EDU

New Oriental has staged a durable recovery from the 2021-2022 Chinese after-school-tutoring crackdown that drove a $1.19B loss in FY2022. The franchise has re-pivoted and rebuilt: FY2025 revenue grew 13.6% to $4.90B and net income rose 20.1% to $372M, extending a steady climb from the FY2023 trough ($3.00B revenue, $177M net income). Operating income grew faster than revenue (+22.2% to $428M), evidence of operating leverage as the new business model scales. The company is debt-free with $1.61B cash (up 16.1%) against $3.66B equity and a manageable 1.05x liabilities/equity, giving it a fortress balance sheet to navigate a volatile regulatory environment.

Management is returning capital aggressively, a signal of confidence: share buybacks jumped to $445M (up 607.8%, shrinking shares 4.1%) and dividends rose 38.0% to $98.2M. Profitability is recovering but still modest — 8.7% operating margin, 7.6% net margin, 10.2% ROE — reflecting the lower-margin mix of the post-crackdown business (which now spans non-academic tutoring, study-abroad, and new ventures). One watch item: operating cash flow fell 20.1% to $897M even as earnings rose, a divergence worth monitoring for working-capital or deferred-revenue dynamics.