Q1 2025 New Oriental Education & Technology Group Inc Earnings Call Transcript
Key Points
- New Oriental Education & Technology Group Inc (EDU) reported a 30.5% top-line growth for the first fiscal quarter of 2025, with net revenues excluding East Buy increasing by 33.5% year over year.
- The company's operating margin and non-GAAP operating margin improved significantly, reaching 23.7% and 24.4%, respectively, marking a 370 basis point and 220 basis point improvement year over year.
- The overseas test prep, overseas study consulting, and adults and university students business segments all recorded strong revenue increases of 19%, 21%, and 30% year over year, respectively.
- New educational business initiatives, including non-academic tutoring and intelligent learning systems, saw a revenue increase of 50% year over year, with strong student enrollments and active user growth.
- The newly integrated tourism-related business line achieved a remarkable 221% revenue increase year over year, indicating successful diversification efforts.
- Operating costs and expenses increased by 27.6% year over year, primarily due to accelerated capacity expansion and new business initiatives.
- Selling and marketing expenses rose by 42.3% year over year, which could impact profitability if not managed effectively.
- The company anticipates margin pressure in the second quarter due to seasonality and increased investments in new business lines.
- Despite strong growth in the tourism business, it is expected to be loss-making for the full fiscal year, indicating potential challenges in achieving profitability.
- The company faces inherent risks and uncertainties related to forward-looking statements, which could impact future performance.
Good evening and thank you for standing by for New Oriental's FY 2025 first quarter results earnings conference call. (Operator Instructions) Today's conference is being recorded.
I'd now like to turn the meeting over to your host for today's conference, Ms. Sisi Zhao.
Thank you. Hello, everyone and welcome to New Oriental's first fiscal quarter 2025 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 the safe harbor provisions of the US Private Security Litigation Reform Act of 1995. Forward
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