Investment Rating - The investment rating for the company is "Outperform the Market" [5] Core Views - The company's education business performed well, with non-e-commerce revenue growing by 31% year-on-year, slightly exceeding previous management guidance. However, the e-commerce business negatively impacted overall profit performance [1][8] - For FY2025Q2, the company achieved net revenue of $1.039 billion, a year-on-year increase of 19.4%, with non-e-commerce revenue at $894 million, up 31.3%, surpassing prior guidance of 25%-28% [1][8] - The company anticipates non-e-commerce revenue growth of 18-21% for FY2025Q3, which is lower than the initial 30% growth forecast due to external consumption pressures [3][17] - The company is actively responding to industry trends by launching targeted programs, such as early study abroad training for youth, to mitigate impacts from high-end product demand pressures [18] Summary by Sections Financial Performance - In FY2025Q2, the company reported a net profit of $31.93 million, a 6.2% increase year-on-year, while Non-GAAP net profit decreased by 29.1% to $35.54 million, primarily due to the impact of the subsidiary's divestiture [1][8] - The operating profit for FY2025Q2 was $19.26 million, down 9.8% year-on-year, with Non-GAAP operating profit at $27.58 million, down 45.8% [1][8] Business Segments - The education new business segment grew by 42.6% year-on-year, while high school training increased by 20%, maintaining strong performance [2][11] - The e-commerce business saw a decline of 23% year-on-year due to the completion of the divestiture of "With Huixing" [2][11] - Deferred revenue as of the end of FY2025Q2 was $1.961 billion, up 19.2% year-on-year, although the growth rate has slowed compared to previous quarters [12][15] Capacity Expansion - The company expanded its capacity by 5% quarter-on-quarter, with the number of schools and learning centers reaching approximately 1,143, a 12% increase year-on-year [12][15] - The company remains on track to achieve its annual capacity expansion plan of 20-25% [12]

Investment Rating - The investment rating for the company is "Outperform the Market" [5] Core Insights - The company's non-e-commerce revenue (education and cultural tourism) grew by 31% year-on-year, slightly exceeding previous management guidance, while overall net revenue reached $1.039 billion, a 19.4% increase [1][8] - The company is expected to face pressure on high-end product demand, leading to a downward revision of revenue forecasts for FY2025-2027 [3][18] - The company remains a leading player in the education and training sector with a clear growth logic [18] Revenue and Profitability - For FY2025Q2, the company achieved a net revenue of $1.039 billion, with non-e-commerce revenue at $894 million, reflecting a 31.3% increase [1][8] - The operating profit was $19.26 million, down 9.8% year-on-year, while Non-GAAP operating profit was $27.58 million, down 45.8% [1][8] - The net profit attributable to shareholders was $31.93 million, a 6.2% increase, while Non-GAAP net profit was $35.54 million, down 29.1% [1][8] Business Segment Performance - The education new business segment grew by 42.6% year-on-year, while high school training increased by 20% [2][11] - The e-commerce business declined by 23% due to the divestiture of "With Huixing" [2][11] - The cultural tourism business is expected to remain in a loss state due to low revenue during the traditional off-season [2][11] Capacity Expansion and Deferred Revenue - The company expanded its capacity by 5% quarter-on-quarter, with a total of approximately 1,143 schools and learning centers, a 12% increase year-on-year [12] - Deferred revenue reached $1.961 billion, a 19.2% increase year-on-year, although the growth rate has slowed compared to previous quarters [15] Future Outlook - For FY2025Q3, non-e-commerce revenue is expected to grow by 18-21% year-on-year, indicating a slowdown from earlier projections [3][17] - The company is actively responding to industry trends by launching targeted programs, such as early training for youth studying abroad, to stabilize its business [18]

