Chinese private tutoring giant New Oriental posts 50% loss in Q1 revenue
China‘s major private education agency New Oriental Education and Technology released its financial report for the third quarter ending February 28 on the Hong Kong Stock Exchange on Tuesday, reporting its total revenue of $614.1 million, compared with that of approximately $1.19 billion in the same period last year, a decrease of 48.4 percent year-on-year.
According to the report, New Oriental’s total revenue from education services reached $510 million in the third quarter, down 54.1 percent year-on-year, mainly due to the impact of polices to clamp down on tutoring services for students under grade nine.
In terms of net profit, the company reported a loss of $141 million, compared to a profit of $101 million in the same period last year, a 239.1 percent slump.
The company’s founder Yu Minhong said in the financial report that despite the bleak earning figures, “both new businesses and initiatives are showing positive and good growth momentum.”
Yu said that in the first nine months of the fiscal year, revenue from the company’s remaining major businesses including overseas test preparation and consulting grew 15 percent year-on-year, and domestic examination preparation business for adults and college students increased by about 59 percent.
Meanwhile, the company is exploring a variety of new business opportunities, including non-academic tutoring, smart learning systems as well as teaching materials and digital smart learning solutions.
“While these new businesses are still in their infancy, we are confident that they will provide a bright future for the company. We expect the new businesses to be able to contribute to total revenue from the next financial year,” Yu said.
The financial results show that the number of New Oriental schools and learning centers totaled 847 for the year ending February 28, a decrease of 778 year-on-year.
Zhou Chenggang, the company’s Chief Executive Officer, said that the firm will develop and enhance its Online-Merge-Offline platforms, providing more advanced and diversified educational services for students of all ages across its remaining key businesses.
The company’s online education platform, Koolearn.com, will continue to expand its online education services for adults and college students, actively seeking business opportunities in new areas such as livestreaming e-commerce, corporate partnerships and smart learning innovation.
On December 28, the company launched a livestreaming platform called “Dongfangzhenxuan,” with Yu Minhong delivering his first livestreaming show selling fresh produce.
Source: Global Times