New Oriental Education & Technology Group Inc. (NYSE:EDU) Q4 2025 Earnings Call Transcript

New Oriental Education & Technology Group Inc. (NYSE:EDU) Q4 2025 Earnings Call Transcript July 30, 2025

New Oriental Education & Technology Group Inc. beats earnings expectations. Reported EPS is $0.61, expectations were $0.29.

Operator: Good evening, and thank you for standing by for New Oriental’s FY 2025 Fourth Quarter Results Earnings Conference Call. [Operator Instructions] Today’s conference is being recorded. If you have any objections, you may now disconnect at this time. I would now like to turn the meeting over to your host for today’s conference, Ms. Sisi Zhao.

Sisi Zhao: Thank you. Hello, everyone, and welcome to New Oriental’s Fourth Fiscal Quarter 2025 Earnings Conference Call. Our financial results for the period were released earlier today and are available on the company’s website as well as our Newswire services. Today, Stephen Yang, Executive President and Chief Financial Officer; and I, will share New Oriental’s 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, please note that the discussion today will contain forward-looking statements made under the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements involve inherent risks and uncertainties.

As such, our results may be materially different from the view expressed today. A number of potential risks and uncertainties are outlined in our public filings with the SEC. New Oriental does not undertake any obligation to update any forward- looking statements, except as required under applicable law. As a reminder, this conference is being recorded. In addition, a webcast of this conference call will be available on New Oriental’s Investor Relations website at investor.neworiental.org. I will now first turn the call over to Mr. Yang. Stephen, please go ahead.

Zhihui Yang: Thank you, Sisi. Hello, everyone, and thank you for joining us on the call. It’s that time of the year again. We’re pleased to announce that Q4 performance exceeded expectations, demonstrating our strong commitment and capabilities to enhance operational consistency and drive long-term value creation. This quarter’s total net revenue, excluding revenues generated from East Buy private label product and live streaming business increased by 18.7% year-over-year, mainly contributed by the continued expansion of our new ventures. Bottom line-wise, we’re delighted to see that our efforts to reduce cost and improved efficiency have proven effective with non-GAAP operating margin, again, excluding operating margin generated from East Buy reached 6.5% this quarter, representing a year-over- year improvement of 410 basis points.

Our key remaining business remains solid, while our new initiatives have also shown positive momentum. Breaking it down for the fourth quarter of 2025. Overseas test prep business recorded a revenue increase of 15% year-over-year. Overseas studies consulting business reported a revenue increase of about 8% year-over-year. Our adults and university students business recorded a revenue increase of 17% year-over-year. At the same time, our continued investments in new education business initiatives, primarily centered on facilitating students’ all-around development have also delivered consistent progress, further driving the company’s overall momentum. Firstly, the non-academic tutoring business, which focus on cultivating students’ innovative ability and comprehensive quality has shown being rolled out to around 60 cities.

Market penetration has significantly increased, particularly across higher-tier cities. The top 10 cities contribute over 60% of this business. Secondly, the intelligence learning system and device business, which utilizes our past teaching experience data and technology to provide personalized and targeted learning and exercise content to improve students’ learning efficiency, has been tested in around 60 existing cities. We’re happy to see improved customer retention and scalability of this new business. The top 10 cities contribute over 50% of this business. In summary, our new educational business initiatives reported a revenue increase of 33% year-over-year for the fourth quarter of 2025. Moving to our integrated tourism-related business line, which includes study tour, research camp business for student of K-12 and university students and towards targeting middle-aged senior audience, recorded a revenue increase of about 71% year-over-year for the fourth fiscal quarter of 2025.

Breaking down, both domestic and international study tours and the research camp for K-12 and university students was conducted across 55 cities nationwide, with the top 10 cities contributing over 50% of the revenue. We also provided a series of premium tourism offerings primarily designed to middle agent senior audience across 30 featured provinces in China and internationally. Our product range has also been expanded, now includes culture travel, China study tour, global study tour and camp education. With regard to our OMO system, we continue our efforts in developing and revamping our online-merge-offline teaching platform, while leveraging our educational infrastructure and technological strengths across our key business lines and new industries.

