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What changed in Grand Canyon Education, Inc.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Grand Canyon Education, Inc.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+281 added−247 removedSource: 10-K (2026-02-18) vs 10-K (2025-02-19)

Top changes in Grand Canyon Education, Inc.'s 2025 10-K

281 paragraphs added · 247 removed · 190 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

58 edited+49 added−34 removed166 unchanged
Biggest changeCongress historically has reauthorized and amended the HEA in regular intervals, approximately every five to seven years. The re-authorization process is currently under way. The re-authorization of the HEA could alter the regulatory landscape of the higher education industry, and thereby impact the manner in which we conduct business and serve our university partners.
Biggest changeThe re-authorization of the HEA could alter the regulatory landscape of the higher education industry, and thereby impact the 15 Table of Contents manner in which we conduct business and serve our university partners. In addition, ED is independently conducting an ongoing series of rulemakings intended to assure the integrity of the Title IV programs.
Department of Veterans Affairs (“VA”), the FTC, the IRS, and for institutions who issue bonds, the SEC. The regulations, standards, and policies of these agencies cover the vast majority of operations of colleges and universities, including educational programs, facilities, instructional and administrative staff, administrative procedures, marketing, recruiting, financing and financial operations, athletics and financial condition.
Department of Veterans Affairs, the FTC, the IRS, and for institutions who issue bonds, the SEC. The regulations, standards, and policies of these agencies cover the vast majority of operations of colleges and universities, including educational programs, facilities, instructional and administrative staff, administrative procedures, marketing, recruiting, financing and financial operations, athletics and financial condition.
To meet the administrative capability standards, an institution must, among other things: ● comply with all applicable Title IV program requirements; ● have an adequate number of qualified personnel to administer the Title IV programs; ● have acceptable standards for measuring the satisfactory academic progress of its students; ● not have student loan cohort default rates above specified levels; ● have various procedures in place for awarding, disbursing and safeguarding Title IV funds and for maintaining required records; ● administer the Title IV programs with adequate checks and balances in its system of internal controls; ● not be, and not have any principal or affiliate who is, debarred or suspended from federal contracting or engaging in activity that is cause for debarment or suspension; ● provide financial aid counseling to its students; ● refer to ED’s Office of Inspector General any credible information indicating that any student, parent, employee, third-party servicer or other agent of the institution has engaged in any fraud or other illegal conduct involving the Title IV programs; ● submit all required reports and consolidated financial statements in a timely manner; and ● not otherwise appear to lack administrative capability.
To meet the administrative capability standards, an institution must, among other things: ● comply with all applicable Title IV program requirements; ● have an adequate number of qualified personnel to administer the Title IV programs; ● have acceptable standards for measuring the satisfactory academic progress of its students; ● not have student loan cohort default rates above specified levels; 20 Table of Contents ● have various procedures in place for awarding, disbursing and safeguarding Title IV funds and for maintaining required records; ● administer the Title IV programs with adequate checks and balances in its system of internal controls; ● not be, and not have any principal or affiliate who is, debarred or suspended from federal contracting or engaging in activity that is cause for debarment or suspension; ● provide financial aid counseling to its students; ● refer to ED’s Office of Inspector General any credible information indicating that any student, parent, employee, third-party servicer or other agent of the institution has engaged in any fraud or other illegal conduct involving the Title IV programs; ● submit all required reports and consolidated financial statements in a timely manner; and ● not otherwise appear to lack administrative capability.
As of December 31, 2024, all states other than California are members of SARA. Any state that does not participate in SARA may impose regulatory requirements on out-of-state post-secondary institutions operating within its boundaries, such as those having a physical facility or conducting certain academic activities within the state.
As of December 31, 2025, all states other than California are members of SARA. Any state that does not participate in SARA may impose regulatory requirements on out-of-state post-secondary institutions operating within its boundaries, such as those having a physical facility or conducting certain academic activities within the state.
Example 2-B in the DCL is described as a “possible business model” developed “with the statutory mandate in mind.” Example 2-B describes the following as a possible business model: “A third-party that is not affiliated with the institution it serves and is not affiliated with any other institution that provides educational services, provides bundled services to the institution including marketing, enrollment application assistance, recruitment services, course support for online delivery of courses, the provision of 21 Table of Contents technology, placement services for internships, and student career counseling.
Example 2-B in the DCL is described as a “possible business model” developed “with the statutory mandate in mind.” Example 2-B describes the following as a possible business model: “A third-party that is not affiliated with the institution it serves and is not affiliated with any other institution that provides educational services, provides bundled services to the institution including marketing, enrollment application assistance, recruitment services, course support for online delivery of courses, the provision of technology, placement services for internships, and student career counseling.
ED has changed its regulations, and may make other changes in the future, in a manner which could require us to incur additional costs in connection with providing the services that we provide our university partners affect their ability to remain eligible to participate in the Title IV programs, impose restrictions on their participation in the Title IV programs, affect the rate at which students enroll in our partners’ programs, or otherwise have a significant impact on our business and results of operations.
ED has changed its regulations, and may make other changes in the future, in a manner 26 Table of Contents which could require us to incur additional costs in connection with providing the services that we provide our university partners affect their ability to remain eligible to participate in the Title IV programs, impose restrictions on their participation in the Title IV programs, affect the rate at which students enroll in our partners’ programs, or otherwise have a significant impact on our business and results of operations.
The institution may pay the entity an amount based on tuition generated for the institution by the entity’s activities for all the bundled services that are offered and provided collectively, as long as the entity does not make prohibited compensation payments to its employees, and the institution does not pay the entity separately for student recruitment services provided by the entity.” The DCL guidance indicates that an arrangement that complies with Example 2-B will be deemed to be in compliance with the incentive compensation provisions of the HEA and ED’s regulations.
The institution may pay the entity an amount based on tuition generated for the institution by the entity’s activities for all the bundled services that are offered and provided collectively, as long as the entity does not make prohibited compensation payments to its employees, and the institution does not pay the entity separately for student recruitment services provided by the entity.” 23 Table of Contents The DCL guidance indicates that an arrangement that complies with Example 2-B will be deemed to be in compliance with the incentive compensation provisions of the HEA and ED’s regulations.
GCU, because it is currently certified to participate in the Title IV programs on a provisional basis, is required to obtain ED approval for new programs, which requirement could impede GCU’s ability to introduce new programs and slow its growth. 25 Table of Contents
GCU, because it is currently certified to participate in the Title IV programs on a provisional basis, is required to obtain ED approval for new programs, which requirement could impede GCU’s ability to introduce new programs and slow its growth. 27 Table of Contents
In addition to having an 19 Table of Contents acceptable composite score, an institution must, among other things, provide the administrative resources necessary to comply with Title IV program requirements, meet all of its financial obligations, including required refunds to students and any Title IV liabilities and debts, be current in its debt payments, and not receive an adverse, qualified, or disclaimed opinion by its accountants in its audited consolidated financial statements.
In addition to having an acceptable composite score, an institution must, among other things, provide the administrative resources necessary to comply with Title IV program requirements, meet all of its financial obligations, including required refunds to students and any Title IV liabilities and debts, be current in its debt payments, and not receive an adverse, qualified, or disclaimed opinion by its accountants in its audited consolidated financial statements.
We believe that the competitive factors in the education services market include: ● reputation and brand awareness; ● quality of university partner base and performance track record; ● the effectiveness of marketing and sales efforts; ● robustness and evolution of technology solutions; ● breadth and depth of services offerings; ● convenient, flexible and dependable access to programs and classes; ● level of student support services; ● quality of student and faculty experience; ● cost of programs; and ● the time necessary to earn a degree.
We believe that the competitive factors in the education services market include: ● reputation and brand awareness; ● quality of university partner base and performance track record; ● the effectiveness of marketing and sales efforts; ● robustness and evolution of technology solutions; 13 Table of Contents ● breadth and depth of services offerings; ● convenient, flexible and dependable access to programs and classes; ● level of student support services; ● quality of student and faculty experience; ● cost of programs; and ● the time necessary to earn a degree.
To address this issue and to meet ED requirements many schools have applied and been approved to be institutional participants in the State Authorization Reciprocity Agreement (“SARA”). SARA is an agreement among member states, districts and territories that establishes comparable national standards for interstate offering of post-secondary distance education courses and programs.
To address this issue and to meet ED requirements many schools have applied and been approved to be institutional participants in the 16 Table of Contents State Authorization Reciprocity Agreement (“SARA”). SARA is an agreement among member states, districts and territories that establishes comparable national standards for interstate offering of post-secondary distance education courses and programs.
Court of Appeals for the Fifth Circuit issued a nationwide preliminary injunction, enjoining the implementation of the borrower defense and closed school provisions of that rule. While this case is decided, the previous versions of the borrower defense and closed school provisions are in effect.
Court of Appeals for the Fifth Circuit issued a nationwide preliminary injunction, enjoining the implementation of the borrower defense and closed school provisions of that rule. While this case is pending, the previous versions of the borrower defense and closed school provisions are in effect.
Climate Disclosures We do not operate in a high-risk industry for climate risks. We believe that we have low climate risk with respect to our physical environment (e.g., fires, drought, hailstorms, increasing weather pattern changes). A significant 12 Table of Contents percentage of our workforce is continuing to work remotely.
Climate Disclosures We do not operate in a high-risk industry for climate risks. We believe that we have low climate risk with respect to our physical environment (e.g., fires, drought, hailstorms, increasing weather pattern changes). A significant percentage of our workforce is continuing to work remotely.
Based on the data derived from the audited financial statements of GCU as of each of June 30, 2024 and 2023, GCU’s composite score was 1.9 and 1.8, respectively, using the proprietary school calculation methodology. If GCU’s future composite scores do not exceed 1.5, ED could impose sanctions.
Based on the data derived from the audited financial statements of GCU as of each of June 30, 2025 and 2024, GCU’s composite score was 1.9 and 1.9, respectively, using the proprietary school calculation methodology. If GCU’s future composite scores do not exceed 1.5, ED could impose sanctions.
ED may also grant an institution the ability to participate in Title IV programs on a provisional basis while it completes its review of the institution’s application. For an institution that is certified on a provisional basis, ED may revoke the institution’s certification without advance notice or advance opportunity for the institution to challenge that 18 Table of Contents action.
ED may also grant an institution the ability to participate in Title IV programs on a provisional basis while it completes its review of the institution’s application. For an institution that is certified on a provisional basis, ED may revoke the institution’s certification without advance notice or advance opportunity for the institution to challenge that action.
The reauthorized HEA reauthorized all of the Title IV programs in which institutions participate but made numerous revisions to the requirements governing the Title IV programs, including provisions relating to student loan default rates and the formula for determining the maximum amount of revenue that institutions are permitted to derive from the Title IV programs.
The reauthorized HEA 18 Table of Contents reauthorized all of the Title IV programs in which institutions participate but made numerous revisions to the requirements governing the Title IV programs, including provisions relating to student loan default rates and the formula for determining the maximum amount of revenue that institutions are permitted to derive from the Title IV programs.
In 2024 and 2023, we contributed $4.5 million and $3.5 million, respectively, to these organizations. ● Encouraging Employee Giving - We participate in Donate to Elevate, a program that encourages employees to participate in the Arizona individual tax credit program, which allows individual taxpayers to contribute money in lieu of state income tax payments to benefit private schools and other non-profit entities in Arizona, as well as local public schools and public charter schools.
In 2025 and 2024, we contributed $5.0 million and $4.5 million, respectively, to these organizations. ● Encouraging Employee Giving - We participate in Donate to Elevate, a program that encourages employees to participate in the Arizona individual tax credit program, which allows individual taxpayers to contribute money in lieu of state income tax payments to benefit private schools and other non-profit entities in Arizona, as well as local public schools and public charter schools.
Our employees take advantage of these opportunities and share our commitment to and enthusiasm for community service projects, as well as charitable organizations throughout the Phoenix area. Through these activities, our employees have the opportunity to volunteer and provide servant leadership that benefits the surrounding neighborhoods and West Phoenix community.
Our employees take advantage of these 9 Table of Contents opportunities and share our commitment to and enthusiasm for community service projects, as well as charitable organizations throughout the Phoenix area. Through these activities, our employees have the opportunity to volunteer and provide servant leadership that benefits the surrounding neighborhoods and West Phoenix community.
GCU, for example, is a member of SARA in Arizona (AZ-SARA), which is administered by the Western Interstate Commission for Higher Education (referred to as W-SARA). There is a yearly renewal for 16 Table of Contents participating in NC-SARA and AZ-SARA and institutions must agree to meet certain requirements to participate.
GCU, for example, is a member of SARA in Arizona (AZ-SARA), which is administered by the Western Interstate Commission for Higher Education (referred to as W-SARA). There is a yearly renewal for participating in NC-SARA and AZ-SARA and institutions must agree to meet certain requirements to participate.
Eligibility and certification procedures . Each institution must apply periodically to ED for continued certification to participate in the Title IV programs. Such recertification generally is required every six years, but may be required earlier, including when an institution undergoes a change in control.
Each institution must apply periodically to ED for continued certification to participate in the Title IV programs. Such recertification generally is required every six years, but may be required earlier, including when an institution undergoes a change in control.
This has not only increased employee satisfaction but has also resulted in savings in the areas of waste, janitorial costs, and travel costs related to business travel and commuting. Our off-campus classroom and laboratory sites are all designed with the same efficient footprint in the 45 sites opened as of December 31, 2024.
This has not only increased employee satisfaction but has also resulted in savings in the areas of waste, janitorial costs, and travel costs related to business travel and commuting. Our off-campus classroom and laboratory sites are all designed with the same efficient footprint in the 47 sites opened as of December 31, 2025.
Legislation has been introduced in both chambers of Congress that seeks to further modify the 90/10 Rule, including proposals to change the ratio requirement to 85/15 (federal to nonfederal revenue), or to eliminate the 90/10 Rule. We cannot predict whether or how legislative or regulatory changes will affect the 90/10 Rule. Student loan defaults .
Additionally, legislation has been introduced in both chambers of Congress that seeks to further modify the 90/10 Rule, including proposals to change the ratio requirement to 85/15 (federal to nonfederal revenue), or to eliminate the 90/10 Rule. We cannot predict whether or how legislative or regulatory changes will affect the 90/10 Rule.
Finally, other industry providers affiliate with university partners to offer massive open online courses, which are aimed at unlimited participation and open access via the web at little or no cost to the student. 13 Table of Contents The education services market is changing and expanding.
