New Oriental Education & Technology Group Inc.

Q4 FY2026 total net revenue was $1,529.5 million, up 23% year over year. Non-GAAP operating income was $110 million, up 34.7%, while operating income was $85.8 million versus an operating loss of $8.7 million in the prior-year period. Net income attributable to New Oriental was $62.2 million, up 775.8%, and non-GAAP net income attributable to New Oriental was $87.8 million, down 10.5%. Basic and diluted net income per ADS were $0.40 and $0.39, and non-GAAP basic and diluted net income per ADS were $0.56 and $0.55. Operating costs and expenses were $1,443.7 million, with cost of revenues at $717.3 million, selling and marketing at $262.5 million, and G&A at $463.9 million. Net cash inflow from operations was about $518.7 million, capex was $99 million, and cash and cash equivalents were $1,821.2 million as of May 31, 2026; term deposits were $1,366.8 million and short-term investments were $2,372.3 million. Deferred revenue was $2,242.9 million, up 14.8% year over year. For FY2027, management expects total net revenue of $6,453.9 million to $6,680.3 million, or 14% to 18% growth. It also expects meaningful cost improvement from overseas-business restructuring, margin expansion in FY2027, and stronger Q1 FY2027 revenue growth and margin expansion. The company also reiterated FY2027 capital return plans of about $500 million in total, consisting of about $300 million in cash dividends and up to $200 million in repurchases, funded from existing cash balance.

The CEO emphasized that FY2026 showed strong execution across core education, East Buy, and newer initiatives, and said the quarter reflected better product and service quality, stronger retention, and improving business momentum. He framed FY2027 as a year of sustainable growth, disciplined expansion, and operating leverage, repeatedly saying the company is confident and expects to beat its annual guidance. He also highlighted AI, New Oriental Home, and East Buy as strategic engines to broaden the ecosystem and deepen customer engagement.

The CFO walked through the quarter’s financials with specific figures: revenue of $1,529.5 million, operating costs and expenses of $1,443.7 million, operating income of $85.8 million, and non-GAAP operating income of $110 million. He noted net cash inflow from operations of about $518.7 million, capex of $99 million, and liquidity of $1,821.2 million in cash and cash equivalents plus $1,366.8 million in term deposits and $2,372.3 million in short-term investments. He also highlighted deferred revenue of $2,242.9 million and the FY2027 shareholder return plan of about $500 million, including about $300 million of dividends and up to $200 million of buybacks.

Analysts pressed for more detail on FY2027 quarterly trends, and management said Q1 should benefit from improving summer enrollment, higher efficiency, and a stronger East Buy contribution, with revenue acceleration and margin expansion expected. On K-12, management guided the combined K-9 and high school business to grow roughly 20% year over year in FY2027 and said Q1 growth should be stronger. Questions on capacity expansion and compliance were answered by saying FY2027 new capacity should rise 10% to 15%, utilization should improve, and management sees the regulatory environment as neutral to positive. On overseas test prep/consulting, management said FY2027 growth should be flat to low single digits, with roughly 15% margin last year and expansion expected this year after restructuring. On costs, management said roughly $100 million was saved in FY2026 and that further savings are expected in FY2027 as the company moves into a second phase of cost control.