Why did New Oriental Education’s share price plummet today? – New Oriental Education (NYSE: EDU)

New Oriental Education Technology Group Co., Ltd. Ministry of Education The stock was trading lower in premarket trading Tuesday.

The company reported a 19.4% year-over-year increase in second-quarter revenue to $1.038 billion, exceeding analysts’ consensus forecast of $1.009 billion.

After deducting the income generated by Dongmai’s own brand products and live broadcast business, total net income increased by 31.3% year-on-year.

The increase was primarily driven by higher net revenue from new business initiatives in education.

The company’s adjusted earnings per American depositary receipt were $0.22, missing analysts’ consensus estimate of $0.29.

Operating costs and expenses surged 20.2% to $1.02 billion in the quarter. Operating income for the quarter fell 9.8% year-on-year to $19.3 million, with operating profit margin of 1.9%.

In the first half of FY25, revenue grew 25.6% to US$2.47 billion.

As of January 20, 2025, the Company has repurchased an aggregate of approximately 11.2 million American depositary shares from the open market for an aggregate amount of approximately $542.8 million under its previously authorized repurchase program.

Second-quarter operating cash inflow totaled $313.3 million. As of November 30, 2024, New Oriental had US$1.42 billion in cash and cash equivalents.

prospect: New Oriental expects that in the third quarter, after deducting the revenue generated by Dongmai’s own brand products and live broadcast business, New Oriental’s total net income will be US$1.007 billion to US$1.03 billion, an annual increase of 18% to 21%. Analysts expected $1.29 billion for the quarter.

price action: EDU stock was down 12.9% in premarket trading at $53.00 as of last check on Tuesday.

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