New Oriental Education's shares sink 6% on weak revenue guidance

BEIJING - New Oriental Education & Technology Group Inc. (NYSE: EDU) reported better-than-expected first quarter earnings on Wednesday, but shares tumbled 6.3% after the company provided disappointing revenue guidance for the current quarter.

The Chinese education company posted adjusted earnings per ADS of $1.60 for its fiscal first quarter ended August 31, beating analyst estimates of $1.47. Revenue rose 30.5% year-over-year to $1.44 billion, in line with expectations.

However, New Oriental's outlook for the second quarter fell short of Wall Street forecasts. The company expects revenue between $851.4 million and $871.8 million, well below the consensus estimate of $1.03 billion.

"We are delighted to start our fiscal year 2025 with a healthy top line growth of 30.5%," said Michael Yu, New Oriental's Executive Chairman. He noted strong performance across the company's overseas test preparation, study consulting, and domestic test prep businesses.

Operating income jumped 42.9% to $293.2 million, while operating margin expanded to 20.4% from 18.6% a year earlier.

New Oriental ended the quarter with $4.9 billion in cash and investments. The company has repurchased approximately 9.8 million ADSs for $457.9 million under its current share buyback program.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

Source: Investing.com