PERDOCEO EDUCATION Corp
For the period ended Sep 30, 2025. Filed Nov 4, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2025 · Filed Nov 4, 2025
PRDO$26.88+1.2%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-06-30; filed 2025-07-31.
0000950170-25-100876
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-09-30; filed 2025-11-04.
0001193125-25-264625
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 128 previous paragraphs and 124 current paragraphs.
68 unchanged; 37 reworded; 19 added; 22 removed; 1 previous and 0 current paragraphs rearranged.
Tables are not compared: 9 previous and 9 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (19)
Current report
During the third quarter of 2025, the oversight and management of the non-degree professional development and continuing education programs offered by Hippo Education (“Hippo”) were transitioned from the CTU segment to the AIUS segment. All prior periods have been recast to reflect this change for comparability, and the results of operations related to Hippo are now reported within the AIUS segment for all periods presented.
Current report
2025 Third Quarter Overview
Current report
Student Loan Program Limits
Current report
In July 2025, Congress passed, and President Trump signed into law a reconciliation bill, H.R. 1 (the “Act”) that made broad changes to many areas of federal spending. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Overview—2025 Second Quarter Overview—Recent Legislative Development,” in our Quarterly Report on Form 10-Q for the quarter ended June 30, 2025 for a description of higher education related changes adopted.
Current report
The provisions in the Act must be implemented by the Department. On September 29, 2025, the Department convened the first of two negotiated rulemaking committees scheduled to meet this fall and early next year. This first committee, referred to as Reimagining and Improving Education (RISE), began discussions regarding changes to the federal student loan programs to implement statutory changes to the Title IV programs under the Higher Education Act of 1965, as amended (“HEA”), included in the Act. Based on current information, student Title IV borrowing at each of AIUS and CTU has generally been within the new loan levels and limits contemplated by the Act. At USAHS, many of its graduate students have historically relied on Grad PLUS loans to finance a portion of their education. The Act phases out the Grad PLUS loan program which becomes unavailable for new students enrolling after July 1, 2026 and replaces it with a more targeted funding framework. While graduate and professional students were formerly considered a single category of students with comparable loan limits, the new targeted loan framework treats graduate and professional students separately, providing higher Stafford Loan limits to students who are enrolled in “professional programs” as currently defined in regulation. The Act allows for the Department to clarify the existing definition of “professional programs” and designate additional programs that satisfy that definition for inclusion in the current non-exhaustive regulatory list. These topics are being considered in the RISE negotiated rulemaking. Any final definition or interpretation of “professional programs” adopted by the Department that conflicts with the authority granted in the Act could be subject to legal challenge and judicial review.
Current report
We are monitoring these discussions and the Department’s interpretations to assess the impact on federal funding availability for new USAHS students after July 1, 2026. Based on historical borrowing patterns, most USAHS graduate students’ borrowing has generally been within the levels and limits established for “professional programs,” if our programs ultimately qualify as such under the Department’s final regulations. In addition, we are actively engaging in conversations with private lending institutions to evaluate and analyze how they can further expand loan programs currently offered to students regardless of whether the new federal loan limits will cover the full cost of attendance for certain students. Although USAHS’s programs are in the types of in-demand licensed health care fields that have been the subject of the ongoing discussions for “professional programs” in the RISE rulemaking, there is uncertainty regarding the Department’s final determination concerning which programs will be eligible for the higher federal loan funding and whether students at USAHS will need to rely on private lending sources to fund their education. In all cases we will continue to support responsible student borrowing of federal financial aid prior to consideration of alternative sources of private lending for those that may need to borrow to pursue their programs of study.
Current report
Gainful Employment
Current report
On October 10, 2023, the Biden Administration published final regulations for a new rule defining what qualifies as “gainful employment” (“GE”). See Item 1, “Business - Student Financial Aid and Related Federal Regulation – GE and FVT Negotiated Rulemaking,” in our Annual Report on Form 10-K for the year ended December 31, 2024 for a description of this regulation.
Current report
On December 22, 2023, the American Association of Cosmetology Schools (“AACS”) filed a lawsuit in the U.S. District Court for the Northern District of Texas seeking to set aside the GE rule. The AACS action challenges the rule on constitutional, statutory and administrative-law grounds, alleging that the Department exceeded its authority under the HEA and violated the Administrative Procedure Act. On March 20, 2024, Ogle School Management, LLC and Tricoci University of Beauty Culture, LLC filed a separate lawsuit in the same court, asserting that the Department exceeded its statutory authority and acted arbitrarily and capriciously in developing and applying the GE metrics and disclosure requirements. On October 2, 2025, the district court ruled in favor of the Department and upheld the GE rule. The plaintiffs have 60 days to file notices of appeal, and we expect at least one of the parties to appeal.
Current report
The Act requires the Department to undertake rulemaking to implement a new, universally applicable earnings-premium standard for program eligibility under Title IV. This new requirement appears to overlap with, and in some respects is inconsistent with, the existing GE rule, which applies primarily to programs at proprietary schools. The Company believes that this new universally applied earnings requirement will be less restrictive than the existing GE rules. This assessment remains subject to the Department’s forthcoming rulemaking and interpretive decisions, and there can be no assurance regarding the ultimate scope, rigor, or interaction of the two frameworks. Any failure to meet the new earnings-premium requirement would only impact Title IV loan eligibility and would not impact Pell Grant eligibility. The Department has scheduled a second negotiating committee, referred to as Accountability in Higher Education and Access through Demand-driven Workforce Pell (AHEAD), to begin negotiations on December 8, 2025 on regulations to implement these requirements and potentially review and reconcile the overlapping and inconsistent provisions of the GE rule.