Finally, other industry providers affiliate with university partners to offer massive open online courses, which are aimed at unlimited participation and open access via the web at little or no cost to the student. The education services market is changing and expanding.
The HEA prohibits an institution that participates in Title IV programs from engaging in “substantial misrepresentation” of the nature of its educational program, its financial charges, or the 23 Table of Contents employability of its graduates.
The HEA prohibits an institution that participates in Title IV programs from engaging in “substantial misrepresentation” of the nature of its educational program, its financial charges, or the employability of its graduates.
In addition, because other regulators may use the composite score for their purposes, a poor composite score could have additional effects. For example, NC-SARA utilizes an institution’s composite score in determining whether such institution is eligible to participate in SARA.
In addition, because other regulators may use the composite score for their 21 Table of Contents purposes, a poor composite score could have additional effects. For example, NC-SARA utilizes an institution’s composite score in determining whether such institution is eligible to participate in SARA.
Further, we 22 Table of Contents also have an obligation to annually submit to ED a Title IV compliance audit conducted by an independent certified public accountant in accordance with applicable federal and ED audit standards. Gainful employment rule s.
Further, we also have an obligation to annually submit to ED a Title IV compliance audit conducted by an independent certified public accountant in accordance with applicable federal and ED audit standards. Gainful employment rule s.
Note, the borrower defense to repayment regulations discussed herein were and are extensive and this does not attempt to discuss all the facets of any of the versions of these regulations. We cannot determine what effect, if any, these regulations may have on out university partners or on us. Compliance reviews.
Note, the borrower defense to repayment regulations discussed herein were and are extensive and this does not attempt to discuss all the facets of any of the versions of these regulations. We cannot determine what effect, if any, these regulations may have on our university partners or on us. 24 Table of Contents Compliance reviews.
ED released performance data at the time it published the proposed regulations that calculates rates for each school’s programs while acknowledging that the methodology used to produce the calculations differs from the methodology in the proposed regulations due to limitations in data availability.
ED released performance data at the time it published the proposed regulations that calculates rates for each school’s programs while acknowledging that the methodology used to produce the calculations differs from the 25 Table of Contents methodology in the proposed regulations due to limitations in data availability.
The top five selected in the survey by employees and the percentage of the responders that selected that topic were Employee Health and Wellbeing (59%), Professional Integrity (47%), Human Capital Management (41%), Community Engagement (36%) and Workforce Diversity and Engagement (20%). 92% of those that responded to the survey confirmed GCE enables a culture of diversity.
Highlights from the survey by employees and the percentage of the responders that selected that topic were Employee Health and Wellbeing (59%), Professional Integrity (47%), Human Capital Management (41%), Community Engagement (36%) and Workforce Diversity and Engagement (20%). 92% of those that responded to the survey confirmed GCE enables a culture of diversity.
Three of our six directors are diverse persons, and two of our directors identify with an under-represented diverse ethnicity. ● We Have Majority Voting for Directors - We have adopted majority voting for directors pursuant to which nominees who fail to achieve an affirmative majority of votes cast must submit their resignation. ● We Hold Annual Elections for Directors - We do not have a staggered board. ● We Assess Board Performance - We conduct regular evaluations of our Board of Directors and Committees. ● Our Independent Directors Meet Without Management - Our independent directors meet regularly in executive sessions without management present. ● We Have a Stock Ownership Policy - We require both our named executive officers and our directors to maintain a meaningful ownership stake at levels specified in our stock ownership policy. ● Our Key Committees are Independent - We have fully independent Audit, Compensation and Nominating and Corporate Governance Committees. ● We Do Not Have a “Poison Pill” - We do not maintain a stockholder rights plan.
The following highlights certain key aspects of our corporate governance framework: ● We Have an Independent Board - Five of our six directors are independent. ● We Have Majority Voting for Directors - We have adopted majority voting for directors pursuant to which nominees who fail to achieve an affirmative majority of votes cast must submit their resignation. ● We Hold Annual Elections for Directors - We do not have a staggered board. ● We Assess Board Performance - We conduct regular evaluations of our Board of Directors and Committees. ● Our Independent Directors Meet Without Management - Our independent directors meet regularly in executive sessions without management present. ● We Have a Stock Ownership Policy - We require both our named executive officers and our directors to maintain a meaningful ownership stake at levels specified in our stock ownership policy. ● Our Key Committees are Independent - We have fully independent Audit, Compensation and Nominating and Corporate Governance Committees. ● We Do Not Have a “Poison Pill” - We do not maintain a stockholder rights plan.
Moreover, we do not have control over some of the factors that could impact the rates and measures for GCU’s programs which will limit our ability to eliminate or mitigate the impact of the regulations on us and GCU’s educational programs.
Moreover, our university partners do not have control over the factors that could impact the rates and measures for their programs which will limit their ability to eliminate or mitigate the impact of the regulations on their educational programs.
The regulations include gainful employment rates and measures that will be based in part on data that is not readily accessible to us or GCU, which makes it difficult for us to predict with certainty how GCU’s educational programs will perform under the new gainful employment benchmarks and the extent to which certain programs could become ineligible for Title IV participation.
The regulations include measures that will be based in part on data that is not readily accessible to us or our university partners, which makes it difficult for us to predict with certainty how our partners’ educational programs will perform under the new benchmarks and the extent to which certain programs could become ineligible for Title IV loans.
We have also provided Implicit Bias Training to all employees. Environmental Awareness Online education is inherently more environmentally friendly than traditional campus education with a reduction in greenhouse gas (“GHG”) production caused by traveling to and from a brick-and-mortar campus. It also increases student capacity while eliminating the need for construction of a physical campus.
Thereafter, all employees complete the training every other year, while management undertakes it annually. Environmental Awareness Online education is inherently more environmentally friendly than traditional campus education with a reduction in greenhouse gas (“GHG”) production caused by traveling to and from a brick-and-mortar campus. It also increases student capacity while eliminating the need for construction of a physical campus.
After 3 months of continuous service, fulltime employees admitted to GCU receive a 100% tuition reduction on undergraduate and graduate programs Additionally, the tuition benefit is available for an eligible employee’s spouse or up to two children with no more than two participants receiving the benefits at any one time.
Additionally, the tuition benefit is available for an eligible employee’s spouse or up to two children with no more than two participants receiving the benefits at any one time. An eligible employee’s spouse or child admitted to GCU receives a 100% tuition reduction on undergraduate programs and a 50% tuition reduction on graduate programs.
Because neither we nor GCU nor ED have access to all of the data that will ultimately be used to evaluate GCU’s programs, we cannot predict whether, or the extent to which, GCU’s programs could fail to comply with the new gainful employment benchmarks.
Because neither we nor our partners have access to all of the data that will ultimately be used to evaluate our partners’ programs, we cannot predict whether, or the extent to which, any program could fail to comply with the new benchmarks.
We are evaluating emissions reduction requirements with key suppliers for costs such as information security systems, communication and marketing costs, travel costs, and continued expansion of our off-campus classroom and laboratory sites. We currently do not have any regulatory emissions reporting obligations.
Our Audit Committee is tasked with oversight of climate-related risks for the Company. 12 Table of Contents We are evaluating emissions reduction requirements with key suppliers for costs such as information security systems, communication and marketing costs, travel costs, and continued expansion of our off-campus classroom and laboratory sites. We currently do not have any regulatory emissions reporting obligations.
GCE received responses from 1,330 employees on the 2024 survey. The survey asked a number of questions regarding employee engagement and satisfaction including whether they are actively engaged with their work, whether they have a sense of pride in what they do and whether they enjoy the type of work assigned to them.
The survey asked a number of questions regarding employee engagement and satisfaction including whether they are actively engaged with their work, whether they have a sense of pride in what they do and whether they enjoy the type of work assigned to them. The responses to each question were overwhelmingly positive.
If ED or another regulator determines that statements made by us or on our behalf are in violation of the regulations, we could be subject to sanctions and other liability, which could have a material adverse effect on our business. Coordinated actions by certain federal agencies .
If ED or another regulator determines that statements made by us or on our behalf are in violation of the regulations, we could be subject to sanctions and other liability, which could have a material adverse effect on our business. Negotiated rulemaking . ED periodically issues new regulations and guidance that can have an adverse effect on our partner institutions.
We are also subject to a number of data security and privacy regulations given our role as a third-party service provider, the compliance with which can materially impact our business model.
We are also subject to a number of data security and privacy regulations given our role as a third-party service provider, the compliance with which can materially impact our business model, including through future guidance, enforcement activity, or regulatory action applicable to institutions and their third-party service providers.
ED published new gainful employment regulations in 2023, which became effective July 1, 2024. These new regulations establish rules for annually evaluating GCU’s educational programs based on the calculation of debt-to-earnings rates (an annual debt-to-earnings rate and a discretionary debt-to-earnings rate) and a median earnings measure.
These regulations establish rules for annually evaluating GCU’s educational programs based on the calculation of debt-to-earnings rates (an annual debt-to-earnings rate and a discretionary debt-to-earnings rate) and a median earnings measure.
Any such actions by legislative or regulatory bodies that affect our operations or those of our university partners could have a material adverse effect on our business and that of university partner institutions.
Any such actions by legislative or regulatory bodies that affect our operations or those of our university partners could have a material adverse effect on our business and that of university partner institutions. ED engaged in two negotiated rulemakings stemming from the OBBBA, both of which reached consensus.
We are also precluded from offering our covered employees who work on financial aid matters (if any), any bonus or incentive-based compensation based on the award of financial aid to students enrolled in a postsecondary institution.
We are also precluded from offering our covered employees who work on financial aid matters (if any), any bonus or incentive-based compensation based on the award of financial aid to students enrolled in a postsecondary institution. ED normally does not approve incentive compensation plans but as part of the Qui Tam settlement, they reviewed and approved our compensation plan.
As of December 31, 2024, 1,446 projects have been completed in which 37,757 hours have been logged by volunteers.
As of December 31, 2025, 1,535 projects have been completed in which 39,155 hours have been logged by volunteers.
We also collect and analyze employee demographic data to identify current trends. 11 Table of Contents ● Training - We provide employees and management with regular training. New hires all complete anti-discrimination and harassment training within 3 months of starting at GCE. Thereafter, all employees complete the training every other year, while management undertakes it annually.
We post all open positions to a variety of job boards to ensure we attract diverse candidates. We also collect and analyze employee demographic data to identify current trends. 11 Table of Contents ● Training - We provide employees and management with regular training. New hires all complete anti-discrimination and harassment training within 3 months of starting at GCE.
Additionally, in January 2025, ED published new regulations, that become effective on July 1, 2026, related to a number of areas, including those concerning return to Title IV. We are in the process of reviewing the regulations and have not formed a view as to the impact on our business.
Additionally, in January 2025, ED published new regulations, that became effective on July 1, 2026, related to a number of areas, including those concerning return to Title IV.
Employee Tuition Benefit – GCE promotes the concept of lifelong learning and supports this concept by offering its employees a generous Tuition Benefit program through its university partner, GCU.
Employee Tuition Benefit – GCE promotes the concept of lifelong learning and supports this concept by offering its employees a generous Tuition Benefit program through its university partner, GCU. After 3 months of continuous service, fulltime employees admitted to GCU receive a 100% tuition reduction on undergraduate and graduate programs.
To be recognized by ED, accrediting commissions must adopt specific standards for their review of educational institutions, conduct peer-review evaluations of institutions, and publicly designate those institutions that meet their criteria.
To be recognized by ED, accrediting commissions must adopt specific standards for their review of educational institutions, conduct peer-review evaluations of institutions, and publicly designate those institutions that meet their criteria. An accredited school is subject to periodic review by its accrediting commissions to determine whether it continues to meet the performance, integrity and quality required for accreditation.
Significant regulations and other factors relating to the Title IV programs that could adversely affect us include the following: Congressional action . Congress must reauthorize the HEA on a periodic basis, usually every five to six years, and the most recent reauthorization through September 30, 2013, occurred in August 2008.
Congress must reauthorize the HEA on a periodic basis, usually every five to six years, and the most recent reauthorization through September 30, 2013, occurred in August 2008.
Previously issued guidance on this topic (Dear Colleague Letters GEN 12-08, GEN 15-01, GEN 16-15 (as modified by the March 8, 2017 electronic announcement), and GEN-23-08) remains in effect.
After substantial community outreach to ED, and a number of notices that the guidance would be delayed, on November 14, 2024, ED formally rescinded DCL 23-03. Previously issued guidance on this topic (Dear Colleague Letters GEN 12-08, GEN 15-01, GEN 16-15 (as modified by the March 8, 2017 electronic announcement), and GEN-23-08) remains in effect.
We have insurance policies in place to cover any damage for our property, plant and equipment. Our Audit Committee is tasked with oversight of climate-related risks for the Company.
We have insurance policies in place to cover any damage for our property, plant and equipment.
These efforts, combined with GCE and GCU’s expanded presence in the community, have contributed to a significant increase in home values since 2011 in the 85017 zip code. ● Furthering Job Creation - We, along with GCU have launched a number of new business enterprises that have reduced costs, provided management opportunities for recent graduates and employment opportunities for students and neighborhood residents, while spurring economic growth in the area. ● Youth Opportunity Foundation - Our employees volunteer and donate time and funds to the Youth Opportunity Foundation which provides advocacy, clinical treatment, education and workforce development for at-risk young people in underprivileged areas.
These efforts, combined with GCE and GCU’s expanded presence in the community, have contributed to a significant increase in home values since 2011 in the 85017 zip code. ● Furthering Job Creation - We, along with GCU have launched a number of new business enterprises that have reduced costs, provided management opportunities for recent graduates and employment opportunities for students and neighborhood residents, while spurring economic growth in the area. 10 Table of Contents ​ ​ GCE also invests in the following activities that benefit the community. ● Funding of Student Tuition Organizations - GCE contributes to private school tuition organizations, which are entities that allocate financial contributions toward tuition assistance and scholarships for disadvantaged students to attend Arizona private schools.
Accreditation Accreditation is a private, non-governmental process for evaluating the quality of educational institutions and their programs in areas including student performance, governance, integrity, educational quality, faculty, physical resources, administrative capability and resources, and financial stability.
