Good day, and welcome to the Legacy Education Inc. second quarter fiscal year 2026 earnings conference call. The call is being recorded and broadcast live and will also be archived on the Legacy Education Inc. website for future reference. To kick off the call, I will turn it over to Nicole Joseph, Senior Vice President of Legacy Education Inc.

Thank you, and hello, everyone. Legacy Education Inc. has issued a news release reporting its financial results and corporate developments for the second quarter fiscal year ended December 31, 2025. The release is available in the Investor Relations section of our corporate website at legacyed.com. With us today on the call are LeeAnn Rohmann, Chief Executive Officer, and Brandon Pope, Chief Financial Officer. On today's earnings call, statements made by Legacy Education Inc.’s management regarding the company's business, which are not historical facts, may be forward-looking statements as identified in federal securities laws. The words may, will, expect, believe, anticipate, project, plan, intend, estimate, and continue, as well as similar expressions are intended to identify forward-looking statements. Forward-looking statements should not be read as a guarantee of future performance. The company cautions you that these statements reflect current expectations about the company's future performance or events and are subject to a number of uncertainties, risks, and other influences, many of which are beyond the company's control, that may influence the accuracy of the statements and projections upon which the statements are based. Factors that may affect the company's results include, but are not limited to, the risks and uncertainties discussed in the Risk Factors section of the annual report on Form 10-K and the quarterly report on Form 10-Q filed with the Securities and Exchange Commission. Forward-looking statements are based on the information available at the time those statements are made and management's good faith beliefs as of the time with respect to future events. All forward-looking statements are qualified in their entirety by the cautionary statement, and Legacy Education Inc. undertakes no obligation to publicly revise or update any forward-looking statements, whether as a result of new information, future events, or otherwise after the date thereof. I will now hand the call over to LeeAnn Rohmann, CEO of Legacy Education Inc. LeeAnn, to you.

Thank you, Nicole. And good afternoon, everyone. Welcome to Legacy Education Inc.’s second quarter fiscal 2026 earnings call. I am joined today by our CFO, Brandon Pope. We are entering a defining decade for health care, and that creates a clear, durable runway for the kind of career-focused education we provide. Demand is rising, complexity is increasing, and the work needs are becoming more urgent by the day. Against that backdrop, Legacy Education Inc. is focused on scaling quality, improving outcomes, and training job-ready graduates for roles the health care system cannot function without. According to the U.S. Bureau of Labor and Statistics’ latest projections, the healthcare occupation sector is expected to be the fastest growing major industry from 2024 to 2034. About 1,900,000 openings are projected each year on average in these occupations due to employment growth and the need to replace workers who leave occupations permanently. Behind those numbers is a structural reality: an aging population, expanded access to care, and accelerating medical technologies that elevate, not replace, the need for skilled human expertise. In a world rapidly shaped by AI and automation, health care remains one of the most human-dependent sectors in the U.S. economy. Technology assists, but people heal. Machines analyze, but compassionate professionals comfort, treat, and save lives. At Legacy Education Inc., we exist at that intersection where innovation meets humanity, training the professionals who fill vital roles technology alone can never assume. Q2 demonstrated exceptional execution across every key operational and financial measure. We capitalized on sustained demand and translated program expansion into profitable growth and continued to strengthen our fundamentals while investing in the future. Revenue grew 40.7% year over year to $19,200,000, marking our fourteenth consecutive quarter of double-digit revenue growth. Adjusted EBITDA increased 10.6% to $3,000,000, reflecting both scale and effective cost management. Net income rose 46% to $2,000,000, or $0.15 per diluted share, up from $0.10 in the prior-year quarter. Ending population grew 6.8% to 3,234, driven by strong enrollment, disciplined marketing execution, and the initial rollout of our new programs. Year to date for six months and for six months ended December 31, 2025, the results were equally strong. Revenue grew 39.6% year over year to $38,600,000.

Please continue.