Current report
We are continuing to evaluate the new earnings premium requirement and to monitor ongoing discussions regarding any potential changes to the gainful employment regulations. Given the complexity of the rules, lack of access to underlying earnings data used to calculate the metrics, and the absence of formal regulations, we are unable to determine the ultimate impact or potential timing of these requirements on our business at this time. See Item 1, “Business - Student Financial Aid and Related Federal Regulation – GE and FVT Negotiated Rulemaking,” in our Annual Report on Form 10-K for the year ended December 31, 2024 for more information. Also see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Overview—2025 Second Quarter Overview—Recent Legislative Development,” in our Quarterly Report on Form 10-Q for the quarter ended June 30, 2025 for a discussion of the new program eligibility requirement. A loss or material reduction in eligible Title IV programs due to either of these requirements would materially impact our student enrollments and profitability.
Current report
The general and administrative expense for the current quarter and year to date increased by 8.6% or $8.1 million and 11.1% or $30.0 million, respectively, as compared to the prior year periods. The increase was due to expenses related to the USAHS acquisition during the current year periods as compared to no expenses in the prior year periods, which more than offset the decrease in expenses for the remaining institutions.
Current report
Admissions expense for the current quarter and year to date increased by 8.8% or $1.8 million and 9.4% or $5.7 million, respectively, as compared to the prior year periods. The increase was primarily due to admissions expenses related to the USAHS acquisition during the current year periods as compared to no expenses in the prior year periods. Excluding USAHS expenses, admissions expenses would have increased slightly as compared to the prior year periods, primarily due to efforts supporting the growth in total student enrollments at CTU.
Current report
The administrative expense for the current quarter and year to date increased by 11.4% or $4.3 million and 12.5% or $14.3 million, respectively, as compared to the prior year periods. The increase was due to administrative expenses related to the USAHS acquisition during the current year periods as compared to no expenses in the prior year periods, which more than offset the decrease in expenses within Corporate and Other.
Current report
(1) The prior year operating results for CTU and AIUS were recast to reflect the transition of the Hippo Education institution from CTU to AIUS.
Current report
Bad debt expense for the current quarter and year to date decreased by 9.4% or $0.8 million and 2.0% or $0.4 million, respectively, as compared to the prior year periods. The improvement for the current quarter and year-to-date periods was primarily driven by decreases at AIUS, which fully offset increased bad debt expenses at CTU and expense for USAHS.
Current report
(1) The prior year operating results for CTU and AIUS were recast to reflect the transition of the Hippo Education institution from CTU to AIUS.
Current report
During the year to date ended September 30, 2025, we repurchased 2.3 million shares of our common stock for $66.7 million at an average price of $29.07 per share, of which approximately 1.6 million shares of our common stock for approximately $46.1 million were purchased under the previous stock repurchase program. As of September 30, 2025, approximately $54.3 million was available under our current authorized stock repurchase program to repurchase outstanding shares of our common stock. Shares of stock repurchased under the program are held as treasury shares. These repurchased shares reduced the weighted average number of shares of common stock outstanding for basic and diluted earnings per share calculations.
Current report
Accrued expenses - income taxes: The increase primarily relates to amounts owed with respect to estimated payments of federal and state income tax for 2025.
Removed paragraphs (22)
Previous report
2025 Second Quarter Overview
Previous report
Recent Legislative Development
Previous report
On July 4, 2025, President Trump signed into law Public Law No. 119-21 (2025) (the “Act”), nicknamed the “One Big Beautiful Bill,” a multi-faceted reconciliation package that includes changes impacting many areas of government spending. The Act includes a number of changes to federal student aid programs under the Higher Education Act of 1965, as amended (“HEA”), including eliminating and replacing Grad PLUS loans for new graduate and professional students, imposing new annual and lifetime borrowing limits across multiple loan programs, establishing an earnings-based eligibility requirement for federal loans that applies equally to all higher education institutions, and adopting new loan repayment options. The changes generally take effect beginning July 1, 2026, and apply prospectively to new borrowers, however some of the changes will require regulations to be promulgated by the Department. Also, existing students as of the effective date are grandfathered in existing loan programs for up to three years while they complete their existing program of study.
Previous report
Loan Limits
Previous report
Under existing law, federal loan limits for undergraduate students are tiered by academic year, with separate ceilings for subsidized and unsubsidized federal Stafford Loans. Graduate and professional students, in turn, may borrow under the Grad PLUS loan program up to the full cost of attendance without regard to any loan limits, subject only to basic credit criteria and the cost of attendance. Parent PLUS loans similarly allowed creditworthy parents to borrow without regard to specific loan limits, provided the amount did not exceed their child’s cost of attendance minus other aid.
Previous report
For undergraduate students, the Act maintains annual and aggregate borrowing limits, with different limits for dependent and independent students. For graduate and professional students, the Act replaces the Grad PLUS loan program with new higher unsubsidized Direct Stafford loan annual and aggregate loan limits, with both annual and aggregate limits for professional students being higher than for graduate students. The Act also sets a lifetime aggregate loan limit that is inclusive of any undergraduate debt. Parent PLUS loans now include both annual and aggregate loan limits. The Act also provides a lifetime aggregate student loan limit, which applies to all federal student loan borrowers, regardless of academic program or degree level.
