Phoenix Education Partners, Inc. Reports Third Quarter Fiscal Year 2026 Results

View all news 07/14/2026 Expanding opportunity for career mobility through skills-aligned education PHOENIX--(BUSINESS WIRE)-- Phoenix Education Partners, Inc. (NYSE: PXED) (the “Company” or “Phoenix Education Partners”), the parent company of The University of Phoenix, Inc. (the “University”), today reported financial results for the three months ended May 31, 2026, with third quarter net revenue of $271.8 million. “The pace of change in the workforce continues to accelerate the need for continuous learning and career mobility,” said Chris Lynne, Chief Executive Officer of Phoenix Education Partners and President of the University of Phoenix. “For nearly five decades, the University of Phoenix has helped working adults adapt, grow and succeed through periods of economic and technological transformation. Today, we are building on that legacy by innovating on behalf of our students, enhancing the learning experience, strengthening employer connections and delivering the skills and education that help learners achieve their educational and career goals. As the workforce continues to evolve, we remain committed to expanding opportunity and helping learners build the capabilities needed to thrive in the future of work.” Third Quarter 2026 Results of Operations Phoenix Education Partners reported net revenue for third quarter 2026 of $271.8 million, compared to $271.7 million for third quarter 2025. In third quarter 2026, the University’s Average Total Degreed Enrollment1 was 85,300, compared to 84,800 for third quarter 2025. Net income attributable to Phoenix Education Partners for third quarter 2026 was $39.2 million, or $1.01 diluted earnings per share, compared to $53.8 million, or $1.42 diluted earnings per share, for third quarter 2025. The decrease in net income attributable to Phoenix Education Partners was primarily due to share-based compensation resulting from our initial public offering (“IPO”) (see sections “Initial Public Offering” and “Reconciliation of GAAP Financial Information to Non-GAAP Financial Information” for additional information), increased advertising expense and higher strategic alternatives, restructuring and other expense. Adjusted EBITDA was $78.1 million for third quarter 2026, compared to $83.4 million for third quarter 2025, and adjusted diluted earnings per share was $1.43 for the third quarter 2026, compared to $1.57 for third quarter 2025.2 First Nine Months of 2026 Results of Operations Phoenix Education Partners reported net revenue for the first nine months of 2026 of $756.3 million, compared to $749.8 million for the first nine months of 2025. In the first nine months of 2026, the University’s Average Total Degreed Enrollment was 84,500, compared to 82,700 for the first nine months of 2025. Net income attributable to Phoenix Education Partners for the first nine months of 2026 was $65.4 million, or $1.69 diluted earnings per share, compared to $116.4 million, or $3.08 diluted earnings per share, for the first nine months of 2025. The decrease in net income attributable to Phoenix Education Partners was primarily due to share-based compensation resulting from our IPO (see sections “Initial Public Offering” and “Reconciliation of GAAP Financial Information to Non-GAAP Financial Information” for additional information), increased advertising expense and higher strategic alternatives, restructuring and other expense. Adjusted EBITDA was $188.1 million for the first nine months of 2026, compared to $185.8 million for the first nine months of 2025, and adjusted diluted earnings per share was $3.40 for the first nine months of 2026, compared to $3.49 for the first nine months of 2025.2 Common Stock Cash Dividend During third quarter 2026, the Company paid a regular common stock cash dividend of $0.21 per share. Today, the Company is announcing that its Board of Directors approved a regular, common stock cash dividend of $0.21 per share to be paid on August 14, 2026 to stockholders of record and holders of certain share-based awards as of July 29, 2026. Share Repurchase Program During third quarter 2026, the Company announced that its Board of Directors adopted a share repurchase program of up to an aggregate amount of $50 million of our common stock. The Company repurchased 0.1 million shares under the program during third quarter 2026 for an aggregate purchase price of $4.0 million, or an average per share price of $29.29. Repurchases may be made from time to time through open market purchases, privately negotiated transactions or other transactions, including pursuant