New Oriental Education & Technology Group (New Oriental Education & Technology Group) Gross Margin %

: 51.41% (As of Nov. 2023)

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Gross Margin % is calculated as gross profit divided by its revenue. New Oriental Education & Technology Group's Gross Profit for the three months ended in Nov. 2023 was $447 Mil. New Oriental Education & Technology Group's Revenue for the three months ended in Nov. 2023 was $870 Mil. Therefore, New Oriental Education & Technology Group's Gross Margin % for the quarter that ended in Nov. 2023 was 51.41%.

Warning Sign:

New Oriental Education & Technology Group Inc gross margin has been in long-term decline. The average rate of decline per year is -3.1%.

The historical rank and industry rank for New Oriental Education & Technology Group's Gross Margin % or its related term are showing as below:

EDU' s Gross Margin % Range Over the Past 10 Years
Min: 43.51 Med: 56.03 Max: 60.34
Current: 54.67

During the past 13 years, the highest Gross Margin % of New Oriental Education & Technology Group was 60.34%. The lowest was 43.51%. And the median was 56.03%.

EDU's Gross Margin % is ranked better than
63.05% of 249 companies
in the Education industry
Industry Median: 48.33 vs EDU: 54.67

New Oriental Education & Technology Group had a gross margin of 51.41% for the quarter that ended in Nov. 2023 => Durable competitive advantage

The 5-Year average Growth Rate of Gross Margin for New Oriental Education & Technology Group was -3.10% per year.

New Oriental Education & Technology Group Gross Margin % Historical Data

The historical data trend for New Oriental Education & Technology Group's Gross Margin % can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

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New Oriental Education & Technology Group Annual Data

Trend

May14

May15

May16

May17

May18

May19

May20

May21

May22

May23

Gross Margin %

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55.55

55.60

52.37

43.51

52.98

New Oriental Education & Technology Group Quarterly Data
	Feb19	May19	Aug19	Nov19	Feb20	May20	Aug20	Nov20	Feb21	May21	Aug21	Nov21	Feb22	May22	Aug22	Nov22	Feb23	May23	Aug23	Nov23
Gross Margin %	Get a 7-Day Free Trial															47.32	51.00	54.49	59.89	51.41

Competitive Comparison

For the Education & Training Services subindustry, New Oriental Education & Technology Group's Gross Margin %, along with its competitors' market caps and Gross Margin % data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

New Oriental Education & Technology Group Gross Margin % Distribution

For the Education industry and Consumer Defensive sector, New Oriental Education & Technology Group's Gross Margin % distribution charts can be found below:

* The bar in red indicates where New Oriental Education & Technology Group's Gross Margin % falls into.

New Oriental Education & Technology Group Gross Margin % Calculation

Gross Margin is the percentage of Gross Profit out of sales or Revenue.

New Oriental Education & Technology Group's Gross Margin for the fiscal year that ended in May. 2023 is calculated as

Gross Margin % (A: May. 2023 )	=	Gross Profit (A: May. 2023 )	/	Revenue (A: May. 2023 )
	=	1588.3	/	2997.76
	=	(Revenue - Cost of Goods Sold)	/	Revenue
	=	(2997.76 - 1409.438)	/	2997.76
	=	52.98 %

New Oriental Education & Technology Group's Gross Margin for the quarter that ended in Nov. 2023 is calculated as

Gross Margin % (Q: Nov. 2023 )	=	Gross Profit (Q: Nov. 2023 )	/	Revenue (Q: Nov. 2023 )
	=	447	/	869.6
	=	(Revenue - Cost of Goods Sold)	/	Revenue
	=	(869.6 - 422.558)	/	869.6
	=	51.41 %

A positive Gross Profit is only the first step for a company to make a net profit. The gross profit needs to be big enough to also cover related labor, equipment, rental, marketing/advertising, research and development and a lot of other costs in selling the products.

New Oriental Education & Technology Group (NYSE:EDU) Gross Margin % Explanation

Warren Buffett believes that firms with excellent long term economics tend to have consistently higher margins.

Durable competitive advantage creates a high Gross Margin % because of the freedom to price in excess of cost. Companies can be categorized by their Gross Margin %

1. Greater than 40% = Durable competitive advantage
2. Less than 40% = Competition eroding margins
3. Less than 20% = no sustainable competitive advantage
Consistency of Gross Margin is key

New Oriental Education & Technology Group had a gross margin of 51.41% for the quarter that ended in Nov. 2023 => Durable competitive advantage

Be Aware

If a company loses its competitive advantages, usually its gross margin declines well before its sales declines. Watching Gross Margin % and Operating Margin % closely helps avoid value trap situations.

New Oriental Education & Technology Group Gross Margin % Related Terms

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New Oriental Education & Technology Group (New Oriental Education & Technology Group) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Defensive » Education » New Oriental Education & Technology Group Inc (NYSE:EDU) » Definitions » Gross Margin %

Comparable Companies

Traded in Other Exchanges

EDUN:Mexico 09901:Hong Kong 0K75:UK N1U0:Germany E1DU34:Brazil

Address

No. 6 Hai Dian Zhong Street, Haidian District, Beijing, CHN, 100080

Website

https://www.neworiental.org

New Oriental is a leading private education provider in China. K-9 academic after-school tutoring used to account for 50%-60% of New Oriental's revenue before the regulatory crackdown in 2021. After terminating its K-9 academic after-school tutoring business, New Oriental has identified a few new initiatives such as nonacademic tutoring and intelligent learning systems and devices. The remaining businesses include high school academic after-school tutoring and overseas-related test preparation and consulting business. It also owns 55.7% of East Buy (HKG: 01797), a market leader in livestreaming e-commerce.