Previous report
While we continue to evaluate the Act, the Company believes that the new federal loan levels are generally sufficient to meet the level of borrowing typical students make while enrolled in our institutions’ programs. Pursuant to the Act’s transition provisions, current graduate and professional students and parents of dependent undergraduate students, who received a federal loan prior to July 1, 2026, may continue borrowing under the prior Grad and Parent PLUS loan programs for up to three additional academic years, or the remainder of the borrower’s expected time to credential, whichever is less, provided the student remains continuously enrolled in the same program. See Item 1, “Business - Student Financial Aid and Related Federal Regulation,” in our Annual Report on Form 10-K for the year ended December 31, 2024 for more information.
Previous report
New Earnings Premium Requirement
Previous report
The Act introduces a new earnings-based eligibility requirement for federal loan access that applies to all institutions, public, private nonprofit, and for-profit. Under the eligibility requirement, graduates from an institution’s programs other than undergraduate certificate programs must meet or exceed specified earnings thresholds. Programs that do not meet these benchmarks risk losing access to federal student loans only, not grants.
Previous report
Under the new earnings metric, by program, the Department evaluates the median earnings of graduates who received Title IV federal student aid four years after completion. The calculation includes only those graduates who are actively employed in two of three years and not enrolled in additional postsecondary education. For undergraduate programs, a program fails the test if median earnings for those graduates fall below those of working adults aged 25 to 34 with only a high school diploma or equivalent. For graduate and professional programs, the comparison group is working adults in the same age range whose highest credential is a bachelor’s degree. If a program fails this test in two of the three most recent years for which data is available, it becomes ineligible to participate in federal student loan programs.
Previous report
The Act includes institutional obligations and several procedural safeguards. The Department is required by the Act to establish a formal appeals process. During the pendency of an appeal, the Secretary may permit the institution to maintain participation in federal financial aid programs. Institutions are required to provide timely warnings to students enrolled in any program that fails to meet the earnings threshold in a given year. For programs that lose eligibility under this framework, institutions may seek to regain access to federal student loans after a period of at least two years. It is anticipated the Department will publish regulations, after completion of a negotiated rulemaking, notice and comment, to fully implement the earnings measure under the Act.
Previous report
The Company believes that this new universally applied earnings requirement will be less restrictive than the existing gainful employment rules. Although the gainful employment rules remain in place following the passage of the Act, existing legal challenges and the passage of this new universal requirement present potential opportunities for the Department to eliminate it as a redundant program assessment measure. We are continuing to evaluate this new requirement, but as with gainful employment, given the complexity of the rule, lack of availability of the earnings data used to calculate the metrics and lack of formal regulations, we are unable to determine the ultimate impact of this requirement on our business at this time. See Item 1, “Business - Student Financial Aid and Related Federal Regulation – GE and FVT Negotiated Rulemaking,” in our Annual Report on Form 10-K for the year ended December 31, 2024 for more information.
Previous report
Borrower Defense and Closed School Loan Discharge Relief
Previous report
The Act delays implementation of the Biden administration regulations on borrower defense to repayment and closed school loan discharges for 10 years, to July 1, 2035, which reinstates the rules promulgated under the first Trump administration. These regulations remain the subject of a legal challenge currently pending with the Supreme Court of the United States. See Item 1, “Business - Student Financial Aid and Related Federal Regulation – Compliance with Federal Regulatory Standards and Effect of Federal Regulatory Violations – ‘Borrower Defense to Repayment’” in our Annual Report on Form 10-K for the year ended December 31, 2024 for more information.
Previous report
Streamlined Loan Repayment Programs
Previous report
The Act consolidates federal student loan repayment options, reducing them to two primary plans starting July 1, 2026: a standard repayment plan where borrowers make fixed payments with terms ranging from 10 to 25 years based on amount borrowed, and a new income-driven Repayment Assistance Plan (“RAP”) that offers loan forgiveness after 30 years. Existing income-driven repayment plans will be phased out by July 2026, requiring both new and existing borrowers to transition to the new repayment structure. These changes may affect students’ ability to manage loan repayment and could influence enrollment decisions, particularly among non-traditional and graduate students.
Previous report
The ultimate impact of the Act on our business, financial condition, and results of operations will depend on the final implementing regulations and the responses of our current and prospective students and other stakeholders.
Previous report
On July 24, 2025, the Department announced its intent to establish two negotiated rulemaking committees scheduled to meet this fall. One committee will consider changes to the Federal student loan programs and the other committee will consider changes to institutional and programmatic accountability, including the Pell Grant Program and other changes. This rulemaking is necessary to implement the statutory changes to the Title IV, HEA programs included in the Act, as well as to implement other Administration priorities. We believe the negotiated rulemaking will also include discussion of the current gainful employment and financial value transparency regulations that overlap with requirements under the Act's earnings premium provisions. While the Secretary has authority to early implement aspects of new regulations that do not adversely affect regulated entities, under the Administrative Procedure Act's master calendar provisions, any new regulations would generally not become effective until July 1, 2027 if final regulations are published in the federal register on or before November 1, 2026.
Previous report
The general and administrative expense for the current quarter and year to date increased by 9.5% or $8.5 million and 12.4% or $21.9 million, respectively, as compared to the prior year periods. The increase was primarily due to a full quarter of expenses related to the USAHS acquisition as compared to no expenses in the prior year quarter.
Previous report
Admissions expense for the current quarter and year to date increased by 12.0% or $2.4 million and 9.7% or $4.0 million, respectively, as compared to the prior year periods. Excluding USAHS expenses, admissions expenses would have increased 5.3% or $1.1 million and 3.0% or $1.2 million, respectively, as compared to the prior year periods.
Previous report
The administrative expense for the current quarter and year to date increased by 7.0% or $2.8 million and 13.1% or $10.0 million, respectively, as compared to the prior year periods. Excluding USAHS expenses, administrative expenses would have decreased 7.1% or $2.9 million for the current quarter as compared to the prior year period, and remained relatively flat for the year to date as compared to the prior year period.