These efforts aim to deliver more advanced and diversified education services to our customers of all ages. A total of $28 million have been invested during the quarter to upgrade and maintain our OMO teaching platform. Beyond OMO, I would like to take this opportunity to highlight our investments in AI and how we integrate it into our teaching ecosystem. Leveraging a combination of open source large models such as Deepseek and GPT, along with our self-developed AI technologies, we have developed new innovative education solutions for our students. Recently, we launched 2 new products: first, a new generation of AI-powered intelligent learning devices. These products feature deep AI integration and equip K-9 students with multifunctional tools, including spoken language coaching, automated IC grading, dictation exercises, classical text recitation and voice assessment functionality, all designed to enhance learning outcomes while saving the time for both teachers, students and parents.

Second, a new AI-driven smart study solution. This product combines premium content from global sources. Our very own accumulation of teaching and researching experience in AI technology. These achievements mark key progress in our customer- focused education products positioning us as a leader in applying AI to the education field. We will continue investing in AI to drive future innovation. Not only does AI help enhance our offerings, but also improve internal efficiency. We have launched an AI content creation platform and student performance feedback application which will help support lesson planning and strengthen home school communication. These tools also provide valuable insights into learning habits and user engagements. Additionally, an AI-powered FAQ databases has been created, built from our day-to-day sales conversations, which have significantly reduced training cost for our sales team and improved sales efficiency and conversion rates.

Now I would like to take a moment to talk about the East Buy, as I know many of you are interested in it. In fiscal year 2025, East Buy continued to invest in private label product strategy centered around green, healthy and quality — high-quality while enriching its product portfolio and exploring new categories. It also achieved breakthroughs in blockbuster products and product upgrades. With consistent quality and broad consumer appeal, East Buy’s private label products have become household staples, gaining greater market recognition. During the reporting period, East Buy further advanced its multichannel strategy and implemented enhancements to its East Buy app and East Buy ministore, all of which have provided users with improved experience.

As the business continues to develop steadily, East Buy has placed greater emphasis on improving operational efficiency and profitability levels to align with the group’s overall strategy. Now I would like to take this opportunity to talk about our share repurchase actions. As of May 31, 2025, the company repurchased an aggregate approximately 14.5 million ADS’s for approximately $700 million from the open market. Now I will turn the call over to Sisi to share with you about the key financials. Sisi, please go ahead.

Sisi Zhao: Thank you, Stephen. Now I’d like to share our key financial details for this quarter. Operating cost and expenses for the quarter were $1,251.8 million, representing an 11.2% increase year-over-year. Cost of revenues increased by 5.1% year-over-year to $569.9 million. Selling and marketing expenses increased by 1.8% year-over-year to $211.9 million. G&A expenses increased by 9.1% year- over-year to $409.8 million. Impairment of goodwill were $60.3 million compared to 0 in the same period of the prior fiscal year. Total share-based compensation expenses, which were allocated to related operating cost and expenses, increased by 11% to $28.6 million in the fourth fiscal quarter of 2025. Operating loss was $8.7 million compared to operating income of $10.5 million in the same period of the prior fiscal year.

Non- GAAP operating income, excluding share-based compensation expenses, amortization of intangible assets resulting from the business acquisitions and impairment of goodwill assigned to the reporting units of kindergarten business was $81.7 million, representing a 116.3% increase year-over-year. Net income attributable to New Oriental for the quarter were $7.1 million, representing a 73.7% decrease year-over-year. Basic and diluted net income per ADS attributable to New Oriental were $0.04 and $0.04, respectively. Non-GAAP net income attributable to New Oriental for the quarter was $98.1 million, representing a 59.4% increase year-over-year. Non-GAAP basic and diluted net income per ADS attributable to New Oriental were $0.62 and $0.61, respectively.

Net cash flow generated from operation for the fourth fiscal quarter of 2025 was approximately $399.1 million, and capital expenditures for the quarter were $65.9 million. Turning to the balance sheet. As of May 31, 2025, New Oriental had cash and cash equivalents of $1,612.4 million, $1,447.8 million in term deposits and $1,873.5 million in short-term investments. New Oriental’s deferred revenue, which represents cash collected upfront from customers and related revenue that will be recognized as the services or goods were delivered. At the end of the fourth fiscal quarter of fiscal year 2025 was $1,954.5 million, an increase of 9.8% as compared to $1,780.1 at the end of the fourth quarter of fiscal year 2024. Now I’ll hand over to Stephen to go through our outlook, guidance and our new shareholder return plan.

