New Oriental Education & Technology Group Inc (EDU) 2025 Q1 法說會逐字稿

Good evening and thank you for standing by for New Orientals FY 2025 first quarter results earnings conference call at this time. (Operator Instructions) Today's conference is being recorded. If you have any objections, you may disconnect at this time.

晚上好，感謝大家此時出席新東方2025財年第一季業績電話會議。 （操作員指示）今天的會議正在錄音。如果您有任何異議，您可以此時斷開連接。

I'd now like to turn the meeting over to your host for today's conference with Sisi Zhao.

現在我想將會議交給主持人，與趙思思一起參加今天的會議。

Thank you. Hello, everyone and welcome to New Oriental's first fiscal quarter, 2025 earnings conference call. Our financial results for the period were released earlier today and available on the company's website as well as on newswire services.

謝謝。大家好，歡迎來到新東方2025年第一財季財報電話會議。我們這段期間的財務表現已於今天稍早發布，並可在公司網站和新聞專線服務上查看。

Today, Zhihui Yang, Executive President and Chief Financial Officer and I will share new rentals latest earnings results and business updates in detail with you after that Stephen and I will be available to answer your questions before we continue.

今天，我和執行總裁兼財務長楊志輝將與您詳細分享新租賃的最新獲利結果和業務動態，然後史蒂芬和我將在我們繼續之前回答您的問題。

Please note that the discussion today will contain forward-looking statements made under the safe harbor provisions of the US Private Security Litigation Reform Act of 1995 for looking statements involved, inherent risks and uncertainties as such.

請注意，今天的討論將包含根據 1995 年美國私人安全訴訟改革法案的安全港條款做出的前瞻性陳述，以了解所涉及的陳述、固有風險和不確定性。

Our results may be materially different from the view expressed today. A number of potential risks and uncertainties are outlined in our public findings with the sec neural does not undertake any obligation to update any forward-looking statements except as required under applicable law.

我們的結果可能與今天表達的觀點有很大不同。我們的公開調查結果概述了許多潛在的風險和不確定性，除非適用法律要求，否則 SEC Neuro 不承擔更新任何前瞻性陳述的義務。

As you remember, this conference is being recorded. In addition, a webcast of this conference call will be available on the Oriental semester relations website at investor.neworiental.org.

如您所知，本次會議正在錄製中。此外，東方學期關係網站 Investor.neworiental.org 也將提供本次電話會議的網路直播。

I will now turn the call over to Mr. Yang. Please go ahead.

我現在將電話轉給楊先生。請繼續。

Thank you, Sisi. Hello everyone and thank you for joining us on the call. We're pleased to announce that the company has forged a healthy growth across our key business line in alignment with the expectations with the top line growth of 30.5%. This quarter total net revenues excluding revenues generated from East to buy private label products and live streaming business increased by 33.5% year over year.

謝謝你，茜茜。大家好，感謝您加入我們的通話。我們很高興地宣布，該公司的主要業務線實現了健康成長，符合預期，營收成長 30.5%。本季剔除東方買自有品牌產品和直播業務產生的收入的總淨收入年增33.5%。

In particular, we're impressed by the highly encouraging growth that the new endeavors have anchored, which has significantly contribute to the core building blocks of the company.

特別是，我們對新努力所帶來的令人鼓舞的成長印象深刻，這為公司的核心建構做出了重大貢獻。

At the same time, New Oriental's bottom line performance for our core educational business has also achieved healthy yields, operating margin wise. We have excluded the operating margins generated from East Bay for this quarter for a better reflection of the performance of new rentals, poor educational business.

同時，新東方核心教育業務的利潤率、營業利益率也實現了健康的利潤。我們排除了東灣本季產生的營業利潤率，以便更好地反映新租賃、教育業務表現不佳的表現。

The operating margin and non GP operating margin for this quarter have reached 23.7% and 24.4% representing 370 basis point and 220 basis point improvement year over year respectively.

本季的營業利益率和非普通合夥人營業利潤率分別達到 23.7% 和 24.4%，年比分別提高 370 個基點和 220 個基點。

We're pleased to see the tremendous efforts that we devoted into our offerings and platforms sparking positive growth across our business lines. Our commitment to maintaining a healthy profitability and market share stands firm as we strive to create sustainable value for our customers and shareholders in the long term.

我們很高興看到我們在產品和平台上投入的巨大努力激發了我們整個業務線的積極成長。我們堅定地致力於維持健康的獲利能力和市場份額，並努力為客戶和股東長期創造可持續的價值。

Now, I would like to spend some time to talk about the quarter's performance across our existing business lines and new initiatives to you. In detail, our key remaining business continued to secure encouraging trends this quarter, breaking it down. The overseas tax business recorded a revenue increase of 19% year over year for the fiscal -- first fiscal quarter of 2025.

現在，我想花一些時間向您談談我們現有業務線的本季業績以及新舉措。具體來說，我們的主要剩餘業務本季繼續保持令人鼓舞的趨勢，打破了這一趨勢。 2025財年第一財季海外稅務業務營收年增19%。

The overseas study consulting business recorded revenue increase of about 21% year over year for this quarter. The adults and university students business recorded a revenue increase of 30% year over year for this quarter.

本季留學諮詢業務營收年增約21%。本季成人和大學生業務營收年增30%。

The ongoing investments are new education business initiatives which mostly revolve around facility students all around development have propelled the company's engine to innovation, having secured strong momentum in their respective ventures.

正在進行的投資是新的教育業務計劃，主要圍繞著設施學生的全面發展，推動了公司的創新引擎，在各自的企業中獲得了強勁的動力。

Firstly, the non AEM two courses which we have offered in around 60 existing cities focuses on cultivating students, innovative ability and comprehensive quality. We're pleased to receive solid interest with a total of approximately 484,000 student enrollments recorded in this quarter. The top 10 cities in China contribute over 60% of this business.

首先，我們在現有約60個城市開設的非AEM兩門課程，著重培養學生的創新能力和綜合品質。我們很高興收到了濃厚的興趣，本季共有約 484,000 名學生註冊。中國前10名城市貢獻了該業務的60%以上。

Secondly, the intelligent learning system and device business has been adopted in around 60 cities. We're happy to see elevated customer retention and scalability with approximately 323,000 active users reported in this quarter. The revenue contribution of these initiatives from the top 10 cities in China is around 55%.