Previous report
Bad debt expense for the current quarter decreased by 10.2% or $0.6 million and increased by 3.0% or $0.4 million for the current year to date, as compared to the prior year periods. The improvement in the current quarter was primarily driven by CTU, fully offsetting an increase at AIUS and expense associated with the USAHS acquisition. The year to date increase was primarily due to a full quarter of USAHS expense, compared to none in the prior year period.
Reworded paragraphs (37)
Previous wording
On December 2, 2024, the Company acquired the University of St. Augustine for Health Sciences (the "USAHS acquisition"). Results of operations related to the USAHS acquisition are included in the consolidated financial statements from the date of acquisition.
Current wording
On December 2, 2024, the Company acquired the University of St. Augustine for Health Sciences (the "USAHS acquisition"). Results of operations related to the USAHS acquisition are included in the condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q from the date of acquisition.
Previous wording
As indicated in “Scrutiny of the For-Profit Postsecondary Education Sector” section within Item 1, "Business" in our Annual Report on Form 10-K for the year ended December 31, 2024, the for-profit industry is scrutinized by various policymakers, agencies and interest groups. Congressional hearings and roundtable discussions were previously held regarding certain aspects of the education industry, including issues surrounding student debt as well as publicly reported student outcomes that may be used as part of an institution’s recruiting and admissions practices, and reports were issued that are highly critical of for-profit colleges and universities. Many of the most highly criticized institutions have been closed now for several years.
Current wording
As indicated in “Scrutiny of the For-Profit Postsecondary Education Sector” section within Item 1, "Business" in our Annual Report on Form 10-K for the year ended December 31, 2024, the for-profit education industry is scrutinized by various policymakers, agencies and interest groups. Congressional hearings and roundtable discussions were previously held regarding certain aspects of the education industry, including issues surrounding student debt, as well as publicly reported student outcomes that may be used as part of an institution’s recruiting and admissions practices, and reports were issued that are highly critical of for-profit colleges and universities. Many of the most highly criticized institutions have been closed now for several years.
Previous wording
We encourage you to review Item 1, “Business,” and Item 1A, “Risk Factors,” in our Annual Report on Form 10-K to learn more about our highly regulated industry and related risks and uncertainties, in addition to the MD&A in our 2025 Quarterly Reports on Form 10-Q.
Current wording
We encourage you to review Item 1, “Business,” and Item 1A, “Risk Factors,” in our Annual Report on Form 10-K for the year ended December 31, 2024 to learn more about our highly regulated industry and related risks and uncertainties, in addition to the MD&A in our 2025 Quarterly Reports on Form 10-Q.
Previous wording
We believe it is useful to present non-GAAP financial measures which exclude certain non-cash items as a means to understand the performance of our core business. As a general matter, we use non-GAAP financial measures in conjunction with results presented in accordance with GAAP to help analyze the performance of our core business, assist with preparing the annual operating plan, and measure performance for some forms of compensation. In addition, we believe that non-GAAP financial information is used by analysts and others in the investment community to analyze our historical results and to provide estimates of future performance.
Current wording
We believe it is useful to present non-GAAP financial measures which exclude certain non-cash items as a means to better understand the performance of our core business. As a general matter, we use non-GAAP financial measures in conjunction with results presented in accordance with GAAP to help analyze the operating performance of our core business, assist with preparing the annual operating plan, and measure performance for some forms of compensation. In addition, we believe that non-GAAP financial information is used by analysts and others in the investment community to analyze our historical results and to provide estimates of future performance.
Previous wording
During the second quarter ended June 30, 2025 ("current quarter"), our academic institutions remained focused on furthering their goal of changing lives through education and preparing learners for essential skills needed in today’s job market. CTU and AIUS offer a wide array of career-focused degree programs which help learners thrive in today’s evolving job market, while USAHS prepares professionals to serve communities across the country with quality medical care. The total enrollment growth at our academic institutions during the current quarter reinforced and validated our strategy of prioritizing student experiences and academic outcomes that, we believe, should ultimately support sustainable and responsible growth.
Current wording
During the third quarter ended September 30, 2025 ("current quarter"), our academic institutions remained focused on furthering their goal of changing lives through education and preparing learners for essential skills needed in today’s job market. CTU and AIUS provide diverse, career-focused degree programs designed to help students excel in a rapidly changing job market, while USAHS develops professionals to serve communities across the country with quality healthcare services. During the current quarter, we experienced total enrollment growth, supported by continued momentum in student retention and engagement as well as increased interest from prospective students looking to pursue a degree at our academic institutions. During the quarter, we also continued to invest in student technology and student support processes that we believe further enhance student experiences and academic outcomes.
Previous wording
Total student enrollments increased 17.4% at June 30, 2025 as compared to June 30, 2024. CTU's total student enrollments increased 7.4% as compared to the prior year quarter end, primarily supported by high levels of student retention and engagement, growth within the corporate student program and higher levels of prospective student interest. Total student enrollments increased 7.1% at AIUS for the current quarter end as compared to the prior year quarter end, driven by the academic calendar at AIUS that resulted in a higher number of enrollment days in the current quarter as compared to the prior year quarter and underlying organic enrollment growth. Lastly, for USAHS, the summer term which began in May of 2025 had total student enrollments of 4,000 as of the current quarter end. New enrollments for the summer term included growth in programs such as nursing and speech language therapy as well as the introduction of new modalities for the Doctorate of Physical Therapy program. USAHS has a traditional university calendar with three academic terms and multiple campuses for in-person classes in California, Texas and Florida. USAHS continues to expand its program offerings in terms of new modalities and current campus locations, with the goal of maximizing the geographical area they serve while providing students with a wider choice in taking their courses between online instruction and in person instruction at a campus location as well as hybrid options in between.