Zhihui Yang: Thank you, Sisi. As we look ahead for fiscal year 2026, we remain optimistic and committed to not only driving revenue growth, but also placing greater emphasis on upholding profitability across all business lines, supported by various cost control and efficiency enhancement measures. To better reflect our long-term strategic priorities and align with the nature of the education industry, characterized by longer business cycles with seasonality, we are now providing full year guidance in addition to our quarterly outlook. We believe this expanded guidance offers a more meaningful and accurate reflection of our business performance and strategy as it smooths out short-term seasonal volatility. We encourage investors to focus on this long-term indicator, which provides a clearer and more comprehensive view of our business, operational progress and growth trajectory.

We expect total net revenue for the group, including East Buy in the first quarter of fiscal year 2026; June 1, 2025 to August 31, 2025, to be in the range of $1,464.1 million to $1,507.2 million, representing a year-over-year increase in the range of 2% to 5%. As for the total net revenue for the group also including East Buy for the full year 2026; June 1, 2025, to May 31, 2026, we expect to be in the range of $5,145.3 million to $5,390.3 million, representing a year-over-year increase in the range of 5% to 10%. You may notice that our fiscal year ’26 Q1 guidance looks relatively conservative. This is primarily because the group has now entered a more stable and sustainable phase, and we are comparing against a high base of the last year Q1, unlike 2 years ago, when we were still undergoing major transformation.

Moreover, East Buy’s restructuring has not yet taken place in fiscal year ’25 Q1 either. Additionally, the earlier timing of the Chinese New Year this year led to temporary class rescheduling, which boosted the revenue recognition in the second half of fiscal year 2025, but will reduce revenue recognition in fiscal year ’26 Q1. As a result, we expect the year-over-year revenue growth will accelerate since the second quarter and throughout the rest of the year. Hence, as I mentioned earlier, I would encourage all of you to focus on our annual guidance. Before ending this quarter’s earnings summary, I would like to announce that the Board approved a 3-year shareholder return plan yesterday, effective from fiscal year 2026. As a gesture of appreciation for our shareholders’ unwavering support.

Under this plan, no less than 50% of the company’s net income attributable to New Oriental for the preceding fiscal year will be allocated to returning value to shareholders through dividend distributions and/or share repurchases. For fiscal year ’26 — for fiscal year 2026, the Board will determine the implementation of the plan based on the net income attributable to New Oriental for the fiscal year ended May 31, 2025, in due course. Now to conclude, New Oriental remain committed to delivering premium offerings for our customers who are pursuing sustainable growth and profitability and sharing the fruits of our success with our shareholders. We’re also in close collaboration with the government authorities, in various provinces and the province in China, issuing compliance with the relevant policy skylines and the related implementations and adjusting our business operation as required.

This is the end of our fiscal year 2025 Q4 summary. At this point, I would like to open the floor for questions. Operator, please open the call for these. Thank you.

Operator: [Operator Instructions] First question comes from the line of Felix Liu from UBS.

Q&A Session

Felix Liu: My question is on your Q1 and FY ’26 guidance, we noticed that Q4 EDU anyway for core business actually grew pretty fast. But as you mentioned, there was a seasonal slowdown in Q1. Can I just ask for more breakdown of your Q1 as well as full year guidance. What are the drags on the business that led to this slowdown? And the management share about the drivers for the recovery in growth in — after Q1?

Zhihui Yang: Okay. Thank you, Felix. Yes, as for the Q1 guidance and the whole year guidance of fiscal year ’26, in the coming Q1, we give the guidance of the revenue growth will be in the range of 2% to 5%. I must mention, firstly, that we’re using the conservative method to give the guidance. And there were some following reasons. Number one is to some extent, I think our business is adversely affected by the economic environment and the international relations changes. So in the coming Q1, we are comparing the — against a high base last year in Q1 both for the core educational business and the East Buy. And number two, as for the K-12 business, we have some — the cutoff issue because this year’s Chinese New Year was earlier than ’24.

So that means some — that means the — in the second half of fiscal year ’25, we had more revenue. And the result is that in the coming Q1, we have less revenue. So this is a cutoff issue. But as we expect, the K-12 revenue growth will be accelerated in the coming Q2 and the rest of the year in Q3 and Q4, because based on our current as mentioned, the forecast for the whole year and the cash we’ll collect already for the Q2 courses. So that’s why, as I said, we expect the revenue acceleration since Q2 for the K-12 business. And the last reason is last year Q1, East Buy restructuring has not yet taken place in Q1. So we will have a hard comparison for East Buy in the coming Q1. But in the — since Q2, it will be better. And yes, this time, since this quarter, we start to give the whole year guidance.