其次，智慧學習系統及設備業務已在約60個城市落地。我們很高興看到客戶保留率和可擴展性有所提高，本季活躍用戶約為 323,000 名。這些措施對中國前10名城市的收入貢獻約為55%。

Our smart education business, educational material and digitalized smart study solutions have continued to contribute material use to the overall advancement of the company. In summary, our new educational business initiatives have recorded a revenue increase of 50% year over year for this quarter.

智慧教育業務、教材及數位化智慧學習解決方案持續為公司整體進步貢獻物資使用。總而言之，我們新的教育業務計劃本季的營收年增了 50%。

In addition, our newly integrated tourism related business line is now comprised of a diverse offerings of cultural trips, study tours in China and overseas, as well as the camp education within the business line. Our study tour and research cap business for students of K-12 and university age achieved tremendous growth this quarter with an increase of 221% in revenue year over year for this quarter, we have operated study towards the research camp business in over 55 cities across the country. With the top 10 cities in China offering over 55% of revenue share of this new business.

此外，我們新整合的旅遊相關業務線現已包括多元化的文化旅行、國內外遊學以及業務線內的營地教育。我們針對K-12和大學年齡層學生的遊學和研究營業務本季度取得了巨大的增長，本季度收入同比增長221%，我們已在超過55個城市開展遊學和研究營業務國家。中國前十大城市提供了這項新業務超過 55% 的收入份額。

The number of tough enough tourism offerings were also piloted to expand our reach to all age groups including the middle aged and elderly individuals around 630 featured provinces in China and globally. Inspiring growth this quarter has affirmed our devotion to deliver premium offerings to our valued customers and we believe this new business line will contribute continuously meaningful revenue from this fiscal year.

也試辦了一些足夠強的旅遊產品，將我們的服務範圍擴大到中國和全球630個特色省份的所有年齡段，包括中老年人。本季令人鼓舞的成長證實了我們致力於為尊貴的客戶提供優質產品的決心，我們相信這條新業務線將在本財年持續貢獻有意義的收入。

With regards to our OMO system, we have perceived in revamping our platform and leverage our educational infrastructure and technology edge on remaining key business and new initiatives with a vision to provide advanced diversified education service to customers of all ages. In this quarter, a total of $24.6 million has been invested in our OMO teaching platform, which equips us with the flexibility to maintain a rival service to students.

就我們的OMO系統而言，我們已經意識到要改造我們的平台，並利用我們的教育基礎設施和技術優勢來開展剩餘的關鍵業務和新舉措，以期為所有年齡段的客戶提供先進的多元化教育服務。本季度，我們的 OMO 教學平台總共投資了 2,460 萬美元，這使我們能夠靈活地為學生提供具有競爭力的服務。

In terms of the East buys performance since April 2022 East to buy has launched a total of 488 SKUs in private label products. In just two years, our product categories have expanded into well diversified product needs to date during the reporting period is by also uplifts the significance of the offering only product with high cost of performance which has proven effective in reiterating is the best value in the minds of our current and new users.

從東買業績來看，2022年4月以來東買共推出自有品牌產品488個SKU。在短短兩年的時間裡，我們的產品類別已擴展到報告期間迄今為止的多元化產品需求，這也提升了僅提供高性價比產品的重要性，這已被證明有效地重申了人們心中的最佳價值我們的現有用戶和新用戶。

In addition, thanks to our multichannel strategy that has been that has driven sustainable growth. If the buys for grants have expanded from our live streaming channels to the lack of TOJD PDU and Xiaohongshu as they amplify our reach to a wider customer base in the new year is to buy will explore offline channels by examining the the partnership with offline schools owned by new rental grants and other parties as part of our vision to initiate offline sales network and enhance our brand awareness to the great expense with regards to the company's latest financial position.

此外，由於我們的多通路策略，推動了永續成長。如果助學金從我們的直播管道擴展到缺乏TOJD PDU和小紅書，因為他們在新的一年擴大了我們對更廣泛客戶群的影響力，那麼購買將透過檢查與線下學校的合作關係來探索線下管道透過新的租金補助和其他各方作為我們啟動線下銷售網絡並增強我們的品牌知名度的願景的一部分，我們在公司最新的財務狀況方面投入了大量資金。

I'm pleased to share that the company is in a healthy financial status with the cash and cash equivalent term deposit and short term investments totaling approximately $4.9 billion.

我很高興地告訴大家，公司財務狀況良好，現金和現金等價物定期存款以及短期投資總計約 49 億美元。

Now, I would also like to take the opportunity to highlight that the company's board of directors approved a share repurchase program in July 2022 and which the company is authorized to repurchase up to $400 million of the company ADS or common shares through the next 12 months.

現在，我還想藉此機會強調，公司董事會於 2022 年 7 月批准了一項股票回購計劃，並授權公司在未來 12 個月內回購最多 4 億美元的公司 ADS 或普通股。

The company's board of directors further approved to extend the effective time of the share purchase program to May 31, 2025 and the increasing the aggregate value of the shares that the company is authorized to repurchase from $400 million to $700 million.

公司董事會進一步批准將股份購買計畫的生效時間延長至2025年5月31日，並將公司授權回購的股份總價值從4億美元增加至7億美元。

As of October 22nd 2024 the company we purchased an aggregate of approximately 9.8 million the ADS for approximately $457.9 million from the open market.

截至 2024 年 10 月 22 日，我們從公開市場以約 4.579 億美元的價格購買了總計約 980 萬股美國存託股份。

Now, I will turn the call over to Sisi to share with you about the key financial. Sisi, please go ahead. Thank you.

現在，我將把電話轉給塞西，與大家分享關鍵的財務問題。茜茜，請繼續。謝謝。

Steven. I'd like to share our key financial details for this quarter. Offering costs and expenses for the quarter for $1,142.3 million representing a 27.6% increase year over year. non-GAAP operating cost and expenses for the quarter, which excludes share based compensation expenses were $1,135.4 million, representing a 32.8% increase year over year. The increase was primarily due to the cost and expenses related to accelerated capacity expansion for educational business and newly integrated tourism related business.