Current wording
Total student enrollments increased 15.1% at September 30, 2025 as compared to September 30, 2024, primarily driven by the St. Augustine acquisition and enrollment growth at CTU. CTU's total student enrollments increased 6.7% as compared to the prior year quarter end, supported by high levels of student retention and engagement, growth within the corporate student program and higher levels of prospective student interest. Total student enrollments decreased 2.9% at AIUS for the current quarter end as compared to the prior year quarter end, driven, in part by the academic calendar at AIUS that resulted in a lower number of enrollment days in the current quarter as compared to the prior year quarter. Lastly, for USAHS, the fall term which began in September of 2025 had total student enrollments of 4,420 as of the current quarter end.
Previous wording
For the current quarter, our academic institutions experienced increased levels of prospective student interest and we continued to refine our marketing and admissions spending strategies, including selectively leveraging generative artificial intelligence to identify and engage with prospective students who, we believe, are more likely to succeed at one of our academic institutions. We also continued to upgrade and enhance our technology within admissions, enrollment and student support processes to ensure that our teams are well-equipped to guide and support the growing number of students enrolled at one of our academic institutions throughout their education journey. Additionally, we maintained our commitment to training and developing our admissions, enrollment, and student support teams, ensuring they are fully prepared to assist the increasing number of students throughout their educational journey at our academic institutions.
Current wording
For the current quarter, our academic institutions continued to experience increased levels of prospective student interest and we continued to refine our marketing and admissions spending strategies, including integrating artificial intelligence to help identify and engage with prospective students who, we believe, are more likely to succeed at one of our academic institutions. We also continued to improve the technology that supports our admissions, academic and student support functions to ensure that our teams are well-equipped with the necessary tools to counsel and support the growing number of students enrolled at one of our academic institutions.
Previous wording
We expect the high levels of student retention and student engagement we experienced through the second quarter of 2025, as well as the prospective student interest experienced, to continue through the remainder of 2025. As a result, full year revenue is expected to be higher for 2025 due to the USAHS acquisition as well as growth in revenue and student enrollments within CTU and AIUS.
Current wording
We expect the high levels of student retention and student engagement we experienced over the past few quarters, as well as the prospective student interest experienced, to continue through the remainder of 2025. As a result, full year revenue is expected to be higher for 2025 primarily driven by the USAHS acquisition as well as expected growth in total student enrollments as a result of these trends.
Previous wording
Revenue for the current quarter increased by 25.7% or $42.8 million as compared to the prior year quarter, primarily due to $36.7 million of revenue from the USAHS acquisition which was completed in December 2024 and therefore did not have comparable results in the prior year quarter. CTU and AIUS also contributed to the increase in revenue due to growth in total student enrollments driven by strong student retention and engagement trends along with increased prospective student interest.
Current wording
Revenue for the current quarter increased by 24.8% or $42.0 million as compared to the prior year quarter, primarily due to $38.0 million of revenue from the USAHS acquisition which was completed in December 2024 and therefore did not have comparable results in the prior year quarter. CTU also contributed to the increase in revenue due to growth in total student enrollments driven by strong student retention and engagement trends along with increased prospective student interest, while AIUS remained relatively flat as compared to the prior year quarter.
Previous wording
Operating income for the current quarter increased to $51.4 million as compared to operating income of $46.0 million in the prior year quarter, driven by increased operating income within CTU and reduced operating losses within Corporate and Other. The increase in operating income for the current quarter was a result of revenue growth at CTU and lower acquisition-related expenses in Corporate and Other as compared to the prior year quarter.
Current wording
Operating income for the current quarter increased to $51.0 million as compared to operating income of $44.8 million in the prior year quarter, driven by increased operating income within CTU and AIUS as well as reduced operating losses within Corporate and Other. The increase in operating income for the current quarter was a result of revenue growth at CTU and continued management of operating expenses.
Previous wording
The Company believes it is useful to present non-GAAP financial measures, which exclude certain non-cash items, as a means to understand the core performance of its operations. (See tables below for a GAAP to non-GAAP reconciliation.) Adjusted operating income was $61.5 million for the current quarter as compared to $49.1 million for the prior year quarter.
Current wording
The Company believes it is useful to present non-GAAP financial measures, such as adjusted operating income, which exclude certain non-cash items, as a means to better understand the core performance of its operations. (See tables below for a GAAP to non-GAAP reconciliation.) Adjusted operating income was $61.0 million for the current quarter as compared to $47.8 million for the prior year quarter.
Previous wording
The current quarter and year to date revenue increased by 25.7% or $42.8 million and 26.1% or $87.6 million, respectively, as compared to the prior year periods. The increase was primarily driven by the acquisition of USAHS completed in December 2024 that was not part of the comparative prior year periods as well as increases in revenue for both the current quarter and year to date at both CTU and AIUS.
Current wording
The current quarter and year to date revenue increased by 24.8% or $42.0 million and 25.7% or $129.6 million, respectively, as compared to the prior year periods. The increase was primarily driven by the acquisition of USAHS completed in December 2024 that was not part of the comparative prior year periods, as well as increases in revenue for both the current quarter and year to date at CTU.
Previous wording
The educational services and facilities expense for the current quarter and year to date increased by 82.6% or $22.7 million and 72.2% or $41.4 million, respectively, as compared to the prior year periods. The increase was primarily due to a full quarter of expenses related to the USAHS acquisition as compared to no expenses in the prior year periods for USAHS.
