Strategic Education, Inc. Reports Second Quarter 2026 Results

Strategic Education, Inc. Reports Second Quarter 2026 Results HERNDON, Va.--( BUSINESS WIRE)-- Strategic Education, Inc. (Strategic Education) (NASDAQ: STRA) today announced financial results for the period ended June 30, 2026.

STRATEGIC EDUCATION CONSOLIDATED RESULTS

Three Months Ended June 30

Education Technology Services Segment Highlights

U.S. Higher Education Segment Highlights

Australia/New Zealand Segment Highlights

BALANCE SHEET AND CASH FLOW

At June 30, 2026, Strategic Education had cash, cash equivalents, and marketable securities of $133.8 million and no debt outstanding under its revolving credit facility. For the first six months of 2026, cash provided by operations was $116.6 million compared to $98.9 million for the same period in 2025. Capital expenditures for the first six months of 2026 were $24.2 million compared to $21.2 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 six months of 2026 were $28.6 million compared to $29.7 million for the same period in 2025. Free cash flow for the first six months of 2026, which is a non-GAAP financial measure, was $92.4 million compared to $77.7 million for the same period in 2025.

For the second quarter of 2026, consolidated bad debt expense as a percentage of revenue was 3.3% compared to 4.0% 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 September 14, 2026 to shareholders of record as of September 4, 2026.

CONFERENCE CALL WITH MANAGEMENT

Strategic Education will host a conference call to discuss its second 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:

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.

STRATEGIC EDUCATION, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(in thousands, except per share data)

For the three months ended

June 30,

For the six months ended

June 30,

2025

2026

2025

2026

Revenues

321,471

337,264

625,061

643,192

Costs and expenses:

Instructional and support costs

166,153

177,872

324,439

332,643

General and administration

106,775

106,447

210,371

214,417

Restructuring costs

2,783

2,465

4,697

4,567

Total costs and expenses

275,711

286,784

539,507

551,627

Income from operations

45,760

50,480

85,554

91,565

Other income (expense)

(315

)

1,351

1,896

2,556

Income before income taxes

45,445

51,831

87,450

94,121

Provision for income taxes

13,114

14,672

25,375

24,153

Net income

32,331

37,159

62,075

69,968

Earnings per share:

Basic

1.41

1.74

2.69

3.25

Diluted

1.37

1.71

2.61

3.19

Weighted average shares outstanding:

Basic

22,906

21,381

23,113

21,501

Diluted

23,516

21,736

23,790

21,954

STRATEGIC EDUCATION, INC.

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share data)

December 31,

2025

June 30,

2026

ASSETS

Current assets:

Cash and cash equivalents

140,757

123,755

Marketable securities

7,297

4,997

Tuition receivable, net

78,202

100,858

Income taxes receivable

2,511

4,772

Other current assets

49,090

55,738

Total current assets

277,857

290,120

Property and equipment, net

107,373

109,994

Right-of-use lease assets

91,140

86,575

Marketable securities, non-current

5,000

Intangible assets

249,243

250,782

Goodwill

1,242,413

1,258,536

Other assets

65,514

67,855

Total assets

2,038,540

2,068,862

LIABILITIES & STOCKHOLDERS’ EQUITY

Current liabilities:

Accounts payable and accrued expenses

105,791

117,169

Contract liabilities

96,247

133,005

Lease liabilities

15,905

14,624

Total current liabilities

217,943

264,798

Deferred income tax liabilities

35,835

33,530

Lease liabilities, non-current

93,216

92,089

Other long-term liabilities

45,140

44,861

Total liabilities

392,134

435,278

Commitments and contingencies

Stockholders’ equity:

Common stock, par value $0.01; 32,000,000 shares authorized; 22,968,860 and 22,208,559 shares issued and outstanding at December 31, 2025 and June 30, 2026, respectively

230

222

Additional paid-in capital

1,436,795

1,377,637

Accumulated other comprehensive loss

(46,115

)

(27,528

)

Retained earnings

255,496

283,253

Total stockholders’ equity

1,646,406

1,633,584

Total liabilities and stockholders’ equity

2,038,540

2,068,862

STRATEGIC EDUCATION, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

For the six months ended

June 30,

2025

2026

Cash flows from operating activities:

Net income

62,075

69,968

Adjustments to reconcile net income to net cash provided by operating activities:

Gain on early termination of operating leases

—

(190

)

Amortization of deferred financing costs

212

Amortization of investment discount/premium

(140

)

Depreciation and amortization

23,198

22,121

Deferred income taxes

)

(2,781

)