史蒂文.我想分享我們本季的主要財務細節。本季的服務成本和費用為 11.423 億美元，年增 27.6%。本季非 GAAP 營運成本和費用（不含股權激勵費用）為 11.354 億美元，較去年同期成長 32.8%。成長主要是由於教育業務和新整合的旅遊相關業務加速產能擴張相關的成本和費用。

Cost of revenues increased by 32.3% year over year to $583.5 million. Selling and marketing expenses increased by 42.3% year over year to $193.7 million. G&A expenses for the quarter increased by 15% year over year to $365.1 million.

收入成本年增 32.3% 至 5.835 億美元。銷售和行銷費用年增 42.3% 至 1.937 億美元。本季的一般管理費用年增 15%，達到 3.651 億美元。

Non-GAAP G&A expenses which exclude share based compensation expenses were $354.5 million, representing a 22.1% increase year over year. Total share based compensation expenses which were allocated to related operating costs and expenses decreased by 82.7% to $6.9 million in the first fiscal quarter of 2025 operating income was $293.2 million. Representing a 42.9% increase year over year non GAAP income from OPERAT operations for the quarter was $300 million. Representing a 22.6% increase year over year. Net income attributable to Neal for the quarter was $245.4 million.

不計股權激勵費用的非 GAAP G&A 費用為 3.545 億美元，較去年同期成長 22.1%。分配給相關營運成本和費用的股份補償費用總額下降了 82.7%，至 690 萬美元，2025 年第一財季的營運收入為 2.932 億美元。本季來自 OPERAT 業務的非 GAAP 收入為 3 億美元，年增 42.9%。年增22.6%。本季尼爾應佔淨利為 2.454 億美元。

Representing a 48.4% increase year over year basic and diluted net income per ADS attributable to the Oriental were $1.49 and $1.48 respectively.

歸屬於東方的每股美國存託股基本和稀釋淨利潤分別為 1.49 美元和 1.48 美元，年增 48.4%。

Non-GAAP net income editable to new rental for the quarter was $264.7 million. Representing a 39.8% increase year over year. Non-GAAP basic and diluted net income per ADS. Attributable to Oriental were $1.61 and $1.60 respectively.

該季度可編輯新租金的非 GAAP 淨利潤為 2.647 億美元。較去年同期成長39.8%。非公認會計原則每美國存託股基本和稀釋淨利。東方歸屬感分別為 1.61 美元和 1.60 美元。

Net cash flow generated from operation for the first fiscal quarter of 2025 was approximately $183.2 million. And capital expenditure for the quarter were $80.2 million.

2025 年第一財季營運產生的淨現金流量約為 1.832 億美元。該季度的資本支出為 8,020 萬美元。

Turning to the balance sheet as of August 31, 2024 new rental had cash and cash equivalents of $1,147 million. In addition, the company had $1,513.8 million in term deposit and $2,248.6 million in short term investments. Neur rentals deferred revenue which represents cash collected upfront from customers and related revenue that will be recognized as the service or goods are delivered.

截至 2024 年 8 月 31 日的資產負債表，新租賃的現金和現金等價物為 11.47 億美元。此外，該公司還有15.138億美元的定期存款和22.486億美元的短期投資。 Neur 租賃遞延收入代表從客戶處預先收取的現金以及將在服務或貨物交付時確認的相關收入。

At the end of the first quarter of fiscal year, 2025 was $733.1 million an increase of 23.7% as compared to $1,401.4 million at the end of the first quarter of last fiscal year.

截至2025財年第一季末，該數字為7.331億美元，較上一財年第一季末的14.014億美元成長23.7%。

Now I'll head over to Zhihui to go through our outlook and guidance.

現在我將前往智慧，介紹我們的展望和指導。

Thank you, Sisi. With the encouraging performance achieved from our diverse business lines backed by our solid educational resources that have stood the test of time. We are bullish on maintaining a healthy growth for our core educational business simultaneously. We will devote ongoing investment in expanding our new tourism related business in belief that this input will nourish more expensive nationwide throughout of our tours in the in this fiscal year.

謝謝你，茜茜。憑藉著經得起時間考驗的堅實教育資源，多元化業務線取得了令人鼓舞的表現。我們看好我們的核心教育業務同時保持健康成長。我們將持續投資擴大新的旅遊相關業務，並相信這項投資將在本財年推動我們全國範圍內的旅遊更加昂貴。

While we strive to safeguard a healthy balance between revenue and profitability growth, we will also cautiously manage our capacity expansion and inherent to underpin the development of our educational business. In this new year.

在我們努力維護收入和獲利成長之間的健康平衡的同時，我們也將謹慎管理我們的產能擴張和固有的支撐我們教育業務發展的能力。在這新的一年裡。

We plan to increase our capacity by around 20% to 25%. For this fiscal year. The most new openings will be launched in the cities with better topline and bottom line performance. Rest assured that we will closely monitor the pace and scale of new openings in accordance to the local operations and financial performance. During the year.

我們計劃將產能增加約 20% 至 25%。本財年。最新開業的酒店將在營收和利潤表現更好的城市開設。請放心，我們將根據當地營運和財務表現密切關注新開幕的速度和規模。年內。

Every second quarter of our financial year tends to be a slower period due to the seasonality of our business. That being said we remain confident in attending a steady growth and satisfactory operating profit for the for the full year.

由於我們業務的季節性，我們財政年度的每個第二季度往往是一個較慢的時期。話雖如此，我們仍然有信心實現全年的穩定成長和令人滿意的營業利潤。

We expect total net revenues excluding revenues generated from east to buy in the second quarter of the fiscal year 2025 September 1, 2024 to November 30, 2024 to be in the range of $851.4 million to $871.8 million. Representing year over year increase in the range of 25% to 28%.

我們預計，2025財年第二季（2024年9月1日至2024年11月30日）不包括東部購買收入的總淨收入將在8.514億美元至8.718億美元之間。年比增幅在25%至28%之間。

In addition, based on our current estimation, we expect the operating margin for the whole company except for is to buy for the fiscal year 2025 will expand year over year. I must say that these expectations and forecasts reflect our considerations of the latest regulatory measure as well as our current and preliminary view, which is subject to change.

