Strayer Education Stock Earnings Reports

Q1 2026 highlights: Revenue declined 1% YoY driven by a slight enrollment dip, but management expects Q1 to be the low point for revenue and revenue growth for the year. Adjusted operating expenses fell 2% due to productivity initiatives (including AI-enabled systems), driving 3% operating income growth and a modest margin expansion to 14.3%; adjusted EPS was $1.41. Education Technology Services (ETS) delivered strong performance: revenue +21% to $42M, operating income +42% ($20M) and 47% margin; Sophia Learning subscribers rose ~40% and revenue +32%; Workforce Edge now has 82 corporate agreements covering ~4 million employees and drove a 70% increase in enrollments into Strayer/Capella (nearly 4,000 students). ETS now represents a meaningful portion of consolidated operating income. In U.S. Higher Education, employer-affiliated enrollment reached an all-time high of 34.5% (+300 bps YoY) and healthcare now comprises over half of U.S. Higher Education enrollment. U.S. Higher Education revenue fell 4% due to slightly lower unaffiliated enrollment and higher discounts/scholarships; average student retention hit a record 89%. ANZ enrollments declined ~3% amid regulatory/visa headwinds for international students but domestic new student growth remains healthy. Capital allocation: repurchased ~493k shares for $40M in the quarter and ~ $200M remains under the authorization. Management reiterated focus on employer strategy, ETS expansion, and productivity to meet their notional plan (EBIT/EPS and margin expansion).