Financial Data and Key Metrics Changes - The company achieved a solid topline growth of 32.1% for the fiscal quarter, with operating margin and non-GAAP operating margin reaching 0.9% and 3.2% respectively [8][9] - Operating income decreased by 78.1% year-over-year to 10.5million,whilenon−GAAPincomefromoperationsfellby53.836.3 million [18] - Net income attributable to New Oriental was 27million,a6.90.16 [18][19] - Cash and cash equivalents, term deposits, and short-term investments totaled approximately 4.9billion[15]BusinessLineDataandKeyMetricsChanges−Theoverseastest−prepbusinessrecordedarevenueincreaseof181,780.1 million, an increase of 33.1% compared to the previous year [20] - The company plans to increase capacity by around 20% to 25% for fiscal year 2025, focusing on cities with better topline and bottom line performance [22] Company Strategy and Development Direction - The company is pivoting to expand its multi-pronged presence and will leverage East Buy for knowledge sharing and product dissemination [7] - A strategic focus on enhancing the OMO (Online-Merge-Offline) system is underway, with a total investment of 30.5millionintheteachingplatform[14]−ThecompanyaimstointegratenewtechnologiessuchasAIandChatGPTintoeducationalofferingstoimprovegrowthandefficiency[23]Management′sCommentsonOperatingEnvironmentandFutureOutlook−Managementexpressedconfidenceinachievingmarginexpansionfortheeducationalbusinessinthefirstquarterof2025,excludingEastBuy[21]−Thecompanyanticipatesstrongdemandforitseducationalservicesandexpectstoachieverevenuegrowthof31400 million of the company's ADS or common shares [15] Q&A Session Summary Question: Growth strategy and room for growth in existing locations - Management plans to increase capacity by 20% to 25% in existing cities, focusing on areas with better performance [27] Question: Margin decline analysis - The margin decline was attributed to accelerated learning center expansion, new tourism business investments, and additional incentives for management and staff [30] Question: Margin expansion expectations - Management expects margin expansion in Q1 and throughout the year, driven by operating leverage and strong market demand [36] Question: Enrollment growth versus capacity expansion - The difference in growth rates is partly due to timing, with expectations for revenue growth to cover incremental costs [39] Question: Revenue outlook for different segments - Revenue growth expectations include 20% to 25% for overseas test-prep, 15% for consulting, and 45% to 50% for new business initiatives [44] Question: Competitive landscape and summer enrollment growth - Competition has intensified, but management believes they will capture more market share due to strong demand and less competition compared to previous years [47] Question: Shareholder return and potential for increased buyback - Management is open to discussing further capital allocation to shareholders after completing the current buyback program [49] Question: Revenue contribution from tourism business - Expected revenue for the tourism business in fiscal year 2025 is around RMB1.2 billion, with anticipated losses in the first year of operation [52]
NEW ORIENTAL(EDU)2024-08-01 03:54