Title

Earning Preview: TAL Education Group this quarter’s revenue is expected to increase by 42.68%, and institutional views are bullish

Abstract

TAL Education Group will report quarterly results on January 29, 2026 Pre-Market, and this preview consolidates recent financial performance, segment dynamics, and current-quarter estimates to outline expectations for revenue, margins, net profit, and adjusted EPS.

Market Forecast

Consensus estimates indicate that TAL Education Group’s current-quarter revenue is forecast to reach $773.60 million, up 42.68% year over year, with adjusted EPS projected at $0.07, up 80.00% year over year; margin guidance for the quarter is not specified, so gross profit margin and net profit margin forecasts are omitted. The company’s main business is expected to maintain momentum under a disciplined cost structure and stable pricing, supporting recent trends in consolidated margin resilience. The largest growth-potential segment is Learning Content Solutions, where revenue was $715.42 million last quarter; while segment-level year-over-year data is not disclosed, consolidated revenue rose 39.07% year over year, and management estimates imply sustained acceleration this quarter.

Last Quarter Review

TAL Education Group delivered revenue of $861.35 million, a gross profit margin of 57.00%, GAAP net profit attributable to the parent company of $124.00 million, a net profit margin of 14.41%, and adjusted EPS of $0.24, up 100.00% year over year. A notable highlight was the net profit’s quarter-on-quarter increase of 296.66%, reflecting disciplined expense control and operational leverage. Main business performance featured Learning Services and Others revenue of $1.53 billion (68.21% of the mix) and Learning Content Solutions revenue of $715.42 million (31.79% of the mix), with consolidated top-line growth of 39.07% year over year indicating broad-based demand across offerings.

Current Quarter Outlook

Learning Services and Others

Learning Services and Others remains the primary revenue contributor, accounting for 68.21% of last quarter’s mix and generating $1.53 billion in revenue. The segment’s size and breadth provide meaningful operating leverage when volumes expand, which has aligned with the uptick in consolidated gross profit margin at 57.00% and net profit margin at 14.41%. In the current quarter, a configuration similar to last quarter—steady service delivery, high engagement, and controlled direct costs—would underpin margin continuity even as pricing and commercial mix evolve. Given the forecast for consolidated revenue to rise to $773.60 million with adjusted EPS at $0.07, the segment’s ability to sustain unit economics while absorbing incremental customer acquisition and retention costs will be central to maintaining profit conversion. Monitoring the balance between utilization rates and service breadth will be essential, because small changes in utilization can translate into disproportionate impacts on EBIT and EPS relative to estimates.

Learning Content Solutions

Learning Content Solutions produced $715.42 million last quarter and represented 31.79% of revenue, positioning it as the largest growth-potential business within TAL Education Group’s mix. The segment benefits from attractive scalability—once content is developed and curated, incremental distribution often carries lower marginal costs—supporting earnings quality in the context of forecast EBIT of $29.79 million (up 5.65% year over year) and adjusted EPS of $0.07 (up 80.00% year over year). In the coming quarter, broadening content coverage and deepening digital adoption can enhance monetization, particularly where the company pairs content with feature extensions and cross-sell initiatives into service lines. The key to upside is expansion of licensed and subscription models that reinforce recurring revenue streams, which can stabilize near-term cash generation and reduce volatility through cycles. Execution around content refresh, relevance, and delivery efficiency will be closely watched, as these factors hold potential to lift consolidated gross margin in tandem with top-line progress even without explicit margin guidance for the quarter.

Share Price Drivers This Quarter

Share price performance will likely hinge on revenue growth durability, margin stability, and EPS delivery versus expectations, anchored by the forecast increase in revenue to $773.60 million and adjusted EPS of $0.07. Last quarter’s upside to consensus on both revenue ($861.35 million versus an $829.53 million estimate) and EPS ($0.24 versus a $0.16 estimate) sets a high bar; the market will expect TAL Education Group to demonstrate continued improvement in operating efficiency and cost discipline to validate the positive trajectory. The interplay across Learning Services and Others and Learning Content Solutions will be critical to margin outcomes, as the mix of high-utilization services and scalable content can shape both gross profit margin and net profit margin. Investors will scrutinize whether the earnings before interest and taxes aligns with the $29.79 million forecast and whether EBIT’s year-over-year growth of 5.65% converts into incremental EPS leverage; upside here would signal robust cost control and enhanced contribution from recurring revenue mechanics. In addition, the quarter-on-quarter cadence of net profit—which expanded by 296.66% last quarter—provides an important context: the sustainability of that momentum will inform sentiment, even if near-term growth rates naturally normalize from the prior quarter’s outsized surge.

Analyst Opinions

Bullish views dominate our collected preview, centering on revenue acceleration, resilient margins inferred from recent performance, and improving EPS leverage relative to last year’s base. The bullish camp highlights that last quarter’s execution exceeded expectations on both the top line and EPS—revenue reached $861.35 million against an $829.53 million estimate, and EPS printed at $0.24 versus a $0.16 estimate—providing a supportive backdrop for the current quarter’s forecast of $773.60 million in revenue and $0.07 in adjusted EPS. Proponents argue that the consolidated gross profit margin of 57.00% and net profit margin of 14.41% last quarter reflect effective cost management, and that the positive year-over-year trends—39.07% for revenue, 48.94% for EBIT, and 100.00% for adjusted EPS—are consistent with the projected year-over-year increases this quarter of 42.68% for revenue, 5.65% for EBIT, and 80.00% for adjusted EPS. They also point to the reinforcing role of segment mix: Learning Services and Others at $1.53 billion with 68.21% of the revenue share and Learning Content Solutions at $715.42 million with 31.79% of the share collectively provide diversified contributions that can stabilize margins and enhance predictability of cash generation. Overall, the bullish perspective expects TAL Education Group to deliver results broadly consistent with the current estimates and sees potential for incremental upside if operating efficiencies continue to scale across services and content, enabling the company to translate revenue growth into sustainable EBIT and EPS gains.