此外，根據我們目前的估計，我們預計2025財年除採購外的整個公司的營業利潤率將比去年同期擴大。我必須說，這些預期和預測反映了我們對最新監管措施的考慮以及我們當前和初步的觀點，這些觀點可能會改變。

To conclude, new rental will always pursue premium offerings to our customers simultaneously achieve sustainable growth. To achieve that we will continue to devote necessary resources on research and application of new technologies such as AI&C CPD into our education and product offerings with a vision to uplift our strengths, to pursue the growth and operating efficiency.

總而言之，新租賃將始終追求為客戶提供優質服務，同時實現永續成長。為了實現這一目標，我們將繼續投入必要的資源，將 AI&C CPD 等新技術的研究和應用融入我們的教育和產品中，以提升我們的優勢，追求成長和營運效率。

We will also continue to seek guidance from the from and cooperate with the government. Authorities comply with the relevant policies, guidelines and any related regulations as well as to further adjust our business operation as required.

我們也將繼續尋求政府的指導和配合。主管機關遵守相關政策、指南和任何相關規定，並根據需要進一步調整我們的業務運作。

As always, we will work diligently to enhancing the nation's education level, to strengthen the leading position. So as to unveil further potential across all our business line and realizing our vision, this is the end of our fiscal year 2025 Q1 summary.

我們將一如既往，為提升民族教育水準、鞏固領先地位而不懈努力。為了揭示我們所有業務線的進一步潛力並實現我們的願景，這是我們 2025 財年第一季總結的結尾。

At this point, I would like to open the floor for questions. Operator. Please open the call for this. Thank you.

現在，我想請大家提問。操作員。請為此撥打電話。謝謝。

(Operator Instructions)

（操作員說明）

Felix Liu, UBS.

劉菲利克斯，瑞銀。

Good evening management. Thank you for taking my question. My question is on your second quarter guidance. We noticed that in the first quarter, your capacity expansion was over 30% young year by the number of learning center.

晚上好管理。感謝您回答我的問題。我的問題是關於第二季度的指導。我們注意到，第一季度，以學習中心數量計算，你們的產能擴張超過了當年的30%。

However, if we look at your second quarter guidance, it's slower than your capacity expansion in the first quarter. So how should we think about the GAAP between capacity growth and the revenue guidance and the management share your outlook for the second half growth? Well, do we expect to see the revenue growth to converge with capacity? Thank you.

然而，如果我們看一下你們第二季的指導，就會發現它比第一季的產能擴張還要慢。那麼，我們應該如何考慮產能成長和收入指導之間的公認會計原則以及管理階層對下半年成長的展望？那麼，我們預期營收成長會與產能成長趨同嗎？謝謝。

Yeah, I think, yeah, thank you, Felix. As for the Q2 guidance, you know, we, we give the guidance of you know, the the the top line growth will be in the range of the 25% to 28% in dollar terms every year. But as every second quarter tends to be a slower quarter due to the seasonality of our education business and but, but you know, we will remain confident in attaining a steady growth of around 30% year over year, you know, for, for the whole year. So that means we expect the revenue growth excluding the buy in Q3 and Q4 will be accelerated compared to the growth of the Q2.

是的，我想，是的，謝謝你，菲利克斯。至於第二季的指導，你知道，我們給出的指導是，每年以美元計算的收入成長將在 25% 至 28% 的範圍內。但由於我們教育業務的季節性，每個第二季度往往會放緩，但是，但你知道，我們仍然有信心實現同比 30% 左右的穩定增長，你知道，對於全年。因此，這意味著我們預計第三季和第四季不包括購買在內的營收成長將比第二季的成長加快。

So, you know, as you know, even though we have seen some impacts of the existing economic environment like the overseas related business, but we will expect the full physical year revenue growth which you know, except for to buy will be around 30% year over year.

所以，如你所知，儘管我們已經看到了現有經濟環境（例如海外相關業務）的一些影響，但我們預計除購買之外的整個實體年度收入增長將在 30% 左右年復一年。

And yeah, you know, we, we opened, you know, more learning centers in last year, Q3 and Q4. And, but, you know, we, we have seen, we ramp up the learning centers, you know, much faster than before. And so, and I, we will feel the new learning, more students into the learning centers and especially in, in the Q3 and Q4. So we're quite optimistic about the, the the top end growth for the whole year, you know, for the whole year. Thank you, Felix.

是的，你知道，我們在去年第三季和第四季開設了更多學習中心。而且，但是，你知道，我們已經看到，我們建立學習中心的速度比以前快得多。因此，我，我們將感受到新的學習，更多的學生進入學習中心，特別是在第三季和第四季。因此，我們對全年的高端成長非常樂觀。謝謝你，菲利克斯。

Thank you.

謝謝。

Thank you.

謝謝。

Alice Cai, Citi.

愛麗絲蔡，花旗銀行。

Good evening, Steven and City. Thanks for taking my question. I have a question about the capacity expansion since Q2 is typically a low season. Are you considering slowing down capacity expansion during this period to improve margin? And do you expect more capacity to be concentrated in Q1 and Q4 for FY25? And for the upcoming, will you focus on encouraging penetration in existing cities rather than entering new ones? Thanks.

晚上好，史蒂文和曼城。感謝您提出我的問題。我對產能擴張有疑問，因為第二季通常是淡季。您是否考慮在此期間放慢產能擴張以提高利潤率？您預計 2025 財年更多產能會集中在第一季和第四季嗎？對於即將到來的，您會專注於鼓勵現有城市的滲透而不是進入新城市嗎？謝謝。

Yeah, you know, by the end of this quarter, Q1, we have added around 6% due capacity. And so yeah, as I said, you know, we plan to you know, increase our capacity expansion by 20% to 25% for the whole year. And, you know, last year we opened more learning centers, but this year, I think we will open the learning center by more, you know, healthy pace 20% to 25%.