to Rule 10b5-1 trading plans, subject to market conditions, applicable legal requirements and other factors. As of May 31, 2026, $46.0 million remained available for repurchases under the program. Balance Sheet, Cash Flow and Liquidity As of May 31, 2026, the Company’s cash and cash equivalents (including restricted cash and cash equivalents) and marketable securities (including current and noncurrent marketable securities) totaled $269.4 million, compared to $194.8 million as of August 31, 2025. The increase was primarily attributable to $116.7 million of cash generated by operating activities, which was partially offset by $17.4 million of cash paid for dividends and dividend equivalents, $15.0 million of capital expenditures, net cash paid to settle share-based awards and repurchases of our common stock. In November 2025, the Company entered into a senior secured revolving credit facility in an aggregate principal amount of $100.0 million that is available as a source of liquidity for Phoenix Education Partners and its subsidiaries and matures on November 13, 2030. As of May 31, 2026, the Company had no outstanding debt under the credit facility or otherwise (with an outstanding letter of credit of approximately $28 million under the facility). Initial Public Offering On October 10, 2025, Phoenix Education Partners completed an IPO of 4.9 million shares of common stock at a price of $32.00 per share, which included 0.6 million shares sold to the underwriters pursuant to their option to purchase additional shares. The shares were offered by certain of the Company’s existing shareholders and, accordingly, the Company did not receive any proceeds from the sale of shares associated with the offering. In connection with the IPO, on October 7, 2025, AP VIII Queso Holdings, L.P. converted into a Delaware corporation pursuant to a statutory conversion and changed its name to Phoenix Education Partners, Inc. As reflected in the financial tables of this press release, we have applied retrospective presentation to our earnings per share for all periods presented such that weighted average shares outstanding reflects certain equity conversions resulting from the IPO. Business Outlook For fiscal year 2026, the Company expects net revenue to be in the range of $1,020.0 million to $1,025.0 million. Adjusted EBITDA for the same period is expected to range between $246.0 million and $250.0 million. Conference Call Information Phoenix Education Partners will host a conference call to discuss its financial results for the third quarter fiscal year 2026, today at 5:00 p.m. Eastern Time. The call can be accessed by webcast on the Phoenix Education Partners website at www.phoenixeducationpartners.com. Please register in the Investor Relations section of the site 15 minutes prior to the call. The call can also be accessed by dialing (800) 715-9871 (domestic) or +1 (646) 307-1963 (toll), using conference ID: 8113013. The webcast will be archived for 30 days and the call replay for seven days. To access the replay, dial (800) 770-2030 (domestic) or +1 (609) 800-9909 (toll), using conference ID: 8113013, or visit the Investor Relations Section of the Phoenix Education Partners website. About Phoenix Education Partners, Inc. Phoenix Education Partners, Inc. is the parent company of The University of Phoenix, Inc., a pioneer in online education for working adults. Founded in 1976, The University of Phoenix provides access to higher education opportunities that enable students to develop the knowledge and skills necessary to achieve their professional goals, improve the performance of their organizations and provide leadership and service to their communities. Use of Non-GAAP Financial Information The Company’s non-GAAP financial measures are intended to supplement, but not be a substitute for, financial measures prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). Management uses, and chooses to disclose to investors, these non-GAAP financial measures because: (i) such measures provide an additional analytical tool to clarify the Company’s results from operations and help to identify underlying trends in its results of operations; (ii) as to the non-GAAP earnings measures, such measures help compare the Company’s performance on a consistent basis across time periods; and (iii) these non-GAAP measures are employed by the Company’s management in its own evaluation of performance and are utilized in financial and operational decision-making processes, such as budgeting and forecasting. Exclusion of items in the non-GAAP presentation should not be construed as an inference that these items are