New Oriental Fiscal Q1 Revenue Rises 23.1% to $1,874.5 Million

New Oriental Education & Technology Group Inc., a provider of private educational services in China, on October 28, 2026 announced unaudited financial results for the first quarter of its fiscal year 2027, the three months ended August 31, 2026, reporting total net revenues of US$1,874.5 million, an increase of 23.1% year over year, according to the company’s first-quarter results announcement.

Operating income rose 20.5% year over year to US$374.7 million, and net income attributable to New Oriental increased 13.5% to US$273.2 million. Basic and diluted net income per ADS attributable to the company were US$1.76 and US$1.74, compared with US$1.52 and US$1.50 in the same period of the prior fiscal year. Each ADS represents ten common shares.

Non-GAAP operating income, which excludes share-based compensation expenses and amortization of intangible assets resulting from business acquisitions, was US$406.8 million, up 21.2% year over year. Non-GAAP net income attributable to New Oriental rose 16.5% to US$300.9 million, with non-GAAP basic and diluted net income per ADS of US$1.94 and US$1.92. The company said the revenue growth was mainly driven by increased net revenues from its new educational business initiatives and the East Buy private label products and livestreaming e-commerce business.

Executive Chairman Michael Yu said revenue from the overseas test preparation and consulting business increased approximately 7.7% year over year, while the domestic test preparation business targeting adults and university students grew approximately 22.3% and new educational business initiatives grew approximately 24.7%. Yu said the company’s non-academic tutoring courses reached around 60 cities with approximately 476,000 student enrollments during the quarter, and its intelligent learning system and devices recorded approximately 515,000 active paid users across around 60 cities. He said New Oriental Home, the company’s newly established comprehensive customer service platform, had served more than 1,678,000 families across 69 cities by the end of the quarter.

Chief Executive Officer Chenggang Zhou said East Buy expanded its private label portfolio to over 1,000 SPUs and its Douyin channel matrix to more than 30 vertical accounts during the quarter. Zhou said East Buy now operates four offline experience stores and has developed instant retail capabilities, including one-hour delivery trials in Beijing and Shanghai.

Executive President and Chief Financial Officer Stephen Zhihui Yang said both the core education business and East Buy expanded their respective operating margins year over year, which he attributed primarily to enhanced operational efficiency and improved utilization of the company’s learning centers. He said East Buy’s rapid growth increased its share of total revenue and that this shift in revenue mix kept the consolidated operating margin at a stable level during the quarter, characterizing the effect as “an anticipated consequence of scaling new businesses.”

Costs, Margins, and Cash Flow

Operating costs and expenses rose 23.7% year over year to US$1,499.8 million, an increase the company attributed primarily to costs and expenses related to the substantial growth in the East Buy private label products and livestreaming e-commerce business. Cost of revenues increased 28.1% to US$817.0 million, selling and marketing expenses rose 30.7% to US$262.2 million, and general and administrative expenses increased 12.6% to US$420.7 million. Total share-based compensation expenses allocated to operating costs and expenses rose 31.3% to US$30.6 million.

Operating margin was 20.0%, compared with 20.4% in the same period of the prior fiscal year. Non-GAAP operating margin, which excludes share-based compensation expenses and amortization of intangible assets resulting from business acquisitions, was 21.7%, compared with 22.0% a year earlier.

Net operating cash inflow for the quarter was approximately US$195.4 million, and capital expenditures were US$65.8 million. As of August 31, 2026, the company held US$1,754.6 million in cash and cash equivalents, US$1,441.3 million in term deposits, and US$2,422.7 million in short-term investments. Deferred revenue, which the company described as cash collected upfront from customers and related revenue that will be recognized as services or goods are delivered, stood at US$2,121.1 million at the end of the quarter, up 11.2% from US$1,906.7 million at the end of the first quarter of fiscal year 2026.

Dividend and Share Repurchase Programs

The board of directors approved an ordinary cash dividend for fiscal year 2027 of US$0.2 per common share, or US$2.0 per ADS, to be distributed in U.S. dollars in two installments. The first installment of US$0.1 per common share, or US$1.0 per ADS, will be paid to holders of record as of the close of business on November 18, 2026, with payment expected on or around December 1, 2026 for holders of common shares and December 4, 2026 for holders of ADSs. The record date for the second installment, also US$0.1 per common share or US$1.0 per ADS, will be determined by the board in due course, with payment expected around six months after the first installment. The aggregate cash dividend is expected to be approximately US$300 million.

The company also reported that as of October 27, 2026 it had fully utilized the US$300 million repurchase amount authorized under its 2026 Share Repurchase Program, announced in October 2025, repurchasing an aggregate of approximately 56.2 million common shares, including shares represented by ADSs, from the open market. A separate 2027 Share Repurchase Program approved by the board in July 2026 authorizes up to US$200 million of repurchases over the subsequent 12 months; no common shares had been repurchased under that program as of October 27, 2026, and the company said it expects to fund the repurchases out of its existing cash balance. Both the dividend and the new repurchase program implement the three-year shareholder return plan the company adopted in July 2025.

New Oriental confirmed its previously provided guidance for fiscal year 2027, which runs from June 1, 2026 to May 31, 2027, of total net revenues in the range of US$6,453.9 million to US$6,680.3 million, representing a year-over-year increase of 14% to 18%. The company said the forecast reflects its current and preliminary view, is subject to change, and is based on the current USD/RMB exchange rate, which is also subject to change.

Management scheduled an earnings conference call for 8 AM U.S. Eastern Time on October 28, 2026, corresponding to 8 PM Beijing/Hong Kong Time, with a live and archived webcast available through the company’s investor relations site.