Although not directly regulated by these entities, we must be mindful of the requirements placed by state professional licensure bodies on our university partner institutions to ensure those institutions maintain that licensure. 17 Table of Contents Accreditation Accreditation is a private, non-governmental process for evaluating the quality of educational institutions and their programs in areas including student performance, governance, integrity, educational quality, faculty, physical resources, administrative capability and resources, and financial stability.
To serve our university partners and community, we seek donations to fund this neighborhood scholarship program. 10 Table of Contents ● Sponsoring K-12 Educational Development - GCE supports GCU’s K-12 Educational Development Department through sponsorship of GCU’s Canyon Professional Development and K-12 Targeted School Assistance programs.
Employees are encouraged to designate tax dollars to the school or program of their choice. ● Sponsoring K-12 Educational Development - GCE supports GCU’s K-12 Educational Development Department through sponsorship of GCU’s Canyon Professional Development and K-12 Targeted School Assistance programs.
In addition, ED is independently conducting an ongoing series of rulemakings intended to assure the integrity of the Title IV programs. ED also frequently issues formal and informal guidance instructing institutions of higher education and other covered entities how to comply with various federal laws and regulations.
ED also frequently issues formal and informal guidance instructing institutions of higher education and other covered entities how to comply with various federal laws and regulations. For example, in February 2023, ED released DCL 23-03, a guidance document expanding the definition of what activities are considered as third-party servicer activities.
Litigation related to the various iterations of the BDR regulations, and the enforcement of these regulations has made this area complicated for all parties to understand and assess. Further, the lack of adjudications in this area has also made things less clear.
While the changes in the OBBBA clarify matters until July 1, 2035, litigation related to the various iterations of the BDR regulations, changes to the enforcement of these regulations, and the lack of adjudications in this area have made this area of the law difficult to predict.
An eligible employee’s spouse or child 9 Table of Contents admitted to GCU receives a 100% tuition reduction on undergraduate programs and a 50% tuition reduction on graduate programs. Monitoring employee engagement and satisfaction – GCE administers an annual survey of all of its employees to assess employee engagement and satisfaction.
Monitoring employee engagement and satisfaction – GCE periodically administers a survey of all of its employees to assess employee engagement and satisfaction. GCE received responses from 1,330 employees on the 2024 survey.
We consider our relations with our employees to be strong. ● Our Hiring Practices and Policies - Our hiring policies and practices include an Equal Employment Opportunity Policy, Nondiscrimination and Anti-Harassment Policy and Complaint Procedure, and the Disability Accommodation Policy. We post all open positions to a variety of job boards to ensure we attract diverse candidates.
In sum, GCE values diversity because it values every employee and university partners’ students entrusted to its care. ● Our Hiring Practices and Policies - Our hiring policies and practices include an Equal Employment Opportunity Policy, Nondiscrimination and Anti-Harassment Policy and Complaint Procedure, and the Disability Accommodation Policy.
However, in November 2019, in connection with its approval of the Transaction without conditions, ED informed GCU that GCU does not satisfy ED’s definition of a non-profit entity and, as a result, that ED will continue to treat GCU as a proprietary institution for purposes of its continued participation in Title IV programs.
On December 15, 2025, ED formally recognized GCU as a non-profit institution for purposes of its participation in Title IV programs. As a result, the 90/10 Rule no longer applies to GCU.
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The responses to each question were overwhelmingly positive.
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ED has also indicated that it may continue to evaluate the scope of activities treated as third-party servicer functions through future rulemaking or guidance, and additional changes to the definition of, or requirements applicable to, third-party servicers remain possible.
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GCE also invests in the following activities that benefit the community. ● Funding of Student Tuition Organizations - GCE contributes to private school tuition organizations, which are entities that allocate financial contributions toward tuition assistance and scholarships for disadvantaged students to attend Arizona private schools.
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Congress historically has reauthorized and amended the HEA in regular intervals, approximately every five to seven years. Congress periodically considers reauthorization of the HEA, although the timing and scope of any such reauthorization remain uncertain.
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Employees are encouraged to designate tax dollars to the school or program of their choice. ● Students Inspiring Students - GCE continues to support GCU’s free tutoring/mentoring program that serves Phoenix-area K-12 schools. Students who seek academic assistance in the GCU Learning Lounge may become eligible to receive the Students Inspiring Students full-tuition scholarship.
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In recent years, ED has indicated an increased focus on accreditor accountability and oversight, which could result in changes to accrediting standards, review practices, or recognition requirements applicable to our university partners.
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In sum, GCE values diversity because it values every employee and university partners’ students entrusted to its care. ● Our Diverse Leadership - Our ability to attract and retain diverse talent is reflected at both our Board of Directors (the “Board”) and management levels. Three of our six directors are women and two directors identify with an underrepresented diverse ethnicity.
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Additionally, ED’s final regulations addressing, among other things, financial responsibility, administrative capability, certification procedures, and Ability-to-Benefit became effective on July 1, 2024. These regulations expand the circumstances under which ED may require financial protection, impose additional and more prescriptive administrative capability standards, and provide ED with broader authority to impose conditions during initial or continuing certification.
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In addition, for all of our employees at the level of manager and above totaling 644 persons, 70.2% are held by women and other diverse persons. ● Our Diverse Workforce - As of December 31, 2024, 80.3% of our 5,830 employees are women and other diverse persons.
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These changes increase compliance obligations for institutions participating in Title IV programs and may affect our business to the extent that we support functions implicated by these enhanced regulatory expectations. Significant regulations and other factors relating to the Title IV programs that could adversely affect us include the following: Congressional action .
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As of December 31, 2024, GCE employed approximately 4,092 professional and administrative personnel, including technical and academic advisors, counseling advisors, marketing and communication professionals, and personnel that handle financial aid processing, information technology, human resources, corporate accounting, finance, and other administrative functions.
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One Big Beautiful Bill Act On July 4, 2025, President Trump signed the One Big Beautiful Bill Act (OBBBA), which includes, among other things, amendments to portions of the Higher Education Act of 1965.
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In addition, as of December 31, 2024, GCE employed approximately 1,738 part-time employees most of whom are student workers. None of our employees are a party to any collective bargaining or similar agreement with us.
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Various portions of the bill have already gone through negotiated rulemaking (discussed later), and it is impossible to predict the outcome of those negotiations or the rulemaking process. OBBBA makes a variety of changes to federal student aid programs, including loan limits, accountability measures for programs based on low earning outcomes, loan repayment, Pell Grant eligibility, and regulatory changes.
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The following highlights certain key aspects of our corporate governance framework: ● We Have an Independent and Diverse Board - Five of our six directors are independent.
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OBBBA sets, effective July 2026, new annual and aggregate loan limits for graduate and professional students, with some limited grandfathering for current graduate and professional student borrowers. For graduate students who are not and have not been professional students, the new aggregate graduate loan limit is $100,000, irrespective of any undergraduate borrowing.
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For example, in February 2023, ED released DCL 23-03, a guidance document expanding the definition of what activities are considered as third-party servicer activities. 15 Table of Contents After substantial community outreach to ED, and a number of notices that the guidance would be delayed, on November 14, 2024, the Department formally rescinded DCL 23-03.
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With respect to graduate students who are or have been professional students, the aggregate graduate loan limit is $200,000 minus the amounts borrowed for the professional degree program.
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Although not directly regulated by these entities, we must be mindful of the requirements placed by state professional licensure bodies on our university partner institutions to ensure those institutions maintain that licensure.
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OBBBA also created a lifetime maximum aggregate amount for Title IV loans that a student may borrow of $257,500 (other than a loan made to the student as a parent borrower on behalf of a dependent student).
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An accredited school is subject to 17 Table of Contents periodic review by its accrediting commissions to determine whether it continues to meet the performance, integrity and quality required for accreditation.
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OBBBA provides institutions the opportunity to limit the amount of loans a student may borrow in an academic year as long as any such limit is applied consistently to all students enrolled in such program of study.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeSome of the other factors that could prevent us from successfully recruiting, enrolling, and retaining students in those programs include: ● t he reduced availability of, or higher interest rates and other costs associated with, Title IV loan funds or other sources of financial aid; ● t he emergence of more successful competitors; ● f actors related to our marketing, including the costs and effectiveness of Internet advertising and broad-based branding campaigns and recruiting efforts; ● p erformance problems with our online systems; ● f ailure of our university partner institutions to maintain institutional and specialized accreditations; ● t he requirements of the education agencies that regulate our university partner institutions which could restrict their initiation of new programs and modification of existing programs; ● t he requirements of the education agencies that regulate our university partner institutions which restrict the ways schools can compensate persons involved in their recruiting activities; ● i ncreased regulation of online education, including in states in which our university partner institutions do not have a physical presence; ● r estrictions that may be imposed on graduates of online programs that seek certification or licensure in certain states; ● s tudent dissatisfaction with our services and programs; ● lack of employment opportunities for graduates of our university partners in fields related to their educational programs: ● d amage to our reputation, or to the reputations of our university partners or other adverse effects as a result of negative publicity in the media, in industry or governmental reports, or otherwise, affecting us or other companies in the post-secondary education sector; ● p rice reductions by competitors that we are unwilling or unable to match; ● a decline in the acceptance of online education; and ● a decrease in the perceived or actual economic benefits that students derive from the programs offered by any university partner institution. 29 Table of Contents If we are unable to continue to develop awareness of the programs of our university partners, and to provide services to successfully recruit, enroll, and retain students on their behalf, enrollments at our university partners would suffer and our ability to increase revenues and maintain profitability would be significantly impaired.
Biggest changeSome of the other factors that could prevent us from successfully recruiting, enrolling, and retaining students in those programs include: ● t he reduced availability of, or higher interest rates and other costs associated with, Title IV loan funds or other sources of financial aid; ● t he emergence of more successful competitors; ● f actors related to our marketing, including the costs and effectiveness of Internet advertising and broad-based branding campaigns and recruiting efforts; ● p erformance problems with our online systems; ● f ailure of our university partner institutions to maintain institutional and specialized accreditations; ● t he requirements of the education agencies that regulate our university partner institutions which could restrict their initiation of new programs and modification of existing programs; ● t he requirements of the education agencies that regulate our university partner institutions which restrict the ways schools can compensate persons involved in their recruiting activities; ● i ncreased regulation of online education, including in states in which our university partner institutions do not have a physical presence; ● r estrictions that may be imposed on graduates of online programs that seek certification or licensure in certain states; ● s tudent dissatisfaction with our services and programs; ● lack of employment opportunities for graduates of our university partners in fields related to their educational programs: ● d amage to our reputation, or to the reputations of our university partners or other adverse effects as a result of negative publicity in the media, in industry or governmental reports, or otherwise, affecting us or other companies in the post-secondary education sector; ● competitors with lower p riced programs; ● a decline in the overall growth of enrollment in post-secondary institutions; ● a decrease in or perceived low student passage rates for professional licenses and other examinations necessary for students to work in their chosen fields post-graduation; ● an inability of our university partners’ to recruit, train and retain quality faculty members; ● a decline in the acceptance of online education; and 31 Table of Contents ● a decrease in the perceived or actual economic benefits that students derive from the programs offered by any university partner institution.
Risk Factor Summary The following is a summary of the material risk factors that could adversely affect our business, financial condition, and operating results: ● We earn a large percentage of our revenue through our contractual relationship as a service provider to GCU, and a decline in GCU’s enrollment could significantly reduce our revenue and impact our overall financial performance. ● GCU’s board of trustees and management have fiduciary and other duties that require them to focus on the best interests of GCU and, over time, those interests could diverge from those of GCE. ● Our Chief Executive Officer’s role as President of GCU may adversely affect his ability to run GCE. ● If we are determined to have paid improper incentive compensation to our covered employees, or tuition sharing arrangements are deemed to violate the incentive compensation regulations, our business will be impaired. ● Our success depends, in part, on our ability to recruit new students to enroll with our university partners. ● A decline in the overall growth of enrollment in post-secondary institutions, or in the number of students seeking degrees online, could cause our university partner institutions to experience lower enrollment, which could negatively impact our future growth. ● We face competition from established and other emerging companies, which could divert university partners to our competitors, result in pricing pressure and significantly reduce our revenue. ● We are subject to laws and regulations as a result of our collection and use of personal information, and any violations of such laws or regulations, or any breach, theft, or loss of such information, could adversely affect our reputation and operations. ● We are required to comply with The Family Educational Rights and Privacy Act, or FERPA, and failure to do so could harm our reputation and negatively affect our business. ● Capacity constraints, system disruptions, or security breaches in our online computer networks and phone systems could have a material adverse effect on our ability to attract and retain students. ● We may have difficulty integrating future acquisitions, which would reduce the anticipated benefits of those transactions. 26 Table of Contents ● Our failure, or our university partners’ failure, to comply with the extensive regulatory requirements governing institutions of higher education could result in financial penalties, restrictions on our operations or growth, or loss of external financial aid funding for our university partners’ students. ● Rulemaking by ED could materially and adversely affect our business. ● Recently published regulations could materially and adversely affect our business. ● If ED does not recertify a university partner institution to continue participating in the Title IV programs, the students we assist would lose their access to Title IV program funds, or a university partner institution could be recertified but be required to accept significant limitations as a condition of its continued participation in the Title IV programs. ● A university partner institution could lose the ability to participate in the Title IV programs if it fails to maintain its institutional accreditation, and our university partners’ student enrollments could decline if a university partner institution fails to maintain any of its accreditations or approvals. ● A university partner institution may lose eligibility to participate in the Title IV programs if its student loan default rates are too high. ● A finding by ED or other regulators that we or our university partner institutions misrepresented the nature of our partner institutions’ educational programs could materially and adversely affect our business. ● A reduction in funding or new restrictions on eligibility for the Federal Pell Grant Program, or the elimination of subsidized Stafford loans, could make college less affordable for certain students at our university partner institutions, which could negatively impact our university partner institutions’ enrollments, and thus our revenue and results of operations. ● If our university partner institutions do not maintain state authorization, they may not operate or participate in the Title IV programs. ● Government agencies, regulatory agencies, and third parties may conduct compliance reviews, bring claims, or initiate litigation against us or our university partners based on alleged violations of the extensive regulatory requirements applicable to us and our university partners. ● The regulatory guidance governing third-party servicers imposes a number of requirements on our business and may expose us to liability for certain regulatory violations that are coextensive with our university partner institutions.
