Q2 2026 New Oriental Education & Technology Group Inc Earnings Call Transcript
Key Points
- New Oriental Education & Technology Group Inc (EDU) reported a strong set of results for the second fiscal quarter of 2026, with total net revenue growing 14.7% year over year to $1.19 billion.
- Non-GAAP operating income more than tripled, rising 206.9% to $89.1 million, and non-GAAP net income attributable to New Oriental increased 68.6% to $72.9 million.
- The company's new initiatives, including non-academic tutoring and intelligent learning systems, are gaining traction and contributing meaningfully to overall performance.
- East Buy, a subsidiary of New Oriental, has expanded its product range and reported strong progress in product development and supply chain enhancements, contributing positively to the group's top-line and bottom-line growth.
- The company is leveraging AI to enhance operational efficiency and improve product offerings, which is expected to contribute to future revenue growth and cost savings.
- Operating costs and expenses for the quarter increased by 10.4% year over year to $1,125.1 million, with cost of revenues rising by 11.8% year over year.
- The overseas study consulting business recorded a slight decrease of about 3% year over year, indicating challenges in this segment.
- Despite the overall positive performance, the overseas-related business faces revenue growth pressure due to challenging market conditions.
- Share-based compensation expenses increased significantly by 156.8% to $21.4 million, impacting overall expenses.
- The company is cautious about the ongoing macroeconomic headwinds and regulatory developments, which could impact future performance.
Good evening and thank you for standing by for New Oriental's FY 2026 second-quarter results earnings conference call. (Operator Instructions) Today's conference is being recorded. If you have any objections, you may disconnect at this time.
I would now like to turn the meeting over to your host for today's conference, Ms. Sisi Zhao. Thank you. Please go ahead.
Thank you. Hello, everyone, and welcome to New Oriental's second fiscal quarter 2026 earnings conference call. Our financial results for the period were released earlier today and available on the company's website as well as on Newswire services.
Today, Stephen Yang, Executive President and Chief Financial Officer, and I will share New Oriental's latest earnings results and business updates in detail with you. After that, Stephen and I will be available to answer your questions.
Before we continue, please note that the discussion today will contain forward-looking statements made under
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