Reporter丨He Jipai Editor丨Yan Zi, the stock price of New Oriental, which is helmed by Yu Minhong, suddenly dropped. As soon as the market opened on August 1, its stock price plunged, falling by more than 17%. At the close, the decline narrowed to 7.85%. The trigger is performance.

Reporter丨He Jipai Editor丨Yan Zi is

Yu Minhong is at the helm of New Oriental , and the stock price suddenly flashed. As soon as

html opened on August 1, its stock price plunged, falling by more than 17%. At the close, the decline narrowed to 7.85%. The trigger for

is performance. The day before, the company disclosed its financial report. In fiscal year 2024, its revenue reached US$4.31 billion, approximately 31 billion yuan, a year-on-year increase of 44%.

However, in the fourth fiscal quarter of fiscal year 2024 (March-May), increased revenue did not increase profits. operating profit was only US$10.527 million, a year-on-year drop of 78.1%.

Profit performance is not satisfactory, JPMorgan Chase , Goldman Sachs and other institutions have lowered the target price of New Oriental.

Last week, Dong Yuhui’s resignation caused New Oriental and Yu Minhong to be frequently searched. The outside world has paid strong attention to its development.

Judging from this financial report, the "best seller" is gone, and Boss Yu still has a trump card in his hand.

The basic market is stable

New Oriental, with a market capitalization of HK$83.5 billion, is Yu Minhong’s ballast; the education business is still its basic market.

Among them, the traditional core business has a stable growth rate.

html From March to May, overseas exam preparation and overseas study consulting business grew by approximately 17.7% and 17.3% year-on-year. Domestic test preparation business for adults and college students increased by approximately 16.4% year-on-year.

At the same time, the new education business is gaining momentum, with revenue growing by 50.3% this quarter.

Among them, the non-subject tutoring business was launched in nearly 60 cities this fiscal quarter, with approximately 875,000 registrations; intelligent learning systems and equipment were also adopted in approximately 60 cities, with 188,000 active paying users this fiscal quarter.

Yu Minhong, who has always been cautious, quietly accelerated the expansion of and actively opened schools for .

As of the end of May, the total number of New Oriental schools and learning centers nationwide was 1,025, an increase of 277 year-on-year and 114 month-on-month.

In fiscal year 2025, New Oriental’s offline teaching locations are expected to expand by 20%-25%.

For comparison, before the double reduction, as of the end of May 2021, New Oriental had 1,669 offline outlets.

The demand for education is strong. Not only New Oriental, but also education and training players and are actively deploying offline this year.

For example, TAL Future may expand its offline teaching points by more than 30% in fiscal year 2025; Gaotu has opened offline campuses in nearly 20 cities and has begun to invest in the research and development of offline operation systems. At the

performance communication meeting, New Oriental CEO and CFO Yang Zhihui mentioned that he had noticed the layout actions of competitors, but now compared with before the introduction of the policy, competition is relatively reduced, and the new learning center will occupy more market share.

is lower than expected

From the perspective of revenue volume, New Oriental has returned to the scale before the double reduction. Before the double reduction of

, the company's peak revenue was US$4.28 billion (fiscal year 2021).

In fiscal year 2024, ’s revenue was US$4.31 billion, the highest in the past five years.

revenue was basically in line with expectations, but poor performance on the profit side made the capital market worry about its profitability.

In the fourth fiscal quarter of fiscal year 2024, New Oriental’s operating profit and net profit both declined.

operating profit margin (non-gaap) was 3.2%, a year-on-year decrease of 5.9 percentage points, lower than market expectations of 6%.

It is worth noting that the profit of has been lower than expected for for two consecutive quarters.

For comparison, at its peak, in the first fiscal quarter of fiscal year 2020 (June-August 2019), New Oriental's net profit reached US$210 million, and its operating profit margin (non-gaap) was 24%.

In the first fiscal quarter of fiscal year 2024, these two data were close to this level. In the fourth fiscal quarter, the profit situation changed.

Yang Zhihui explained that the profit margin was lower than expected, mainly due to accelerating the expansion of education space, investment in cultural tourism business, and increasing the salary of management and employees.

"The operating profit margin of this fiscal quarter will have a short-term impact." He emphasized.

Bet on Culture and Tourism

First I drove to Tibet for 21 days, and then I went to Portugal with my daughter for a week. Since the end of April, Yu Minhong has expressed his love for the mountains and rivers, and has written 26 travel stories in his personal official account.

Boss Yu, who loves to travel around, is betting heavily on a new business: cultural tourism.

In July last year, New Oriental officially opened up the cultural tourism business, shouting the slogan of "starting a new business", and established Beijing New Oriental Cultural Tourism with a registered capital of 1 billion yuan. The legal person and chairman are Yu Minhong.

Yu said that New Oriental’s core competitiveness is “lecturing”. "If our cultural tourism business is developed, we will cultivate a group of tour guides who can give lectures."

relies on New Oriental, a big IP, and retains its original education team, so its cultural tourism business is growing rapidly. Geographically, the layout of cultural tourism destinations and New Oriental’s offline teaching points are highly overlapped, and the company can reuse its team and ground resources. The business of

is mainly led by Yang Zhihui. Its products cover all ages, including middle-aged and elderly people, parents and teenagers, and teenagers. It provides services such as cultural tourism, study, international study tours, and camp education.

One of its important tags is that it is expensive. For example, a 16-day, 14-night family trip to the United Kingdom and Ireland costs a total of 52,800 yuan per person.

Last year, cultural tourism business revenue was 330 million yuan, and ’s revenue in fiscal year 2025 is expected to reach 1.2 billion yuan.

This year, the cultural and tourism sector has seen frequent moves.

html In April, the Hulunbuir Municipal People's Government, Inner Mongolia Forest Industry Group and New Oriental Cultural Tourism reached a strategic cooperation. One of the contents of

's tripartite cooperation is to establish a product model of "micro-short dramas + line products + performing arts + B&B hotels + cultural creativity".

In the same month, the new headquarters of New Oriental Cultural Tourism Group was unveiled in Haidian, Beijing.

html At the beginning of 2000, Yu Minhong revealed that the cultural tourism business will be listed separately in the future. By then, he will have three listed companies in his hands.

According to the "2024 Hurun Global Rich List", Yu Minhong ranks 1,577th with a net worth of 16.5 billion yuan.

In the future, if the "troika" of education, e-commerce, and cultural tourism goes smoothly, his net worth will also rise.

The departure of a person will have limited impact on him who holds three cards.

title picture source: Tu Chong

picture source: New Oriental, except where noted