Risk Factor Summary The following is a summary of the material risk factors that could adversely affect our business, financial condition, and operating results: ● We earn a large percentage of our revenue through our contractual relationship as a service provider to GCU, and a decline in GCU’s enrollment could significantly reduce our revenue and impact our overall financial performance. ● GCU’s board of trustees and management have fiduciary and other duties that require them to focus on the best interests of GCU and, over time, those interests could diverge from those of GCE. ● Our Chief Executive Officer’s role as President of GCU may adversely affect his ability to run GCE. ● If we are determined to have paid improper incentive compensation to our covered employees, or tuition sharing arrangements are deemed to violate the incentive compensation regulations, our business will be impaired. ● Our success depends, in part, on our ability to recruit new students to enroll with our university partners. ● A decline in the overall growth of enrollment in post-secondary institutions, or in the number of students seeking degrees online, could cause our university partner institutions to experience lower enrollment, which could negatively impact our future growth. ● We face competition from established and other emerging companies, which could divert university partners to our competitors, result in pricing pressure and significantly reduce our revenue. ● We are subject to laws and regulations as a result of our collection and use of personal information, and any violations of such laws or regulations, or any breach, theft, or loss of such information, could adversely affect our reputation and operations. ● We are required to comply with The Family Educational Rights and Privacy Act, or FERPA, and failure to do so could harm our reputation and negatively affect our business. ● Capacity constraints, system disruptions, or security breaches in our online computer networks and phone systems could have a material adverse effect on our university partners’ ability to attract and retain students, which may negatively impact our business. ● We may have difficulty integrating future acquisitions, which would reduce the anticipated benefits of those transactions. 28 Table of Contents ● Our failure, or our university partners’ failure, to comply with the extensive regulatory requirements governing institutions of higher education could result in financial penalties, restrictions on our operations or growth, or loss of external financial aid funding for our university partners’ students. ● Rulemaking by ED could materially and adversely affect our business. ● Recently published regulations could materially and adversely affect our business. ● If ED does not recertify a university partner institution to continue participating in the Title IV programs, the students we assist would lose their access to Title IV program funds, or a university partner institution could be recertified but be required to accept significant limitations as a condition of its continued participation in the Title IV programs. ● A university partner institution could lose the ability to participate in the Title IV programs if it fails to maintain its institutional accreditation, and our university partners’ student enrollments could decline if a university partner institution fails to maintain any of its accreditations or approvals. ● A university partner institution may lose eligibility to participate in the Title IV programs if its student loan default rates are too high. ● A finding by ED or other regulators that we or our university partner institutions misrepresented the nature of our university partner institutions’ educational programs could materially and adversely affect our business. ● A reduction in funding or new restrictions on eligibility for the Federal Pell Grant Program, or the elimination of subsidized Stafford loans, could make college less affordable for certain students at our university partner institutions, which could negatively impact our university partner institutions’ enrollments, and thus our revenue and results of operations. ● If our university partner institutions do not maintain state authorization, they may not operate or participate in the Title IV programs. ● Government agencies, regulatory agencies, and third parties may conduct compliance reviews, bring claims, or initiate litigation against us or our university partners based on alleged violations of the extensive regulatory requirements applicable to us and our university partners. ● The regulatory guidance governing third-party servicers imposes a number of requirements on our business and may expose us to liability for certain regulatory violations that are coextensive with our university partner institutions.
Possession and use of personal information in our operations also subjects us to legislative and regulatory burdens that could require us to implement certain policies and procedures, such as the procedures we adopted to comply with the Red Flags Rule that was promulgated by the FTC under the federal Fair Credit Reporting Act and that requires the establishment of guidelines and policies regarding identity theft related to student credit accounts, and could require us to make certain notifications of data breaches and restrict our use of personal information.
Possession and use of personal information in our operations subjects us to legislative and regulatory burdens that could require us to implement certain policies and procedures, such as the procedures we adopted to comply with the Red Flags Rule that was promulgated by the FTC under the federal Fair Credit Reporting Act and that requires the establishment of guidelines and policies regarding identity theft related to student credit accounts, and could require us to make certain notifications of data breaches and restrict our use of personal information.
The risks we may encounter in acquisitions include: ● i f we incur significant debt to finance a future acquisition and our business does not perform as expected, we may have difficulty complying with debt covenants; ● i f we use our stock to make a future acquisition, it will dilute existing stockholders; ● w e may have difficulty integrating the operations and personnel of any acquired company; ● we may face t he challenges and additional investments involved with integrating new products, services and technologies into our sales and marketing process associated with any acquired business; ● o ur ongoing business may be disrupted by transition and integration issues with any acquired business; ● t he costs and complexity of integrating the internal information technology infrastructure of each acquired business with ours may be greater than expected and may require additional capital investments; ● w e may be unable to achieve the financial and strategic goals for any acquired businesses; ● w e may have difficulty in maintaining controls, procedures and policies during the transition and integration period following a future acquisition; ● o ur relationships with existing university partners could be adversely affected following an acquisition; and ● a s successor we may be subject to certain liabilities of our acquisition targets.
The risks we may encounter in acquisitions include: ● i f we incur significant debt to finance a future acquisition and our business does not perform as expected, we may have difficulty complying with debt covenants; ● i f we use our stock to make a future acquisition, it will dilute existing stockholders; ● w e may have difficulty integrating the operations and personnel of any acquired company; ● we may face t he challenges and additional investments involved with integrating new products, services and technologies into our sales and marketing process associated with any acquired business; ● o ur ongoing business may be disrupted by transition and integration issues with any acquired business; ● t he costs and complexity of integrating the internal information technology infrastructure of each acquired business with ours may be greater than expected and may require additional capital investments; ● w e may be unable to achieve the financial and strategic goals for any acquired businesses; 35 Table of Contents ● w e may have difficulty in maintaining controls, procedures and policies during the transition and integration period following a future acquisition; ● o ur relationships with existing university partners could be adversely affected following an acquisition; and ● a s successor we may be subject to certain liabilities of our acquisition targets.
The institution may pay the entity an amount based on tuition generated for the institution by the entity’s activities for all the bundled services that are offered and provided collectively, as long as the entity does not make prohibited compensation 28 Table of Contents payments to its employees, and the institution does not pay the entity separately for student recruitment services provided by the entity.” The DCL guidance indicates that an arrangement that complies with Example 2-B will be deemed to be in compliance with the incentive compensation provisions of the HEA and ED’s regulations.
The institution may pay the entity an amount based on tuition generated for the institution by the entity’s activities for all the bundled services that are offered and provided collectively, as long as the entity does not make prohibited compensation 30 Table of Contents payments to its employees, and the institution does not pay the entity separately for student recruitment services provided by the entity.” The DCL guidance indicates that an arrangement that complies with Example 2-B will be deemed to be in compliance with the incentive compensation provisions of the HEA and ED’s regulations.
We are still reviewing the final regulations and cannot predict the ultimate impact of the final regulations discussed above, but the final regulations do impose a broad range of additional requirements on institutions, which increases the possibility that our university partners could be subject to additional reporting requirements, potential 35 Table of Contents liabilities and sanctions, and potential loss of Title IV eligibility if our efforts, or the efforts of our university partners, to modify operations to comply with the new regulations are unsuccessful, which could have a significant impact on our business and results of operations.
We are still reviewing the final regulations and cannot predict the ultimate impact of the final regulations discussed above, but the final regulations do impose a broad range of additional requirements on institutions, which increases the possibility that our university partners could be subject to additional reporting requirements, potential 38 Table of Contents liabilities and sanctions, and potential loss of Title IV eligibility if our efforts, or the efforts of our university partners, to modify operations to comply with the new regulations are unsuccessful, which could have a significant impact on our business and results of operations.
The final rules add more standards related to topics such as the provision of adequate financial aid counseling and career services, ensuring the availability of clinical and externship opportunities, the 34 Table of Contents disbursement of Title IV funds in a timely manner, compliance with high school diploma requirements, preventing substantial misrepresentations, complying with gainful employment requirements, and avoiding significant negative actions with a federal, state, or accrediting agency.
The final rules add more standards related to topics such as the provision of adequate financial aid counseling and career services, ensuring the availability of clinical and externship opportunities, the 37 Table of Contents disbursement of Title IV funds in a timely manner, compliance with high school diploma requirements, preventing substantial misrepresentations, complying with gainful employment requirements, and avoiding significant negative actions with a federal, state, or accrediting agency.
If our university partner institutions fail to satisfy the standards of any of those specialized accrediting commissions or state agencies, the institution could lose the specialized accreditation or approval for the affected programs, which could result in materially reduced student enrollments in those programs and have a material adverse effect on us. 36 Table of Contents A university partner institution may lose eligibility to participate in the Title IV programs if its student loan default rates are too high.
If our university partner institutions fail to satisfy the standards of any of those specialized accrediting commissions or state agencies, the institution could lose the specialized accreditation or approval for the affected programs, which could result in materially reduced student enrollments in those programs and have a material adverse effect on us. 39 Table of Contents A university partner institution may lose eligibility to participate in the Title IV programs if its student loan default rates are too high.
A major breach, theft, or loss of personal information regarding our university partner’s students and their families or our employees that is held by us or our vendors, or a violation of laws or regulations relating to the same, could have a material adverse effect on our reputation and result in further regulation and oversight by federal and state authorities and increased costs of compliance.
A major breach, theft, or loss of personal information regarding our university partners’ students and their families or our employees that is held by us or our vendors, or a violation of laws or regulations relating to the same, could have a material adverse effect on our reputation and result in further regulation and oversight by federal and state authorities and increased costs of compliance.
Although we currently provide services to 22 university partners across the United States, GCU is, and will for the foreseeable future remain, our most significant university partner. Accordingly, the risk factors set forth below also include risks attributable to GCU’s operations, which could materially affect us.
Although we currently provide services to 20 university partners across the United States, GCU is, and will for the foreseeable future remain, our most significant university partner. Accordingly, the risk factors set forth below also include risks attributable to GCU’s operations, which could materially affect us.
Should those interests diverge in a meaningful way, it could lead to changes in the relationship that would be adverse to us. 27 Table of Contents Our Chief Executive Officer’s role as President of GCU may adversely affect his ability to run GCE . Mr. Brian E.
Should those interests diverge in a meaningful way, it could lead to changes in the relationship that would be adverse to us. 29 Table of Contents Our Chief Executive Officer’s role as President of GCU may adversely affect his ability to run GCE . Mr. Brian E.
Congress must periodically reauthorize the HEA and annually determine the funding level for each Title IV program. In 2008, the HEA was reauthorized through September 30, 2013 by the Higher Education Opportunity Act.
The U.S. Congress must periodically reauthorize the HEA and annually determine the funding level for each Title IV program. In 2008, the HEA was reauthorized through September 30, 2013 by the Higher Education Opportunity Act.
As a service provider, we assist our university partners with some facets of these areas. As such, we must be mindful of, and 37 Table of Contents compliant with, the administrative capability requirements.
As a service provider, we assist our university partners with some facets of these areas. As such, we must be mindful of, and 40 Table of Contents compliant with, the administrative capability requirements.
If we are unaware of the data and information stored on our systems, we may be unable to appropriately comply with all legal obligations, and we may be exposed to governmental enforcement or prosecution actions, private litigation, fines and penalties or adverse publicity that could harm our reputation and business.
If we are unaware of the data and information stored on our systems, 34 Table of Contents we may be unable to appropriately comply with all legal obligations, and we may be exposed to governmental enforcement or prosecution actions, private litigation, fines and penalties or adverse publicity that could harm our reputation and business.
We also collect and maintain personal information of our employees in the ordinary course of our business. Our services can be accessed globally through the Internet. Therefore, we may be subject to the application of national privacy laws in countries outside the U.S. from which applicants and students access our services.
We also collect and maintain personal information of our employees in the ordinary course of 33 Table of Contents our business. Our services can be accessed globally through the Internet. Therefore, we may be subject to the application of national privacy laws in countries outside the U.S. from which applicants and students access our services.
Rulemaking by ED could materially and adversely affect our business. Over the past few years, ED has regularly promulgated new regulations and guidance that impact our university partners and our business directly.
Rulemaking by ED and Congressional legislation could materially and adversely affect our business. Over the past few years, ED has regularly promulgated new regulations and guidance that impact our university partners and our business directly.
Compliance with NIST will likely increase operational cost if required to come into compliance. Other General Risks Our success depends upon our ability to recruit and retain key personnel.
Compliance with NIST will likely increase operational cost if required to come into compliance. Other General Risks Our success depends upon our ability and our university partners’ ability to recruit and retain key personnel.
In addition, the terms of our prior credit facility limited, and the terms of any future debt agreements are likely to similarly limit, our ability to pay dividends. As a result, capital appreciation, if any, of our common stock will be your sole source of gain for the foreseeable future.
In addition, the terms of our prior credit facility limited, and the terms of any future debt agreements are likely to similarly limit, our ability to pay 46 Table of Contents dividends. As a result, capital appreciation, if any, of our common stock will be your sole source of gain for the foreseeable future.
We are required to perform system and process evaluation and testing of our internal control over financial reporting to allow management to report on the effectiveness of our internal control over financial reporting in our Form 10-K filing for that year, as required by Section 404 of the Sarbanes-Oxley Act.
We are required to perform system and process evaluation and testing of our internal control over financial reporting to 45 Table of Contents allow management to report on the effectiveness of our internal control over financial reporting in our Form 10-K filing for that year, as required by Section 404 of the Sarbanes-Oxley Act.
In some cases, these enforcement actions have resulted in material sanctions, loss of Title IV eligibility, or closure in 33 Table of Contents schools. We cannot predict with certainty how all of these regulatory requirements will be applied, or whether we will be able to comply with all of the applicable requirements in the future.
In some cases, these enforcement actions have resulted in material sanctions, loss of Title IV eligibility, or closure in schools. We cannot predict with certainty how all of these regulatory requirements will be applied, or whether we will be able to comply with all of the applicable requirements in the future.
These changes may place additional regulatory burdens on postsecondary schools generally, and specific initiatives may be targeted at or have an impact upon companies like us that provide services to institutions of higher education.
These changes may place additional regulatory burdens on postsecondary 44 Table of Contents schools generally, and specific initiatives may be targeted at or have an impact upon companies like us that provide services to institutions of higher education.
SARA is overseen by a national council (NC-SARA) and administered by four regional education compacts. GCU, for example, is a member of SARA in Arizona (AZ-SARA), which is 39 Table of Contents administered by the Western Interstate Commission for Higher Education (referred to as W-SARA).
