New Oriental Education & Technology Group (EDU) investor relations material

Executive summary

• Q4 FY2026 net revenue rose 23% year-over-year to $1,529.5 million, with operating income swinging to $85.8 million from a prior year loss and non-GAAP operating income up 34.7% to $110 million.

• Net income attributable to shareholders surged 775.8% year-over-year to $62.2 million in Q4 FY2026.

• Growth was driven by core education, East Buy, new creative ventures, and domestic test preparation for adults/university students, despite economic headwinds.

• New initiatives, including non-academic children’s business and intelligent learning systems, expanded to 60 cities, with top 10 cities contributing over 50% of revenue and 1,072,000 enrollments.

• Integrated tourism-related business and New Oriental Home platform showed strong early traction, serving over 950,000 families in 69 cities with high engagement.

Financial highlights

• Operating costs and expenses rose 15.3% year-over-year to $1,443.7 million; cost of revenues up 25.9% to $717.3 million.

• Selling and marketing expenses increased 23.9% to $262.5 million; G&A expenses up 13.2% to $463.9 million.

• FY2026 operating income increased 50.2% to $643.3 million; non-GAAP operating income up 33.1% to $737.6 million.

• Non-GAAP net income for Q4 FY2026 was $87.8 million, down 10.5% year-over-year; FY2026 non-GAAP net income was $571.1 million, up 10.5% year-over-year.

• Cash and equivalents at $1,821.2 million, term deposits $1,366.8 million, and short-term investments $2,372.3 million as of May 31, 2026; deferred revenue increased 14.8% to $2,242.9 million.

Outlook and guidance

• FY2027 net revenue expected to be $6,453.9–$6,680.3 million, a 14–18% year-over-year increase.

• Confident in Q1 FY2027 revenue and margin expansion, driven by strong enrollment and operational efficiency.

• K-12 business projected to grow around 20% year-over-year in FY2027, with higher margins.

• Overseas-related business expected to be flattish or low single-digit growth, with margin expansion due to restructuring.

• Continued cost control and AI-driven efficiency improvements targeted for FY2027.