Current wording
The educational services and facilities expense for the current quarter and year to date increased by 73.7% or $20.9 million and 72.7% or $62.3 million, respectively, as compared to the prior year periods. The increase was primarily due to a full quarter of expenses related to the USAHS acquisition as compared to no expenses in the prior year periods for USAHS.
Previous wording
Advertising and marketing expense for the current quarter and year to date increased by 16.9% or $3.9 million and 16.1% or $7.6 million, respectively, as compared to the prior year periods. Excluding USAHS expenses, advertising expenses would have remained relatively flat as compared to the prior year periods.
Current wording
Advertising and marketing expense for the current quarter and year to date increased by 10.4% or $2.8 million and 14.0% or $10.4 million, respectively, as compared to the prior year periods. The increase was primarily due to advertising and marketing expenses related to the USAHS acquisition during the current year periods as compared to no expenses in the prior year periods.
Previous wording
Depreciation and amortization expense for the current quarter and year to date increased by $7.1 million and $15.9 million as compared to the prior year periods, driven by the USAHS acquisition, which includes amortization for definite-lived intangible assets as well as amortization related to finance leases for ground-based campuses.
Current wording
Depreciation and amortization expense for the current quarter and year to date increased by $7.0 million and $22.8 million, respectively, as compared to the prior year periods, driven by the USAHS acquisition, which includes amortization for definite-lived intangible assets as well as amortization related to finance leases for ground-based campuses.
Previous wording
Operating income for the current quarter and year to date increased by 11.7% or $5.4 million and 11.7% or $10.8 million as compared to the prior year periods. This improvement was primarily driven by increased revenue, which more than offset the increases in operating expenses, as compared to the prior year periods.
Current wording
Operating income for the current quarter and year to date increased by 13.8% or $6.2 million and 12.4% or $17.0 million, respectively, as compared to the prior year periods. This improvement was primarily driven by increased revenue, which more than offset the increases in operating expenses, as compared to the prior year periods.
Previous wording
For the quarter and year to date ended June 30, 2025, we recorded a provision for income taxes of $15.2 million reflecting an effective tax rate of 27.0% and $28.0 million reflecting an effective tax rate of 24.9%, respectively, as compared to a provision for income taxes of $14.6 million reflecting an effective tax rate of 27.5% and $28.0 million reflecting an effective tax rate of 26.4% for the respective prior year periods. The effective tax rate for the current quarter and year to date was benefitted by the tax effect of stock-based compensation, which decreased the effective tax rate for the quarter and year to date by 0.3% and 2.9%, respectively. The effective tax rate for the current quarter and year to date also includes the release of previously recorded tax reserves, which decreased the effective tax rate by 1.7% and 1.5%, respectively. The effective tax rate for the prior year quarter and year to date includes release of previously recorded tax reserves, which reduced the effective tax rate by 1.2% and 1.3%, respectively.
Current wording
For the quarter and year to date ended September 30, 2025, we recorded a provision for income taxes of $16.2 million reflecting an effective tax rate of 28.9% and $44.2 million reflecting an effective tax rate of 26.2%, respectively, as compared to a provision for income taxes of $14.1 million reflecting an effective tax rate of 26.9% and $42.1 million reflecting an effective tax rate of 26.6% for the respective prior year periods. The effective tax rate for the current quarter and year to date was impacted by the tax effect of stock-based compensation, which decreased the effective tax rate for the quarter and year to date by 0.2% and 2.0%, respectively. For the full year 2025, we expect our effective tax rate to be between 26.0% and 26.5%.
Previous wording
(1) USAHS includes results of operations beginning on the acquisition date of December 2, 2024. Operating loss for the current quarter and year to date includes $7.2 million and $16.1 million, respectively, of depreciation and amortization expense associated with acquired tangible and intangible assets as well as finance leases.
Current wording
(2) USAHS includes results of operations beginning on the acquisition date of December 2, 2024. Operating income (loss) for the current quarter and year to date includes $7.1 million and $23.2 million, respectively, of depreciation and amortization expense associated with acquired tangible and intangible assets as well as finance leases.
Previous wording
CTU. Current quarter and year to date revenue increased by 4.6% or $5.1 million and 4.9% or $11.2 million, respectively, as compared to the prior year periods. The increase was driven by total student enrollment growth of 7.4% at June 30, 2025 as compared to the prior year quarter end. CTU's total student enrollment growth was supported by high levels of student retention and engagement, growth in the corporate student program and higher levels of prospective student interest.
Current wording
CTU. Current quarter and year to date revenue increased by 4.3% or $4.8 million and 4.7% or $15.5 million, respectively, as compared to the prior year periods. The increase was driven by total student enrollment growth of 6.7% at September 30, 2025 as compared to the prior year quarter end. CTU's total student enrollment growth was supported by high levels of student retention and engagement, growth in the corporate student program and higher levels of prospective student interest.
Previous wording
Current quarter and year to date operating income for CTU increased by 7.9% or $3.4 million and 8.6% or $7.3 million, respectively, as compared to the prior year periods driven by the increase in revenue discussed above, which more than offset increased operating expenses.
Current wording
Current quarter and year to date operating income for CTU increased by 6.7% or $3.0 million and 7.4% or $9.8 million, respectively, as compared to the prior year periods driven by the increase in revenue discussed above, which more than offset increased operating expenses.
Previous wording
AIUS. Current quarter and year to date revenue increased slightly by 1.9% or $1.0 million and 0.5% or $0.6 million, respectively, as compared to the prior year periods. The increase was driven by total student enrollment growth of 7.1% at June 30, 2025 as compared to the prior year quarter end. The increase in total student enrollments was driven by the academic calendar at AIUS that resulted in a higher number of enrollment days in the quarter as compared to prior year quarter and underlying organic enrollment growth.
