New Oriental Education & Technology Group Inc. (NYSE:EDU) reported fourth-quarter results on Wednesday that exceeded revenue forecasts but fell short of earnings expectations, with investors focusing on continued business expansion and a stronger outlook for the year ahead.
Shares of the Chinese education services provider rose more than 3% in pre-market trading following the results announcement.
The company reported adjusted earnings of $0.55 per share for the quarter ended May 31, 2026, below analysts’ consensus estimate of $0.94. Revenue, however, increased 23% year over year to $1.53 billion, surpassing market expectations of $1.46 billion.
Education Businesses Continue to Drive Revenue Growth
New Oriental said revenue growth was supported by continued expansion across its newer education businesses, as well as stronger demand for overseas test preparation and domestic exam preparation services for university students and adult learners.
Adjusted operating income increased 34.7% from the prior-year period to $110.0 million, while adjusted operating margin improved to 7.2%, an increase of 60 basis points.
The company said profitability benefited from improved operational efficiency and better resource utilisation, despite one-off costs related to an internal management restructuring.
Executive Chairman Michael Yu said: “We are pleased to conclude the final quarter of fiscal year 2026 on a strong note, with continued healthy top line growth of 23.0%.”
Company Forecasts Continued Growth in Fiscal 2027
Looking ahead, New Oriental expects fiscal 2027 revenue to be between $6.45 billion and $6.68 billion.
The forecast represents year-over-year growth of between 14% and 18%, with the midpoint of $6.57 billion implying growth of approximately 16% compared with fiscal 2026 revenue of $5.66 billion.
Shareholder Returns and Deferred Revenue Increase
The company’s board of directors also approved a new shareholder return programme for fiscal 2027.
The plan includes approximately $300 million in cash dividends, to be paid in two instalments, along with a new $200 million share repurchase programme that will be executed over the next 12 months.
Meanwhile, deferred revenue increased 14.8% year over year to $2.24 billion at the end of the quarter, reflecting continued strength in advance customer payments and providing additional visibility into future revenue.
New Oriental Education & Technology Group stock price
