Key Takeaways
New Oriental Education & Technology Group Inc. (9901.HK) reported a 45.3% surge in net income to $126.8 million for its third fiscal quarter, as revenue from new educational initiatives and overseas test preparation fueled strong top-line growth.
"We are pleased to share of continued acceleration in our revenue growth year over year in the third fiscal quarter of 2026," Michael Yu, New Oriental's Executive Chairman, said. "We are sharpening our focus on our core education business, prioritizing enhancements of teaching standards and product quality."
Total net revenues for the quarter ended February 28 increased 19.8% year-over-year to $1.42 billion. The company’s non-GAAP net income increased 34.3% to $152.2 million, with non-GAAP diluted earnings per ADS at $0.95.
Despite the strong results, the company's Hong Kong-listed shares fell 3.6%. Looking ahead, New Oriental forecasted fourth-quarter revenue of $1.43 billion to $1.47 billion and raised its full-year revenue guidance, signaling confidence in sustained momentum.
The growth was driven by a 23.3% year-over-year increase in its new educational business initiatives. The overseas test preparation business saw revenues climb by approximately 7.4%, while the domestic test preparation business for adults and university students grew by 14.5%.
The company reported a non-GAAP operating margin of 14.3%, an increase of 230 basis points from the same period last year. "This was primarily driven by enhanced operational efficiency and improved utilization within our educational business," said Stephen Zhihui Yang, the company's Chief Financial Officer.
New Oriental continued its shareholder return plan, repurchasing approximately 3.3 million ADSs for about $184.3 million as of April 21, 2026. The board also approved the second installment of its fiscal year 2026 dividend.
The robust performance across its diversified educational offerings suggests New Oriental's strategic pivot is yielding significant returns. Investors will be watching the upcoming fourth-quarter results to see if the growth in new initiatives can continue its high-speed trajectory and offset any potential softness in other segments.
This article is for informational purposes only and does not constitute investment advice.