30.3% to $6.1 million, reflecting both scale and effective cost management. Net income rose 21.2% to $4,200,000 compared to $3,500,000 last year. These outcomes reaffirm our trajectory toward full-year performance consistent with our expectations and well ahead of last year. They also reflect careful tax governance, disciplined expense management, and continued operational progress across campuses. Building on a record first half gives us momentum, but more importantly, it reflects the execution happening across the platform. Let me walk you through the strategic and operational highlights that are strengthening the business and positioning us for the back half of fiscal 2026. Our new program execution: In Q2 we launched our MRI program at Central Coast College campus with 33 new starts. Also, we are excited about the traction the new cardiac sonography program will bring to the Central Coast Valley, and we will begin enrolling in the second half of the fiscal year for that program. We received accreditation approval for our fourth sterile processing program and have begun enrolling on all four campuses; that will reflect in the second half of the fiscal year. Surgical technology is also gaining momentum with our first cohorts set to begin in the second half, each already contributing to future enrollment pipelines and revenue. In the education delivery, we began introducing the hybrid delivery model at Contra Costa Medical Career College and surgical technology and diagnostic medical sonography programs. This online delivery method allowed us to identify an additional cohort start in both of those programs. We will continue to evaluate the other programs and plan for further expansion of our hybrid programs at Contra Costa Medical Career College. Moving to campus performance, the integration of Contra Costa Medical Career College is complete. Enrollment there tops all-time highs of over 500 students with accreditation alignment strengthening every metric from admissions to placement. In October 2025, the Integrity College of Health campus in Pasadena hosted its two-day ABHES reaccreditation visit. We are pleased to announce that yesterday, we formally received the notice that our Integrity campus has been granted a six-year grant of reaccreditation, the longest grant period awarded by the accreditor ABHES. The grant demonstrates ABHES' confidence in the strength of our academic delivery, student outcomes, and institutional compliance, and it reflects the disciplined work of our faculty and campus teams to maintain high standards in curriculum, clinical training, and continuous improvement. Our outcomes: The retention rates have remained strong throughout the quarter and into the first half of the fiscal year across all campuses. Our imaging programs have held multiple credentialing review sessions, and we are already seeing the impact of more students entering their credentialing pathways and successfully passing their exams. We will continue to expand this initiative to further strengthen student outcomes and increase graduate placements within these programs. In faculty and innovation, we have made strategic investments in online education leadership and curriculum design infrastructure to support consistency, quality assurance, and compliance across our learning environment. The initiative is designed, as we are scaling, to maintain our strong student outcomes, engagement, and interaction while reducing variability across campuses and supporting scalable program growth. Our faculty are not just delivering curriculum; they are building the future of how we teach. Innovation here is not a buzzword. It is the daily discipline of improving the student experience, adopting better tools, sharing best practices, and refusing to accept good enough when student success is on the line. During Q2, our faculty invested three focus days in professor development and course improvement work, reinforcing our tech-and-touch approach, pairing AI-enabled tools with strong faculty engagement to improve quality and scale. We are integrating AI to support instruction, to reduce administrative burden, and surface actionable insights earlier while ensuring students continue to receive high-touch guidance, feedback, and coaching. The result is a more consistent learning experience and a clearer pathway to retention, credentialing success, and graduate placement. With the workforce, with more than 200,000 registered nursing vacancies projected annually through 2031, and staffing shortages across imaging and surgical sonography, our mission is tightly linked to solving an urgent national labor need. With that, I am going to turn the call over to Brandon Pope, who will take you through our detailed financial results.

