Strategic Education, Inc. Reports Third Quarter 2026 Results

Strategic Education, Inc. (Strategic Education) (NASDAQ: STRA) today announced financial results for the period ended September 30, 2026.

STRATEGIC EDUCATION CONSOLIDATED RESULTS

Three Months Ended September 30

• Revenue increased 1.6% to $325.1 million compared to $319.9 million for the same period in 2025, driven by strength within the Education Technology Services segment, an increase in U.S. Higher Education segment revenue per student, and favorable foreign currency impacts. Revenue on a constant currency basis, which is a non-GAAP financial measure, increased 0.1% to $320.1 million in the third quarter of 2026 compared to $319.9 million for the same period in 2025. For more details on non-GAAP financial measures used in this press release, refer to the information in the Non-GAAP Financial Measures section of this press release.

• Loss from operations was $87.6 million, compared to income from operations of $37.0 million or 11.6% of revenue for the same period in 2025. Persistent international student immigration constraints have led us to reassess our near-term growth expectations for ANZ, resulting in a non-cash charge of $134.1 million related to the impairment of goodwill and intangibles associated with the acquisition of Torrens University and related assets. Adjusted income from operations on a constant currency basis, which is a non-GAAP financial measure, was $50.2 million compared to $51.3 million for the same period in 2025. Adjusted income from operations excludes the aforementioned impairment of goodwill and intangible assets. The adjusted operating income margin on a constant currency basis, which is a non-GAAP financial measure, was 15.7% compared to 16.0% for the same period in 2025.

• Net loss was $98.3 million compared to net income of $26.6 million for the same period in 2025. Adjusted net income on a constant currency basis, which is a non-GAAP financial measure, was $36.4 million compared to $37.7 million for the same period in 2025.

• Adjusted EBITDA, which is a non-GAAP financial measure, was $71.0 million compared to $69.6 million for the same period in 2025.

• Diluted loss per share was $4.68 compared to diluted earnings per share of $1.15 for the same period in 2025. Adjusted diluted earnings per share on a constant currency basis, which is a non-GAAP financial measure, increased to $1.69 from $1.63 for the same period in 2025. Adjusted diluted weighted average shares outstanding, which is a non-GAAP financial measure, decreased to 21,461,000 from 23,209,000 for the same period in 2025. During the three months ended September 30, 2026, the Company repurchased 347,472 shares of common stock for $28.5 million, and during the nine months ended September 30, 2026, the Company repurchased 1,261,201 shares of common stock for $101.3 million.

Education Technology Services Segment Highlights

• For the third quarter, average total subscribers at Sophia Learning increased approximately 22% from the same period in 2025, and Sophia Learning revenue increased 19.8% to $21.3 million compared to $17.8 million for the same period in 2025.

• As of September 30, 2026, Workforce Edge had a total of 83 corporate agreements, collectively employing approximately 4,030,000 employees.

• ETS revenue increased 11.9% to $42.8 million in the third quarter of 2026 compared to $38.3 million for the same period in 2025, driven by growth in Sophia Learning subscriptions and higher employer affiliated enrollment.

• ETS income from operations was $18.2 million in the third quarter of 2026 compared to $16.0 million for the same period in 2025. The operating income margin was 42.5% compared to 41.7% for the same period in 2025.

U.S. Higher Education Segment Highlights

• For the third quarter, student enrollment within USHE decreased 1.1% to 84,725 compared to 85,640 for the same period in 2025. Our ongoing focus on employers is generating consistent growth in employer affiliated enrollment, but in the third quarter was again offset by a decline in unaffiliated enrollment. Employer affiliated enrollment in the third quarter was 34.7% of USHE enrollment, up from 32.7% during the same period in 2025.

• USHE’s healthcare portfolio generated strong total enrollment growth during the third quarter, increasing 9% from the same period in 2025 and now comprises 54% of USHE total enrollment compared to 49% for the same period in 2025. Of USHE’s total healthcare enrollment, approximately 38% is from employer partners.

• During the third quarter, Strayer University launched an Associate of Applied Science in Radiologic Technology program for enrollment in October 2026. With the addition of this program, USHE has now recently launched several new licensure-track healthcare offerings, including Strayer University’s Licensed Practical Nurse Diploma, Capella University’s Bachelor of Science in Nursing (Prelicensure), and an expanded Capella University Nurse Practitioner portfolio.

• For the third quarter, FlexPath enrollment was 26% of USHE enrollment compared to 24% for the same period in 2025. Healthcare programs comprise 73% of FlexPath enrollment.

• Revenue increased 0.3% to $213.7 million in the third quarter of 2026 compared to $213.1 million for the same period in 2025, driven by higher third quarter revenue per student.

