NEW ORIENTAL-S

EDU Q4 FY26 Quick Take: Q4 (Mar–May) results were solid, modestly above sell-side estimates and company guidance. On trend, buy-side sentiment appears more upbeat than the sell side. After several quarters of expectation resets, the market seems to have moved past the prior spell of guide-downs and misses, and back to EDU's earlier pattern of cautious guides with reliable execution that ultimately beats.

While study-abroad remains in a slow recovery near term and K12 demographics will be a headwind longer term, the fading drag from livestreaming (still on a low base), share gains in non-academic and adult English, plus improved sentiment and ongoing buybacks, should provide a floor through volatility. At yesterday's close, the $8.1bn market cap implies ~12.5x FY27 P/E; versus a ~15x sector median and the 2-year EPS CAGR outlook, the valuation does not look stretched.

Key takeaways:

1) Slight overall beat

Total revenue grew 23% YoY; we estimate a 6–7ppt FX tailwind. That implies organic growth of ~16%, up nearly 3ppt QoQ. For FY27, management guided revenue of $6.45–6.68bn (+14–18% YoY), also above expectations.

2) Core education up 20%+

(1) K12 new-format businesses grew 24.8% YoY, with a slight sequential acceleration. Since last Oct, issuance of quality-education training licenses has declined MoM, with a 0.2% drop each month in Mar–May. As a leading incumbent, EDU stands to benefit from a tighter competitive landscape.

(2) Study-abroad services continued to recover to +3.6% YoY in Q4. Despite ongoing intl headwinds (visa issuances still down YoY, though the decline narrowed), EDU offset gaps in traditional consulting and training by expanding IELTS/TOEFL prep from primarily college youth into teens, and by adding on-campus study-abroad advisory services.

(3) Adult English was strong at +29% YoY, and we estimate high-school subjects delivered a steady ~18% growth (to be confirmed on the call). Both benefited from supply contraction and rising industry concentration.

(4) Based on movements in non-controlling interests, Oriental Selection revenue likely grew close to 40%. With new brands, it appears to have emerged from the overhang that started around Aug 2024.

3) Shareholder returns still ~6%

The company previously announced a 3-year return program, committing at least 50% of net income to shareholders via dividends and buybacks. Of the up-to-$300mn buyback authorized in Oct 2025 for the following 12 months, $274mn had been executed as of Jul 28.

For FY27, EDU plans to continue with $300mn in dividends plus $200mn in buybacks. On an $8.1bn market cap at yesterday's close, that implies ~6% shareholder return, a mid-range level. $New Oriental EDU & Tech(EDU.US) $NEW ORIENTAL-S(09901.HK)

New Oriental Q3 FY26 First Take: Q3 results were solid, topping management’s typically cautious guide, while ex-FX growth moderated slightly QoQ. Within the mix, Oriental Selected likely came in better, and core education tracked in line.

Overall, the print was marginally above BBG expectations. Since the company’s preview over the past month, top houses have raised estimates, so the BBG consensus shown below is lagging; the actual result is basically inline.

1) Overall: Total revenue grew 20% YoY. FX tailwinds contributed 6–7ppt by Dolphin Research’s estimate, implying ~13% organic growth; sequentially roughly flat, though last year’s Q3 base was not high. Details to be confirmed on the call.

By segment, core education rose 14% YoY, while live e-com and other businesses were up an estimated ~60%. Oriental Selected’s new leadership is guiding the business out of the past two years’ turbulence by lifting the share of self-operated e-com to build core members and expanding culture-tourism sales on live platforms, re-accelerating growth.

2) Core education:

(1) K-12 new businesses grew 23% YoY and remain the main growth driver. Management has expressed confidence in 15%–20% growth for FY27; since Q4 last year, issuance of quality-education training licenses has slowed, suggesting marginal competition is unlikely to intensify, a clear positive for incumbent New Oriental.

(2) The overseas study segment is facing Intl environment headwinds. Consulting likely remains pressured, but test-prep grew 7%; overall flat to LSD growth.

(3) Adult English grew 14.5% YoY. High-school subjects are also tracking ~15% steady growth (to be confirmed on the call).

3) Shareholder returns: Of the $300mn 1-year buyback announced last Oct., roughly half has been completed; at this pace it should be fully utilized by expiry. The $190mn dividend is being paid in two tranches as planned. On a $8.9bn mkt cap at yesterday’s close, the shareholder yield is ~5.5%, a solid mid-to-high level among U.S.-listed China ADRs. $New Oriental EDU & Tech(EDU.US) $NEW ORIENTAL-S(09901.HK)

The market today was truly surreal: Ganfeng Lithium, Mingming Hen Mang, and East Buy all surged collectively, like stepping hard on the accelerator, while Dazhong Public Utilities took a nosedive in the opposite direction. It can only be said that capital in the past two days went straight for concepts and liquidity. China Tourism Group Duty Free was extremely zen, not moving a muscle... Today was another day witnessing faith and missing out on the rally 🙈

EDU Q2 FY26 First Take: Results beat, led by a better‑than‑feared study‑abroad segment. The company also raised its FY26 revenue guide.

Test‑prep grew 4%. Consulting was undisclosed but likely softer, implying overall roughly flat YoY. Still, this is well above the market’s low‑single‑digit decline expectation.

New initiatives rebounded as expected, validating management’s prior comments on seasonality. Smaller players focus on winter/summer peaks; with Q2 in the fall semester, competitive intensity eased for EDU. However, enrollment growth kept decelerating, implying momentum likely won’t hold next quarter; learning devices also slowed slightly.

Management guided next‑quarter revenue growth in line with the Street. It raised the FY26 revenue guide to $5.3–5.5bn, implying +8–12% (was +5–10%).

A group‑wide cost‑out/efficiency program kicked off in Q4 FY25 (calendar Q2 2025) and was evident last quarter. Execution continued this quarter, with cuts concentrated in selling expenses; OPM expanded by nearly 400bps YoY.

The company paid the planned dividend and repurchased $86mn of shares this quarter. Under the previously announced $490mn shareholder‑return program, the implied yield vs. the current ~$9.0bn market cap is 5.4%, providing support during drawdowns. $New Oriental EDU & Tech(EDU.US) $NEW ORIENTAL-S(09901.HK)