Core Insights - New Oriental Education & Technology Group Inc. reported mixed results for Q2 fiscal 2025, with earnings missing estimates while net revenues exceeded expectations, leading to a 23.2% drop in stock price [1][3]. Financial Performance - Adjusted earnings were 22 cents per ADS, missing the consensus estimate of 47 cents by 53.2%, and decreased 24.1% year-over-year [3]. - Total revenues reached $1,038.6 million, slightly surpassing the consensus by 0.4% and growing 19.4% year-over-year. Excluding certain revenues, net revenues were $894.2 million, marking a 31.3% increase compared to the previous year [4]. - The overseas test preparation and study consulting segments grew by 21.1% and 31.0% year-over-year, while the domestic test preparation business saw a 34.9% increase [5]. Business Initiatives - New educational initiatives recorded a 42.6% revenue increase year-over-year, with non-academic tutoring courses offered in about 60 cities, attracting approximately 994,000 student enrollments [6]. - The company focused on aligning capacity expansion with revenue growth and enhancing its online-merge-offline teaching system [2]. Cost and Expenses - Cost of revenues increased by 17.9% year-over-year to $498.3 million, while non-GAAP operating costs rose 23.5% to $1,011.1 million, primarily due to accelerated capacity expansion and new business integrations [7]. - Selling and marketing expenses increased by 26.6%, and non-GAAP general and administrative expenses rose by 24.7% [8]. Operating Margins - Non-GAAP operating income was $27.6 million, down 45.8% year-over-year, with a non-GAAP operating margin of 2.7%, a decrease of 320 basis points from the previous year [8]. - The non-GAAP operating margin, excluding certain contributions, improved by 12 basis points year-over-year to 3.2%, indicating resilience in managing profitability [9]. Cash Position - As of November 30, 2024, the company had total cash and cash equivalents of approximately $1,418.2 million, up from $1,389.4 million at the end of fiscal 2024 [10]. Share Repurchase Program - The board approved a share repurchase program, increasing the authorization to $700 million, with approximately 11.2 million ADS repurchased for $542.8 million as of January 20, 2025 [11]. Future Guidance - For Q3 fiscal 2025, the company expects total revenues, excluding certain revenues, to be between $1,007.3 million and $1,032.5 million, indicating an 18-21% growth year-over-year [12].

淘宝百亿补贴也开始区域竞价。 淘宝百亿补贴近期上线区域竞价功能，商家可根据自身情况选择销售区域，以省份为单位竞价，每 个区域竞价获胜的前三名将被平台优先派单，前三名售罄后其他名次才有被派单的机会。天猫商家 参与该活动可享受交易佣金 100% 返还。 接近淘宝的人士告诉我们，这一调整旨在改善百亿补贴商品价格不够低的情况。一些经销商有意愿 在平台更低价卖货，但碍于品牌经销规则，担心商品窜货售外地被品牌处罚而未能报出最低价。平 台鼓励更多商家参与区域内竞价，在最低价的基础上叠加官方补贴，拿出比竞争对手更具优势的价 格。 拼多多在 2023 年前后便开始实施此类区域竞价模式。淘宝、京东等多家电商平台此后都开始力推 百亿补贴，从招商、货源管理到风控制度等各个环节学习拼多多。他们暂时都活在拼多多的影子 里，还没能动摇百亿补贴与拼多多强关联的用户心智。 教育新业务增速下降、东方甄选 GMV 收缩，新东方股价跌超 20%。 财报显示，新东方去年 9-11 月营业收入同比上升 19.4% 至 10.39 亿美元，经营利润同比下降 9.8% 至 1930 万美元。昨晚至今，这家公司美、港股股价都下跌超 20%，市值没了近 170 ...

Investment Rating - The report maintains a "Buy" rating for New Oriental [1][11] Core Insights - New Oriental reported a revenue of USD 1.039 billion for the second quarter of FY25, representing a year-on-year increase of 19.4%. However, the Non-GAAP net profit attributable to the parent company decreased by 29.1% to USD 36 million [2][8] - The education business continues to show strong growth, with a revenue increase of 28% year-on-year to USD 899 million. New business revenue, including non-academic training and learning machines, reached USD 301 million, up 43% year-on-year [3][9] - The overseas education business is facing challenges, with revenue of USD 249 million in the latest quarter, a 30.3% increase year-on-year, but expected to slow down in the next quarter due to reduced demand [4][10] Financial Performance and Forecast - For FY25, the adjusted net profit attributable to the parent company is projected to be USD 493 million, with revenues expected to grow to USD 5.271 billion, reflecting a year-on-year growth rate of 22.2% [6][11] - The company anticipates continued growth in non-academic training, with enrollment expected to reach 3.82 million, indicating significant potential compared to pre-"Double Reduction" policy levels [3][9] - The target price is set at USD 109.5 under the SOTP valuation, equivalent to HKD 85.6, maintaining the "Buy" rating [11]