SARA is overseen by a national council (NC-SARA) and administered by four regional education compacts. GCU, for example, is a member of SARA in Arizona (AZ-SARA), which is administered by the Western Interstate Commission for Higher Education (referred to as W-SARA).
Additionally, our operations are vulnerable to interruption or malfunction due to events beyond our control, including natural disasters and network and 32 Table of Contents telecommunications failures. Our computer networks may also be vulnerable to unauthorized access, computer hackers, computer viruses, malicious code, organized cyber-attacks and other security problems.
Additionally, our operations are vulnerable to interruption or malfunction due to events beyond our control, including natural disasters and network and telecommunications failures. Our computer networks may also be vulnerable to unauthorized access, computer hackers, computer viruses, malicious code, organized cyber-attacks and other security problems.
For example , GCU, calculated its composite score with respect to its fiscal years ending June 30, 2024 and 2023. As of June 30, 2024 and 2023, GCU’s composite score per GCU’s audited financial statements was 1.9 and 1.8, respectively, using the proprietary school calculation. If GCU’s future composite scores do not exceed 1.5, ED could impose sanctions.
For example , GCU, calculated its composite score with respect to its fiscal years ending June 30, 2025 and 2024. As of June 30, 2025 and 2024, GCU’s composite score per GCU’s audited financial statements was 1.9 for both years, using the proprietary school calculation. If GCU’s future composite scores do not exceed 1.5, ED could impose sanctions.
State regulatory requirements for online education have historically varied among the states. To address this issue and to meet new ED requirements many schools have applied and have been approved to be approved institutional participants in the State Authorization Reciprocity Agreement (“SARA”).
State regulatory requirements for online education have historically varied among the states. To address this issue and to meet new ED requirements many schools have applied and have been approved to be approved institutional participants in SARA.
This may require us to incur substantial additional 42 Table of Contents professional fees and internal costs to further expand our accounting and finance functions and expend significant management efforts.
This may require us to incur substantial additional professional fees and internal costs to further expand our accounting and finance functions and expend significant management efforts.
Senate Committee on Health, Education, Labor and Pensions, the U.S. House of Representatives Committee on Education and the Workforce and other Congressional committees regarding various aspects of the education industry, including accreditation matters, student debt, student recruiting, cost of tuition, distance learning, competency-based learning, student success and outcomes and other matters.
House of Representatives Committee on Education and the Workforce and other Congressional committees regarding various aspects of the education industry, including accreditation matters, student debt, student recruiting, cost of tuition, distance learning, competency-based learning, student success and outcomes and other matters.
The competitive landscape may also result in longer and more complex sales cycles with prospective university partners, which would negatively affect our ability to add additional university partners and thus our ability to grow our business. 30 Table of Contents A number of competitive factors could cause us to lose potential university partner opportunities or force us to offer our solutions on less favorable economic terms, including: ● c ompetitors may develop service offerings that our potential university partners find to be more compelling than ours; ● c ompetitors may adopt more aggressive pricing policies and offer more attractive sales terms, adapt more quickly to new technologies and changes in university partner and student requirements, and devote greater resources to the acquisition of qualified students than we can; and ● c urrent and potential competitors may establish cooperative relationships among themselves or with third parties to enhance their products and expand their markets, and our industry is likely to see an increasing number of new entrants and increased consolidation.
A number of competitive factors could cause us to lose potential university partner opportunities or force us to offer our solutions on less favorable economic terms, including: ● c ompetitors may develop service offerings that our potential university partners find to be more compelling than ours; ● c ompetitors may adopt more aggressive pricing policies and offer more attractive sales terms, adapt more quickly to new technologies and changes in university partner and student requirements, and devote greater resources to the acquisition of qualified students than we can; and ● c urrent and potential competitors may establish cooperative relationships among themselves or with third parties to enhance their products and expand their markets, and our industry is likely to see an increasing number of new entrants and increased consolidation.
There is a yearly renewal for participating in NC-SARA and AZ-SARA and institutions must agree to meet certain requirements to participate. All states other than California are members of SARA.
There is a yearly renewal for participating in NC-SARA and AZ-SARA and 42 Table of Contents institutions must agree to meet certain requirements to participate. As of December 31, 2025, all states other than California are members of SARA.
Investors seeking cash dividends should not purchase our common stock. 43 Table of Contents Item 1B. Unresolved Staff Comments None.
Investors seeking cash dividends should not purchase our common stock. Item 1B. Unresolved Staff Comments None.
Even if we or our university partners adequately address the issues raised by any such proceeding and successfully defend against it, we may have to devote significant financial and management resources to address these issues, which could harm our business. See Part 1, Item 3 – Litigation for a discussion of certain litigation matters to which we are a party.
Even if we or our university partners adequately address the issues raised by any such proceeding and successfully defend against it, we may have to devote significant financial and management resources to address these issues, which could harm our business.
The regulatory guidance governing third-party servicers imposes a number of requirements on our business and may expose us to liability for certain regulatory violations that are coextensive with our university partner institutions.
See Part 1, Item 3 – Litigation for a discussion of certain litigation matters to which we are a party. 43 Table of Contents The regulatory guidance governing third-party servicers imposes a number of requirements on our business and may expose us to liability for certain regulatory violations that are coextensive with our university partner institutions.
Recently published regulations could materially and adversely affect our business. In addition to other regulations discussed elsewhere (such as the new Gainful Employment regulations), on July 1, 2024 new regulations became effective covering the areas of financial responsibility, administrative capability, certification standards and procedures, and ability to benefit.
In addition to other regulations discussed elsewhere (such as those related to the OBBBA), on July 1, 2024 new regulations became effective covering the areas of financial responsibility, administrative capability, certification standards and procedures, and ability to benefit.
Although we use security and business controls to limit access and use of personal information, a third party may be able to circumvent those security and business 31 Table of Contents controls, which could result in a breach of student or employee data and privacy.
A user who circumvents security measures could misappropriate sensitive information or cause interruptions or malfunctions in our operations. Although we use security and business controls to limit access and use of personal information, a third party may be able to circumvent those security and business controls, which could result in a breach of student or employee data and privacy.
The uncertainty surrounding these issues, and any resolution of these issues that increases loan costs or reduces students’ access to Title IV loans or to student extended payment plans, could reduce student demand for educational programs which would adversely impact our revenues and operating profit or result in increased regulatory scrutiny. 41 Table of Contents The increased scrutiny and results-based accountability initiatives in the education sector, as well as ongoing policy differences in Congress regarding spending levels, could lead to significant changes in connection with the reauthorization of the HEA or otherwise.
The uncertainty surrounding these issues, and any resolution of these issues that increases loan costs or reduces students’ access to Title IV loans or to student extended payment plans, could reduce student demand for educational programs which would adversely impact our revenues and operating profit or result in increased regulatory scrutiny.
A reduction in funding or new restrictions on eligibility for the Federal Pell Grant Program, or the elimination of subsidized Stafford loans, could make college less affordable for certain students at our university partner institutions, which could negatively impact our university partner institutions’ enrollments, and thus our revenue and results of operations. The U.S.
Further, a failure to comply with these regulatory requirements could result in termination of our ability to continue providing these services to other university partner institutions, which would materially adversely affect us. 41 Table of Contents A reduction in funding or new restrictions on eligibility for the Federal Pell Grant Program, or the elimination of subsidized Stafford loans, could make college less affordable for certain students at our university partner institutions, which could negatively impact our university partner institutions’ enrollments, and thus our revenue and results of operations.
Any misinterpretation by us of these regulatory requirements or adverse changes in regulations or interpretations thereof by regulators could materially adversely affect us.
Additionally, regulatory agencies may sometimes disagree with the way we have interpreted or applied these requirements. Any misinterpretation by us of these regulatory requirements or adverse changes in regulations or interpretations thereof by regulators could materially adversely affect us.
AI technologies also carry the risk of generating content that is factually incorrect or infringing on third-party intellectual property rights. If we suffer adverse consequences due to any of these factors, it could in turn have a material adverse effect on our reputation, financial performance, and operations.
If we suffer adverse consequences due to any of these factors, it could in turn have a material adverse effect on our reputation, financial performance, and operations.
We are subject to laws and regulations as a result of our collection and use of personal information, and any violations of such laws or regulations, or any breach, theft, or loss of such information, could adversely affect our reputation and operations.
We are subject to rapidly changing laws and regulations relating to privacy and data security as a result of our collection and use of personal information, and any failure to comply with such laws or regulations could lead to government enforcement actions or private litigation or adversely affect our reputation and operations.
We face competition from established and other emerging companies, which could divert university partners to our competitors, result in pricing pressure and significantly reduce our revenue. We expect existing competitors and new entrants to the educational services market to revise and improve their business models constantly in response to challenges from competing businesses, including ours.
We face competition from established and other emerging companies, which could divert university partners to our competitors, result in pricing pressure and significantly reduce our revenue.
Such privacy laws could impose conditions that limit the way we market and provide our services. Our computer networks and the networks of certain of our vendors that hold and manage confidential information on our behalf may be vulnerable to unauthorized access, employee theft or misuse, computer hackers, computer viruses, and other security threats.
Incidents may occur as a single instance, or may occur over an extended period of time without detection. Our computer networks and the networks of certain of our vendors that hold and manage confidential information on our behalf may be vulnerable to unauthorized access, employee theft or misuse, computer hackers, computer viruses, and other security threats.
Moreover, ED has published extensive requirements for the protection of student data and has indicated such requirements may be strengthened in the future. Additionally, university personnel or students, or our employees or independent contractors, could use our online learning platform to store or process regulated personal information without our knowledge.
Additionally, personnel or students of our university partners, or our employees or independent contractors, could use our online learning platform to store or process regulated personal information without our knowledge.
Proposed legislation, additional rulemaking or additional examinations from U.S. Congress may impact general public perception of the industry in a negative manner resulting in a material and adverse impact on our business. The process of re-authorization of the HEA began in 2014 and is ongoing. Congressional hearings began in 2013 and will continue to be scheduled by the U.S.
To the extent we continue to provide third party servicer functions, we will be subject to these requirements, the compliance with which can materially impact our business model. Proposed legislation, additional rulemaking or additional examinations from U.S. Congress may impact general public perception of the industry in a negative manner resulting in a material and adverse impact on our business.
Our primary competitors have historically included EmbanetCompass (formerly owned by Pearson) and Wiley Education Services. There are also several new and existing vendors providing some or all of the services we provide to other segments of the education market, and these vendors may pursue the institutions we target.
There are also several new and existing vendors providing some or all of the services we provide to other segments of the education market, and these vendors may pursue the institutions we target. In addition, colleges and universities may choose to continue using or to develop their own solutions in-house, rather than pay for our solutions.
Further, we could be fined or otherwise sanctioned by ED, which could increase our cost of regulatory compliance and materially adversely affect us. 38 Table of Contents Further, a failure to comply with these regulatory requirements could result in termination of our ability to continue providing these services to other university partner institutions, which would materially adversely affect us.
Further, we could be fined or otherwise sanctioned by ED, which could increase our cost of regulatory compliance and materially adversely affect us.
We have made, and expect to continue making, investments in the integration of artificial intelligence (“AI”) into our platforms, products, and services. However, AI presents various risks, challenges, and potential unintended consequences that could disrupt our ability to effectively integrate and leverage these technologies.
We have made, and expect to continue making, investments in the integration of AI into our platforms, products, and services.
We are also subject to a number of data security and privacy regulations given our role as a third-party servicer and these standards are evolving. To the extent we continue to provide third party servicer functions, we will be subject to these requirements, the compliance with which can materially impact our business model.
ED has indicated that it may revisit the scope of third-party servicer requirements through future rulemaking or guidance, which could expand compliance obligations and increase our costs. We are also subject to a number of data security and privacy regulations given our role as a third-party servicer and these standards are evolving.
In addition, colleges and universities may choose to continue using or to develop their own solutions in-house, rather than pay for our solutions. Increased competition may result in changes in the revenue share percentage we are able to negotiate to receive from a university partner.
Increased competition may result in changes in the revenue share percentage we are able to negotiate to receive from a university partner. The competitive landscape may also result in longer and more complex sales cycles with prospective university partners, which would negatively affect our ability to add additional university partners and thus our ability to grow our business.
Removed
A user who circumvents security measures could misappropriate sensitive information or cause interruptions or malfunctions in our operations.
Added
If we are unable to continue to develop awareness of the programs of our university partners, and to provide services to successfully recruit, enroll, and retain students on their behalf, enrollments at our university partners would suffer and our ability to increase revenues and maintain profitability would be significantly impaired.
Removed
For example, in October 2023, ED imposed a fine of $37 million on GCU (which GCU is appealing) related to alleged misrepresentation by GCU regarding the costs of certain doctorate programs. Similar rules apply under state laws or are incorporated in institutional accreditation standards.
Added
In addition, our university partners have in the past, and will in the future, create additional programs to meet the needs of current and prospective students or the employers of their graduates.
Removed
The FTC applies similar rules prohibiting any unfair or deceptive marketing practices to the education sector and has pursued litigation against us and GCU related in part to these matters. See Part I, Item 3 – Legal Proceedings – FTC Complaint .
Added
Even if our university partners are able to develop acceptable new programs that meet market demands, establishing or modifying such programs requires us and our university partners to make investments, incur market expenses and allocate extensive resources.
Removed
As discussed, ED has started a new negotiated rulemaking addressing state authorization which implicates SARA. While no regulations have been published, any regulation could have a material adverse effect on our business. Additionally, regulatory agencies may sometimes disagree with the way we have interpreted or applied these requirements.
Added
If we and our university partners are unable to do so in a cost-effective manner or are unable to otherwise effectively manage the operations of such programs, our business, financial condition and results of operations could be adversely affected.
Removed
In addition, our largest university partner, GCU, has been subject to additional scrutiny.
Added
We expect existing competitors and new entrants to the educational services market to revise and improve their business models constantly in response to challenges from competing businesses, including ours. 32 Table of Contents Our primary competitors have historically included EmbanetCompass (formerly owned by Pearson) and Wiley Education Services.
Removed
In October 2021, the FTC issued a public statement indicating that it would coordinate efforts with ED and the VA to investigate for-profit universities, a category that at that time included GCU due to ED’s 2019 decision that GCU did not satisfy ED’s definition of a non-profit entity and, as a result, that ED would continue to treat GCU as a proprietary institution for purposes of its continued participation in Title IV programs.