是的，你知道，到本季末，即第一季度，我們增加了約 6% 的到期產能。所以，是的，正如我所說，我們計劃將全年產能擴張增加 20% 至 25%。而且，你知道，去年我們開設了更多的學習中心，但今年，我認為我們將開設更多的學習中心，你知道，健康的步伐是 20% 到 25%。

And yeah, as I said, you know, we went up the learning centers much faster than before. And so I think as the whole year wise, I think the margin, you will see the margin expanded for the whole year and in the, in the Q2. Yeah, we we might be need some like margin like tiny margin pressure in the Q2 because of the seasonality Q2 is the low season. But we do believe for the whole year, the margin will be expanded for the education business except for for Easter Bay. Thank you, Alice.

是的，正如我所說，你知道，我們進入學習中心的速度比以前快得多。因此，我認為從全年來看，我認為利潤率在全年和第二季都會擴大。是的，我們可能需要一些像第二季的利潤這樣的微小利潤壓力，因為第二季是淡季。但我們確實相信，全年教育業務的利潤率將會擴大（復活節灣除外）。謝謝你，愛麗絲。

Thanks.

謝謝。

Yiwen Zhang, China Renaissance.

張藝文，中國文藝復興。

Yeah, great. That's what my question. So my question is about the margin. So it's, you know, very good to see our adjust op margin increase 220 bits. Our wild wild place is reversing the dip in the previous quarter. So can you discuss more about what are driving this improvement. And how should we think about the driver, drivers to pay out in the rest of the year? Thank you.

是的，太棒了。這就是我的問題。所以我的問題是關於保證金的。因此，您知道，很高興看到我們的調整操作餘裕增加了 220 位元。我們的狂野之地正在扭轉上一季的頹勢。那麼您能否多討論推動這項改進的因素。我們該如何考慮司機，司機在今年剩餘的時間裡要支付的費用？謝謝。

Well, thank you even you asked the question about the margin. You know, let us start with the margin analysis of this quarter that the non GAAP open margin for educational basis which excluding is to buy was expanded by 220 basis points year over year. You know, as you know, I think, you know, last year Q1 op margin was high base.

好吧，謝謝你甚至問了關於保證金的問題。要知道，讓我們從本季的利潤率分析開始，剔除購買的教育基礎的非公認會計準則開放利潤率同比擴大了220個基點。你知道，如你所知，我認為，去年第一季的營運利潤率是高基數。

So that means we have a hard comparison this quarter, but we still got the, the margin expansion by 220 basis points every year. I think this is mainly due to the following reasons. Number one, we're pleased to see that the business lines achieved the, the positive topline growth for all business lines. And number two is we started to bear fruit of the learning center expansion of last year. It drives the, the, the overall utilization rate up and get more operating leverage.

因此，這意味著我們本季進行了艱難的比較，但我們仍然得到了每年 220 個基點的利潤率擴張。我認為這主要是由於以下幾個原因。第一，我們很高興看到所有業務線都實現了積極的營收成長。第二是我們去年的學習中心擴建開始有成果。它推動了整體利用率的提高並獲得了更多的營運槓桿。

Number three, you know, we started to make cost control in the whole company and we leverage more overhead in this quarter. Even though we will spend more money on the the new tourism business, but you know, the educational business except for the buy, we we still got the margin extension higher than we expected.

第三，你知道，我們開始在整個公司範圍內進行成本控制，並且我們在本季度利用了更多的管理費用。儘管我們會在新的旅遊業務上花更多的錢，但你知道，除了購買之外的教育業務，我們的利潤率仍然高於我們的預期。

And as for the margin outlook, you know, due to the seasonality of the business every second quarter is the low season. So we're likely to experience some minor major pressure in the second quarter. But as I said, you know, we were quite confident about the Q3 and Q4.

至於利潤率前景，你知道，由於業務的季節性，每第二季都是淡季。因此，我們在第二季可能會遇到一些較小的重大壓力。但正如我所說，我們對第三季和第四季都非常有信心。

So we are optimistic on the margin profile for the educational business, including Easter buy in in the whole year. And I think we expect that the whole year mar the non GOP margin will be expanded, you know, for the whole year. Thank you,

因此，我們對教育業務的利潤率持樂觀態度，包括全年的復活節買入。我認為我們預計全年 3 月非共和黨的利潤率將會擴大，你知道，全年。謝謝你，

Lucy Yu, Bank of America.

露西·餘，美國銀行。

Hi, Steven is but just to clarify, given, you said the second quarter, non GAAP op margin will be under pressure. Do you mean that excluding is by we're going to see margin contraction on a year over year basis. So just to clarify on that.

您好，史蒂文只是想澄清一下，鑑於您所說的第二季度非公認會計準則營運利潤率將面臨壓力。您的意思是排除我們將看到利潤率逐年收縮。所以只是想澄清一下。

And actually my question is on the cultural tourism. You did mention that a camp revenue was up by over 200% year, over year. So may I know like how much revenue that cultural tourism contributed this quarter? And is that business segment loss making or profit making for this quarter? Thank you.

其實我的問題是關於文化旅遊的。您確實提到營地收入逐年增加超過 200%。請問本季文化旅遊貢獻了多少收入？該業務部門本季是虧損還是獲利？謝謝。

Yeah, you know the, yeah, the margin, the tiny margin pressure in Q2. What I, you know what I said is only related to the educational business and because you know, we got the 25% to 20% to 28% top line growth and the Q2 is the low season of the the the educational business. So I think that you will see more leverage in Q3 and Q4.

是的，你知道，是的，第二季的利潤率、微小的利潤率壓力。我所說的只與教育業務有關，因為你知道，我們的收入成長了 25% 到 20% 到 28%，而第二季是教育業務的淡季。所以我認為你會在第三季和第四季看到更多的槓桿。

And so this is the the, so as I said, we were quite optimistic, optimistic about the margin profile in Q3 and Q4 and the tourism in the sense, yeah, the Q1 was the peak season for the tourism business, you know, such as the, the camp business and the, the overseas study tour, you know, the domestic study tour business.