unusual, infrequent or non-recurring. Other companies, including other companies in the education industry, may calculate non-GAAP financial measures differently, limiting their usefulness as a comparative measure across companies. Adjusted net income attributable to Phoenix Education Partners, Inc. We define adjusted net income attributable to Phoenix Education Partners, Inc. as net income attributable to Phoenix Education Partners, Inc., adjusted to eliminate the impact of restructuring lease expense, net, strategic alternatives expense, cybersecurity incident expense, impairment charges and asset disposal losses, litigation charges and regulatory expense, non-cash share-based compensation expense, certain tax effects and other items.3 Adjusted EBITDA. We define adjusted EBITDA as net income attributable to Phoenix Education Partners, Inc., adjusted to eliminate the impact of restructuring lease expense, net, strategic alternatives expense, cybersecurity incident expense, impairment charges and asset disposal losses, litigation charges and regulatory expense, non-cash share-based compensation expense, depreciation and amortization, interest income, net of interest expense, provision for income taxes and certain other items.3 Adjusted earnings per share. We define adjusted earnings per share as adjusted net income attributable to Phoenix Education Partners, Inc. divided by basic or diluted shares, as applicable, used in computing earnings per share. Adjusted EBITDA margin. We define adjusted EBITDA margin as adjusted EBITDA divided by net revenue, expressed as a percentage. Included in the sections that follow are reconciliations between the non-GAAP financial measures and the most directly comparable GAAP measures. With respect to Adjusted EBITDA for 2026, we are not able to reconcile this forward-looking non-GAAP financial measure to the most directly comparable GAAP measure without unreasonable efforts because we are unable to predict the ultimate outcome of certain items, including but not limited to, current special items and share-based compensation, which could have a significant impact on our future GAAP results. Forward-Looking Statements This press release contains, and oral statements made from time to time by representatives of the Company may contain, forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995, which involve risks and uncertainties. These forward-looking statements are generally identified by the use of forward-looking terminology, including the terms “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “forecast,” “intend,” “likely,” “may,” “outlook,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “target,” “will,” “would” and, in each case, their negative or other various or comparable terminology. All statements other than statements of historical facts contained in this press release, including statements regarding our strategy, future operations, future financial position, future revenue, projected costs, prospects, plans, objectives of management, and expected market growth are forward-looking statements. The forward-looking statements could relate to the following, among other things: our strategy, outlook and growth prospects; our operational and financial targets and dividend policy; general economic trends and trends in the industry and markets; and the competitive environment in which we operate. These statements involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance, or achievements to be materially different from any future results, performance, or achievements expressed or implied by the forward-looking statements. Important factors that could cause our results to vary from expectations include, but are not limited to: our ability to comply with the extensive regulatory requirements for our business, and the impact of a failure to comply with applicable regulations or regulatory requirements, standards or policies, which could subject us to significant monetary liabilities, Title IV repayment obligations (including as a result of sub-regulatory guidance), fines and penalties, including loss of or limitations upon access to U.S. federal student loans, grants and military program benefits for our students, and otherwise have a material adverse impact on our business; shifts in higher education policy at the federal and state levels; our ability to maintain our institutional accreditation and our eligibility to participate in Title IV programs; our ability to enroll and retain students, including the impact of changes to internet search due to artificial intelligence; our ability to adapt to changing market needs or new