Added
While we expect our use of AI to help grow our business and benefit our university partners, the use of AI presents various risks, challenges, and potential unintended consequences that could disrupt our ability to effectively integrate and leverage these technologies and it is not certain that we will realize our desired or anticipated benefits.
Removed
In the period following the FTC’s statement, ED, the VA and the FTC initiated multiple actions against GCU, including audits, compliance reviews, civil investigative demands, fines and lawsuits, and the FTC has initiated civil investigative demands and a lawsuit against us, that allege, among other things, misrepresentations made in connection with marketing activities, including statements made related to GCU’s non-profit status.
Added
AI technologies also carry the risk of generating content that is or is alleged to be deficient, biased, factually incorrect or infringing on third-party intellectual property rights, which may in turn make us subject to private lawsuits, regulatory scrutiny, or reputational harm. Furthermore, the use of AI may result in incidents that compromise the confidentiality of data, including personal data.
Removed
See “– Regulation of Our University Partners - Coordinated action by federal agencies.” These actions, taken as 40 Table of Contents a whole, appear to be coordinated in the manner described in the 2021 FTC statement.
Added
Such privacy laws could impose conditions that limit the way we market and provide our services.
Removed
These actions, or any future actions by ED, FTC or any other federal or state government agencies or accrediting bodies with oversight over us or GCU, if ultimately resolved adversely to us or GCU, could result in monetary penalties and liabilities, further impact GCU’s non-profit status, and/or cause reputational harm.
Added
Moreover, ED has published extensive requirements for the protection of student data and has indicated such requirements may be strengthened in the future.
Removed
At this time, we cannot predict what changes those could be or what effect any of those outcomes could have on our business.
Added
In addition, we may in the future be subject to litigation under state and federal privacy and data security laws and regulations by governmental authorities and private litigants, including class actions, any of which could have a material adverse effect on our business.
Added
We face risks of cyber and other security incidents, which can impact our business, result in harm to our operations, and require costly remediation measures. We and our university partners face an ever-increasing number of cybersecurity threats from a broad range of threat actors.
Added
These threats can result in security incidents, including hacking and data breaches, which may be caused by intentional or unintentional actions by our employees, contractors, consultants, students or other third parties, including cyber-attacks by malicious threat actors.
Added
Security incidents may take the form of unauthorized activity and access, phishing or spoofing, malicious penetration, system viruses, malicious code, malware, ransomware, denial of service attacks and other organized cyber-attacks that seek to exploit vulnerabilities and threaten the confidentiality, integrity and availability of information. We have in the past, and may in the future, be subject to such cyber-security incidents.
Added
The increased use of mobile devices by our employees, and the employees and students of our university partners, increases the risk of Information Technology (“IT”) threats and vulnerabilities, such as those involving unsecure networks, as well as unintentional disclosure of personal information, such as through the theft of a mobile device, which can lead to a security incident and/or data breach.
Added
On July 4, 2025, President Trump signed the OBBBA, which makes a variety of changes to federal student aid programs, including loan limits, accountability measures for programs based on low earning outcomes, loan repayment, Pell Grant eligibility, and regulatory changes.
Added
As one example, OBBBA creates the “Do No Harm” accountability framework, effective July 2026, that institutions must satisfy at the program level in order for students to continue to receive Federal Direct Loans for such programs.
Added
Under this framework, OBBBA requires that an undergraduate program become ineligible for Federal Direct Loans if, in two out of three consecutive years, the median earnings of a cohort of program completers are less than the median earnings of working adults aged 25-34 with only a high school diploma, either in the state where the institution is located or, if fewer than 50% of students at the institution reside in the institution’s state, the national average.
Added
OBBBA requires that a graduate or professional program become ineligible for Federal Direct Loans if, in two out of three consecutive years, the median earnings of a cohort of program completers are 36 Table of Contents less than the median earnings of working adults aged 25–34 with only a bachelor’s degree.
Added
Both the undergraduate and graduate/professional accountability provisions apply to the cohort of students who completed the program four years prior, are working, are not enrolled at any institution, and who received Federal Direct Loan funds for enrollment in the program. If a cohort is less than 30 students, the Secretary of Education may aggregate additional years of programmatic data.
Added
Based on data provided by the ED for students that graduated in 2015-2016, all of the programs that we provide services to our university partners passed this metric except GCU’s Masters in Mental and Social Health programs.
Added
GCU is currently analyzing the data related to these programs and it appears that most universities that provide these programs online to working adult students fail this metric.
Added
To the extent that these or any other programs offered by our university partners pursuant to our services agreements fail these metrics, then this would have an adverse effect on our university partners and thus an adverse effect on our business.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeThe results of the assessment are used to develop initiatives to enhance our security controls, make recommendations to improve processes, and inform a broader Company-wide risk assessment that are then reported to our Board, Audit Committee and members of management. Technical Safeguards : We regularly assess and deploy technical safeguards designed to protect our information systems from cybersecurity threats.
Biggest changeThe results of the assessment are used to develop initiatives to enhance our security controls, make recommendations to improve processes, and inform a broader Company-wide risk assessment that are then reported to our Board of Directors, Audit Committee and members of management.
Governance Disclosure Board Oversight : The Board of Directors, in coordination with the Audit Committee of the Board, has responsibility for managing the overall risk strategy for the Company, including cyber security risk.
Governance Disclosure Board Oversight : The Board of Directors, in coordination with the Audit Committee of the Board of Directors, has responsibility for managing the overall risk strategy for the Company, including cyber security risk.
Cybersecurity and Infrastructure Security Agency. Our CISO works closely with our Chief Risk Officer to provide risk reporting and ensure security and compliance. Chief Information Security Officer : Our CISO has led the Company’s security team for more than seven years, overseeing the implementation of multiple new technologies and processes to help protect the organization.
Cybersecurity and Infrastructure Security Agency. Our CISO works closely with our Chief Risk Officer to provide risk reporting and ensure security and compliance. Chief Information Security Officer : Our CISO has led the Company’s security team for more than eight years, overseeing the implementation of multiple new technologies and processes to help protect the organization.
In this regard, the Company has implemented policies and procedures for all employees including: (i) information security/cybersecurity policies, which are internally available for all employees, (ii) information security/cybersecurity 44 Table of Contents awareness training; (iii) a clear escalation process which employees can follow in the event an employee notices something suspicious; and (iv) ensuring that information security/cybersecurity is part of the employee performance evaluation and/or disciplinary process.
In this regard, the Company has implemented policies and procedures for all employees including: (i) information security/cybersecurity policies, which are internally available for all employees, (ii) information security/cybersecurity awareness training; (iii) a clear escalation process which employees can follow in the event an employee notices something suspicious; and (iv) ensuring that information security/cybersecurity is part of the employee performance evaluation and/or disciplinary process.
We regularly remind employees of the importance of handling and protecting data, including through annual privacy and security training to enhance employee awareness of how to detect and respond to cybersecurity threats.
We regularly remind employees of the importance of handling and protecting data, including through annual privacy and 47 Table of Contents security training to enhance employee awareness of how to detect and respond to cybersecurity threats.
Such safeguards are regularly evaluated and improved based on vulnerability assessments, cybersecurity threat intelligence and incident response experience. Incident Response and Recovery Planning : We have established comprehensive incident response and recovery plans that guide our response in the event of a cybersecurity incident. We continuously test and evaluate the effectiveness of those plans.
Incident Response and Recovery Planning : We have established comprehensive incident response and recovery plans that guide our response in the event of a cybersecurity incident. We continuously test and evaluate the effectiveness of those plans.
Added
Technical Safeguards : We regularly assess and deploy technical safeguards designed to protect our information systems from cybersecurity threats. Such safeguards are regularly evaluated and improved based on vulnerability assessments, cybersecurity threat intelligence and incident response experience.

Item 2. Properties

Properties — owned and leased real estate

3 edited+0 added−0 removed5 unchanged
Biggest changeIn addition to its owned facilities, GCE leases 39 off-campus classroom and laboratory sites for use in serving its university partners, four office locations in California, and office space in Indianapolis, Indiana.
Biggest changeOverall, GCE’s office building is 60% more energy efficient than a standard office building. 48 Table of Contents In addition to its owned facilities, GCE leases 42 off-campus classroom and laboratory sites for use in serving its university partners, three office locations in California, and office space in Indianapolis, Indiana.
GCE has commitments to add more off-campus classroom and laboratory sites as of December 31, 2024 that have not yet commenced and plans to add additional off-campus classroom and laboratory sites in Arizona and in other states in the 45 Table of Contents U.S. to accommodate our growth plans in 2025 and beyond.
GCE has commitments to add more off-campus classroom and laboratory sites as of December 31, 2025 that have not yet commenced and plans to add additional off-campus classroom and laboratory sites in Arizona and in other states in the U.S. to accommodate our growth plans in 2026 and beyond.
Additional environment-friendly design features include low VOC paints, use of recycled building materials, interior and exterior LED light bulbs, and implementation of an energy-efficient VRF mechanical system. Overall, GCE’s office building is 60% more energy efficient than a standard office building.
Additional environment-friendly design features include low VOC paints, use of recycled building materials, interior and exterior LED light bulbs, and implementation of an energy-efficient VRF mechanical system.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

9 edited+0 added−2 removed3 unchanged
Biggest changeThe following table sets forth our share repurchases of common stock and our share repurchases in lieu of taxes, which are not included in the repurchase plan totals as they were effected in conjunction with the vesting of restricted share awards, during each period in the fourth quarter of fiscal 2024: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total Number of Maximum Dollar ​ ​ ​ ​ ​ ​ ​ Shares Purchased as ​ Value of Shares ​ ​ ​ ​ Average ​ Part of Publicly ​ That May Yet Be ​ ​ Total Number of ​ Price Paid ​ Announced ​ Purchased Under Period ​ Shares Purchased ​ Per Share ​ Program ​ the Program Share Repurchases ​ ​ October 1, 2024 – October 31, 2024 117,477 ​ $ 134.95 117,477 ​ $ 148,600,000 November 1, 2024 – November 30, 2024 139,251 ​ $ 161.54 139,251 ​ $ 126,100,000 December 1, 2024 – December 31, 2024 159,769 ​ $ 165.85 159,769 ​ $ 99,600,000 Total 416,497 ​ $ 155.69 416,497 ​ $ 99,600,000 Tax Withholdings ​ ​ October 1, 2024 – October 31, 2024 — ​ $ — — ​ $ — November 1, 2024 – November 30, 2024 — ​ $ — — ​ $ — December 1, 2024 – December 31, 2024 — ​ $ — — ​ $ — Total — ​ $ — — ​ $ — ​ GCE Stock Performance The following graph compares the cumulative total return of our common stock with the cumulative total returns of the S&P 500 Index and our education services peer group of seven companies that includes: Wiley Education Services, Pearson plc, CHEGG, Inc., Laureate Education, Inc., Strategic Education, Inc., Adtalum Global Education, Inc. and Coursera.
Biggest changeThe following table sets forth our share repurchases of common stock and our share repurchases in lieu of taxes, which are not included in the repurchase plan totals as they were effected in conjunction with the vesting of restricted share awards, during each period in the fourth quarter of fiscal 2025: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total Number of ​ ​ Maximum Dollar ​ ​ ​ ​ ​ ​ ​ Shares Purchased as ​ Value of Shares ​ ​ ​ ​ Average ​ Part of Publicly ​ That May Yet Be ​ ​ Total Number of ​ Price Paid ​ Announced ​ Purchased Under Period ​ Shares Purchased ​ Per Share ​ Program ​ the Program Share Repurchases ​ ​ ​ ​ ​ ​ October 1, 2025 – October 31, 2025 31,924 ​ $ 211.36 31,924 ​ $ 137,600,000 November 1, 2025 – November 30, 2025 280,438 ​ $ 163.83 280,438 ​ $ 91,700,000 December 1, 2025 – December 31, 2025 293,368 ​ $ 161.35 293,368 ​ $ 344,400,000 Total 605,730 ​ $ 165.13 605,730 ​ $ 344,400,000 Tax Withholdings ​ ​ ​ ​ ​ ​ October 1, 2025 – October 31, 2025 — ​ $ — — ​ $ — November 1, 2025 – November 30, 2025 — ​ $ — — ​ $ — December 1, 2025 – December 31, 2025 — ​ $ — — ​ $ — Total — ​ $ — — ​ $ — ​ GCE Stock Performance The following graph compares the cumulative total return of our common stock with the cumulative total returns of the S&P 500 Index and our education services peer group of seven companies that includes: Wiley Education Services, Pearson plc, CHEGG, Inc., Laureate Education, Inc., Strategic Education, Inc., Adtalem Global Education, Inc. and Coursera Inc.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information Our common stock trades on the Nasdaq Global Market under the symbol “LOPE.” The holders of our common stock are entitled to one vote per share on any matter to be voted upon by stockholders.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information Our common stock trades on the Nasdaq Global Select Market under the symbol “LOPE.” The holders of our common stock are entitled to one vote per share on any matter to be voted upon by stockholders.
The current expiration date on the repurchase authorization by the Board of Directors is March 1, 2026. Repurchases occur at the Company’s discretion and the Company may modify, suspend or discontinue the repurchase authorization at any time. Repurchases may be made in the open market or in privately negotiated transactions, pursuant to the applicable SEC rules.
The current expiration date on the repurchase authorization by the Board of Directors is March 1, 2027. Repurchases occur at the Company’s discretion and the Company may modify, suspend or discontinue the repurchase authorization at any time. Repurchases may be made in the open market or in privately negotiated transactions, pursuant to the applicable SEC rules.
The stock price performance included in this graph is not necessarily indicative of future stock price performance. Item 6. [Reserved] ​ 48 Table of Contents
The stock price performance included in this graph is not necessarily indicative of future stock price performance. Item 6. [Reserved] ​ 51 Table of Contents
Holders As of December 31, 2024, there were approximately 176 registered holders of record of common stock. A substantially greater number of holders of common stock are “street name” or beneficial holders, whose shares are held of record by banks, brokers and other financial institutions.
Holders As of December 31, 2025, there were approximately 187 registered holders of record of common stock. A substantially greater number of holders of common stock are “street name” or beneficial holders, whose shares are held of record by banks, brokers and other financial institutions.
Purchases of Equity Securities by the Issuer and Affiliated Purchasers On January 29, 2025, our Board of Directors approved a $200.0 million increase under the Company’s existing stock repurchase program, reflecting an aggregate authorization for share repurchases since the initiation of the program of $2,245.0 million.