Stock-based compensation

11,327

10,259

Impairment of right-of-use lease assets

802

338

Changes in assets and liabilities:

Tuition receivable, net

(20,398

)

(23,548

)

Other assets

(13,007

)

(5,359

)

Accounts payable and accrued expenses

(3,643

)

12,833

Income taxes payable and income taxes receivable

(3,785

)

(2,278

)

Contract liabilities

44,861

37,275

Other liabilities

(2,634

)

(2,295

)

Net cash provided by operating activities

98,864

116,550

Cash flows from investing activities:

Purchases of property and equipment

(21,151

)

(24,198

)

Purchases of marketable securities

(25,804

)

(5,802

)

Proceeds from marketable securities

42,575

8,306

Proceeds from other investments

—

Other investments

(231

)

(138

)

Cash paid for acquisition, net of cash acquired

(16

)

—

Other investing activities

—

(71

)

Net cash used in investing activities

(4,627

)

(21,874

)

Cash flows from financing activities:

Common dividends paid

(29,215

)

(26,924

)

Net payments for stock awards

(9,182

)

(12,504

)

Repurchase of common stock

(60,032

)

(72,745

)

Net cash used in financing activities

(98,429

)

(112,173

)

Effect of exchange rate changes on cash, cash equivalents, and restricted cash

2,519

132

Net decrease in cash, cash equivalents, and restricted cash

(1,673

)

(17,365

)

Cash, cash equivalents, and restricted cash — beginning of period

146,656

149,511

Cash, cash equivalents, and restricted cash — end of period

144,983

132,146

STRATEGIC EDUCATION, INC.

UNAUDITED SEGMENT REPORTING

(in thousands)

For the three months ended

June 30,

For the six months ended

June 30,

2025

2026

2025

2026

Revenues:

U.S. Higher Education

215,635

220,526

436,643

433,117

Australia/New Zealand

69,144

74,384

117,404

126,204

Education Technology Services

36,692

42,354

71,014

83,871

Consolidated revenues

321,471

337,264

625,061

643,192

Income (loss) from operations:

U.S. Higher Education

20,759

32,375

50,715

57,877

Australia/New Zealand

12,756

1,002

10,660

(1,005

)

Education Technology Services

15,028

19,568

28,876

39,260

Restructuring costs

(2,783

)

(2,465

)

(4,697

)

(4,567

)

Consolidated income from operations

45,760

50,480

85,554

91,565

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 from operations, operating margin, income before income taxes, net income, earnings 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) income/loss recognized from the Company’s investments in partnership interests and other investments, and (3) discrete tax adjustments utilizing an adjusted effective income tax rate of 29.0% for both the three months ended June 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 June 30, 2026 are also presented on a constant currency basis utilizing an exchange rate of 0.64 Australian Dollars to U.S. Dollars, which was the average exchange rate for the same period in 2025. We define EBITDA as net income 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) 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.

STRATEGIC EDUCATION, INC.

UNAUDITED RECONCILIATION OF NON-GAAP FINANCIAL MEASURES

ADJUSTED TOTAL COSTS AND EXPENSES, ADJUSTED INCOME FROM OPERATIONS, ADJUSTED OPERATING MARGIN, ADJUSTED INCOME BEFORE INCOME TAXES, ADJUSTED NET INCOME, AND ADJUSTED EPS

(in thousands, except per share data)

For the three months ended June 30, 2025

Non-GAAP Adjustments

As Reported

(GAAP)

Restructuring

costs (1)

Loss from

other

investments (2)

Tax

adjustments (3)

As Adjusted

(Non-GAAP)

Total costs and expenses

275,711

(2,783

)

—

272,928

Income from operations

45,760

2,783

—

48,543

Operating margin

14.2

15.1

Income before income taxes

45,445

2,783

2,259

—

50,487

Net income

32,331

2,783

2,259

(1,527

)

35,846

Earnings per share:

Diluted

1.37

1.52

Weighted average shares outstanding:

Diluted

23,516

For the three months ended June 30, 2026

Non-GAAP Adjustments

As Reported

(GAAP)

Restructuring

costs (1)

Income from

other

investments (2)

Tax

adjustments (3)

As Adjusted

(Non-GAAP)

Total costs and expenses

286,784

(2,465

)

—

284,319

Income from operations

50,480

2,465

—

52,945

Operating margin

15.0

15.7

Income before income taxes

51,831

2,465

(311

)

—

53,985

Net income

37,159

2,465

(311

)

(984

)

38,329

Earnings per share:

Diluted

1.71

1.76

Weighted average shares outstanding:

Diluted

21,736

(1)

(2)

Reflects income/loss recognized from the Company’s investments in partnership interests and other investments.