Investment Rating - The report maintains a "Buy" rating for New Oriental Education Technology (9901 HK) with a target price adjusted to HKD 60.00, indicating a potential upside of 28.5% from the current price of HKD 46.70 [1][3][13]. Core Insights - The report expresses optimism regarding the K12 growth prospects despite uncertainties affecting revenue expectations, maintaining a "Buy" stance [1][6]. - The company's revenue for the fiscal year ending May 31, 2025, is projected to reach USD 4.972 billion, reflecting a year-on-year growth of 15.3% [2][15]. - The adjusted net profit for the fiscal year 2025 is estimated at USD 481 million, with an adjusted EPS of USD 0.29, showing a growth of 27.7% compared to the previous year [2][15]. Financial Overview - Revenue projections for New Oriental Education Technology are as follows: - 2023: USD 2.998 billion - 2024: USD 4.314 billion - 2025E: USD 4.972 billion - 2026E: USD 5.928 billion - 2027E: USD 6.872 billion - The company is expected to achieve a net profit of USD 259 million in 2023, increasing to USD 720 million by 2027 [2][15]. - The report highlights a significant increase in new business revenue, which is expected to maintain a high growth rate of 43% year-on-year, contributing to 28% of total revenue [6][7]. Performance Metrics - The report notes that the adjusted operating profit margin for the second quarter of fiscal year 2025 is projected at 2.7%, with a net profit margin of 3.4% [6][7]. - The company’s K12 education business is anticipated to show a revenue growth rate exceeding 30% for the fiscal year 2025, contributing nearly 60% to core education revenue [6][7]. - The report indicates that the company’s stock price has recently declined by 22% following earnings announcements, leading to a future 12-month P/E ratio of 13.8, which is considered low historically [6][7].

Investment Rating - Maintain BUY rating with a revised target price of US$80 0 (previous US$87 0) [1] Core Views - New Oriental's 2QFY25 net revenue grew 19% YoY to US$1 039mn (+31% YoY excluding East Buy revenue) in line with estimates but non-GAAP net income declined 29% YoY to US$36mn below estimates due to East Buy adjustment and tourism business investments [1] - Management guided 3QFY25E net revenue (excluding East Buy) to grow 18-21% YoY to US$1 01-1 03bn below expectations due to macro uncertainty and intensifying competition [1] - FY25-27E total revenue forecasts trimmed by 2-3% due to softer-than-expected revenue guidance [1] Earnings Summary - FY25E revenue forecast at US$5 081mn with adjusted net profit of US$439 4mn and EPS of US$2 65 [2] - FY27E revenue forecast at US$6 725mn with adjusted net profit of US$829 8mn and EPS of US$5 01 [2] - P/E ratio expected to decline from 25 4x in FY25E to 13 8x in FY27E [2] Business Segments - Overseas test prep and study consulting revenue grew 21% and 31% YoY respectively in 2QFY25 accounting for 24% of total revenue [5] - Domestic test prep revenue grew 35% YoY accounting for 9% of total revenue in 2QFY25 [5] - New educational initiatives revenue grew 43% YoY in 2QFY25 driven by non-academic tutoring (student enrolment +26% YoY) and intelligent learning systems (active paid users +44% YoY) [5] - East Buy revenue declined 9% YoY with a net loss of US$13 5mn in 1HFY25 but would have recorded US$4 6mn net income excluding the impact of Time with Yuhui disposal [5] - Tourism business revenue grew 233% YoY in 2QFY25 [5] Financial Forecasts - FY25E revenue revised down 2 6% to US$5 080 9mn with gross profit revised down 3 8% to US$2 721 0mn [6] - FY25E non-GAAP net income revised down 15 0% to US$439 4mn with EPS revised down 15 0% to US$2 7 [6] - Gross margin expected to be 53 6% in FY25E down 0 7ppt from previous forecast [6] Valuation - Educational and consulting business valued at US$77 1 (96% of total valuation) based on 28x FY25E PE [8] - East Buy valued at US$1 6 (2% of total valuation) based on 8x FY25E PE [8] - Tourism and others business valued at US$1 3 (2% of total valuation) based on 10x FY25E PE [8] - Sum-of-the-parts valuation of US$14 773 7mn with a 10% holdco discount resulting in a total valuation of US$13 296 3mn [9] Peer Comparison - Education sector average PE of 28 4x for FY25E and 16 1x for FY26E [11] - E-commerce sector average PE of 8 0x for FY25E and 7 0x for FY26E [11]