Thank you, LeeAnn. Let us begin with our second quarter results. As LeeAnn mentioned, revenue increased 40.7% to $19,200,000 from $13,600,000, driven by a 49.4% increase in new student starts to 593 from 397 last year. EBITDA increased 54.8% to $2,700,000 from $1,800,000 last year. Adjusted EBITDA rose 61.6% to $3,300,000 from $1,900,000 last year. Adjusted EBITDA margin increased to 15.8% from 13.7% last year. Our effective tax rate was 28.9%. It increased from 27.3% last year. As a reminder, our effective tax rate may fluctuate based on the timing of tax benefits associated with stock option exercises. Our annual effective tax rate excluding these benefits is 29.6%. In the first quarter we experienced high stock option exercises, and we realized those benefits. However, we did not experience the same volume in Q2; therefore, our effective tax rate increased. Net income advanced 46% to $2,000,000 from $1,400,000 last year, and diluted EPS improved 50% to $0.15 from $0.10 last year. Turning to our operating expenses for the second quarter, educational services totaled $10,300,000, or 53.6% of revenue, compared to $7,500,000, or 54.9% of revenue, last year. The 130 basis point improvement was primarily due to operating efficiency and compensation offset by increases in excursion fees and non-cash compensation. General and administrative expenses were $6,100,000, or 31.8% of revenue, compared to $4,300,000, or 31.9% of revenue, last year. The slight improvement was due to operating efficiencies relating to professional fees and insurance, offset by increases in bad debt expense. Our bad debt expense remains consistent at 5% of revenue. Now let us turn to our six months ending December 31, 2025. Revenue increased 39.6% to $38,600,000 from $27,600,000 last year, driven by a 37.2% increase in new student starts to 1,710 from 1,246 last year. EBITDA increased 22.9% to $5,600,000 from $4,500,000 last year. Adjusted EBITDA increased 30.3% to $6,100,000 from $4,700,000 last year. Effective tax rate was consistent at 27.7%. Net income increased 21.2% to $4,200,000 from $3,500,000 last year. Diluted earnings per share was $0.30 compared to $0.29 last year. Coming to operating expenses for the same period, educational services totaled $20,600,000, or 53.4% of revenue, compared to $14,700,000, or 53.1%, last year. The slight increase as a percentage of revenue is primarily attributable to increases in non-cash compensation and excursion fees, offset by reductions in employee compensation. General and administrative expenses were $12,200,000, or 31.7% of revenue, compared to $8,300,000, or 30.1% of revenue, last year. The increase as a percentage of revenue is primarily attributable to increased professional fees, facilities, and bad debt expense. Now turning to our balance sheet. We have a strong balance sheet with $21,100,000 in cash, working capital exceeding $27,000,000, and little debt at $600,000. You will note our accounts receivable reserve as a percentage of accounts receivable increased to 11.5% from 9.5% last quarter. This simply reflects the timing of quarterly accounts receivable write-offs as we implemented a quarterly reserve analysis as opposed to annually last year. Our operating cash flow remains strong at $2,100,000 and reflects the timing of Title IV disbursements and performance-based compensation. In summary, our second quarter performance reflects a disciplined approach to scaling and margin expansion and positions us well for continued investment into growth. With that, I will turn it back to LeeAnn.

Thank you, Brandon.

Fiscal 2026 is shaping up to be a pivotal year.

