Group 1 - The core viewpoint of the article highlights that New Oriental-S (09901) reported a 15% year-on-year increase in total revenue for Q2 of the 2026 fiscal year, reaching $1.191 billion, surpassing market expectations by 3% and exceeding the company's previous guidance of 9% to 12% [1] - Non-GAAP operating profit surged by 223% year-on-year to $89 million, exceeding consensus expectations by 62%, with a corresponding Non-GAAP operating profit margin of 7.5%, which is an increase of 2.8 percentage points over the consensus estimate of 4.7% [1] - Haitong International raised the target price for New Oriental from HKD 49 to HKD 52 based on the upward revision of performance expectations, maintaining an outperform rating [1] Group 2 - The company has been able to capture market share despite a generally sluggish study abroad industry, achieving a 1% year-on-year growth in Q2 of the 2026 fiscal year, with expectations for this trend to continue into the next quarter [1] - The company is taking a conservative stance on Q4 performance due to the strong seasonal characteristics of the study abroad consulting business, anticipating a decline in study abroad revenue next year due to the overall industry situation and the merger of its exam preparation and study abroad consulting businesses [1] - Haitong International noted that the company's cost reduction and efficiency enhancement measures are showing continued effectiveness, with progress in optimizing teacher allocation and diversifying product offerings, indicating sustainable growth in the K12 business [2]

Core Viewpoint - The report from Haitong International indicates that New Oriental-S (09901) has exceeded market expectations with a 15% year-on-year revenue growth to $1.191 billion for Q2 of FY2026, surpassing the company's previous guidance of 9% to 12% [1] Group 1: Financial Performance - Non-GAAP operating profit increased significantly by 223% year-on-year to $89 million, exceeding consensus expectations by 62%, resulting in a Non-GAAP operating profit margin of 7.5%, which is 2.8 percentage points higher than the consensus estimate of 4.7% [1] - Haitong International has raised the target price for New Oriental from HKD 49 to HKD 52 based on the upward revision of performance expectations, maintaining an outperform rating [1] Group 2: Market Position and Strategy - Despite a generally sluggish study abroad industry due to ongoing macroeconomic and international uncertainties, the company has managed to capture market share with a 1% year-on-year growth in Q2 of FY2026, a trend expected to continue into the next quarter [1] - The company is implementing cost reduction and efficiency enhancement measures, with progress noted in optimizing teacher allocation and diversifying product offerings, which include OMO, 1V1, small classes, and subject expansion [2] Group 3: Future Outlook - The company holds a cautious outlook for Q4 of FY2026 due to the strong seasonality of the study abroad consulting business, and anticipates a decline in study abroad revenue next year due to the overall industry situation and the merger of its exam preparation and study abroad consulting businesses [1] - The management has shown a strong commitment to improving profitability in the study abroad segment, despite current revenue growth being maintained at a low double-digit rate [2]

Core Viewpoint - New Oriental's total revenue for the second quarter of fiscal year 2026 increased by 15% year-on-year to $1.191 billion, exceeding market consensus by 3% and surpassing the company's previous guidance of 9% to 12% [1] Financial Performance - Non-GAAP operating profit surged by 223% year-on-year to $89 million, exceeding consensus expectations by 62%, with a corresponding Non-GAAP operating profit margin of 7.5%, which is 2.8 percentage points higher than the consensus estimate of 4.7% [1] Future Outlook - Looking ahead, the overall industry situation has not yet recovered, and the merger of the company's test preparation and study abroad consulting businesses is expected to lead to a decline in study abroad revenue [1] - Based on the upward revision of performance expectations, the target price has been raised from HKD 49 to HKD 52, with a rating of "outperform the market" [1] Operational Efficiency - The company has observed ongoing effectiveness in cost reduction and efficiency enhancement measures, with progress noted in teacher allocation optimization and product diversification across various dimensions, including OMO, 1V1, small class courses, and subject expansion [1] Business Sustainability - The company's K12 business shows sustainable growth potential, while the study abroad segment faces revenue pressure; however, the company is determined to improve the profitability of this segment [1] - Despite maintaining low double-digit revenue growth, investors are encouraged to focus more on profit growth, as the management has demonstrated a strong commitment to delivering returns to investors [1]