(3)

Reflects tax impacts of the adjustments described above and discrete tax adjustments related to stock-based compensation and other adjustments, utilizing an adjusted effective income tax rate of 29.0% for both the three months ended June 30, 2025 and 2026.

STRATEGIC EDUCATION, INC.

UNAUDITED RECONCILIATION OF NON-GAAP FINANCIAL MEASURES

Q2 2026 AS ADJUSTED WITH CONSTANT CURRENCY

(in thousands, except per share data)

As Reported

(GAAP)

Non-GAAP adjustments (1)

Constant

currency

adjustment (2)

As Adjusted

with Constant

Currency

(Non-GAAP)

Revenues

337,264

—

(7,026

)

330,238

Total costs and expenses

286,784

(2,465

)

(6,821

)

277,498

Income from operations

50,480

2,465

(205

)

52,740

Operating margin

15.0

16.0

Income before income taxes

51,831

2,154

(225

)

53,760

Net income

37,159

1,170

(159

)

38,170

Earnings per share:

Diluted

1.71

1.76

Weighted average shares outstanding:

Diluted

21,736

(1)

Reflects non-GAAP adjustments related to restructuring costs, income/loss from other investments, and tax adjustments as described further in the Unaudited Reconciliation of Non-GAAP Financial Measures table above.

(2)

Reflects an adjustment to translate foreign currency results after the non-GAAP adjustments for the three months ended June 30, 2026 at a constant exchange rate of 0.64 Australian Dollars to U.S. Dollars, which was the average exchange rate for the same period in 2025.

STRATEGIC EDUCATION, INC.

UNAUDITED NON-GAAP SEGMENT REPORTING

(in thousands)

For the three months ended

June 30,

For the six months ended

June 30,

2025

2026

2025

2026

Revenues:

U.S. Higher Education

215,635

220,526

436,643

433,117

Australia/New Zealand

69,144

74,384

117,404

126,204

Education Technology Services

36,692

42,354

71,014

83,871

Consolidated revenues

321,471

337,264

625,061

643,192

Income (loss) from operations:

U.S. Higher Education

20,759

32,375

50,715

57,877

Australia/New Zealand

12,756

1,002

10,660

(1,005

)

Education Technology Services

15,028

19,568

28,876

39,260

Restructuring costs

(2,783

)

(2,465

)

(4,697

)

(4,567

)

Consolidated income from operations

45,760

50,480

85,554

91,565

Adjustments to consolidated income from operations:

Restructuring costs

2,783

2,465

4,697

4,567

Total adjustments to consolidated income from operations

2,783

2,465

4,697

4,567

Adjusted income (loss) from operations by segment:

U.S. Higher Education

20,759

32,375

50,715

57,877

Australia/New Zealand

12,756

1,002

10,660

(1,005

)

Education Technology Services

15,028

19,568

28,876

39,260

Total adjusted income from operations

48,543

52,945

90,251

96,132

STRATEGIC EDUCATION, INC.

UNAUDITED RECONCILIATION OF NON-GAAP FINANCIAL MEASURES

EBITDA AND ADJUSTED EBITDA

(in thousands)

For the three months ended

June 30,

2025

2026

Net income

32,331

37,159

Provision for income taxes

13,114

14,672

Other (income) expense

315

(1,351

)

Depreciation and amortization

12,003

11,195

EBITDA (1)

57,763

61,675

Stock-based compensation

5,856

4,873

Restructuring costs (2)

2,089

2,176

Cloud computing amortization (3)

2,566

2,959

Adjusted EBITDA (1)

68,274

71,683

(1)

Denotes non-GAAP financial measures. Please see the information in the Non-GAAP Financial Measures section of this press release for more detail regarding these adjustments and management’s reasons for providing this information.

(2)

Reflects 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. Excludes $0.7 million and $0.3 million of depreciation and amortization expense for the three months ended June 30, 2025 and 2026, respectively.

(3)

Reflects amortization expense associated with deferred implementation costs incurred in cloud computing arrangements.

STRATEGIC EDUCATION, INC.

UNAUDITED RECONCILIATION OF NON-GAAP FINANCIAL MEASURES

FREE CASH FLOW

(in thousands)

For the six months ended

June 30,

2025

2026

Net cash provided by operating activities

98,864

116,550

Purchases of property and equipment

(21,151

)

(24,198

)

Free cash flow (1)

77,713

92,352

(1)

Denotes a non-GAAP financial measure. Please see the information in the Non-GAAP Financial Measures section of this press release for more detail regarding these adjustments and management’s reasons for providing this information.