One that underscores both the resilience and strategic progress of our organization. And that momentum is backed by a clear, disciplined plan. Let me outline the continued strategic priorities. Sustained enrollment growth: We will continue to scale what is working in demand generation, optimizing digital performance and marketing while expanding high-conversion referral channels. That includes strengthening employer relationships and building deeper high school partnerships that create a reliable pipeline of aligned, career-motivated students. The focus is not just top-of-funnel volume, but quality starts, persistence, and outcomes. On our curriculum expansion, we are focused on the full deployment and operational readiness of all of our four new allied health programs, ensuring consistent delivery across campuses, faculty preparedness, lab readiness, and externship alignment. In parallel, we are actively pursuing additional regulatory approvals, including our registered nursing authorization across multiple campuses and targeted surgical program specialties—areas where market demand remains strong and our platform is well-positioned to execute with quality and compliance. In our operational innovation, our tech-and-touch approach remains a key lever, enhancing the student experience by blending technology-enabled efficiency with high-accountability instruction and hands-on clinical rigor. We will continue advancing hybrid delivery and simulation-based models to help students build competence and confidence while supporting faculty with enhanced tools, consistent course design, and visibility into student progress. Our expansion: We are taking a measured yet ambitious approach to growth, evaluating accretive acquisitions and assessing organic expansion opportunities, including branch campuses and new programs that align to our operating model, high outcomes standards, and mission to address urgent healthcare workforce needs. As we have mentioned, our acquisition pipeline remains robust, with several single and multi-campus opportunities both within California and in adjacent markets. We continue to prioritize the targets that can integrate seamlessly and contribute immediately to scale and profitability, with a goal of announcing our next deal within this fiscal year. Importantly, we have reinforced our execution by bringing back Joe Bartolome, a proven multi-campus operator with over twenty-four years of senior leadership in career and health care education, as Senior Vice President of Operations. Joe brings deep familiarity with Legacy Education Inc.’s operations and culture from his prior role. His track record includes leading branch expansions, executing acquisitions, and driving operational turnarounds in regulated environments. In this role, Joe will oversee scalable growth across our platform, playing a central role in launching the branch location or locations, integrating potential acquisitions, and ensuring disciplined, outcomes-focused execution that sustains our momentum. Now, as we pursue these growth initiatives, we do it with discipline in a regulated industry. That brings me to compliance and the federal policy environment. Regulatory change is consistent and constant in our sector, and we are built to navigate it. Our accreditations and federal Title IV approvals remain fully intact. We are executing with strong compliance readiness and operational rigor. We are actively monitoring ongoing Department of Education rulemaking and evaluating potential impacts, but the direction of policy reinforces our strategy: deliver strong outcomes, maintain transparency, and train graduates for high-need health care roles. In short, the industry is moving toward higher standards, and that plays to our strengths. As you heard today, we are delivering the combination of sustained growth, expanding profitability, and a strong balance sheet. We grew revenue, meaningfully expanded adjusted EBITDA, and maintained disciplined cost management, all while continuing to invest in program expansion, delivery innovation, and scalable operational infrastructure. Just as importantly, we are doing it with strong liquidity, low leverage, and positive operating cash flow, which gives us flexibility to execute and the resilience to navigate a dynamic regulatory environment. With that, I will turn the call over to the operator to please open the line for questions. Thank you. We will now be conducting a question and answer session. Before pressing the star keys. Our first question today is coming from Mike Grondahl, Northland Securities. Your line is now live.

Hey, LeeAnn and Brandon, congrats on a very strong quarter. Let us talk about new student starts first. The 593 was very robust in the December quarter. Can you talk a little bit about what programs, what areas were performing really well or maybe outperformed?

Hi, Mike. Great to hear from you. As we look at our Q3, what we found is that, again, from a timing perspective, we got the benefit of being able to add additional cohorts at Contra Costa Medical Career College with the hybrid approval, so that added to the ultrasound or diagnostic medical sonography program as well as our surgical tech program. And those still remain in the top five of the programs that led to that nearly 600 enrollments. So that was a key piece to that. Our vocational nursing also contributed to those increased enrollments and led to an additional start that we were able to benefit from in Q2.

Got it. And then what we are optimistic about is that we got the MRI launched, but we do have several of the new programs, as we indicated in our comments, that we will be launching in Q3 and Q4. We had received the approvals but were waiting for the state approval that moved us into Q3 and Q4. Got it. And that is what I wanted to focus on next. Those new programs starting kind of January, February, March, April, could you just mention those again? And then what type of students can they support kind of near term and medium term? If that makes sense.

Not sure in terms of when you say what kind of students to support, but I can tell you that from the programs for Q1 and Q2 that we started were the surgical tech and HDMC, the sterile processing, and our cardiac AAS program in some of our campuses. But really where we were seeing this is the MRI in our Central Coast that just led to the one start.

Got it. Guess what I was asking is these new programs starting in the second half now, are they able to handle a 20-student cohort, a 30-student cohort? And then what could it maybe be, you know, a couple to several quarters down the road?

Got it. Thank you for that clarification. As we see the 20 upwards to 30, we started 33 in Central Coast with our MRI. We will be able to, as we mentioned, we will be starting the cardiac sonography. All of those programs lend to those types of 20 to 30 seats that we fill initially, and then you will have recurring starts every, really every three months.

