New Oriental's market value evaporated by 90 percent, alongside an 80 percent slump in its operating revenues and a dismissal of 60,000 employees, Yu Minhong, founder of the Chinese private education giant disclosed on Saturday, attributing the fallout to the regulatory toughening over private tutoring and other uncertainties.
Looking in retrospect, a tumultuous 2021 when New Oriental's businesses was hit by a mix of policy changes, coronavirus and uncertainty in international affairs, Yu wrote in a post on his personal WeChat account that the company's cash payouts concerning tuition refunds, employees' severance payment and surrendering the tenancy of tutoring facilities, among others, totaled nearly 20 billion yuan ($3.14 billion).
Throughout the process, New Oriental decided on a complete termination of its tutoring services, both in-person and online, for students from kindergarten to grade 9, read the post.
The company has shifted toward a focus on quality-oriented education and moved to up the ante in the marketplace for college students and overseas Chinese education, Yu said in the post.
Moreover, New Oriental's online education unit, mainly based on its Hong Kong-listed subsidiary Koolearn Technology Holding, has launched a livestream marketing system that sees the company transition toward an e-commerce platform operator specializing in the screening and sales of farm products.