這就是，正如我所說，我們對第三季度和第四季度的利潤狀況以及旅遊業非常樂觀，從某種意義上說，是的，第一季度是旅遊業務的旺季，你知道，這樣例如，營地業務和海外遊學業務，你知道，國內遊學業務。

So the revenue of the Q1 was somewhere around $90 million of the tourism business. This is the revenue in and yeah, we, we are profitable in Taiwan because of the peak season. But for the whole year, I think we will see that making of the tourism business.

因此，第一季旅遊業務的收入約為 9,000 萬美元。這是台灣的收入，是的，由於旺季，我們在台灣實現了盈利。但從全年來看，我認為我們將看到旅遊業的發展。

And you know, it's just the 1st year, we need more time to testify the product and the business models for the tourism business. But we're quite confident about the development of the tourism business. Thank you, Lucy.

你知道，這只是第一年，我們需要更多的時間來驗證旅遊業務的產品和商業模式。但我們對旅遊業務的發展還是很有信心的。謝謝你，露西。

Thank you, Zhihui.

謝謝你，志輝。

Timothy Zhao, Goldman Sachs.

提摩西·趙，高盛。

Hi. Hi, Zhihui. Thank you for taking my question. My question is regarding your K-12 new initiatives. Just wondering if you can break down in terms of the revenue growth between the academic tutoring and the intelligent learning devices and services.

你好。嗨，志輝。感謝您回答我的問題。我的問題是關於你們的 K-12 新舉措。只是想知道您是否可以細分學術輔導與智慧學習設備和服務之間的收入成長。

And the related question on the specific segment is I do notice that I think for the non tutoring, the quarterly enrollment for the past quarter grew by around 11% young year compared to close to 40% a quarter ago, just wondering if you can elaborate more on the growth and what kind of growth that we should expect on the enrollment? I think for the following quarters versus only 11% for this quarter. Thank you.

關於特定細分市場的相關問題是，我確實注意到，我認為對於非輔導來說，上個季度的季度入學人數增長了約11%，而上一季則接近40%，只是想知道您是否可以詳細說明更多關於增長的問題以及我們應該期望入學人數增長什麼樣的增長？我認為在接下來的幾個季度中，這一比例僅為 11%。謝謝。

You share with the, with the team about the the revenue breakdown within the new business.

您與團隊分享新業務的收入細目。

Business. The new K29 educational related, including the node tutoring and intelligence learning device business grew by over 50% in Q1 56% and both are growing at similar rates. And yeah --

商業。新K29教育相關，包括節點輔導和智慧學習設備業務在Q1成長超過50%，達到56%，兩者的成長速度相似。是的——

And your second question about the enrollment? Yeah, the enrollment growth of the K-12 seems to be low in this quarter because we open the summer window earlier than that of last year. So we, so that is we reported more more student enrollment in last year, Q4. It's a kind of the timing difference.

你的第二個問題是關於招生的？是的，本季 K-12 的入學人數成長似乎較低，因為我們比去年提前打開了夏季窗口。因此，我們報告去年第四季的學生入學人數有所增加。這是一種時間上的差異。

And and so if you combine the Q4 and Q1, the enrollment growth will be and it's, it's very strong. Absolutely. And you know, as I said, even though the, the, the Q4, the Q2 will be the low season, but we're quite confident about the, the, the whole year. The top end grows and and we, and I, I think we will see that even the accelerating top end grows in Q3 and Q4.

因此，如果將第四季和第一季結合起來，入學人數的成長將會非常強勁。絕對地。正如我所說，儘管第四季、第二季將是淡季，但我們對全年充滿信心。高端市場成長，我們，我，我認為我們會看到，即使是第三季和第四季高端市場的加速成長。

And for the new businesses, I think we, we still keep the same guidance of the 40% to 50%. Top end goal for the new businesses for the full year.

對於新業務，我認為我們仍然保持 40% 至 50% 的指導方針。全年新業務的最高目標。

Thank you, Zhihui. Thank you.

謝謝你，志輝。謝謝。

Charlotte Wei, HSBC.

夏洛特·魏，匯豐銀行。

And congratulations on your strong results. Thank you, Steven and for taking my question. And could you please share more color on the growth in different business segments in the second quarter? Thank you.

恭喜您取得優異的成績。謝謝你，史蒂文，謝謝你回答我的問題。您能否詳細介紹一下第二季不同業務部門的成長情況？謝謝。

Yeah. Actually, if you, yeah, you're asking the guidance for the guidance call.

是的。事實上，如果你，是的，你正在詢問指導電話的指導。

Yeah. Yeah.

是的。是的。

Okay. Yeah, overseas related business will grow like about over 20% and the domestic test prep university students business grow will be over 30%, 35% and high school business grow like 20%. And the new business will grow like over 50% around 50%.

好的。是的，海外相關業務成長20%左右，國內應試大學生業務成長30%、35%以上，高中業務成長20%左右。新業務將成長50%以上，50%左右。

Thank you very clear. Thank you.

謝謝你說得很清楚。謝謝。

DS Kim, JP Morgan.

DS Kim，摩根大通。

Hi, Zhihui. Hi, thanks. For taking my question. I just have a follow up on all your points that you made on new businesses if I may. Did you say, this past quarter, new businesses grew over 56%. Did I hear it correctly? Because, from the press release, I think, I mean, it's a minor thing but a press release seems to say 49.8% this quarter. So just wanted to double check if I'm looking.

嗨，志輝。你好，謝謝。為了回答我的問題。如果可以的話，我只是跟進您對新業務提出的所有觀點。您是否說過，上個季度新業務成長超過 56%？我沒聽錯吧？因為，從新聞稿來看，我認為，我的意思是，這是一件小事，但新聞稿似乎說本季為 49.8%。所以只是想仔細檢查一下我是否在尋找。

Yeah. That's the growth for non academic tutoring and intelligent learning device the over 55%.

是的。非學術輔導和智慧學習設備的成長超過 55%。

Oh, okay. So that means that this new educational business initiative has something else as well. And may I ask what, what else is here? And also can you, if you could give us the breakdown in terms of like current revenue last year revenue between non-academic tutoring versus intelligence and some others? How to mix within this subsegment?

