Covista Inc. Reports 4.5% Revenue Growth to $487M, Net Income Declines 31.6%

Covista Inc. reported a revenue increase of 4.5% to $487.0 million for the third quarter of fiscal year 2026, compared to $466.1 million in the same period last year. The growth was driven by higher revenues across all segments, particularly in the Chamberlain and Medical and Veterinary divisions. However, net income decreased by 31.6% to $41.6 million, primarily due to a loss from discontinued operations and increased costs associated with labor, marketing, and growth initiatives. Diluted earnings per share fell to $1.20, down from $1.59 in the prior year.

In terms of operational metrics, total student enrollment at Chamberlain saw a slight decline of 0.7% for the January 2026 session, while Walden University experienced a 12.3% increase in enrollment compared to the previous year. The Medical and Veterinary schools reported a 4.1% increase in enrollment for the January semester. The company also noted a significant shift in revenue recognition due to a change in the academic calendar, which resulted in $18.0 million of revenue being recognized in the second quarter instead of the third.

Covista's financial position showed a decrease in cash and cash equivalents, which fell to $147.0 million from $199.6 million as of June 30, 2025. The company reported a net cash increase from operating activities of $346.4 million for the nine months ended March 31, 2026, up from $273.8 million in the prior year, attributed to higher cash collections from students and reduced legal settlement payments. However, cash used in financing activities increased significantly, primarily due to share repurchases totaling $239.9 million.

Strategically, Covista entered into a new term loan agreement on March 2, 2026, amounting to $510.0 million, while repaying its previous debt obligations. The company also continued its share repurchase program, buying back 637,538 shares at an average price of $103.04 per share during the quarter. Looking ahead, Covista remains focused on optimizing its capital structure and enhancing its operational efficiency to support growth initiatives.

The outlook for Covista indicates a commitment to improving enrollment and revenue growth while managing costs effectively. The company is also navigating regulatory challenges related to financial aid and compliance, which could impact its operations. Covista's management believes that its current liquidity position, combined with available credit facilities, will support its operational and strategic goals in the coming periods.