• Income from operations was $22.0 million in the third quarter of 2026 compared to $22.9 million for the same period in 2025. The operating income margin was 10.3% compared to 10.7% for the same period in 2025.

Australia/New Zealand Segment Highlights

• For the third quarter, student enrollment within ANZ decreased 9.1% to 17,101 compared to 18,808 for the same period in 2025. Lower international enrollment, resulting from regulatory changes in Australia, was partially offset by growing domestic enrollment.

• Revenue was relatively unchanged at $68.6 million in the third quarter of 2026 compared to the same period in 2025, driven by favorable foreign currency impacts and higher revenue per student, offset by lower enrollment. Revenue on a constant currency basis, which is a non-GAAP financial measure, decreased 7.2% to $63.6 million in the third quarter of 2026 compared to $68.6 million for the same period in 2025, driven by lower third quarter student enrollment.

• Income from operations was $10.8 million in the third quarter of 2026 compared to $12.5 million for the same period in 2025. The operating income margin was 15.8% compared to 18.2% for the same period in 2025. Income from operations on a constant currency basis, which is a non-GAAP financial measure, was $10.0 million in the third quarter of 2026 compared to $12.5 million for the same period in 2025. The operating income margin on a constant currency basis, which is a non-GAAP financial measure, was 15.7% compared to 18.2% for the same period in 2025.

BALANCE SHEET AND CASH FLOW

At September 30, 2026, Strategic Education had cash, cash equivalents, and marketable securities of $138.6 million and no debt outstanding under its revolving credit facility. For the first nine months of 2026, cash provided by operations was $173.5 million compared to $159.0 million for the same period in 2025. Capital expenditures for the first nine months of 2026 were $36.8 million compared to $32.0 million for the same period in 2025. Capital expenditures including cloud computing investments, which flow through operating cash flow within other assets, for the first nine months of 2026 were $44.8 million compared to $45.2 million for the same period in 2025. Free cash flow for the first nine months of 2026, which is a non-GAAP financial measure, was $136.7 million compared to $127.0 million for the same period in 2025.

For the third quarter of 2026, consolidated bad debt expense as a percentage of revenue was 4.6% compared to 4.7% of revenue for the same period in 2025.

COMMON STOCK CASH DIVIDEND

Strategic Education announced today that it declared a regular, quarterly cash dividend of $0.60 per share of common stock. This dividend will be paid on December 7, 2026 to shareholders of record as of November 30, 2026.

CONFERENCE CALL WITH MANAGEMENT

Strategic Education will host a conference call to discuss its third quarter 2026 results at 10:00 a.m. (ET) today. This call will be available via webcast. To access the live webcast of the conference call, please go to www.strategiceducation.com in the Investor Relations section 15 minutes prior to the start time of the call to register. An earnings release presentation will also be posted to www.strategiceducation.com in the Investor Relations section. Following the call, the webcast will be archived and available at www.strategiceducation.com in the Investor Relations section. To participate in the live call, investors should register here prior to the call to receive dial-in information and a PIN.

About Strategic Education, Inc.

Strategic Education, Inc. (NASDAQ: STRA) (www.strategiceducation.com) is dedicated to helping advance economic mobility through higher education. We primarily serve working adult students globally through our core focus areas: 1) Education Technology Services, developing and maintaining relationships with employers to build education benefits programs providing employees access to affordable and industry-relevant training, certificate, and degree programs, including through Workforce Edge, a full-service education benefits administration solution for employers, and Sophia Learning, which offers low-cost online general education-level courses that are ACE-recommended for college credit; 2) U.S. Higher Education, including Capella University and Strayer University, each institutionally accredited, and collectively offering flexible and affordable associate, bachelor’s, master’s, and doctoral programs; and 3) Australia/New Zealand, comprised primarily of Torrens University. This portfolio of high quality, innovative, relevant, and affordable programs and institutions helps our students prepare for success in today’s workforce and find a path to bettering their lives.

Forward-Looking Statements

This communication contains certain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements may be identified by the use of words such as “expect,” “estimate,” “assume,” “believe,” “anticipate,” “may,” “will,” “forecast,” “outlook,” “plan,” “project,” “potential” and other similar words, and include all statements that are not historical facts, including with respect to, among other things, the future financial performance and growth opportunities of Strategic Education; Strategic Education’s plans, strategies and prospects; and future events and expectations. The statements are based on Strategic Education’s current expectations and are subject to a number of assumptions, uncertainties and risks, including but not limited to:

• the pace of student enrollment;

• Strategic Education’s continued compliance with Title IV of the Higher Education Act, and the regulations thereunder, as well as other federal laws and regulations, institutional accreditation standards and state regulatory requirements;

