New Oriental Announces Results for the First Fiscal Quarter Ended August 31, 2026

BEIJING, Oct. 28, 2026 /PRNewswire/ -- New Oriental Education & Technology Group Inc. (the "Company" or "New Oriental") (NYSE: EDU/ 9901.SEHK), a provider of private educational services in China, today announced its unaudited financial results for the first fiscal quarter ended August 31, 2026, which is the first quarter of New Oriental's fiscal year 2027.

Financial Highlights for the First Fiscal Quarter Ended August 31, 2026

- Total net revenues increased by 23.1% year over year to US$1,874.5 million for the first fiscal quarter of 2027.

- Operating income increased by 20.5% year over year to US$374.7 million for the first fiscal quarter of 2027.

- Net income attributable to New Oriental increased by 13.5% year over year to US$273.2 million for the first fiscal quarter of 2027.

Key Financial Results

Operating Highlights for the First Fiscal Quarter Ended August 31, 2026

Michael Yu, New Oriental's Executive Chairman, commented, "We are delighted to start our fiscal year 2027 with strong top line growth of 23.1%, above our current full year guidance range. Revenues from overseas test preparation and consulting business increased by approximately 7.7%. In addition, our domestic test preparation business targeting adults and university students grew by approximately 22.3% year over year, while our new educational business initiatives grew by approximately 24.7% year over year. This quarter, our non-academic tutoring courses reached around 60 cities, attracting approximately 476,000 student enrollments, and our intelligent learning system and devices were adopted across around 60 cities, with approximately 515,000 active paid users. In this new fiscal year, we will continue to deepen the execution of our core strategy, with continuous improvement in teaching and product quality as our primary growth drivers. We are confident that this disciplined approach will enable us to generate healthy and sustainable value over the long term. Alongside our growth momentum, our cost optimization and operational efficiency initiatives have entered a new phase this year and have achieved notable progress. New Oriental Home, our newly established comprehensive customer service platform integrated across all departments, had already served over 1,678,000 families across 69 cities by the end of this quarter. This platform has already begun to demonstrate its ability to enhance customer loyalty and retention and strengthen our cross-selling capabilities. We believe it will further increase customer lifetime value while lowering our overall customer acquisition costs. We remain firmly committed to building a stronger brand and creating enduring value for our customers and shareholders."

Chenggang Zhou, New Oriental's Chief Executive Officer, added, "This fiscal quarter, we continued to execute our strategy of disciplined capacity expansion to balance revenue growth with operational efficiency. Equally important, AI remains at the core of our organizational priorities. This fiscal year, we will maintain measured investment in AI to enhance the competitiveness of our existing products, develop new AI-powered education products that can be commercialized efficiently, and apply AI more broadly to reduce labor costs and improve operating efficiency, while providing stronger support to our staff. In this fiscal quarter, East Buy expanded its private label portfolio to over 1,000 SPUs and its Douyin channel matrix to more than 30 vertical accounts. Leveraging New Oriental's learning center network, East Buy now has four offline experience stores and has developed instant retail capabilities, including one-hour delivery trials in Beijing and Shanghai. For this fiscal year, East Buy will advance its multi-channel strategy, accelerate private label development, refine App membership operations and enhance supply chain efficiency to support sustainable long-term growth."

Stephen Zhihui Yang, New Oriental's Executive President and Chief Financial Officer, commented, "We are pleased to report that, in this fiscal quarter, both our core education business and East Buy recorded year over year expansion in their respective operating margins, primarily attributable to enhanced operational efficiency and improved utilization of our learning centers. Concurrently, East Buy's rapid growth increased its share of total revenue, and this shift in our revenue mix kept our consolidated operating margin at a stable level during this quarter. We view this as an anticipated consequence of scaling new businesses, and we remain confident in the margin trajectory of each business line on a standalone basis. In this fiscal year, we will remain firmly committed to our strategy of pursuing balanced revenue and profit growth, and we will continue to deepen our cost reduction and efficiency enhancement initiatives across key business lines. Through these efforts, we aim to deliver sustainable, healthy growth over the long term while steadily enhancing our profitability."