We give the guidance of the 5% to 10% year-over-year growth for the whole group. And it shows that the revenue growth acceleration since Q2 and breakdown of the different business lines. I think the overseas-related business, yes, it will negatively impact by the economic environment and international situations change. So we expect the revenue will be down by roughly 4% ,5%. And the K-12 business, I think the K-9 business, for the Q1, the revenue growth will be somewhere around 15%, 16% year-over-year but we do expect the whole year revenue growth of the K-9 business will be somewhere around 20%. High school business, Q1 and the whole year will be around — year-over-year growth will be around 11% to 12% or even a little bit more. And the college business, the growth rate will be 10% in the Q1 and the coming new year, Felix.

Operator: Next, we have Lucy Yu from Bank of America.

Lucy Yu: I have actually a follow-up question on the guidance that you just gave. What is the major difference that you have been revised this quarter versus last quarter when you gave the guidance for FY ’26. So what has changed in terms of line of business. And secondly, just to clarify on the shareholder return program. Is it based on reported net income or non-GAAP net income?

Zhihui Yang: Second question answer first. The capital allocation for the next 3 years is calculated based on the net income, the net income attributable to GAAP net income attributable to New Oriental. And I think, yes, this time, we changed the guidance from the non- East Buy to the whole group, including the East Buy. Because East Buy started to restructure the business since last year — so in past 4 quarters, I think the management of the East Bay fix the operations. And East Buy is still — we will control East Buy. So I think it’s a good time for us to give the guidance of the whole group, including the East Buy. And I think going forward, we will give the guidance for the whole group, including the East Buy. Lucy?

Lucy Yu: One more follow-up. So the guidance revenue growth is all in U.S. dollars or renminbi?

Felix Liu: Dollars. In dollars.

Lucy Yu: And you are using current rates?

Zhihui Yang: Yes, yes, we’re using the current exchange rate in the first 45-50 days of this quarter.

Operator: Thank you. Next, we have [indiscernible] from CITIC.

Unidentified Analyst: Hello. Good evening, Stephen and Sisi. My question is about the deterioration of our revenue. So what is the main reason for our revenue deterioration, especially for the non-academic business? So is it because of the competition or it’s just our own adjustment? And if we like looking long-term exactly in the next 3 years, how do we think of our growth rate in the next 3 years?

Zhihui Yang: I think the revenue slowing down is mainly due to the economic environment and the international relationship change because we have seen some transparent, some of them don’t want to send their kids to study abroad in the future. So it will negatively impact our — the overseas business. And as for the competition in K-12 field, I think the competition is a little bit stronger than that of the last year. But I think it’s okay. If you compare the competition level now with a couple of years ago before the policy is much less. And so the — I think the market is still huge, especially for the K-9, not done it versus the business. So we still guide the K-9 business grow by 20% in the coming year. I think during this macroeconomic situation, I think is still good.

And going forward, and yes, the Q1 is a little bit weak. But based on our current estimation, I think the Q2 and Q3, Q4 will be better. And in the longer term, I still think the K-12 business will be the key growth driver of the whole group.

Unidentified Analyst: Yes. Can I have a follow-up question as that because if you look at the revenue growth before the policy, maybe our K-12 revenue growth rate can be over 20%? Well, right for now, maybe it’s just like around 15%. So if you look at it in the next few years, with the growth rate for K-12 business like going up to the over 20% or just around like 10% to 20%.

Zhihui Yang: I think the K-9 business, we do believe we can get the revenue growth by 20%. It will still be very good. And the high school business because we got the all-time high in last fiscal year. So we have a high base — so going forward, I think the revenue growth will be somewhere around 10% to 15% going forward.

Operator: Next, we have Alice Chow from Citibank.

Alice Chow: I have 2 questions. And first one is on the margin trend. How should we think about the operating margin trend for FY ’26? For the core education business and also the whole business because since that we started to provide guidance for the whole business, right? And my second question is on the goodwill impairment. And can you please give us some more color on this? Why was the goodwill associated with kindergarten business to begin with? And will the company continue to divest off still the noncore business and also like cultural tourism?

Zhihui Yang: Okay. Thank you, Alice. Your margin question. Let us start with this quarter’s margin analysis. In the Q4, in this quarter, we got the 410 basis point margin expansion. I think the margin expansion even for the Q4 and the whole year fiscal year ’25 was mainly due to the operating leverage and the efficiency enhancements and the cost control. As you know, we started to do the cost control since March this year, and we have seen the good result, which helps to drive the margin up. And I do believe the cost control will help the margin profile in the coming year, in the Q1 and the whole year, fiscal year ’26. As we look at the margin of the Q1, we remain optimistic about the margin profile in Q1, even though we’re facing some revenue slowing down.

