New Oriental Education & Technology Group (EDU) Q3 2025 earnings summary

Executive summary

• Q3 FY2025 net revenues decreased 2% year-over-year to $1,183.1M, but core educational revenue excluding East Buy rose 21.2% to $1,038.3M.

• Operating income increased 9.8% year-over-year to $124.5M; net income attributable to shareholders was $87.3M, up 0.1%.

• New ventures and business lines, especially in non-academic and technology-driven education, contributed to growth, with 408,000 enrollments and 309,000 active device users in Q3.

• Share repurchase program expanded to $700M, with $695.5M already repurchased as of April 22, 2025.

Financial highlights

• Operating margin (excluding East Buy) reached 12.1%, and non-GAAP operating margin was 13.3%.

• Non-GAAP net income for Q3 was $113.3M, down 14.3% year-over-year; non-GAAP EPS was $0.70.

• Operating costs and expenses fell 3.2% year-over-year to $1,058.5M.

• Cash and equivalents, term deposits, and short-term investments totaled $4.7B as of February 28, 2025.

• Deferred revenue increased 15% year-over-year to $1,749.9M.

Outlook and guidance

• Q4 FY2025 net revenues (excluding East Buy) expected between $1,009.1M and $1,036.6M, up 10–13% year-over-year.

• Revenue in RMB projected to grow 12–15% in Q4.

• Non-GAAP operating margin for educational business expected to expand year-over-year in Q4.

• Margin pressure from overseas and tourism-related businesses expected to ease as cost and efficiency initiatives take effect.

• For FY2026, core business lines are expected to maintain similar growth rates as Q4, with K-9 new business projected to grow 25–30%.