Got it. Maybe just lastly, you talked a little bit about this recent new hire and kind of your willingness and activity on the acquisition front. What is kind of your outlook there? Would you think you could do one still this year? Or what does the pipeline look like?

That is the goal and that is what we have been confident in, in terms of an announcement before the end of the fiscal year, based on where we are in the process of looking at these opportunities. We are on a path that we feel strong that, provided that we have no surprises, we should be able to definitely hit that goal of doing this before the end of the fiscal year.

Got it. Thank you.

Thank you. Our next question today is coming from Jeff Cohen from Ladenburg Thalmann. Your line is now live.

Hi, Jeff.

Geoffrey, your line is now live. Please proceed.

Thank you very much. So, thanks for taking our questions. I guess, you talk about—I just wanted to follow along with Mike's question about the M&A front that you have been looking at for probably a number of years. So is any of that outside of the state of California? Or is your intention to stay in the state of California? I am assuming if you add another facility, it would be similar in size to the current facilities.

Yeah. Great question. I am trying to reinforce the fact that we are looking at both inside California and also outside of California. There are single campuses, but the majority of these opportunities we are looking at are multi-campus at this point. That will take us in the adjacent states outside of California.

Okay, got it. Super. Can you talk about the hybrid programs? Are you finding that students enrolled in the hybrid programs are holding also part-time jobs or full-time jobs? Or is it hybrid in nature, but it is full time as far as commitment?

It is full time as far as commitment. What we are finding is that we are getting a positive response because of just the type of student that has a desire to learn online. They are already embracing so much of this online. And it is the combination of the fact that they do their theory online, and then they are coming into the campus a couple of days a week for lab. So, what we are trying to balance are the students that were in the full residential programs. They are wanting to transfer into the hybrid programs. But, based on where they are in their programs, they are far enough along that they cannot do that, but we are eager to continue to keep transitioning the hybrid programs. Because I do not have to tell you the flexibility that falls into this hybrid model just affords a different type of person that thought, with a part-time job, that they could not do this. But they can now with the flexibility of what hybrid offers.

Okay. That is very helpful. And then could you talk about the back half of the year, or I should say the first half on a fiscal basis? But does it feel like the back half, as far as cadence, would compare with last year as far as back half versus front half? Any commentary on that front? I know you do not give a specific outlook, but.

Yeah. I mean, I cannot give specific outlook, but what I would say is that in terms of looking at your models, the way that we have looked at your models is that I would say that we are aligned with those models, and there might be some opportunity with the new program rollout that may be falling into Q3 and Q4 that we can see a little bit of opportunity there.

Okay. And then lastly, it seems like your revenue was higher per student. Are more students entering more expensive programs? Or is the hybrid model giving you some leverage as far as the operating expenses?

Yes. If you are looking at this quarter over last quarter, it seems higher primarily because in the second quarter of last year, we had the student population, but we had no revenue. And so this year we do. So that is why it increased as a percentage of revenue, but from $5,700 per student, $5,100 last time. And there are certain programs that are earning at a quicker pace. The longer programs, theoretically do—or not theoretically, historically do. And so we are seeing more starts in those programs that LeeAnn mentioned that are higher margin.

I got it. That is helpful, Brandon. Okay, thanks for taking our questions. Nice quarter.

Thank you, Jeff. Thank you. We reached the end of our question and answer session. I would like to turn the floor back over to the enrollment for closing remarks. Thank you, operator. And thank you all for joining us. Q2 reflects strength, consistency, and confidence in our ability to deliver. We remain focused on empowering students, advancing health care education, and creating sustained value for our shareholders. We are proud of what we have achieved and more excited about what lies ahead. To our employees, faculty, and students, I cannot say it enough: Thank you. Thank you. Thank you for your dedication. To our investors, thank you for believing in our mission. We appreciate your continued trust and support, and we look forward to updating you next quarter. Ladies and gentlemen, this concludes today's call. Thank you for joining us and have a great day.