哦好的。因此，這意味著這項新的教育業務計劃還有其他意義。可以問一下，這裡還有什麼嗎？如果您能為我們提供去年非學術輔導與智力和其他一些收入之間的當前收入明細嗎？如何在這個細分市場中進行混合？

Yeah. The actually every quarter the contribution is similar. So the non academic tutoring is roughly about half more than half of the new educational business and roughly about third is the intelligent learning device business and these two are growing faster than the rest smaller categories.

是的。實際上每季的貢獻是相似的。因此，非學術輔導大約佔新教育業務的一半以上，大約三分之一是智慧學習設備業務，這兩個業務的成長速度比其他較小的類別更快。

And smaller category if I may is like book sales or may, may I check out what else we have here? Just to double check.

還有較小的類別，如果可以的話，比如圖書銷售，或者可以，我可以看看我們這裡還有什麼嗎？只是為了仔細檢查。

Yeah, intelligent books and also some to be business.

是的，有智慧的書籍，也有一些商業書籍。

Got it. Thank you very much. And I if I may follow up on earlier, you mentioned and kindly gave us a breakdown of the growth momentum for 2Q guidance. Can I doublecheck whether that was based on us? Dollar versus RMB? And if you could provide this first quarter, similar breakdown between a segment growth, if possible, it would be great. Thank you so much and I'll go back to the queue

知道了。非常感謝。如果我可以跟進之前，您提到並善意地向我們詳細介紹了第二季度指導的增長勢頭。我可以仔細檢查一下這是否是基於我們的嗎？美元兌人民幣？如果您能提供第一季細分市場成長之間的類似細分（如果可能的話），那就太好了。非常感謝，我會回到隊列中

Q1 guidance and just to share him about the exchange rates

第一季指導，只是分享匯率

We're using. Yeah, we I can share with you the exchange rate that we're using for for Q1 quarter and the guidance quarter. Is that okay?

我們正在使用。是的，我可以與您分享我們第一季和指導季度使用的匯率。可以嗎？

Yes. Earlier growth was it based on?

是的。早期的成長是基於什麼？

Yeah, Q1 exchange rate is [7.22. And, and Q2 is 7.08] roughly.

是的，第一季匯率是[7.22。並且，Q2 大致為 7.08]。

Thank you very much.

非常感謝。

(Operator Instructions)

（操作員說明）

Lucy Yu, Bank of America.

露西·餘，美國銀行。

Zhihui, sorry, just wanted to follow up on the second quarter, margin and I know that you said it's a low season, but if you're looking at the top line is still growing at over 25% to like 28% which is not low. So why would should we think that the margin will decline or contract on a year over year basis? Is there any other like investment that you're going to step up or some other reasons? Thank you.

志輝，抱歉，只是想跟進第二季度的利潤率，我知道你說這是淡季，但如果你看一下營收仍然以超過 25% 的速度增長，比如 28%，這不是低的。那麼，為什麼我們會認為利潤率會逐年下降或收縮呢？您還有其他類似的投資需要加強嗎？謝謝。

You know, the, the Q2. Yeah, the Q2 is the, the, the the low season for all business lines, the overseas related, even for the K '12 business and the tourism business, you know, we have tiny revenue from the tourism business. So we will suffer the loss of the tourism business in Q2.

你知道，Q2。是的，第二季度是所有業務線、海外相關業務的淡季，甚至是 K'12 業務和旅遊業務，你知道，我們的旅遊業務收入微乎其微。所以我們第二季的旅遊業務將會遭受損失。

And and so if you, if you saw the numbers, you know that historically, every Q2, every year will be the the low margin profile for the whole company. And and I, yeah, as I said, you know, we will open more learning centers in the second half of the last year, but we still need more time to fill the students into the new learning centers. So yeah, and I must mention that, you know, we're using the the conservative approach to give the margin guidance as always.

因此，如果你看到這些數字，你就會知道，從歷史上看，每個第二季、每年整個公司的利潤率都會很低。我，是的，正如我所說，你知道，我們將在去年下半年開設更多的學習中心，但我們仍然需要更多的時間來讓學生進入新的學習中心。所以，是的，我必須提到，你知道，我們一如既往地使用保守的方法來提供利潤指導。

We and then I just may I follow up that how much like loss or margins. Have you sucked in from tourism in second quarter? Thank you.

我們然後我可以跟進損失或利潤有多少。第二季你從旅遊業獲利了嗎？謝謝。

I think it's too early to say that but, you know, it is still a margin drive. And also, you know, so we, we, we, we spend some, you know, more expenses, more expenses in, in even in the marketing and in the in the coming Q2.

我認為現在說這個還為時過早，但是，你知道，這仍然是利潤驅動因素。而且，你知道，所以我們，我們，我們，我們花了一些，你知道，更多的費用，更多的費用，甚至在行銷和即將到來的第二季。

But I think we will. Yeah, I said, as you said, we, we spend more money on the marketing in Q1. But we, we, we, we started to control the seller market in Q2. You know, we are still in the process. And so that's why we got the, the margin timing pressure in Q2. But we, we expect we will do better than than we expected on margin wise in Q2.

但我想我們會的。是的，我說，正如你所說，我們在第一季的行銷上花了更多的錢。但我們，我們，我們，我們在第二季開始控制賣方市場。你知道，我們仍在這個過程中。這就是我們在第二季面臨保證金時機壓力的原因。但我們預期第二季的利潤率會比我們的預期好。

Understood, Zhihui. So, so let's put it this way. So if we excluding is buy, if we excluding culture tourism, will the rest of the revenue rest of the business still see margin contraction in second quarter.

明白了，志輝。那麼，就讓我們這樣說吧。因此，如果我們排除購買，如果我們排除文化旅遊，那麼第二季其餘業務的其餘收入是否仍會出現利潤率收縮。

Yes, I think so. I think the if you take out the, the impact of the tourism and business, I think the margin will be better than the, than the the, the, the overall company margin profile except for Easter buy. You know, we don't give the guidance of the Easter Buy by topline growth in the market.

是的，我想是的。我認為，如果剔除旅遊業和商業的影響，我認為利潤率會比復活節購買以外的整體公司利潤率更好。您知道，我們不會根據市場的營收成長來提供復活節買入的指引。

Understood. Thank you so much.

明白了。太感謝了。

Thank you, Lucy.