technologies, including artificial intelligence; our ability to maintain existing, and develop additional, business-to-business, or B2B, relationships with employers; our ability to attract or retain a qualified senior management team and qualified faculty members; the impact of compliance reviews, claims, or litigation that government agencies, regulatory agencies, and third parties may conduct, bring or initiate against us based on alleged violations of the extensive regulatory requirements applicable to us; our ability to establish, maintain, protect and enforce our intellectual property and proprietary rights and prevent third parties from making unauthorized use of such rights; liability associated with any failure to comply with data privacy and data security laws and the unauthorized access, duplication, distribution or other use of confidential or personal information, including liability and costs associated with the cybersecurity incident we identified in November 2025; additional tax liabilities; our ability to pay dividends on our common stock or the timing or amount of any such dividends; and other risk factors identified in the Company’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. These forward-looking statements are based on assumptions and subject to risks and uncertainties. Given these uncertainties, undue reliance should not be placed on these forward-looking statements. These forward-looking statements represent our estimates and assumptions only as of the date of this press release and, except as required by law, we undertake no obligation to update or review publicly any forward-looking statements, whether as a result of new information, future events or otherwise after the date of this press release. We anticipate that subsequent events and developments will cause our views to change. This press release should be read completely and with the understanding that our actual future results may be materially different from what we expect. Our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures, or investments we may undertake. We qualify all of our forward-looking statements by these cautionary statements. ____________________ 1“Average Total Degreed Enrollment” represents the aggregate of monthly Total Degreed Enrollment during a specified period divided by the number of months in the period. We define “Total Degreed Enrollment” as the number of confirmed students (both new and continuing) enrolled in credit-bearing courses who post attendance at least one time during a calendar month (even if they withdraw later in the same month), excluding students who graduated as of the end of such month. 2 Adjusted EBITDA and adjusted earnings per share are non-GAAP measures. For more information on non-GAAP measures used in this press release and a reconciliation of our GAAP information to our non-GAAP information, refer to the sections titled “Use of Non-GAAP Financial Information” and “Reconciliation of GAAP Financial Information to Non-GAAP Financial Information.” 3 During the first quarter of fiscal year 2026, we changed our definition of this measure to start with “Net income attributable to Phoenix Education Partners, Inc.” instead of “Net income” and began excluding expenses incurred related to our cybersecurity incident, which we do not believe are representative of our ongoing operations. We have retrospectively changed this measure for all periods presented to conform with our new definition. PHOENIX EDUCATION PARTNERS, INC. AND SUBSIDIARIES Condensed Consolidated Statements of Income (Unaudited) Three Months Ended May 31, Nine Months Ended May 31, (In thousands, except per share data) 2026 2025 2026 2025 Net revenue $ 271,801 $ 271,703 $ 756,289 $ 749,801 Costs and expenses: Instructional and support 110,284 110,446 330,774 325,779 General and administrative 97,754 83,320 302,416 255,703 Strategic alternatives, restructuring and other 11,937 6,837 31,673 17,886 Total costs and expenses 219,975 200,603 664,863 599,368 Operating income 51,826 71,100 91,426 150,433 Interest income 2,183 2,278 5,720 8,334 Interest expense (651 ) (107 ) (1,416 ) (332 ) Income before income taxes 53,358 73,271 95,730 158,435 Provision for income taxes 14,452 18,622 30,877 40,564 Net income 38,906 54,649 64,853 117,871 Net loss (income) attributable to noncontrolling interests 261 (808 ) 548 (1,489 ) Net income attributable to Phoenix Education Partners, Inc. $ 39,167 $ 53,841 $ 65,401 $ 116,382 Earnings per share:(1) Basic $ 1.09 $ 1.51 $ 1.83 $ 3.27 Diluted $ 1.01 $ 1.42 $ 1.69 $ 3.08 Shares used in computing earnings per share: Basic 35,882 35,560 35,766 35,542 Diluted 