New Oriental Education & Technology Group (NYSE:EDU) reported fourth-quarter fiscal 2026 revenue growth of 23% year over year, supported by its core education operations, East Buy e-commerce business and newer initiatives, while management forecast fiscal 2027 revenue growth of 14% to 18%.
Total net revenue for the quarter reached $1.53 billion. Operating income was $85.8 million, compared with an operating loss of $8.7 million a year earlier. Non-GAAP income from operations rose 34.7% to $110 million. Net income attributable to New Oriental increased 775.8% year over year to $62.2 million, while non-GAAP net income declined 10.5% to $87.8 million.
Education Businesses and New Initiatives
Executive President and Chief Financial Officer Stephen Yang said the company’s core operations and newer businesses both gained traction during the quarter. Overseas test preparation revenue increased 6% year over year, while overseas study consulting revenue rose about 1%. Revenue from programs serving adults and university students increased 29%.
New educational initiatives delivered a combined 25% year-over-year revenue increase. The company’s non-academic children business had expanded to about 60 cities, with the top 10 cities contributing approximately 60% of revenue. Its intelligent learning system and device business was also available in around 60 cities, and its top 10 markets accounted for more than half of that business’s revenue.
Yang said New Oriental’s tourism-related offerings include study tours, research camps, cultural tours and senior health and wellness travel. Student programs operate in approximately 55 cities, while premium adult-tourism products span around 30 Chinese provinces as well as select international destinations. The company has partnered with more than 45 wellness facilities for its asset-light senior tourism offering.
The company invested $31.2 million in the quarter to maintain and upgrade its online-merge-offline teaching platform. It is also incorporating artificial intelligence into product development and operations. Investor Relations Director Sisi Zhao said AI is being deployed across existing education products, including learning devices and classroom tools, as well as in internal functions intended to improve employee productivity and reduce staffing needs.
Yang said New Oriental’s proprietary AI-powered personalized learning platform completed its first deployment phase and generated sales within 25 days of launch. He described the platform as a specialized learning system built around the company’s education assets rather than a general-purpose large language model.
East Buy and New Oriental Home
East Buy expanded its multi-platform livestreaming strategy on Douyin during fiscal 2026, adding 11 vertical livestreaming accounts and bringing its channel matrix to 18 channels. Yang said the business plans to expand its private-label food and daily-necessities portfolio, increase product research and quality-control efforts, advance its app membership ecosystem and broaden its offline experience footprint.
Management also highlighted its New Oriental Home pilot, a single-app platform combining education services, East Buy offerings and cultural tourism products for households. The pilot had been launched in 69 cities, including Hangzhou, Suzhou, Xi’an and Wuhan, and had more than 950,000 registered families as of the quarter’s end.
Yang said the platform’s cumulative activity participation rate was around 70%, while its latest campaign activation rate was 23%. He also said retention for seventh-grade students increased by 10 basis points from summer to autumn, and that the loyalty model has supported cross-selling, conversion and customer-acquisition efficiency.
Costs, Cash and Fiscal 2027 Outlook
Fourth-quarter operating costs and expenses rose 15.3% to $1.44 billion. Cost of revenues increased 25.9% to $717.3 million, while selling and marketing expenses increased 23.9% to $262.5 million. General and administrative expenses rose 13.2% to $463.9 million.
The company recorded no goodwill impairment in the quarter, compared with a $60.3 million impairment charge in the prior-year period. Share-based compensation expenses declined 20.7% to $22.7 million.
New Oriental generated $518.7 million in operating cash flow during the quarter and spent $99 million on capital expenditures. As of May 31, it held $1.82 billion in cash and cash equivalents, $1.37 billion in term deposits and $2.37 billion in short-term investments. Deferred revenue rose 14.8% year over year to $2.24 billion.
For fiscal 2027, management expects total net revenue of $6.45 billion to $6.68 billion, representing growth of 14% to 18%. Yang said management expects K-12 education revenue to increase by roughly 20%, driven by enrollment trends and higher retention. He also said the company expects first-quarter revenue and margins to expand, with East Buy expected to contribute more revenue and profit.
The company plans to add 10% to 15% in new capacity in fiscal 2027, following a 13% capacity increase in fiscal 2026. Yang said revenue growth is expected to outpace capacity expansion, improving learning-center utilization. Capital expenditures are expected to range from $250 million to $300 million, partly reflecting construction of a new headquarters in Changchun.
Yang said New Oriental saved roughly $100 million through cost controls in fiscal 2026 and expects additional savings in the coming year through management restructuring and greater AI use. The company expects its overseas-related business to be flat to up low single digits in fiscal 2027, with margins improving from roughly 15% in the prior year through restructuring and expense controls.
The board approved a fiscal 2027 shareholder-return plan totaling approximately $500 million, including an expected $300 million cash dividend to be paid in two installments and a new share repurchase authorization of up to $200 million. Separately, the company said it had repurchased approximately 51.5 million common shares, including shares represented by ADSs, for about $274 million as of July 28.
About New Oriental Education & Technology Group (NYSE:EDU)
New Oriental Education & Technology Group (NYSE: EDU) is one of China’s leading providers of private educational services, specializing in language training, test preparation and consulting for overseas study. The company’s offerings span a range of subjects, including English language instruction, preparatory courses for examinations such as the TOEFL, GRE and GMAT, and K-12 after-school tutoring. New Oriental’s curriculum is delivered through a combination of in-person learning centers and digital platforms, enabling students across various regions to access its educational resources.
Founded in 1993 by Michael Yu Minhong in Beijing, New Oriental began as a small language school and quickly expanded its footprint.
