A new radial three-cavity structure of the coaxial virtual cathode oscillator is proposed and studied numerically in this paper. Using the radial three-cavity structure, the beam-wave conversion efficiency is enhanced by modulating the electric field in the beam-wave interaction area, while the resonator composed of the radial three-cavity configuration and the mesh anode helps restrain mode competition effectively . And then the coaxial extraction structure benefits the energy extraction, and it can also absorb the used electrons entering into the drifting tube. Therefore, this new kind of virtual cathode oscillator can achieve a high output power. With an electron beam of 50 kA at 400 kV, a peak power of about 6 GW is achieved by simulation at 4.5 GHz. The mean power reaches 3.1 GW and the beam-wave conversion efficiency is about 15%.