Abstract
New Oriental Education & Technology will report fiscal Q2 results on January 28, 2026 Pre-Market; this preview compiles consensus forecasts and company indicators to frame expectations for revenue, margin trajectory, net profit, and adjusted EPS alongside recent institutional commentary.Market Forecast
Based on the most recent guidance-style indicators, the market anticipates New Oriental Education & Technology to deliver fiscal Q2 revenue of $1.16 billion, implying an estimated year-over-year increase of 15.08%, with forecast EBIT of $57.26 million (estimated YoY +111.80%) and adjusted EPS of $0.33 (estimated YoY +14.96%). Margin expectations embed a continuation of healthy conversion from gross to net income, though explicit consensus figures for gross profit margin, net margin, and adjusted EPS YoY are drawn from the company’s forecast field; if realized, they would underscore improving operating efficiency.Management emphasis and recent run-rate trends point to resilient services revenue supported by learning services demand, with products providing a smaller but complementary contribution. The segment judged to offer the most promising growth remains services, with last quarter’s services revenue at $4.33 billion and products at $0.57 billion, highlighting the core revenue engine and cross-sell opportunity into value-added offerings.
Last Quarter Review
New Oriental Education & Technology reported last quarter revenue, gross margin of 58.12%, GAAP net profit attributable to the parent company of $241.00 million with a net profit margin of 15.81%, and adjusted EPS of $1.61, with year-over-year adjusted EPS growth of 0.63%; net profit increased quarter-on-quarter by 3,290.46%. A key highlight was the robust profitability inflection, reflected in both margin resilience and significant sequential net income acceleration. Main business highlights showed services revenue of $4.33 billion and products revenue of $0.57 billion, underscoring the dominance of services within the portfolio and the stabilization of ancillary product lines.Current Quarter Outlook (with major analytical insights)
Main business momentum
Services remain the economic backbone, evidenced by their revenue scale and margin carry-through. The last quarter’s gross profit margin of 58.12% offers a cushion against seasonal fluctuations, and the net profit margin of 15.81% indicates solid operating discipline as scale effects accrue. As the company advances into the peak enrollment and renewal cycle for its fiscal second quarter, the expected revenue growth of 15.08% and forecast EBIT of $57.26 million point to sustained utilization of teaching capacity and improving operating leverage. Management’s recent cadence of execution suggests that a blend of higher-ticket offerings and utilization of digital and hybrid delivery can support mix and retention, which in turn helps preserve gross margin in the mid-to-high 50% range while expanding EBIT dollars more quickly than revenue.Most promising growth vector
Within the portfolio, services present the largest absolute growth opportunity due to their scale and the breadth of monetizable touchpoints across tutoring, test preparation, and value-added services. The evidence is the services share of revenue in the last reported quarter at $4.33 billion compared with products at $0.57 billion, which places a premium on optimizing cohort conversion, price realization, and cross-sell of premium formats. The forecast EPS growth of 14.96% year over year, if achieved, implies continued incremental margin capture, supported by operating cost controls and a greater mix of services tied to outcomes and higher willingness to pay. Execution risks include seasonality and potential pricing sensitivity in key markets, but the scale and brand equity of the services franchise mitigate churn and support renewal rates.Key stock-price swing factors this quarter
Two variables appear most consequential. The first is margin translation: investors will parse gross-to-EBIT conversion against the forecast EBIT of $57.26 million for signs that cost optimization remains intact, especially after a quarter marked by a 58.12% gross margin and 15.81% net margin. The second is revenue quality within services—particularly growth durability in core learning services versus ancillary products—since a higher services mix typically correlates with better gross margin and stickier cash flow. Any update to enrollment trends, average revenue per student, or cohort retention could recalibrate expectations for the remainder of the fiscal year and drive valuation dispersion, while commentary on product strategy will help clarify cross-sell headroom.Analyst Opinions
The majority of recent institutional commentary tilts constructive, emphasizing revenue acceleration and improved operating leverage into fiscal Q2, with supportive estimates for revenue at $1.16 billion, EBIT at $57.26 million, and EPS at $0.33. Several well-followed analysts highlight the resilience of services and evidence of stable to improving margins, framing upside risk if cohort retention and premium formats continue to scale. The bullish camp points to the notable sequential net income uplift recorded last quarter and the double-digit forecast growth in both revenue and EBIT as signals of healthy demand and careful cost management.Overall, the prevailing view is positive: upside could come from better-than-expected services utilization and disciplined expense lines, while watchpoints include seasonality and competitive intensity. Investors will likely focus on whether the company can sustain mid-to-high 50% gross margin and translate revenue growth into proportionately faster EBIT and EPS gains, validating the case embedded in current estimates.
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