Core Viewpoint - New Oriental has experienced a challenging fiscal year 2025 and is expected to face an even tougher fiscal year 2026, with significant concerns regarding slowing revenue growth and declining net profit [1][2]. Revenue Performance - In Q4 of fiscal year 2025, New Oriental reported revenue of $1.24 billion, a year-on-year increase of 9.4%. For the entire fiscal year, revenue reached $4.9 billion, up 13.6% year-on-year [1][2]. - The revenue growth rate has significantly slowed compared to fiscal year 2024, which saw a growth rate of 43.9% [1]. - The company forecasts Q1 of fiscal year 2026 revenue growth to be only 2% to 5%, with an annual growth expectation of 5% to 10% [1][10]. Net Profit Analysis - New Oriental's net profit for Q4 of fiscal year 2025 was $7.1 million, a dramatic decline of 73.7% year-on-year [2][4]. - The sharp decline in net profit is primarily attributed to increased costs and expenses, which rose by 11.2% to $1.25 billion, outpacing revenue growth [4]. - A significant factor in the profit drop was a goodwill impairment of $60.3 million, related to previous acquisitions of kindergartens, which was a one-time charge [4][5]. Business Segment Performance - The growth of New Oriental's educational new business, primarily K9, has been slowing, with revenue growth rates of 49.8%, 42.6%, 34.5%, and 32.5% over the past four quarters [7]. - Traditional overseas exam preparation and consulting services have stabilized, with revenue growth of 14.6% and 8.2% respectively in Q4 [8][9]. - Domestic exam preparation services have also shown a decline in growth, influenced by reduced enrollment and participation [9]. Future Outlook - The company anticipates a revenue range of $1.46 billion to $1.51 billion for Q1 of fiscal year 2026, indicating continued slow growth [10]. - For the entire fiscal year 2026, revenue is projected to be between $5.15 billion and $5.39 billion, with specific growth expectations of approximately 20% for K9 business and 10% for domestic exam preparation [10].
新东方：告别不容易的2025财年，迎接更不容易的2026财年