Update on Shareholder Return for the Fiscal Year 2026

As part of the shareholder return for the fiscal year 2026, the Company announced in October 2025 a share repurchase program (the "2026 Share Repurchase Program"), under which the Company is authorized to repurchase up to US$300 million of its ADSs or common shares over the subsequent 12 months. As of October 27, 2026, the Company had fully utilized the US$300 million repurchase amount authorized under its 2026 Share Repurchase Program for an aggregate of approximately 56.2 million common shares (including common shares represented by ADSs) from the open market.

Update on Shareholder Return for the Fiscal Year 2027

To implement its three-year shareholder return plan adopted in July 2025 for the fiscal year 2027, the board of directors of the Company previously approved an ordinary cash dividend and a new share repurchase program (the "2027 Share Repurchase Program") in July 2026.

The Company today announced that its board of directors has approved an ordinary cash dividend for the 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: (i) the first installment, US$0.1 per common share, or US$1.0 per ADS, will be paid to holders of common shares and ADSs of record as of the close of business on November 18, 2026, Beijing/Hong Kong Time and New York Time, respectively; and (ii) the second installment, US$0.1 per common share, or US$1.0 per ADS, will be paid to holders of common shares and ADSs of a record date to be further determined by the board of directors of the Company in due course. The payment date for the first installment is expected to be on or around December 1, 2026 and December 4, 2026 for holders of common shares and holders of ADSs, respectively. The payment date for the second installment is expected to be around six months after the payment date of the first installment. Further details regarding the record date and payment date for the second installment will be announced by the Company in due course.

The aggregate amount of the cash dividend to be paid in two installments is expected to be approximately US$300 million. For holders of common shares, in order to qualify for the first installment of the dividend, all valid documents for the transfer of shares accompanied by the relevant share certificates must be lodged for registration with the Company's Hong Kong branch share registrar, Computershare Hong Kong Investor Services Limited, at Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen's Road East, Wanchai, Hong Kong no later than 4:30 p.m. on November 18, 2026 (Beijing/Hong Kong Time). Dividend to be paid to the Company's ADS holders through the depositary bank will be subject to the terms of the deposit agreement.

Pursuant to the 2027 Share Repurchase Program, the Company may repurchase up to US$200 million of its ADSs or common shares over the subsequent 12 months following the board approval. As of October 27, 2026, the Company had not yet repurchased any common shares under the 2027 Share Repurchase Program. The Company's proposed repurchases may be made from time to time in the open market at prevailing market prices, in privately negotiated transactions, in block trades and/or through other legally permissible means, depending on market conditions and in accordance with applicable rules and regulations. The board of directors of the Company will review the share repurchase program periodically, and may authorize adjustment of its terms and size. The Company expects to fund the repurchases out of its existing cash balance.

Financial Results for the First Fiscal Quarter Ended August 31, 2026

Net Revenues

For the first fiscal quarter of 2027, New Oriental reported net revenues of US$1,874.5 million, representing a 23.1% increase year over year. The growth was mainly driven by the increase in net revenues from the Company's new educational business initiatives and East Buy private label products and livestreaming e-commerce business.

Operating Costs and Expenses

Operating costs and expenses for the quarter were US$1,499.8 million, representing a 23.7% increase year over year. The increase was primarily due to the cost and expenses related to the substantial growth in East Buy private label products and livestreaming e-commerce business.

- Cost of revenues increased by 28.1% year over year to US$817.0 million.

- Selling and marketing expenses increased by 30.7% year over year to US$262.2 million.

- General and administrative expenses for the quarter increased by 12.6% year over year to US$420.7 million.

Total share-based compensation expenses, which were allocated to related operating costs and expenses, increased by 31.3% to US$30.6 million in the first fiscal quarter of 2027.

Operating Income and Operating Margin

Operating income was US$374.7 million, representing a 20.