Core Viewpoint - Haitong International maintains an "outperform" rating for New Oriental-S (09901) and raises the target price from HKD 49 to HKD 52 based on upgraded performance expectations [1] Group 1: Financial Performance - In Q2 FY26, the company's total revenue increased by 15% year-on-year to USD 1.191 billion, exceeding consensus expectations by 3% and surpassing the previous guidance of 9%-12% [2] - Non-GAAP operating profit surged by 223% year-on-year to USD 89 million, exceeding consensus expectations by 62%, resulting in a Non-GAAP operating profit margin of 7.5%, which is 2.8 percentage points higher than the consensus forecast [2] - Deferred revenue reached USD 2.1615 billion, reflecting a year-on-year growth of 10.2%, consistent with the 10% growth in Q1 FY26 [2] Group 2: K12 Business Outlook - K12 business revenue is expected to accelerate in Q3 FY26, driven by improved retention rates and increased class scheduling during the winter break [2] - The company has made significant progress in enhancing product quality and teaching effectiveness, leading to a notable increase in user retention rates for high school and K9 non-academic businesses [2] - K12 revenue is projected to grow by 19% year-on-year to USD 815 million, with high school business expected to grow by 18% and K9 new business by 23% due to strong recovery in junior high [2] Group 3: Study Abroad Business Challenges - The study abroad sector remains under pressure, impacting the overall revenue of the core education segment [3] - Despite a challenging macroeconomic and international environment, the company managed to capture market share in Q2 FY26, achieving a 1% year-on-year growth [3] - The company holds a conservative outlook for Q4 FY26 due to the seasonal characteristics of the study abroad consulting business and anticipates a decline in study abroad revenue next year due to ongoing industry challenges [3] Group 4: Cost Reduction and Efficiency Improvement - The core education segment's operating profit margin improved by 3 percentage points in Q2 FY26, primarily due to effective cost reduction and efficiency measures [4] - These measures include cautious expansion of learning centers and control of marketing expenses, which are expected to continue delivering results [4] - The company forecasts a year-on-year increase in Non-GAAP operating profit margins of 1.4 and 1.6 percentage points in Q3 FY26 and FY26, respectively, reaching 13.4% and 12.9% [4]

Core Viewpoint - Haitong International maintains an "outperform" rating for New Oriental-S (09901) and raises the target price from HKD 49 to HKD 52 based on upgraded performance expectations [1] Group 1: Financial Performance - In Q2 FY26, the company's total revenue increased by 15% year-on-year to USD 1.191 billion, exceeding consensus expectations by 3% and surpassing the previous guidance of 9%-12% [1] - Non-GAAP operating profit surged by 223% year-on-year to USD 89 million, exceeding consensus expectations by 62%, with a Non-GAAP operating profit margin of 7.5%, up 2.8 percentage points from the consensus estimate of 4.7% [1] - Deferred revenue reached USD 2.1615 billion, a year-on-year increase of 10.2%, consistent with the 10% growth in Q1 FY26 [1] Group 2: K12 Business Outlook - K12 business revenue is expected to accelerate growth in Q3 FY26, driven by improved retention rates and increased course offerings during the winter break [2] - The K12 business revenue is projected to grow by 19% year-on-year to USD 815 million, with high school business expected to grow by 18% and K9 new business anticipated to increase by 23% [2] Group 3: Study Abroad Business Challenges - The study abroad sector remains under pressure, impacting the overall revenue of the core education segment [3] - Despite a 1% year-on-year growth in Q2 FY26, the company is expected to adopt a conservative outlook for Q4 FY26 due to the seasonal characteristics of the study abroad consulting business [3] - The company anticipates a decline in study abroad revenue next year due to the ongoing instability in the industry and the merger of exam preparation and study abroad consulting businesses [3] Group 4: Cost Reduction and Efficiency Improvement - The core education segment's operating profit margin improved by 3 percentage points in Q2 FY26, attributed to effective cost reduction and efficiency measures [4] - The company expects these measures to continue yielding results, with projected Non-GAAP operating profit margins increasing by 1.4 and 1.6 percentage points year-on-year to 13.4% and 12.9% for Q3 FY26 and FY26, respectively [4]