謝謝你，露西。

Timothy Zhao, Goldman Sachs.

提摩西·趙，高盛。

Great. Thank you, Zhihui. This is so I think the follow up question on, on E by I think one is on, I think your revenue guidance because I think there was a transaction between EDU parent company and the ey regarding the ey education period previously, just wondering in your guidance for the edu core, basically the edu educational services, does that include the esy previous education business?

偉大的。謝謝你，志輝。因此，我認為關於 E 的後續問題是，我認為您的收入指導是因為我認為 EDU 母公司和 ey 之前就 ey 教育期進行了交易，只是想知道您的收入指導對edu核心的指導，基本上是edu教育服務，這是否包括esy之前的教育業務？

And secondly, I think for Ed for ey, I think the implied revenue for ESY actually dropped quite significantly on a Q on Q basis. Just wondering if you can elaborate what is the background or the rationale behind that? And how should we think about the revenue going forward? Thank you.

其次，我認為對於 Ed for ey 來說，我認為 ESY 的隱含收入實際上按季度大幅下降。只是想知道您是否可以詳細說明背後的背景或理由是什麼？我們該如何考慮未來的收入？謝謝。

The guidance of Q top2 grows in the range of 25% to 28% is the core education business except for East East. Okay. And and you know, I'm very glad to hear from you about the, the, the question of the East, but you know, I'm afraid you know, I'm unable to, to share the the latest financial results of the Easter buy because you know, they will announce their half year report in this next quarter.

Q top2的指引成長在25%至28%之間，是除東東外的核心教育業務。好的。你知道，我很高興聽到你關於東方問題的消息，但是你知道，恐怕你知道，我無法分享最新的財務結果復活節買入，因為你知道，他們將在下個季度公佈半年報告。

So next quarter, I think we the first party you know, the company and Easter Buy will announce the East by financial status in much more detail next quarter.

因此，下個季度，我認為我們是您知道的第一方，該公司和 Easter Buy 將在下個季度更詳細地公佈 East 的財務狀況。

Sure. So just to clarify on the guidance, I think if you look at it is by previous half year financials for their education business, which is now part of EU core business is around like a USD304 million per quarter. Just wondering when you talk about the guidance for edu core education business. So when you look at on a year on year basis, the last year number for eu core education business that also includes the epi education business, right?

當然。因此，為了澄清指導意見，我認為如果你看一下他們的教育業務前半年的財務數據，該業務現在是歐盟核心業務的一部分，每季約為 3.04 億美元。只是想知道您何時談論edu核心教育業務的指導。因此，當您逐年查看歐盟核心教育業務（也包括 Epi 教育業務）去年的數字時，對吧？

Yeah. Correct, Timothy. So your your understanding is totally correct. So when we give guidance, we do Apple to Apple comparison. So both the comparison quarter and the the guidance quarter, both includes the educational portion of is device business. Is that clear?

是的。正確，蒂莫西。所以你的理解是完全正確的。因此，當我們提供指導時，我們會進行蘋果與蘋果的比較。因此，比較季度和指導季度都包括設備業務的教育部分。清楚了嗎？

Yes. Thank you, Zhihui.

是的。謝謝你，志輝。

DS Kim, JP Morgan.

DS Kim，摩根大通。

Hello sir. Hi. Hi, sorry, I didn't mean to beat a dead horse here, but some investors were asking me just now on this. So I thought it would be better to clarify things on new businesses again. Sorry. So just to be clear when you earlier commented that next quarter, growth, guidance of new businesses of over 50% did you mean to include other smaller businesses or only non-academic and intelligent learning devices?

你好先生。你好。你好，抱歉，我不是故意要死馬當活馬醫的，只是剛才有投資者問我這個問題。所以我覺得還是把新業務的事情再澄清一下比較好。對不起。因此，需要明確的是，當您早些時候評論說下個季度新業務的成長和指導將超過 50% 時，您的意思是包括其他小型企業還是僅包括非學術和智慧學習設備？

If you compare that 50% or over 50% growth next quarter, how does that number look for this quarter? August quarter and then similarly for high school business, we expected a 20% growth as you send next quarter. How was the growth this quarter? Would you be able to comment on that? Sorry for a redundant question.

如果您比較下個季度 50% 或超過 50% 的成長，那麼本季的數字如何？八月季度以及高中業務的情況類似，我們預計下季度發送的數據將成長 20%。本季的成長情況如何？您能否對此發表評論？抱歉問了一個多餘的問題。

Yeah, to make it clear for, for Q2's guidance, for overall new initiatives, new educational initiative including all the things. So together is around 45%, 46%. And if you only look at non academic tutoring and the intelligent learning device, the two key ones, the growth is over 50%. Okay. And, and the high school Business, high school Business, Q1's growth is about 20% -- 20% to 21%.

是的，為了明確第二季的指導，整體新舉措，新的教育舉措，包括所有的事情。所以加起來大約是 45%、46%。而如果只看非學術輔導和智慧學習設備這兩個關鍵領域，成長超過50%。好的。而且，還有高中商務，高中商務，第一季的成長約20%——20%到21%。

Thank you. That's very clear. So about 5%, 4% of deceleration for the new businesses in terms of Apple app, which I think is pretty great. Given that the base get the coms got much tougher. So thank you for the clarification.

謝謝。這非常清楚。因此，就蘋果應用程式而言，新業務的減速約為 5%、4%，我認為這相當不錯。考慮到基地的建設變得更加艱難。謝謝您的澄清。

Thanks.

謝謝。

Thank you. We are now approaching the end of the conference call. I will now turn the call over to New Oriental executive President and CFO, Zhihui Yang for his closing remarks.

謝謝。我們現在電話會議即將結束。現在請新東方執行總裁兼財務長楊志輝致閉幕詞。

Thank you again for joining us on today. If you have any further questions? Please do not hesitate to contact me or any of our investor relations representatives. Thank you.

再次感謝您今天加入我們。如果您還有其他問題？請隨時聯繫我或我們的任何投資者關係代表。謝謝。

Thank you. This concludes today's conference call. Thank you for participating and you may now disconnect.

謝謝。今天的電話會議到此結束。感謝您的參與，您現在可以斷開連接。