What happened
Shares of OneSmart International Education Group (ONE -14.42%) are looking brilliant today, up by 29% as of 1:05 p.m. EDT, after the company reported fiscal third-quarter earnings. OneSmart swung to a loss but investors are optimistic now that the company's learning centers are reopening.
So what
Revenue in the fiscal third quarter fell 32% to 744.9 million yuan ($104.4 million). That resulted in an adjusted net loss of 416.1 million yuan ($58.3 million), compared to a profit of 125.1 million yuan a year ago. The Chinese consumer discretionary company, which provides tutoring services to students, said that all of its physical learning centers were closed until public school activities resumed in late May. OneSmart's fiscal quarter ended May 31 and it started to reopen its learning centers in June.
Image source: Getty Images.
"Strictly following local governments' guidelines, we have continuously taken the proper measures to protect health and safety of our students and employees," CEO Steve Zhang said in a statement. "We appreciate our employees' great efforts and flexibilities to help our students continue achieving their academic excellence in this year's ZhongKao and GaoKao, especially with a limited timeframe and online-offline shift during the pandemic."
Now what
As of Aug. 4, over 90% of OneSmart's learning centers have reopened, which has allowed average monthly student enrollments as of mid-August to exceed levels from February. Year to date, the company has nearly 94,000 average monthly student enrollments in its OneSmart 1on1 segment and over 51,000 in its OneSmart Young Children segment.
Fiscal fourth-quarter revenue is guided to 900 million yuan to 1 billion yuan.