Current wording
AIUS. Current quarter revenue decreased slightly by 1.2% or $0.7 million as compared to the prior year period and remained relatively stable for the current year to date as compared to the prior year period. Total student enrollments decreased 2.9% at September 30, 2025, as compared to the prior year quarter end, driven by the academic calendar at AIUS that resulted in a lower number of enrollment days in the quarter as compared to prior year quarter.
Previous wording
Current quarter operating income for AIUS decreased by 6.5% or $0.8 million as compared to the prior year quarter, primarily driven by a non-recurring expense benefit recorded in the prior year quarter. The year to date operating income for AIUS increased by 7.9% or $1.8 million as compared to the prior year period, primarily driven by lower operating expenses as compared to the prior year period.
Current wording
Current quarter and year to date operating income for AIUS increased by 8.7% or $0.7 million and 10.6% or $3.1 million, respectively, as compared to the prior year period, driven by lower operating expenses as compared to the prior year periods.
Previous wording
USAHS. Revenue for the current quarter and year to date was approximately $36.7 million and $75.9 million, respectively. USAHS reported operating losses of approximately $1.7 million for the current quarter and $2.0 million for the current year to date. These losses were primarily driven by $7.2 million and $16.1 million, for the current quarter and year to date, respectively, in depreciation and amortization expenses related to acquired tangible and intangible assets, as well as finance leases.
Current wording
USAHS. Revenue for the current quarter and year to date was approximately $38.0 million and $113.9 million, respectively. For the year-to-date period, USAHS reported operating losses of approximately $2.0 million, while reporting breakeven results for the current quarter. For the current quarter and year-to-date period, USAHS reported depreciation and amortization expenses of $7.1 million and $23.2 million, respectively, associated with acquired tangible and intangible assets, along with finance leases.
Previous wording
Corporate and Other. This category includes unallocated costs that are incurred on behalf of the entire company. Total Corporate and Other operating loss for the current quarter and year to date improved by 46.5% or $4.6 million and 25.4% or $3.8 million, respectively, as compared to the prior year periods, primarily due to lower acquisition-related costs in both the current quarter and year to date as compared to the prior year periods.
Current wording
Corporate and Other. This category includes unallocated costs that are incurred on behalf of the entire company. Total Corporate and Other operating loss for the current quarter and year to date improved by 27.7% or $2.3 million and 26.2% or $6.1 million, respectively, as compared to the prior year periods, primarily due to lower acquisition-related expenses in both the current quarter and year to date as compared to the prior year periods.
Previous wording
A detailed discussion of the accounting policies and estimates that we believe are most critical to our financial condition and results of operations that require management’s most subjective and complex judgments in estimating the effect of inherent uncertainties is included under the caption “Summary of Critical Accounting Policies and Estimates” included in Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the year ended December 31, 2024. Note 2 “Summary of Significant Accounting Policies” of the notes to our consolidated financial statements in our Annual Report on Form 10-K for the year ended December 31, 2024 also includes a discussion of these and other significant accounting policies.
Current wording
A detailed discussion of the accounting policies and estimates that we believe are most critical to our financial condition and results of operations that require management’s most subjective and complex judgments in estimating the effect of inherent uncertainties is included under the caption “Summary of Critical Accounting Policies and Estimates” included in Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the year ended December 31, 2024. Note 2 “Summary of Significant Accounting Policies” of the notes to our audited consolidated financial statements in our Annual Report on Form 10-K for the year ended December 31, 2024 also includes a discussion of these and other significant accounting policies.
Previous wording
As of June 30, 2025, cash, cash equivalents, restricted cash and available-for-sale short-term investments(“cash balances”) totaled $659.6 million. Restricted cash as of June 30, 2025 was $21.6 million and primarily related to a letter of credit USAHS is required to maintain with the Department of Education. Our cash flows from operating activities have historically been adequate to fulfill our liquidity requirements. We have historically financed our operating activities, organic growth and acquisitions primarily through cash generated from operations and existing cash balances. We expect to continue to generate cash during the remainder of 2025. We anticipate that we will be able to satisfy the cash requirements associated with, among other things, our working capital needs, capital expenditures, lease commitments and quarterly dividend payments through at least the next 12 months primarily with cash generated by operations and existing cash balances.
Current wording
As of September 30, 2025, cash, cash equivalents, restricted cash and available-for-sale short-term investments(“cash balances”) totaled $668.6 million. Restricted cash as of September 30, 2025 was $21.3 million and primarily related to a letter of credit USAHS is required to maintain with the Department of Education. Our cash flows from operating activities have historically been adequate to fulfill our liquidity requirements. We have historically financed our operating activities, organic growth and acquisitions primarily through cash generated from operations and existing cash balances. We expect to continue to generate cash during the remainder of 2025. We anticipate that we will be able to satisfy the cash requirements associated with, among other things, our working capital needs, capital expenditures, lease commitments, share repurchases and quarterly dividend payments through at least the next 12 months primarily with cash generated from operations and existing cash balances.
Previous wording
On July 31, 2025, the Board of Directors of the Company approved a new stock repurchase program for up to $75.0 million which will commence on July 31, 2025 and expires January 31, 2027. The new stock repurchase program replaced the previous stock repurchase program approved on February 20, 2024. The timing of purchases and the number of shares repurchased under the program is determined by the Company’s management and will depend on a variety of factors including stock price, trading volume and other general market and economic conditions, its assessment of alternative uses of capital, regulatory requirements and other factors. The Board of Directors approved the aforementioned stock repurchase program believing it advantageous to the Company and its stockholders to repurchase shares of the Company’s common stock from time to time at prices below what the Board of Directors believed to be the intrinsic value of the Company’s common stock.