• legislation and other actions by the U.S. Congress, actions by the current administration, rulemaking and other action by the Department of Education or other governmental entities, including without limitation action related to Title IV programs, Department of Education staffing levels, borrower defense to repayment applications, gainful employment or similar measures, 90/10, increased focus by governmental entities on for-profit education institutions, and including actions by governmental entities in Australia and New Zealand;

• the impairment of goodwill and indefinite-lived intangible assets in ANZ and any further impairment in the future;

• competitive factors;

• risks associated with the opening of new campuses;

• risks associated with the offering of new educational programs and adapting to other changes;

• risks associated with the acquisition of other businesses, including existing educational institutions;

• risks relating to the timing of regulatory approvals;

• Strategic Education’s ability to implement its growth strategy;

• risks associated with the ability of Strategic Education’s students to finance their education in a timely manner;

• risks associated with cybersecurity incidents, including but not limited to reputational risks and possible liability under U.S. state and federal privacy statutes and legal actions;

• risks associated with the use of artificial intelligence and related tools;

• general economic and market conditions; and

• additional factors described in Strategic Education’s most recent Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.

Many of these risks, uncertainties and assumptions are beyond Strategic Education’s ability to control or predict. Because of these risks, uncertainties and assumptions, you should not place undue reliance on these forward-looking statements. Furthermore, these forward-looking statements speak only as of the information currently available to Strategic Education on the date they are made, and Strategic Education undertakes no obligation to update or revise forward-looking statements, except as required by law. Actual results may differ materially from those projected in the forward-looking statements.

Non-GAAP Financial Measures

In our press release and schedules, we report certain financial measures that are not required by, or presented in accordance with, accounting principles generally accepted in the United States of America (“GAAP”). We discuss management’s reasons for reporting these non-GAAP measures below, and the press release schedules that follow reconcile the most directly comparable GAAP measure to each non-GAAP measure that we reference. Although management evaluates and presents these non-GAAP measures for the reasons described below, please be aware that these non-GAAP measures have limitations and should not be considered in isolation or as a substitute for total costs and expenses, income (loss) from operations, operating margin, income (loss) before income taxes, net income (loss), earnings (loss) per share or any other comparable financial measure prescribed by GAAP. In addition, we may calculate and/or present these non-GAAP financial measures differently than measures with the same or similar names that other companies report, and as a result, the non-GAAP measures we report may not be comparable to those reported by others.

Management uses certain non-GAAP measures to evaluate financial performance because those non-GAAP measures allow for period-over-period comparisons of the Company’s ongoing operations before the impact of certain items described below. Management believes this information is useful to investors to compare the Company’s results of operations period-over-period. These measures are Adjusted Total Costs and Expenses, Adjusted Income from Operations, Adjusted Operating Margin, Adjusted Income Before Income Taxes, Adjusted Net Income, Adjusted Diluted Earnings Per Share (EPS), Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA), Adjusted EBITDA, and Free Cash Flow. We define Adjusted Total Costs and Expenses, Adjusted Income from Operations, Adjusted Operating Margin, Adjusted Income Before Income Taxes, Adjusted Net Income, and Adjusted Diluted EPS to exclude (1) severance costs, asset impairment charges, gains/losses on sale of real estate and early termination of leased facilities, and other costs associated with the Company’s restructuring activities, (2) goodwill and intangible assets impairment charges related to the Company’s acquisition of Torrens University and associated assets in Australia and New Zealand, (3) income/loss recognized from the Company’s investments in partnership interests and other investments, and (4) discrete tax adjustments utilizing an adjusted effective income tax rate of 29.0% for both the three months ended September 30, 2025 and 2026. To illustrate currency impacts to operating results, Revenue, Adjusted Total Costs and Expenses, Adjusted Income from Operations, Adjusted Operating Margin, Adjusted Income Before Income Taxes, Adjusted Net Income, and Adjusted Diluted EPS for the three months ended September 30, 2026 are also presented on a constant currency basis utilizing an exchange rate of 0.65 Australian Dollars to U.S. Dollars, which was the average exchange rate for the same period in 2025. We define EBITDA as net income (loss) before other income (expense), the provision for income taxes, depreciation and amortization, and from this amount in arriving at Adjusted EBITDA we also exclude stock-based compensation expense, amortization expense associated with deferred implementation costs incurred in cloud computing arrangements, and the amounts in (1) and (2) above. We define Free Cash Flow as net cash provided by operating activities less purchases of property and equipment. These non-GAAP measures are reconciled to the most directly comparable GAAP measures in the sections that follow. Non-GAAP measures should not be viewed as substitutes for GAAP measures.

View source version on businesswire.com: https://www.businesswire.com/news/home/20261105159475/en/

Media gallery