New Oriental Education & Technology Group Inc.

FY2026 Q4 performance: strong growth + improving profitability - Revenue: total net revenue +23% YoY to $1,529.5m. - Profitability: Non-GAAP operating income +34.7% YoY to $110m; Q4 operating income turned positive to $85.8m vs operating loss of $8.7m in prior-year quarter. - Cash flow: $518.7m operating cash inflow in Q4; CapEx $99m. - Balance sheet strength: $1,821.2m cash & cash equivalents, plus $1,366.8m term deposits and $2,372.3m short-term investments as of May 31, 2026. - Surprising detail: despite cost pressure (marketing and revenue costs up), margin improved—management emphasized quality/retention and cost discipline.

Business momentum: core education + new initiatives driving growth - Overseas test prep: +6% YoY in Q4. - Overseas study consulting: ~+1% YoY (slower). - Adults & university students business: +29% YoY (strong). - Non-academic tutoring (rolled out to ~60 cities): steady growth; top 10 cities ~60% of business. - Intelligent learning system/device: launched in ~60 cities; top 10 cities >50%, with improved retention + scalability. - New educational initiatives impact: new educational business revenue +25% YoY in Q4. - Opportunity theme: “quality drives retention” (management repeatedly linked margin/outperformance to higher student retention).

OMO + AI + “New Oriental Home” ecosystem: major strategic initiatives - OMO platform investment: $31.2m invested in the quarter to improve/maintain the platform. - AI deployment: proprietary AI-powered personalized learning platform completed first phase, achieving meaningful sales within 25 days of launch (management claims product-market fit). - New Oriental Home (single app for family lifecycle services): - Pilot in 69 cities. - >950,000 registered families by end of the quarter. - ~70% cumulative activity participation rate; campaign activation 23%, outperforming many public e-commerce platforms. - Reported retention improvement: Grade 7 retention +10 bps from summer to autumn. - Why it matters to investors: potential to lower customer acquisition costs via cross-selling and integrated loyalty, while improving retention and engagement.