FAST NEWS: Koolearn’s Loss Narrows Amid Transformation, Including Move Into E-commerce

The latest: Online education company Koolearn Technology Holding Ltd. (1797.HK) said its interim loss for the six months through last November narrowed by 19.3% year-on-year to 544 million yuan ($85.9 million), according to an announcement issued late on Friday. Looking up: The group’s total revenue for the period decreased by 15.3% year-on-year to 573 million yuan. But its costs also fell by 23.5% to 400 million yuan, mainly due to the phasing out of its K-9 business under China’s recent new education regulations. Take Note: The company’s university education business…

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FAST NEWS: New Oriental Suspends K-9 Curriculum-Based Classes, Sees Revenue Hit Up to 60%

The latest: Educational services provider New Oriental Education & Technology Group Inc. (9901.HK; EDU.US) announced plans to terminate its primary school curriculum-based tutoring services for students from kindergarten to 9th grade in all of its learning centers nationwide by the end of this year. Looking up: The move will put the company in compliance with new regulatory steps to rein in the after-school tutoring business, which will reduce the risk of future policy supervision. The company will use the pivot to explore new business opportunities such as test preparation and adult language…

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FAST NEWS: Koolearn Forecasts Losing Up to 40% of Its Revenue After Education Cleanup

The latest: Koolearn Technology Holding Ltd. (1797.HK) said it will stop offering after-school tutoring services for kindergartners to ninth-year students (K-9) for academic subjects included in China’s compulsory education system. The Hong Kong-listed online arm of education giant New Oriental (EDU.US) said the cessation will take place by the end of November, according to a statement released after markets closed on Monday. Looking Up: The move, a response to China’s ban on such classes by for-profit companies, will remove a huge overhang for Koolearn, allowing the education services provider to…

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Education Crackdown Creates ‘Zombies Companies’ in Need of Transformation

Beijing municipal government’s new rules requiring non-profit status for after-school tutoring firms marks group’s latest setback Key points: Beijing has become the first major city requiring all after-school education companies to become non-profits, according to announcements from the companies Companies are unlikely to be shut down, but may have to sell core assets and look for new businesses to take advantage of their core skills and technologies  By Doug Young China’s bustling crowd of after-school tutoring providers are increasingly looking like field of “zombie companies.” That’s one key takeaway from…

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Spark Education Launches IPO Into Regulatory Storm

Looming crackdown aimed at easing pressure on students could force online small-class specialist to slash its fundraising plans Key points: Despite its rapid growth, Spark Education’s IPO is likely to get most scrutinized for its comments about China’s looming crackdown on extracurricular educators Regulatory uncertainty could force the company to slash its fundraising target by about half By Doug Young Talk about bad timing. Online education specialist Spark Education Ltd. has just filed its prospectus for a New York IPO that would look quite attractive if not for a huge…

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17 Education Offers Lesson in Localization

Company posts triple-digit revenue growth in first quarterly earnings report since IPO as it transitions from do-it-yourself learning to localized classrooms By Doug Young When is 153% revenue growth just a slight disappointment? The answer: When you’re 17 Education & Technology Group Inc. (Nasdaq: YQ), which just announced its first quarterly earnings report since its IPO late last year. And those results were decidedly mixed, with the company looking for gold in a crowded field of money-losing education firms. They’re all trying to tap the wallets of millions of Chinese…

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