Strategic Education Reports 2.9% Revenue Growth to $321.5 Million in Q2 2025

Strategic Education, Inc. reported a revenue increase of 2.9% for the second quarter of 2025, reaching $321.5 million compared to $312.3 million in the same period of 2024. For the first half of 2025, total revenue rose to $625.1 million, up from $602.5 million year-over-year. The company's net income also saw an increase, with $32.3 million reported for the second quarter, up from $29.9 million in 2024, and $62.1 million for the first half of 2025, compared to $59.6 million in the prior year. Diluted earnings per share improved to $1.37 for the second quarter and $2.61 for the first half, reflecting growth in profitability.

The financial performance was bolstered by significant contributions from the Education Technology Services (ETS) segment, which experienced a 49.6% revenue increase to $36.7 million in the second quarter, driven by new employer partnerships and growth in Sophia Learning subscriptions. However, the U.S. Higher Education (USHE) segment reported a slight revenue decline of 0.5% to $215.6 million, attributed to a 0.8% decrease in total enrollment. The Australia/New Zealand (ANZ) segment also faced challenges, with a 3.1% enrollment drop leading to a 2.8% revenue decrease to $69.1 million.

Strategically, the company has focused on enhancing its educational offerings and partnerships. The ETS segment's growth reflects successful initiatives in employer partnerships, which are crucial for student enrollment. Additionally, the company has continued to invest in its marketing strategies and technology to support student success. As of June 30, 2025, total enrollment across all segments was 105,363, a slight decrease from 106,190 in the previous year, indicating a need for continued focus on student retention and recruitment.

Operationally, Strategic Education's total assets increased to $2.09 billion as of June 30, 2025, up from $2.05 billion at the end of 2024. The company reported a rise in tuition receivable, net of allowances, to $97.9 million, reflecting ongoing student enrollment and financial aid participation. The company also maintained a strong cash position, with cash and cash equivalents totaling $133.6 million. However, the total liabilities increased to $424.8 million, primarily due to higher contract liabilities, which rose to $135.2 million.

Looking ahead, Strategic Education remains optimistic about its growth trajectory, emphasizing its commitment to providing high-quality education and closing the skills gap in the workforce. The company plans to continue leveraging its strategic partnerships and expanding its educational offerings to enhance student engagement and success. Management has indicated that they will closely monitor market conditions and regulatory changes, particularly in the U.S. and Australia, to adapt their strategies accordingly.