New Oriental Education reported operating profit of $66.3 million in the second quarter of its fiscal year through last November, a 244.4% increase over the same period a year earlier. Revenue reached $1.19 billion, up 14.7% year-on-year, driven by robust demand across its non-academic tutoring and adult training businesses. Net profit climbed 42.3% to $45.5 million, reflecting strong margin expansion as non-GAAP operating profit margin rose to 7.5%, more than four percentage points higher than the prior year quarter. These results mark a significant rebound from the company’s challenges following the government crackdown on K-12 tutoring services.

The company’s newer segments powered much of the growth during the quarter. Its new education initiatives division recorded 21.6% year-on-year revenue growth, enrolling approximately 1.06 million students across about 60 cities. Intelligent learning systems and devices now serve some 352,000 active paying users in the same regions. Meanwhile, selling and marketing expenses fell slightly to $194 million even as total operating costs rose 10.4% due to higher administrative and share-based compensation expenses. Improved resource allocation and operational efficiency drove profitability gains in these high-growth businesses.

Buoyed by the quarter’s performance, New Oriental’s management lifted full-year revenue guidance to a range of $5.3 billion to $5.5 billion, and projects third-quarter revenue growth of 11% to 14% year-on-year. The company highlighted recovering demand for study abroad in the U.K. and Australia, as well as better coordination between its test preparation and consulting units, as key drivers of sustained margin improvements. Following the results, HSBC upgraded its recommendation to “buy” and set a new target of $68 per share, citing accelerating earnings estimate revisions and improving operational leverage.

Analyst consensus has shifted higher in recent weeks, with average full-year earnings per share forecasts rising by approximately 8% since the start of the quarter. Upward revisions reflect confidence in New Oriental’s ability to scale its non-academic tutoring offerings and monetize its intelligent learning platform. Should the company deliver on its guidance and maintain current growth trajectories in adult training and overseas test preparation, further positive revisions and multiple expansion could support continued share performance.