Purchases of Equity Securities by the Issuer and Affiliated Purchasers On December 10, 2025, our Board of Directors approved a $300.0 million increase under the Company’s existing stock repurchase program, reflecting an aggregate authorization for share repurchases since the initiation of the program of $2,545.0 million.
This chart assumes that an investment of $100 was made in our common stock, in the index, and in the peer group on December 31, 2019 and that all dividends paid (if any) were reinvested, and tracks the relative performance of such investments through December 31, 2024. 47 Table of Contents ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 12/19 12/20 12/21 12/22 12/23 12/24 Grand Canyon Education, Inc. 100.00 97.20 89.48 110.30 137.84 171.00 S&P 500 100.00 118.40 152.39 124.79 157.59 197.02 2024 Peer Group 100.00 122.18 92.11 90.83 100.46 113.82 ​ The information contained in the performance graph shall not be deemed “soliciting material” or to be “filed” with the SEC nor shall such information be deemed incorporated by reference into any future filing under the Securities Act or the Exchange Act, except to the extent that we specifically incorporate it by reference into such filing.
This chart assumes that an investment of $100 was made in our common stock, in the index, and in the peer group on December 31, 2020 and that all dividends paid (if any) were reinvested, and tracks the relative performance of such investments through December 31, 2025. 50 Table of Contents ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 12/20 ​ ​ ​ 12/21 ​ ​ ​ 12/22 ​ ​ ​ 12/23 ​ ​ ​ 12/24 ​ ​ ​ 12/25 Grand Canyon Education, Inc. 100.00 92.05 113.48 141.81 175.92 178.62 S&P 500 100.00 128.71 105.40 133.10 166.40 196.16 2025 Peer Group 100.00 75.38 74.11 82.20 93.54 95.35 ​ The information contained in the performance graph shall not be deemed “soliciting material” or to be “filed” with the SEC nor shall such information be deemed incorporated by reference into any future filing under the Securities Act or the Exchange Act, except to the extent that we specifically incorporate it by reference into such filing.
Since the initial approval of our share repurchase plan, we have repurchased 23,883,357 shares of common stock at an aggregate cost of $1,945.4 billion, which purchases are recorded at cost in the accompanying December 31, 2024 consolidated balance sheet and statement of stockholders’ equity.
The amount and timing of future share repurchases, if any, will be made as market and business conditions warrant. 49 Table of Contents Since the initial approval of our share repurchase plan, we have repurchased 25,363,153 shares of common stock at an aggregate cost of $2,200.6 million, which purchases are recorded at cost in the accompanying December 31, 2025 consolidated balance sheet and statement of stockholders’ equity.
During the fourth quarter and the year ended December 31, 2024, GCE repurchased 416,497 46 Table of Contents and 1,141,678 shares of common stock, respectively, at an aggregate cost of $64.8 million and $165.4 million, respectively.
At December 31, 2025, there remained $344.4 million available under our current share repurchase authorization. During the fourth quarter and the year ended December 31, 2025, GCE repurchased 605,730 and 1,479,796 shares of common stock, respectively, at an aggregate cost of $100.0 million and $255.3 million, respectively.
Removed
The amount and timing of future share repurchases, if any, will be made as market and business conditions warrant.
Removed
At December 31, 2024, there remained $99.6 million available under our current share repurchase authorization (which authorization was increased to $299.6 million in January 2025).

Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

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Biggest changeItem 6. [Reserved] ​ 48 ​ Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations ​ 49 ​ Item 7A. Quantitative and Qualitative Disclosures about Market Risk ​ 56 ​ Item 8. Consolidated Financial Statements and Supplementary Data ​ 57 ​
Biggest changeItem 6. [Reserved] ​ 51 ​ Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations ​ 52 ​ Item 7A. Quantitative and Qualitative Disclosures about Market Risk ​ 59 ​ Item 8. Consolidated Financial Statements and Supplementary Data ​ 60 ​

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeFor more information, see our consolidated financial statements and the notes to those consolidated financial statements included elsewhere in this Annual Report on Form 10-K. 55 Table of Contents The following table reconciles net income to Adjusted EBITDA for the periods indicated: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ 2024 2023 Net income ​ $ 226,234 ​ $ 204,985 ​ Plus: interest expense ​ 4 ​ 33 ​ Less: investment interest and other ​ (15,920) ​ (10,452) ​ Plus: income tax expense ​ 65,081 ​ 54,690 ​ Plus: amortization of intangible assets ​ ​ 8,419 ​ ​ 8,419 ​ Plus: depreciation and amortization ​ 28,135 ​ 23,554 ​ EBITDA ​ 311,953 ​ 281,229 ​ Plus: contributions in lieu of state income taxes (a) ​ 4,500 ​ 3,500 ​ Plus: share-based compensation (b) ​ ​ 14,225 ​ ​ 13,204 ​ Plus: litigation and regulatory costs (c) ​ ​ 6,203 ​ ​ 3,628 ​ Plus: impairment and other (d) ​ 1,897 ​ — ​ Plus: loss on fixed asset disposal (e) ​ ​ 102 ​ ​ 741 ​ Plus: severance costs (f) ​ ​ 1,133 ​ ​ — ​ Adjusted EBITDA ​ $ 340,013 ​ $ 302,302 ​ (a) Represents contributions to various private Arizona school tuition organizations to assist with funding for education.
Biggest changeThe following table reconciles net income to Adjusted EBITDA for the periods indicated: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ ​ ​ 2025 ​ ​ ​ 2024 ​ ​ ​ Net income ​ $ 216,170 ​ $ 226,234 ​ Less: investment interest and other ​ (13,941) ​ (15,916) ​ Plus: income tax expense ​ 63,681 ​ 65,081 ​ Plus: amortization of intangible assets ​ ​ 8,419 ​ ​ 8,419 ​ Plus: depreciation and amortization ​ 31,483 ​ 28,135 ​ EBITDA ​ 305,812 ​ 311,953 ​ Plus: contributions in lieu of state income taxes (a) ​ 5,000 ​ 4,500 ​ Plus: share-based compensation (b) ​ ​ 13,639 ​ ​ 14,225 ​ Plus: litigation and regulatory costs (c) ​ ​ 40,486 ​ ​ 6,203 ​ Plus: lease termination, impairment and other (d) ​ 2,411 ​ 1,897 ​ Plus: loss on disposal of fixed assets (e) ​ ​ 941 ​ ​ 102 ​ Plus: severance costs (f) ​ ​ 299 ​ ​ 1,133 ​ Adjusted EBITDA ​ $ 368,588 ​ $ 340,013 ​ (a) Represents contributions to various private Arizona school tuition organizations to assist with funding for education.
GCE’s most significant university partner is GCU, a comprehensive regionally accredited university that offers graduate and undergraduate degree programs, emphases and certificates across ten colleges both online, on ground at its campus in Phoenix, Arizona and at eight off-campus classroom and laboratory sites. We also provide education services to numerous university partners across the United States.
GCE’s most significant university partner is GCU, a comprehensive regionally accredited university that offers graduate and undergraduate degree programs, emphases and certificates across ten colleges both online, on ground at its campus in Phoenix, Arizona and at 11 off-campus classroom and laboratory sites. We also provide education services to numerous university partners across the United States.
Contractual Obligations Our contractual obligations primarily consist of capital expenditures primarily for new off-campus classroom and laboratory sites opening and continued spend on computer equipment, software licenses, internal software development and furniture and equipment to support our increasing employee headcount. See Note 6 - Leases , in Item 8, 54 Table of Contents Consolidated Financial Statements and Supplementary Data.
Contractual Obligations Our contractual obligations primarily consist of capital expenditures primarily for new off-campus classroom and laboratory sites opening and continued spend on computer equipment, software licenses, internal software 57 Table of Contents development and furniture and equipment to support our increasing employee headcount. See Note 6 - Leases , in Item 8, Consolidated Financial Statements and Supplementary Data.
Off-Balance Sheet Arrangements We do not have any off-balance sheet arrangements that have had or are reasonably likely to have a material current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures, or capital resources as of December 31, 2024.
Off-Balance Sheet Arrangements We do not have any off-balance sheet arrangements that have had or are reasonably likely to have a material current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures, or capital resources as of December 31, 2025.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations The following discussion and analysis of our financial condition and results of operations for the years ended December 31, 2024 and 2023 should be read in conjunction with our consolidated financial statements and related notes that appear in Item 8, Consolidated Financial Statements and Supplementary Data .
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations The following discussion and analysis of our financial condition and results of operations for the years ended December 31, 2025 and 2024 should be read in conjunction with our consolidated financial statements and related notes that appear in Item 8, Consolidated Financial Statements and Supplementary Data .
The output method provides a faithful depiction of the performance toward complete 49 Table of Contents satisfaction of the performance obligation and can be tied to the time elapsed which is consumed evenly over the service period and is a direct measurement of the value provided to our partners.
The output method provides a faithful depiction of the performance toward complete 52 Table of Contents satisfaction of the performance obligation and can be tied to the time elapsed which is consumed evenly over the service period and is a direct measurement of the value provided to our partners.
Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K filed with the SEC for the fiscal year ended December 31, 2023 incorporated herein by reference. The following table sets forth certain income statement data as a percentage of revenue for each of the periods indicated.
Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K filed with the SEC for the fiscal year ended December 31, 202 4 incorporated herein by reference. The following table sets forth certain income statement data as a percentage of revenue for each of the periods indicated.
The current expiration date on the repurchase authorization by our Board of Directors is March 1, 2026. Repurchases occur at the Company’s discretion and the Company may modify, suspend or discontinue the repurchase authorization at any time.
The current expiration date on the repurchase authorization by our Board of Directors is March 1, 2027. Repurchases occur at the Company’s discretion and the Company may modify, suspend or discontinue the repurchase authorization at any time.
The increases in employee compensation including share-based compensation and benefits were primarily due to increased headcount to support our university partners, and their planned increases in enrollment, tenure-based salary adjustments, benefit costs and the increased number of off-campus classroom and laboratory sites open year over year.
The increases in employee compensation including share-based compensation and benefits were primarily due to increased headcount to support our university partners, and their planned increases in enrollment, tenure-based salary adjustments, a significant year over year increase in benefit costs and the increased number of off-campus classroom and laboratory sites open year over year.
The inclusion of excess tax benefits and deficiencies as a component of our income tax expense increases the volatility within our provision for income taxes as the amount of excess tax benefits or deficiencies from share-based compensation awards are dependent on our stock price at the date the restricted awards vest.
The inclusion of excess tax benefits and deficiencies as a component of our income tax expense increases the volatility within our provision for income taxes as the amount of 55 Table of Contents excess tax benefits or deficiencies from share-based compensation awards are dependent on our stock price at the date the restricted stock awards vest.
In addition, we have provided certain services to a university partner to assist them in expanding their online graduate programs. As of December 31, 2024, GCE provides education services to 22 university partners across the United States. We seek to add additional university partners and to introduce additional programs with both our existing partners and with new partners.
In addition, we have provided certain services to a university partner to assist them in expanding their online graduate programs. As of December 31, 2025, GCE provides education services to 20 university partners across the United States. We seek to add additional university partners and to introduce additional programs with both our existing partners and with new partners.
We define working capital as the 53 Table of Contents assets and liabilities, other than cash, generated through the Company’s primary operating activities. Changes in these balances are included in the changes in assets and liabilities presented in the consolidated statement of cash flows .
We define working capital as the assets and liabilities, other than cash, generated through the Company’s primary operating activities. Changes in these balances are included in the changes in assets and liabilities presented in the consolidated statement of cash flows .
The increases in other technology and academic costs and occupancy and depreciation were primarily due to the costs associated with the increased number of off-campus classroom and laboratory sites to support our 22 university partners and their increased enrollment growth as well as an increase in curriculum cost reimbursement to our university partners.
The increases in other technology and academic costs and occupancy and depreciation were primarily due to the costs associated with the increased number of off-campus classroom and laboratory sites to support our 20 university partners and their increased enrollment growth as well as an increase in technology costs and curriculum cost reimbursements to our university partners.
In connection with such contributions made, we received a dollar-for-dollar state income tax credit, which resulted in a reduction in our effective income tax rate to 22.3% and 21.1% for the years ended December 31, 2024 and 2023, respectively. Had these contributions not been made, our effective tax rate would have been 23.5% and 22.1% for 2024 and 2023, respectively.
In connection with such contributions made, we received a dollar-for-dollar state income tax credit, which resulted in a reduction in our effective income tax rate to 22.8% and 22.3% for the years ended December 31, 2025 and 2024, respectively. Had these contributions not been made, our effective tax rate would have been 24.1% and 23.5% for 2025 and 2024, respectively.
Our counseling services and support expenses as a percentage of revenue decreased 0.2% to 31.3% for the year ended December 31, 2024, from 31.5% for the year ended December 31, 2023 primarily due to our ability to leverage our counseling services and support expenses across an increasing revenue base.
Our counseling services and support expenses as a percentage of revenue decreased 0.3% to 31.0% for the year ended December 31, 2025, from 31.3% for the year ended December 31, 2024 primarily due to our ability to leverage our counseling services and support expenses across an increasing revenue base.
The increase in occupancy and depreciation is primarily related to higher depreciation expense associated with our continued enhancements to technology infrastructure and internal-use software development. The increase in other counseling services and support expenses is primarily the result of increased travel costs for our 22 university partners.
The increase in occupancy and depreciation is primarily related to higher depreciation expense associated with our continued enhancements to technology infrastructure and internal-use software development. The decrease in other counseling services and support expenses is primarily the result of decreased travel costs for our 20 university partners.
Amortization of intangible assets for the years ended December 31, 2024 and 2023 were $8.4 million for both periods. As a result of the Acquisition, certain identifiable intangible assets were created (primarily customer relationships) that will be amortized over their expected lives. Investment interest and other .
Amortization of intangible assets for the years ended December 31, 2025 and 2024 were $8.4 million for both periods. As a result of the Orbis Education acquisition in 2019, certain identifiable intangible assets were created (primarily customer relationships) that will be amortized over their expected lives. Investment interest and other .
During the year ended December 31, 2024 and 2023, $165.4 million and $130.8 million, respectively was used to purchase treasury stock in accordance with GCE’s share repurchase program. In 2024 and 2023, $7.8 million and $6.3 million, respectively, of cash was utilized to purchase common shares withheld in lieu of income taxes resulting from the vesting of restricted share awards.