38,920 37,966 38,799 37,831 ____________________ (1) As described in the Company’s Annual Report on Form 10-K for fiscal year 2025, earnings per share for all periods presented in the Company’s financial statements are retrospectively presented such that weighted average shares outstanding reflects conversions resulting from the IPO. PHOENIX EDUCATION PARTNERS, INC. AND SUBSIDIARIES Condensed Consolidated Balance Sheets (Unaudited) As of ($ in thousands) May 31, 2026 August 31, 2025 ASSETS Current assets: Cash and cash equivalents $ 155,020 $ 136,504 Restricted cash and cash equivalents 2,973 36,497 Marketable securities 75,051 9,005 Accounts receivable, net 96,475 58,957 Prepaid income taxes 8,173 3,160 Other current assets 23,176 21,827 Total current assets 360,868 265,950 Marketable securities 36,396 12,803 Property and equipment, net 38,282 38,846 Goodwill 3,732 3,732 Intangible assets, net 85,424 87,294 Operating lease right-of-use assets, net 36,532 41,920 Deferred income taxes, net 24,517 20,566 Other assets 22,896 22,451 Total assets $ 608,647 $ 493,562 LIABILITIES AND EQUITY Current liabilities: Accounts payable $ 24,375 $ 25,696 Accrued compensation and benefits 19,557 28,534 Student deposits 7,594 11,049 Deferred revenue 76,046 37,210 Current operating lease liabilities 9,822 8,948 Other current liabilities 51,047 50,608 Total current liabilities 188,441 162,045 Long-term operating lease liabilities 55,879 64,352 Other long-term liabilities 37,895 27,110 Total liabilities 282,215 253,507 Commitments and contingencies Equity: General partner — — Limited partners — 246,735 Preferred Stock — — Common Stock 360 — Additional paid-in capital 275,155 — Retained earnings 48,747 — Accumulated other comprehensive (loss) income, net (7 ) 39 Total Phoenix Education Partners, Inc. equity 324,255 246,774 Noncontrolling interests 2,177 (6,719 ) Total equity 326,432 240,055 Total liabilities and equity $ 608,647 $ 493,562 PHOENIX EDUCATION PARTNERS, INC. AND SUBSIDIARIES Condensed Consolidated Statements of Cash Flows (Unaudited) Nine Months Ended May 31, ($ in thousands) 2026 2025 Operating activities: Net income $ 64,853 $ 117,871 Adjustments to reconcile net income to net cash provided by operating activities: Share-based compensation 47,624 1,908 Depreciation and amortization 16,800 16,348 Non-cash lease expense 5,388 5,370 Impairment charges and asset disposal losses 609 113 Provision for credit losses on accounts receivable 24,585 35,885 Deferred income taxes 6,931 28,885 Changes in assets and liabilities, excluding the impact of acquisition: Accounts receivable (62,103 ) (76,715 ) Prepaid income taxes (5,013 ) (276 ) Other assets (1,948 ) 983 Accounts payable (1,321 ) (11,197 ) Accrued compensation and benefits (8,977 ) (11,383 ) Student deposits (3,455 ) (70,862 ) Deferred revenue 38,836 28,742 Operating lease liabilities (7,599 ) (8,510 ) Other liabilities 1,474 (5,373 ) Net cash provided by operating activities 116,684 51,789 Investing activities: Purchases of property and equipment (15,005 ) (16,399 ) Purchases of marketable securities (118,120 ) (20,557 ) Sales of marketable securities 14,758 8,475 Maturities of marketable securities 13,815 14,723 Acquisition, net of cash acquired — (1,982 ) Other investing activities (108 ) (58 ) Net cash used in investing activities (104,660 ) (15,798 ) Financing activities: Common stock repurchased (3,963 ) — Payments of dividends and dividend equivalents (17,375 ) — Payroll taxes paid on share-based awards (6,150 ) (774 ) Proceeds from stock option exercises 456 — Payments of dividends and dividend equivalents to noncontrolling interests — (13,961 ) Capital distributions to limited partners — (134,001 ) Net cash used in financing activities (27,032 ) (148,736 ) Net change in cash and restricted cash (15,008 ) (112,745 ) Cash and restricted cash, beginning of period 173,001 356,170 Cash and restricted cash, end of period $ 157,993 $ 243,425 Supplemental disclosure information: Income tax payments, net $ 28,958 $ 11,987 Noncontrolling interest issued in business combination $ — $ 4,147 PHOENIX EDUCATION PARTNERS, INC. AND SUBSIDIARIES Reconciliation of GAAP Financial Information to Non-GAAP Financial Information (Unaudited) Three Months Ended May 31, Nine Months Ended May 31, ($ in thousands, except per share data) 2026 2025 2026 2025 Net income attributable to Phoenix Education Partners, Inc. $ 39,167 $ 53,841 $ 65,401 $ 116,382 Special items and share-based compensation: Restructuring lease expense, net(a) 4,029 2,121 7,634 3,837 Strategic alternatives expense(b) 856 2,402 6,133 7,401 Cybersecurity incident expense(c) 267 — 5,096 — Impairment charges and asset disposal losses(d) 89 29 609 113 Litigation charges and regulatory expense(e) 4,977 1,295 7,383 3,980 Non-cash share-based compensation expense(f) 8,458 645 47,624 1,908 Other(g) 1,719 1,057 4,818 3,288 Income tax effects of special items and share-based compensation(h) (3,794 ) (1,857 ) (12,669 ) (5,050 ) Adjusted net income attributable to Phoenix Education Partners, Inc. $ 55,768 $ 59,533 $ 132,029 $ 131,859 Earnings per share: Basic $ 1.09 $ 1.51 $ 1.83 $ 3.27 Diluted $ 1.01 $ 1.42 $ 1.69 $ 3.08 Adjusted earnings per share: Basic $ 1.55 $ 1.67 $ 3.69 $ 3.71 Diluted $ 1.43 $ 1.57 $ 3.40 $ 3.49 Shares used in computing earnings per share and adjusted earnings per share: Basic 35,882 35,560 35,766 35,542 Diluted 38,920 37,966 38,799 37,831 Three Months Ended May 31, Nine Months Ended May 31, ($ in thousands) 2026 2025 2026 2025 Net income attributable to Phoenix Education Partners, Inc. $ 39,167 $ 53,841 $ 65,401 $ 116,382 Restructuring lease expense, net(a) 4,029 2,121 7,634 3,837 Strategic alternatives expense(b) 856 2,402 6,133 7,401 Cybersecurity incident expense(c) 267 — 5,096 — Impairment charges and asset disposal losses(d) 89 29 609 113 Litigation charges and regulatory expense(e) 4,977 1,295 7,383 3,980 Non-cash share-based compensation expense(f) 8,458 645 47,624 1,908 Depreciation and amortization 5,595 5,534 16,800 16,348 Interest income, net of interest expense (1,532 ) (2,171 ) (4,304 ) (8,002 ) Provision for income taxes 14,452 18,622 30,877 40,564 Other(g) 1,719 1,057 4,818 3,288 Adjusted EBITDA $ 78,077 $ 83,375 $ 188,071 $ 185,819 Net income attributable to Phoenix Education Partners, Inc. margin 14.4 % 19.8 % 8.6 % 15.5 % Adjusted EBITDA margin 28.7 % 30.7 % 24.9 % 24.8 % Net revenue used in computing net income attributable to Phoenix Education Partners, Inc. margin and adjusted EBITDA margin $ 271,801 $ 271,703 $ 756,289 $ 749,801 a) Restructuring lease expense, net represents non-cancelable lease obligations, including any offset from sublease income, and other related expenses for leased space we have exited as part of our ground campus and administrative space rationalization plans. In 2012, as a key component of the University’s transformation initiatives, the University began the process of completing the orderly closure of its ground campuses, as more enrolling students made the choice to take their programs online. The University completed the orderly closure of its campus locations in early fiscal year 2025, with only one physical location, in Phoenix, Arizona, currently enrolling new students. Additionally, the University completed its exit of 19 floors of its 22-floor administrative office buildings during fiscal year 2024 pursuant to its space rationalization plans. b) Strategic alternatives expense generally consists of costs associated with strategic and capital market transactions, including our IPO and offering-related costs, strategic advisory fees, and costs associated with the evaluation or execution of strategic alternatives. c) Represents expense associated with the cybersecurity incident detected in November 2025. Refer to the Company’s quarterly report on Form 10-Q for the third quarter of fiscal year 2026 for additional information. d) Represents non-cash impairment charges and asset disposal losses. e) Litigation charges and regulatory expense principally includes charges incurred to defend, settle or otherwise resolve legal matters that fall outside the scope of ordinary or routine litigation incidental to our business and expense associated with a multi-year insurance policy pertaining to borrower defense to repayment claims. f) Represents non-cash equity-based compensation expense in accordance with Accounting Standards Codification Topic 718, Compensation: Stock Compensation. Although share-based compensation is a key incentive offered to our employees, we evaluate our business performance excluding share-based compensation expense because it is a non-cash expense. The increase in share-based compensation expense in the three and nine months ended May 31, 2026 compared to the respective prior year periods resulted from our IPO. g) Represents other expenses that we believe are not indicative of our ongoing operations. h) Represents the income tax effect, if any, of these non-GAAP adjustments, calculated using the appropriate statutory tax rates. View source version on businesswire.com: https://www.businesswire.com/news/home/20260714730954/en/ Investor Relations Contact: Beth Coronelli [email protected] Media Contact: Andrea Smiley [email protected] Source: Phoenix Education Partners, Inc. View all news