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New Oriental Stock Rises on Strong Revenue Beat and Return to Profitability
Shares of New Oriental Education & Technology (NYSE: EDU) rose in pre-market trading after the company announced strong fourth-quarter financial results, highlighted by a significant revenue beat and a return to operating profitability that overshadowed a miss on earnings estimates.
Strong Revenue Growth Drives Q4 Results
New Oriental reported total net revenues of $1.53 billion for its fourth fiscal quarter of 2026, a 23.0% increase from the same period last year, according to its earnings release. This figure comfortably surpassed the consensus analyst forecast of approximately $1.46 billion.
The company also demonstrated a dramatic improvement in profitability. It posted an operating income of $85.8 million, a stark reversal from an operating loss of $8.7 million in the prior-year period. Net income attributable to the company surged 775.8% year-over-year to $62.2 million.
Mixed Earnings Picture
While the top-line results were strong, the report was not without a blemish. New Oriental's reported earnings per share (EPS) of $0.550 fell short of the analyst consensus estimate of $0.940.
AdHowever, investors appeared to focus on the robust revenue growth and the successful turnaround in profitability. The positive top-line momentum seemed to outweigh concerns over the EPS miss, pushing the stock up 3.5% in pre-open trading, as cited by Investing.com.
Business Transformation Paying Off
The strong quarterly performance underscores the success of New Oriental's strategic pivot following a regulatory crackdown on the academic tutoring sector in China. The company has since diversified its business into new growth areas.
Key initiatives driving the recovery include non-academic tutoring, the development of intelligent learning systems and devices, and a successful expansion into livestreaming e-commerce. According to the report, these results build on a strong prior quarter and reinforce the positive outlook held by many analysts covering the stock.
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