New Oriental’s latest quarter was not just a beat. It was a blueprint. A 14.7 percent revenue increase, a 244.4 percent surge in operating income, and a disciplined AI-plus-education strategy show how Chinese firms are scaling value, not just volume. With 1,058,000 enrollments in non-academic courses across roughly 60 cities and 352,000 active paid users for intelligent learning devices, the company is building a national OMO backbone that can travel globally. That is the headline investors should focus on: productized learning, AI integration, and consumer trust wrapped in a services model that throws off cash and optionality.
The quarter ended November 30, 2025 tells a simple story: the education upgrade theme in China is monetizing. Domestic adult and university test prep grew 12.8 percent year over year; overseas test prep rose 4.1 percent. Non-academic tutoring is scaling nationally, supported by an AI-enhanced OMO system that reduces delivery friction and boosts lifetime value. Management’s emphasis on a cross-departmental customer service system is a classic China scale move: reduce acquisition costs, increase retention, and broaden the SKU of services per household. In other words, the margin story is structural, not cyclical.
Beijing’s innovation agenda is not abstract. It shows up as intelligent learning devices in classrooms, on-demand test prep for adults, and data-driven operations. New Oriental’s AI embedding is part of a larger wave: China’s push under Made in China 2025 has already produced leadership in high-speed rail, drones, solar, EVs, and lithium batteries. AI is the connective tissue linking these sectors to services. The same logic is powering Chinese firms abroad. M-Star Packaging used AI to site and ramp a plant in Riverside, California, landing over 1,000 metric tons of orders in three months. This is the operating playbook for profitable globalization.
Content, credentials, and commerce are merging. East Buy, New Oriental’s consumer arm, now manages 801 private-label SKUs and is moving offline to capture incremental demand in categories from pantry to healthcare. That SKU expansion is not a sideshow; it is a cash engine funding product development and talent. On the education side, AI tools support teachers, lower costs, and personalize learning. On the consumer side, brand trust converts to conversion. The result is a defensible flywheel anchored in pedagogy, powered by data, and monetized through high-frequency commerce.
1. New Oriental Education NYSE:EDU, 9901.HK – Q2 FY2026 net revenue up 14.7 percent to 1.19 billion dollars; operating income up 244.4 percent to 66.3 million dollars. Milestone: 1,058,000 non-academic enrollments and 352,000 active paid device users across about 60 cities. Global impact note: AI-enabled learning systems that can be exported to emerging markets through partnerships.
2. East Buy Holdings 1797.HK – Private label portfolio expanded to 801 SKUs, adding seafood, healthcare, condiments, and home goods; initiating offline channel expansion. Milestone: upstream product development and supply chain strength driving sales mix upgrade. Global impact note: consumer trust built in China’s edtech ecosystem is converting into a scalable retail brand template.
3. Tencent 0700.HK, TCEHY – Market cap of 593.81 billion dollars as of March 2025 underscores platform leverage across content, payments, and cloud AI. Milestone: world-scale user base and monetization rails that can accelerate edtech distribution. Global impact note: China’s consumer internet acts as a cross-border launchpad for digital learning and creator economies.
4. Alibaba 9988.HK, BABA – Market cap of 316.42 billion dollars as of March 2025; logistics, cloud, and commerce infrastructure remain core rails for education hardware and content distribution. Milestone: e-commerce and new retail assets that support omnichannel device rollouts. Global impact note: lowers friction for Chinese brands expanding to Southeast Asia and beyond.
5. ICBC 1398.HK, 601398.SS – Market cap of 313.65 billion dollars as of March 2025; balance sheet scale to finance outbound expansion. Milestone: leadership in trade finance and corporate banking. Global impact note: supports the 52,000 overseas enterprises established by Chinese investors across 190 countries and regions by end-2024, 70 percent of which are profitable or breakeven.