But we still expect the margin expansion in the coming Q1. And the whole year margin, I think it’s a little bit early to make a forecast of the new year margin. But we are doing the cost control. We care more, we focus more about the profitability than the revenue growth. And so I think we will strive to achieve the margin profile, the healthy margin profile in the whole year of the fiscal year ’26. And so let me summarize. Revenue is a little bit slowing down, and we care more about the bottom line, and we will do more cost control and care more about the efficiency enhancements and the more operating leverage to drive the margin up in the coming quarter and the new year. Your second question is about the goodwill impairment of the kindergarten.

We acquired the — some kindergarten so many years ago, roughly 8, 10 years ago. And because of some reasons, the policy and the new wars, decreased. So I think we discussed with the auditors, and we think the goodwill impairment should be down at this time. So we did the impairment loss of $60 million in this quarter, but it’s all, it’s one time.

Alice Chow: May I have a follow-up question. I would like to know more about the cultural tourism? Is there any plan to scale back the business?

Zhihui Yang: What was that? Can you repeat again? Can you repeat?

Unidentified Analyst: Yes, is there any plan to scale back the cultural tourism?

Zhihui Yang: Our Tourism business. Yes, we started with the tourism business 1.5 years ago. And the revenue growth in last fiscal year, fiscal year ’25 was extremely high. And most of the business — the tourism business are related to the summer camp, study tour, both domestic and internationally. And — but going forward, I think we still need time to build the business model of the tourism. And I think the revenue growth of the tourism business will be slowed down in the new year. And anyway, as a new business, we need more time to fix the business model of the tourism business.

Operator: Next, we have Timothy Zhao from Goldman Sachs.

Timothy Zhao: I think my question is regarding the profitability and margin outlook. I think one is regarding the 4.1 percentage point margin increase for the core business for the past quarter. Just wondering if you can help quantify the impact from the cost control measures that you have done since March. And going forward into the new year, like how much room that you have for the further cost control? And secondly, also on the margin-related question on the capacity expansion. Just wondering, I think for the May quarter, how many new learning centers were newly opened? And what is your learning center or the capacity expansion plan into fiscal year ’26?

Zhihui Yang: The margins, yes, the Q4, we got the margin expansion by 410 basis points and it’s really hard for us to justify how much from the cost control. But anyway, it’s a good result, the cost control and the — to stick to the high operating leverage. And going forward, even in the Q1 — coming Q1 and the new year, I think the cost control will help us to drive the margin up. And roughly, the cost control will give us the, let’s say, the 100 to 150 basis point margin up. So this is roughly estimation. And your second question is about the expansion, right? Yes. Yes. I think in Q4, the net add is 9% — is 8% to 9%, the learning centers. And going forward, in the coming new year, I think our plan is to monitor the capacity expansion to ensure alignment of revenue growth.

So I think as the whole group, we will control the learning center expansion compared to the revenue growth. So we do hope we can have the leverage from the high utilization rate of the new learning centers. So roughly, we — originally, we plan to open 10% to 15% of the new learning centers. It depends on the revenue growth. And typically, we set up new learning centers in the second half of the year. So it’s back loaded. And so I think we have 1 or 2 quarters to wait to decide how many learning centers we set up in the second half of the year to prepare for the new year. And so — and I must mention that we only allow the cities with a better top line growth and good margins to allow them to open the learning centers, especially for the K-12 business.

Operator: [Operator Instructions] Next, we have D.S. Kim from JPMorgan.

D. S. Kim: I just have a few follow-ups from the previous comment, if that’s okay. So you earlier mentioned that margin could go up in the first quarter. Were you referring to the group level or core education only? That’s the first follow-up to earlier point. And second, can I just double check, when you say cost control can give us about like 100, 150 bps of margin expansion, is it regarding first quarter or full year? Just as a follow-up, then I have one more question.

Zhihui Yang: For the full year, the cost control. And yes, I said — because we started — we go back to give the guidance for the whole group. So the margin analysis and guidance is for the group. So what I’m saying is the whole group margin expansion will be happened in Q1.

D. S. Kim: Got it. And again, this is kind of a follow-up, but I did a very rough calculation based on the number that you gave us, the breakdown. And I think we are essentially guiding core education, excluding East Buy to grow about 11%, 12% in fiscal ’26 versus, I think, last quarter, you mentioned 14%, 15% growth. Am I right about this? Or can you comment on education on the apples-to-apple guidance versus last quarter? Just want to double check.

