.
Total net revenues increased by 9.4% year over year to US$1,243.2 million in Q4 FY2025, with core educational businesses (excluding East Buy) growing by 18.7%.
The company reported an operating loss of US$8.7 million, a decrease from an operating income of US$10.5 million in the prior year, primarily due to impairment of goodwill.
Non-GAAP operating income surged by 116.3% to US$81.7 million, and non-GAAP operating margin improved to 6.6%, indicating strong underlying operational efficiency.
Net income attributable to New Oriental decreased by 73.7% to US$7.1 million, but non-GAAP net income increased by 59.4% to US$98.1 million, highlighting the impact of non-recurring items on GAAP results.
Forward Guidance
New Oriental expects total net revenues for the first quarter of fiscal year 2026 to be between US$1,464.1 million and US$1,507.2 million, representing a year-over-year increase of 2% to 5%. For the full fiscal year 2026, total net revenues are projected to be in the range of US$5,145.3 million to US$5,390.3 million, indicating a year-over-year increase of 5% to 10%.
Positive Outlook
- Expected continued revenue growth in Q1 FY2026 (2% to 5% year-over-year).
- Anticipated full fiscal year 2026 revenue growth (5% to 10% year-over-year), reflecting a long-term strategic view.
- Commitment to intensifying management efforts on core educational business, enhancing product capabilities and quality.
- Focus on systematically developing educational resources and improving operational efficiency.
- Continued execution of cost optimization and efficiency enhancement initiatives across all business lines.
Challenges Ahead
- The forecast reflects New Oriental's current and preliminary view, which is subject to change.
- The forecast is based on the current USD/RMB exchange rate, which is also subject to change.
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