Current wording
On July 31, 2025, the Board of Directors of the Company approved a new stock repurchase program for up to $75.0 million which commenced on July 31, 2025 and expires January 31, 2027. The new stock repurchase program replaced the previous stock repurchase program approved on February 20, 2024. The timing of purchases and the number of shares repurchased under the program is determined by the Company’s management and will depend on a variety of factors including stock price, trading volume and other general market and economic conditions, its assessment of alternative uses of capital, regulatory requirements and other factors.
Previous wording
On July 31, 2025 the Board of Directors declared a quarterly dividend of $0.15 per share, which will be paid on September 12, 2025 for holders of record of common stock as of September 2, 2025. This marks a 15.4% increase in the quarterly dividend, the second such increase since dividends commenced in 2023. Any decision to pay future cash dividends, however, will be made by the board of directors and depend on the Company’s available retained earnings, financial condition and other relevant factors. The Company expects quarterly dividend payments to be an integral and growing part of its balanced capital allocation strategy that also prioritizes investments in student support and technology projects, while also evaluating acquisitions and share repurchases.
Current wording
On October 31, 2025 the Board of Directors declared a quarterly dividend of $0.15 per share, which will be paid on December 12, 2025 for holders of record of common stock as of November 28, 2025. Any decision to pay future cash dividends, however, will be made by the board of directors and depend on the Company’s available retained earnings, financial condition and other relevant factors. The Company expects quarterly dividend payments to be an integral and growing part of its balanced capital allocation strategy that also prioritizes investments in student support and technology projects, while also evaluating future acquisitions and share repurchases.
Previous wording
During the years to date ended June 30, 2025 and 2024, net cash flows provided by operating activities totaled $143.9 million and $93.0 million, respectively. The increase in net cash flows from operating activities for the current quarter was primarily driven by increased operating income.
Current wording
During the years to date ended September 30, 2025 and 2024, net cash flows provided from operating activities totaled $185.1 million and $144.0 million, respectively. The increase in net cash flows from operating activities for the current year to date was primarily driven by increased operating income.
Previous wording
During the years to date ended June 30, 2025 and 2024, net cash flows used in investing activities totaled $7.3 million and $60.1 million, respectively.
Current wording
During the year to date ended September 30, 2025, net cash flows used in investing activities totaled $29.8 million compared to net cash flows provided by investing activities of $7.3 million for the prior year to date.
Previous wording
Purchases and Sales of Available-for-Sale Investments. Purchases and sales of available-for-sale investments resulted in a net cash outflow of $3.6 million and $58.1 million for the years to date ended June 30, 2025 and 2024, respectively.
Current wording
Purchases and Sales of Available-for-Sale Investments. Purchases and sales of available-for-sale investments resulted in a net cash outflow of $24.3 million for the current year to date as compared to a net cash inflow of $10.3 million for the prior year to date.
Previous wording
Capital Expenditures. Capital expenditures increased to $4.5 million for the year to date ended June 30, 2025 as compared to $2.0 million for the year to date ended June 30, 2024. For the full year 2025, we expect capital expenditures to be approximately 1.5% of revenue.
Current wording
Capital Expenditures. Capital expenditures increased to $6.3 million for the year to date ended September 30, 2025 as compared to $3.0 million for the year to date ended September 30, 2024. For the full year 2025, we expect capital expenditures to be approximately 1.5% of revenue.
Previous wording
Business Acquisition. The Company received a working capital true up of $0.8 million in relation to the USAHS acquisition during the year to date ended June 30, 2025.
Current wording
Business Acquisition. The Company received a working capital true up of $0.8 million from the former owners of USAHS in relation to the USAHS acquisition during the year to date ended September 30, 2025.
Previous wording
During the years to date ended June 30, 2025 and 2024, net cash flows used in financing activities totaled $74.7 million and $23.0 million, respectively. Payments to repurchase shares of our common stock were $46.1 million for the year to date ended June 30, 2025 and $6.8 million for the year to date ended June 30, 2024.
Current wording
During the years to date ended September 30, 2025 and 2024, net cash flows used in financing activities totaled $106.3 million and $31.5 million, respectively. Payments to repurchase shares of our common stock were $66.7 million for the year to date ended September 30, 2025 and $6.8 million for the year to date ended September 30, 2024.
Previous wording
Payments of cash dividends and dividend equivalents. During the years to date ended June 30, 2025 and 2024, the Company made dividend and dividend equivalent payments of $17.7 million and $14.6 million, respectively.
Current wording
Payments of cash dividends and dividend equivalents. During the years to date ended September 30, 2025 and 2024, the Company made dividend and dividend equivalent payments of $27.4 million and $23.2 million, respectively.
Previous wording
Principal payments for finance leases and failed sale leaseback. During the year to date ended June 30, 2025, the Company made payments of $2.9 million for finance leases and a failed sale leaseback, both related to USAHS.
Current wording
Principal payments for finance leases and failed sale leaseback. During the year to date ended September 30, 2025, the Company made payments of $4.2 million for finance leases and a failed sale leaseback, both related to USAHS.
Previous wording
Construction financing. The decrease in construction financing liability is primarily due to the recategorization of sale leaseback upon lease commencement.
Current wording
Construction financing. The decrease in construction financing liability is primarily due to the recategorization of the failed sale leaseback upon lease commencement.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
For the full year 2025, we expect our effective tax rate to be between 26.0% and 26.5%.