(Yicai) Oct. 25 -- New Oriental Education and Technology Group's revenue growth in the latest fiscal quarter ended Aug. 31 failed to meet market expectations, according to the Chinese educational services giant's first financial report since popular live sales host Dong Yuhui quit its livestream e-commerce unit East Buy.

New Oriental posted a 30 percent jump in net revenue for the first fiscal quarter of the year 2025 ended Aug. 31 to USD1.4 billion, according to the financial report released on Oct. 23. This falls short of market expectations of growth of between 31 percent and 34 percent. Net profit, meanwhile, surged 48.4 percent to USD245 million.

Excluding East Buy, revenue growth for the full fiscal year 2025 is expected to stay at around 30 percent, the report said, adding that revenue growth for the next quarter is expected to grow at a slower pace of between 25 percent and 28 percent to reach between USD851 million and USD872 million.

The news resulted in many financial institutions lowering their target price for the Beijing-based company.

Citi reduced its target price to HKD64 (USD8.24) from HKD83, the US lender said in a research note, adding that New Oriental’s forecast is relatively conservative but is in line with expectations.

Goldman Sachs trimmed New Oriental's target price to HKD68, saying that the company is still in the early stages of expanding scale and profits and is in a relatively stable policy environment.

New Oriental's projections for revenue growth and operating profit margin for the next fiscal quarter were weaker than expected, Daiwa Securities said, lowering its target price to HKD70 from HKD78.

These target prices are still higher than today’s closing price of HKD48 (USD6.20). New Oriental’s Hong Kong-traded stock [HKG:9901] climbed 2.6 percent today, while its New York-traded stock [NYSE:EDU] closed down 0.5 percent yesterday at USD61.17.

New Oriental's operating profit surged 42.9 percent over the period to USD290 million. When excluding East Buy’s self-operated products and e-commerce business, profit soared 58.4 percent to USD300 million.

The company's new tourism segment grew significantly in the quarter, which is a peak period for summer vacations, Chief Executive Officer Zhou Chenggang said. Revenue from tourism was around USD90 million during the period and is expected to make a substantial contribution to overall revenue in the next fiscal year.

The firm’s education division performed well. Revenue from overseas exam preparations surged 18.8 percent year on year, while that from international study consulting jumped 20.7 percent, the report said. Earnings from Chinese exam preparations for adults and college students soared 30.4 percent and that from its high school business advanced 20 percent.

In addition, New Oriental's intelligent learning system and equipment business is now available in around 60 cities and had 323,000 active paying users this quarter.

Editor: Kim Taylor