Investment Rating - The report maintains a "Buy" rating for the company, anticipating a price increase of over 15% in the next 6-12 months [4]. Core Insights - The company reported FY2Q25 unaudited revenue of $1.039 billion, representing a year-over-year increase of 19.4%. The net profit attributable to shareholders was $32 million, up 6.2%, while the adjusted net profit decreased by 29.1% to $36 million [1][2]. - The education segment, excluding certain businesses, generated $894 million in revenue, marking a 31.3% increase, surpassing previous guidance [2]. - The company expects FY3Q25 education revenue to be between $1.01 billion and $1.03 billion, reflecting a growth of 20-23% [2]. Summary by Sections Financial Performance - The company achieved a gross margin of 52.0%, an increase of 0.6 percentage points year-over-year. The operating profit margin (excluding e-commerce) was 2.8%, up 1.0 percentage points [3]. - The forecast for Non-GAAP net profit for FY25 to FY27 is $490 million, $670 million, and $850 million, respectively, with year-over-year growth rates of 34.75%, 35.96%, and 27.21% [4]. Revenue Growth - The education business saw significant growth, with overseas exam training and consultation services increasing by 21.1% and 31.0%, respectively. Domestic exam training for adults and college students grew by 34.9% [2]. - The number of active paid users for the smart learning system increased by 44.2% to 261,000 [2]. Cost Management - The company effectively controlled costs, with a sales expense ratio of 18.9% and a management expense ratio of 31.3%, both showing slight increases [3].

Financial Data and Key Metrics - The company released its financial results for the second fiscal quarter of 2025, which are available on the company's website and Newswire services [3] Business Updates and Strategy - The company's Executive President and Chief Financial Officer, Stephen Yang, along with Investor Relations Director, Sisi Zhao, will provide detailed updates on the latest earnings results and business developments [3] Forward-Looking Statements - The discussion during the conference call will include forward-looking statements made under the Safe Harbor provisions of the US Private Securities Litigation Reform Act of 1995 [4] - These statements involve inherent risks and uncertainties, and actual results may differ materially from those expressed [4] - The company has outlined potential risks and uncertainties in its public filings with the SEC and does not undertake any obligation to update any forward-looking statements [4] Q&A Session - The management will be available to answer questions after the prepared remarks [3]

Core Insights - New Oriental Education & Technology Group reported strong revenue growth of 19.4% year-over-year, reaching $1.04 billion, surpassing analyst expectations of $1.01 billion [2][4] - The company faced challenges in adjusted earnings per share (EPS), reporting $0.22, which was below the forecasted $0.30, indicating a 24% decline from the previous year [4][8] - The operating margin decreased from 2.5% to 1.9%, attributed to increased operational costs related to business expansion and regulatory adaptations [4][8] Financial Performance - Revenue for Q2 FY2025 was $1.04 billion, a 19.4% increase from $869.6 million in Q2 FY2024 [4] - Adjusted EPS was $0.22, down from $0.29 in the same quarter last year [4] - Net income rose to $31.9 million, a 6.2% increase from $30.1 million in Q2 FY2024 [4] Operational Developments - The revenue growth was primarily driven by the expansion of non-academic tutoring services and intelligent learning systems, with a notable 31.3% growth when excluding contributions from East Buy [7] - Key segments such as overseas test preparation and study consulting saw growth rates of 21% and 31%, respectively, demonstrating the company's adaptability to regulatory changes [8] Regulatory Environment - The company continues to navigate challenges from China's "double reduction" policy, which aims to reduce student workloads and private tutoring hours, necessitating a pivot towards diversification and strategic cost management [9] - Operational costs increased by 20% year-over-year, reflecting the impact of regulatory adaptations [9] Strategic Outlook - Looking ahead, New Oriental projects a revenue increase of 18% to 21% for Q3 FY2025, excluding East Buy contributions, with a focus on expanding private label products and enhancing digital outreach [12] - Management is committed to strategic growth and profitability, emphasizing diversification and leveraging technology to capture new revenue opportunities [10][12]