Zhihui Yang: The fiscal year ’26, right?

D. S. Kim: ’26 yes, sir.

Zhihui Yang: Yes. It seems to be a little bit lower than we gave the guidance last quarter because, yes, as I said, the overseas-related business, we — I think it will negatively impact by the macro economy and the international relationship change. And so we revised the guidance of the fiscal year ’26. I think the overseas-related business will be down by, let’s say, the 5% — 4%, 5% year-over-year. This is for the whole year. So this is a new change compared to the last.

D. S. Kim: So I think that probably implies 11%, 12%, if you have the number. If not, that’s totally fine. And final question is, in terms of the buyback and dividend, can you give us a little bit of color on how you are thinking about between the 2? Like is it going to be dependent on the level of share prices? Or do you have certain pockets within that 50% in mind for dividend at least this much? Any sort of qualitative color would be appreciated, and that’s it.

Zhihui Yang: I think, first of all, we finished the $700 million share buyback in this quarter, in Q4. And also, we paid $100 million special dividend in last year — in this fiscal year, last year September. And so we had a Board meeting yesterday. And I’m happy to see the Board approve the new capital allocation program, not only for this year, but also for next 3 years from fiscal year ’26 to fiscal year ’28, so which amounted to the, let’s say, the 50% of the GAAP net income. And now we haven’t yet decided the dividend or the share buyback. I think I will discuss with the Board, even Michael, to make a decision to justify either the dividend or share buyback or both. But one more information, I think we still need the auditors to give us the final audit report of the fiscal year ’25. And I think we will file the 20-F at the end of — roughly at the end of September. So by then, I think we will decide how much amount to do the capital allocation anyways.

D. S. Kim: And if I just make a comment, not a question, I think many or most investors may prefer dividend rather than buyback because dividend seems a little more visible and sustainable. So please, please consider and especially if it is a regular dividend, not in the form of special that we did pre-COVID. So just true sense from me.

Operator: Next, we have Charlotte Wei from HSBC.

Charlotte Wei: I have a question regarding the non-academic enrollment. So I noticed that this quarter’s enrollment growth slowed down quite meaningfully. Can I understand — could you please provide some color on the reasons? And also, can you share with us the summer enrollment growth for the K-9 nonacademic tutoring? And how does it compare to the industry growth trend?

Zhihui Yang: Yes. As I said, there is some seasonality impact, as I said, because of the early Chinese New Year and some revenues were recorded in Q3 and Q4 last year. And so it will negatively impact the Q1 revenue and enrollment. And yes, Q1 seems to be low. But I think based on our — the numbers, the cash and the student enrollment we have already got from customers for the Q2 courses, I think the numbers is higher than the Q1. So that’s why I said, we expect the revenue growth will be accelerated in the Q2 — since Q2. And that’s why we gave the guidance of the whole year higher than the Q1. And the industry growth — sorry, I have no idea about the whole industry growth. And it’s really hard for me to make a comparison between us and the other competitors. And yes.

Operator: Next, we have Elsie Sheng from CLSA.

Yiran Sheng: So my question is about the summer. So we are now in the summer. So I would like to see if you have any color on the summer student recruitment, for example, like the new student enrollment growth and also like retention rate? And do you observe any changes on the demand side?

Zhihui Yang: The demand is a little bit less than we expected compared to 1 quarter ago because of the whole — the economic situation. And — but the — but sorry, but I think it’s still good for the K-12 business, even for the industry. And I don’t believe the whole industry is still growing. And I think we are still taking the market share. And yes, as I said, I think since Q2, the revenue growth will be accelerated again. And so yes, and the student enrollment number in the summer, we haven’t finished the enrollment window for the summer. So I think in next quarter’s earnings call, I will share with you the number. enrollment for the whole…

Yiran Sheng: And about the retention rate?

Zhihui Yang: The retention rate is still going up, both for the whole — the K-9 business and high school business is still going up.

Operator: Thank you. We are now approaching the end of the conference call. I will now turn the call over to New Oriental’s Executive President and CFO, Stephen Yang, for his closing remarks.

Zhihui Yang: Again, thank you for joining us today. If you have any further questions, please do not hesitate to contact me or any of our Investor Relations representatives. Thank you. This concludes today’s conference call. Thank you for participating. You may now disconnect.