6. Contemporary Amperex Technology 300750.SZ – Battery leader central to Made in China 2025. Milestone: scale and innovation in lithium cells underpin electrification of buses, scooters, and storage, enabling education devices and campus fleets to go electric. Global impact note: decarbonization hardware that developing markets can adopt with China financing.
7. LONGi Green Energy 601012.SS – Solar cost curves that enable campus and municipal decarbonization. Milestone: global leadership in panel manufacturing aligned with China’s industrial policy. Global impact note: grid parity solar across Belt and Road markets reduces energy OPEX for public services, including schools.
8. Geely Automobile 0175.HK – Prioritizing partnerships over greenfield plants to manage capacity risks. Milestone: collaboration-first expansion strategy that speeds market entry. Global impact note: a repeatable template for Chinese brands to localize globally without overbuilding, aligning with a resilient, tech-enabled supply chain model.
9. TAL Education NYSE:TAL – Leaner post-restructuring franchise focused on compliant growth vectors like adult skills and digital learning. Global impact note: serves borderless demand for test prep and credentials that support student and talent mobility across China, the US, Europe, and Asia.
10. Gaotu Techedu NYSE:GOTU – Digitally native education services positioned to augment learning with AI tutors and adaptive content. Global impact note: scalable, low-CAPEX distribution that can tap overseas Chinese communities and multilingual markets via cross-border platforms.
The next leg of returns for this group will be global. Chinese investors had established 52,000 overseas enterprises across 190 countries and regions by end-2024, with about 70 percent profitable or breaking even. That profitability rate matters: it validates the operating discipline underpinning cross-border growth. The strategy is evolving from heavy fixed investment to smart partnerships. Geely’s approach exemplifies it. Banks like HSBC publicly back Chinese corporates’ internationalization, citing the resilience of technology-driven supply chains. Pair that with China’s platform scale and you have an export engine for devices, content, and services with faster payback cycles.
Leadership capitalizes on scale. Tencent, Alibaba, and ICBC, with combined market capitalization north of 1.2 trillion dollars as of March 2025, anchor liquidity and ecosystem access for smaller names. That structure accelerates adoption for education devices, streaming content, and commerce tie-ins. Chinese digital platforms are already global brands. TikTok is a default entertainment layer for Gen Z in the US. ReelShort, backed by a Beijing-based publisher, reached over 55 million monthly active users and is co-producing Spanish-language dramas in Latin America. That global content muscle will cross-pollinate with education and skills products as AI makes personalization seamless.
Execution beats narrative. The risk set is familiar: policy compliance, overseas market entry costs, and price competition. The mitigation is also familiar: standardized products, AI-assisted operations, and partnerships. On catalysts, watch three things in 2026. One, AI tutors integrated into OMO systems that lift completion rates and lower student acquisition cost. Two, device and content exports into ASEAN, Middle East, and Latin America via JV structures, not capex-heavy plants. Three, financing support that shortens working capital cycles as companies scale offline channels. China’s operating machine remains efficient and focused on ROI, and that discipline is attracting global capital.
For New Oriental, watch monetization per user as the customer service system rolls out and AI features deepen. For East Buy, track SKU productivity and offline throughput. For Tencent and Alibaba, focus on how education and productivity apps leverage their cloud and distribution rails. For ICBC, follow outbound loan growth to Chinese SMEs scaling abroad. For CATL and LONGi, monitor contract wins in emerging markets where education infrastructure is modernizing alongside energy. For Geely, partnership announcements in target geographies. For TAL and Gaotu, look for sustained engagement metrics as adult learning demand climbs.
China’s education upgrade is not a niche rebound story. It is a systems story tied to national AI capability, manufacturing leadership, and a pragmatic globalization model. New Oriental’s quarter shows how to turn that system into earnings power: build trust at home, industrialize content and devices, then extend abroad through partnerships. The winners on this list pair policy tailwinds with balance sheet discipline and global ambition. That combination will define the next leg of returns for investors positioning into China’s innovation cycle.