During the year ended December 31, 2025 and 2024, $255.3 million and $165.4 million, respectively was used to purchase treasury stock in accordance with GCE’s share repurchase program. In 2025 and 2024, $9.5 million and $7.8 million, respectively, of cash was utilized to purchase common shares withheld in lieu of income taxes resulting from the vesting of restricted share awards.
We anticipate that marketing and communication expenses will increase in the future as we continue to invest to meet our partners’ needs although we might continue to have a decline in these costs as a percentage of revenue. General and administrative .
We anticipate that marketing and communication expenses will increase in the future as we continue to invest to meet our partners’ needs and these costs as a percentage of revenue could increase in the future. General and administrative .
Amortization of intangible assets have been excluded from the table below: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ 2024 2023 Costs and expenses Technology and academic services 16.0 % 16.1 % Counseling services and support 31.3 31.5 Marketing and communication 20.6 21.1 General and administrative 4.5 4.5 ​ Year Ended December 31, 2024 Compared to Year Ended December 31, 2023 Service revenue .
Amortization of intangible assets have been excluded from the table below: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ ​ ​ ​ 2025 ​ ​ ​ 2024 ​ ​ ​ Costs and expenses ​ ​ Technology and academic services 15.8 % 16.0 % Counseling services and support 31.0 31.3 Marketing and communication 20.7 20.6 General and administrative 4.3 4.5 ​ Year Ended December 31, 2025 Compared to Year Ended December 31, 2024 Service revenue .
Impairment and other expenses of $1.9 million for the year ended December 31, 2024 primarily includes the write-off of an internal use software project that the Company had been attempting to develop for its other university partners that has been terminated and costs relating to exiting certain off-campus classroom and laboratory sites. Amortization of intangible assets .
We incurred i mpairment and other expenses of $1.9 million for the year ended December 31, 2024 due to the write-off of an internal use software project that the Company had been attempting to develop for its other university partners that has been terminated and costs relating to exiting certain off-campus classroom and laboratory sites. Amortization of intangible assets .
This increase was primarily attributable to the increased cost to market our university partners’ programs and to the marketing of new university partners and new locations which resulted in increased advertising of $7.7 million, increased employee compensation, including share-based compensation and benefits of $1.1 million, an increase in other marketing and communication expenses of $0.5 million and an increase in occupancy and depreciation costs of $0.3 million.
This increase was primarily attributable to the increased cost to market our university partners’ programs and to the marketing of new university partners and new locations which resulted in increased advertising of $15.2 million, increased employee compensation, including share-based compensation and benefits of $1.5 million and an increase in occupancy and depreciation costs of $0.1 million.
As of December 31, 2024 and 2023, GCE has reserved approximately $14,626 and $13,631, respectively, for uncertain tax positions, including interest and penalties. Results of Operations For a discussion of the results of operations for fiscal year 2023 vs 2022, see “Item 7.
As of December 31, 2025 and 2024, GCE has reserved approximately $16,824 and $14,626, respectively, for uncertain tax positions, including interest and penalties. Results of Operations For a discussion of the results of operations for fiscal year 2024 vs 2023, see “Item 7.
The Company intends to continue using a significant portion of its cash flows from operations to repurchase its shares. Share Repurchase Program On January 29, 2025, our Board of Directors increased the authorization under its existing stock repurchase program by $200.0 million, reflecting an aggregate authorization for share repurchases since the initiation of the program of $2,245.0 million.
The Company intends to continue using a significant portion of its cash flows from operations to repurchase its shares. Share Repurchase Program On December 10, 2025, our Board of Directors increased the authorization under its existing stock repurchase program by $300.0 million, reflecting an aggregate authorization for share repurchases since the initiation of the program of $2,545.0 million.
Our general and administrative expenses for the year ended December 31, 2024 were $46.3 million, an increase of $3.1 million, or 7.1%, as compared to general and administrative expenses of $43.2 million for the year ended December 31, 2023.
Our general and administrative expenses for the year ended December 31, 2025 were $47.4 million, an increase of $1.1 million, or 2.4%, as compared to general and administrative expenses of $46.3 million for the year ended December 31, 2024.
Such contributions are viewed by our management to be made in lieu of payments of state income taxes and are therefore excluded from evaluation of our core operating performance. (b) Reflects share-based compensation expense. (c) Reflects primarily regulatory litigation.
Such contributions are viewed by our management to be made in lieu of payments of state income taxes and are therefore excluded from evaluation of our core operating performance. (b) Reflects share-based compensation expense. (c) Reflects regulatory litigation and includes the qui tam settlement of $35.0 million.
Our technology and academic services expenses for the year ended December 31, 2024 were $165.1 million, an increase of $10.2 million, or 6.6%, as compared to technology and academic services expenses of $154.9 million for the year ended December 31, 2023.
Our technology and academic services expenses for the year ended December 31, 2025 were $175.1 million, an increase of $10.0 million, or 6.0%, as compared to technology and academic services expenses of $165.1 million for the year ended December 31, 2024.
Our marketing and communication expenses for the year ended December 31, 2024 were $212.4 million, an increase of $9.6 million, or 4.7%, as compared to marketing and communication expenses of $202.8 million for the year ended December 31, 2023.
Our marketing and communication expenses for the year ended December 31, 2025 were $229.2 million, an increase of $16.8 million, or 7.9%, as compared to marketing and communication expenses of $212.4 million for the year ended December 31, 2024.
We anticipate that counseling services and support expense will increase in the future as we continue to invest to meet our partners’ needs although we might continue to have a decline in these costs as a percentage of revenue. Marketing and communication .
We anticipate that counseling services and 54 Table of Contents support expense will increase in the future as we continue to invest to meet our partners’ needs and these costs as a percentage of revenue could increase in the future. Marketing and communication .
The increase in revenue per student between years is primarily due to the s ervice revenue per student for ABSN students at off-campus classroom and laboratory sites generating a significantly higher revenue per student than we earn under our agreement with GCU, as these agreements generally provide us with a higher revenue share percentage, the partners have higher tuition rates than GCU and the majority of our partners’ students take more credits on average per semester.
These decreases were offset by the service revenue per student for ABSN students at off-campus classroom and laboratory sites generating a significantly higher revenue per student than we earn under our agreement with GCU, as these agreements generally provide us with a higher revenue share percentage, the partners have higher tuition rates than GCU and the majority of our partners’ students take more credits on average per semester.
Excluding sites closing in 2024 to new enrollments, total enrollments at our off-campus classroom and laboratory sites increased 14.9% between years.
Excluding sites closed in 2024 to new enrollments, total enrollments at our off-campus classroom and laboratory sites increased 18.7% between years.
Cash Flows from Financing Activities ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, (In thousands) ​ 2024 ​ 2023 Net cash used in financing activities ​ $ (173,175) ​ $ (137,124) Financing activities consumed $173.2 million of cash in the year ended December 31, 2024 compared to $137.1 million in the year ended December 31, 2023.
Cash Flows from Financing Activities ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, (In thousands) ​ 2025 ​ 2024 Net cash used in financing activities ​ $ (264,758) ​ $ (173,175) Financing activities consumed $264.8 million of cash in the year ended December 31, 2025 compared to $173.2 million in the year ended December 31, 2024.
This increase was primarily attributable to increases in employee compensation and related expenses including share-based compensation and benefits, in occupancy and depreciation costs and in other counseling services and support expenses of $18.0 million, $2.9 million and $0.3 million, respectively.
This increase was primarily attributable to increases in employee compensation and related expenses including share-based compensation and benefits and in occupancy and depreciation costs of $18.9 million and $1.6 million, respectively. These increases were partially offset by a decrease in other counseling services and support expenses of $1.3 million, respectively.
Our service revenue for the year ended December 31, 2024 was $1,033.0 billion, an increase of $72.1 million, or 7.5%, as compared to service revenue of $960.9 million for the year ended December 31, 2023.
Our service revenue for the year ended December 31, 2025 was $1,106.1 million, an increase of $73.1 million, or 7.1%, as compared to service revenue of $1,033.0 million for the year ended December 31, 2024.
Our unrestricted cash and cash equivalents and investments were $324.6 million and $244.5 million at December 31, 2024 and 2023, respectively.
Our unrestricted cash and cash equivalents and investments were $300.1 million and $324.6 million at December 31, 2025 and 2024, respectively.
Our marketing and communication expenses as a percentage of revenue decreased by 0.5% to 20.6% for the year ended December 31, 2024, from 21.1% for the year ended December 31, 2023, primarily due to our ability to leverage our marketing and communication expenses across an increasing revenue base.
Our general and administrative expenses as a percentage of revenue decreased by 0.2% to 4.3% for the year ended December 31, 2025, from 4.5% for the year ended December 31, 2024, primarily due to our ability to leverage our general and administrative expenses across an increasing revenue base.
Cash Flows from Investing Activities ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, (In thousands) ​ 2024 ​ 2023 Net cash provided by (used in) investing activities ​ $ 61,365 ​ $ (80,472) Investing activities provided $61.4 million of cash in the year ended December 31, 2024 compared to consuming $80.5 million in the year ended December 31, 2023.
Cash Flows from Investing Activities ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, (In thousands) ​ 2025 ​ 2024 Net cash (used in) provided by investing activities ​ $ (221,594) ​ $ 61,365 Investing activities consumed $221.6 million of cash in the year ended December 31, 2025 compared to providing $61.4 million of cash in the year ended December 31, 2024.
Our counseling services and support expenses for the year ended December 31, 2024 were $323.5 million, an increase of $21.2 million, or 7.0%, as compared to counseling services and support 51 Table of Contents expenses of $302.3 million for the year ended December 31, 2023.
Our counseling services and support expenses for the year ended December 31, 2025 were $342.7 million, an increase of $19.2 million, or 5.9%, as compared to counseling services and support expenses of $323.5 million for the year ended December 31, 2024.
This increase was primarily due to increases in other technology and academic costs and in occupancy and depreciation of $8.3 million and $4.9 million, respectively, partially offset by a decrease in employee compensation and related expenses, including share-based compensation of $3.0 million.
This increase was primarily due to increases in other technology and academic costs, in occupancy and depreciation costs and in employee compensation and related expenses, including share-based compensation and benefit costs of $6.2 million, $1.9 million and $1.9 million, respectively.
Cash provided by or used in investing activities includes net investment activity. In the year ended December 31, 2024, proceeds from the sale of investments, net of purchases of available-for-sale securities were $99.0 million as the Company sold all its investments in the third quarter of 2024 and the proceeds were invested in cash and cash equivalents.
In the year ended December 31, 2024, proceeds from the sale of investments, net of purchases of available-for-sale securities were $99.0 million as the Company sold all its investments in the third quarter of 2024 and the proceeds were held in cash and cash equivalents until being reinvested in early 2025.
Our net income for the year ended December 31, 2024 was $226.2 million, an increase of $21.2 million, or 10.4% as compared to $205.0 million for the year ended December 31, 2023, due to the factors discussed above.
Our net income for the year ended December 31, 2025 was $216.2 million, a decrease of $10.0 million, or 4.4% as compared to $226.2 million for the year ended December 31, 2024, due primarily to the litigation settlement and the other factors discussed above.
Accounts payable increased between December 31, 2023 and December 31, 2024 by $9.7 million compared to the decrease between December 31, 2022 and December 31, 2023 of $3.1 million due to the timing of vendor payments.
Accounts payable increased by $9.7 million between December 31, 2023 and December 31, 2024 compared to the decrease of $3.4 million between December 31, 2024 and December 31, 2025, a decline year over year in cash provided by operating activities of $13.1 million due to timing of vendor payments.
Cash Flows from Operating Activities ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, (In thousands) ​ 2024 ​ 2023 Net cash provided by operating activities ​ $ 289,958 ​ $ 243,662 The increase in cash generated from operating activities between the year ended December 31, 2023 and the year ended December 31, 2024 was primarily due to increased income and changes in working capital balances, primarily accounts payable and accrued liabilities.
Cash Flows from Operating Activities ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, (In thousands) ​ 2025 ​ 2024 Net cash provided by operating activities ​ $ 273,491 ​ $ 289,958 The decrease in cash generated from operating activities between the year ended December 31, 2024 and the year ended December 31, 2025 was primarily due to the decline in net income between years due primarily to the litigation settlement and changes in working capital balances.
Liquidity and Capital Resources ​ ​ ​ ​ ​ ​ ​ ​ ​ As of December 31, (In thousands) ​ 2024 ​ 2023 Cash, cash equivalents and investments ​ $ 324,623 ​ $ 244,506 Overview Our liquidity position, as measured by cash and cash equivalents and investments increased by $80.1 million between December 31, 2023 and December 31, 2024, which was largely attributable to cash flows from operations exceeding share repurchases, investment purchases, net of proceeds and capital expenditures during the year ended December 31, 2024 .
Liquidity and Capital Resources ​ ​ ​ ​ ​ ​ ​ ​ ​ As of December 31, (In thousands) ​ 2025 ​ 2024 Cash, cash equivalents and investments ​ $ 300,079 ​ $ 324,623 Overview Our liquidity position, as measured by cash and cash equivalents and investments decreased by $24.5 million between December 31, 2024 and December 31, 2025, which was largely attributable to cash expended for share repurchases and capital expenditures exceeding our cash provided by operations during the year ended December 31, 2025 .
Income tax expense for the year ended December 31, 2024 was $65.1 million, an increase of $10.4 million, or 19.0%, as compared to income tax expense of $54.7 million for the year ended December 31, 2023.
Income tax expense . Income tax expense for the year ended December 31, 2025 was $63.7 million, a decrease of $1.4 million, or 2.2%, as compared to income tax expense of $65.1 million for the year ended December 31, 2024.
The increase year over year in service revenue was primarily due to an increase in GCU enrollments to 123,149 at December 31, 2024, an increase of 5.0% over enrollments at December 31, 2023. Partner enrollments totaled 127,155 at December 31, 2024 as compared to 121,250 at December 31, 2023.
The increase year over year in service revenue was primarily due to an increase in partner enrollments of 7.1% to 136,239 at December 31, 2025 as compared to 127,155 at December 31, 2024. GCU enrollments increased to 131,826 at December 31, 2025, an increase of 7.0% over enrollments at December 31, 2024.
The decrease in employee compensation and related expenses is primarily due to decreased faculty reimbursements due to changes in our agreements with certain university partners whereby we no longer reimburse these partners for their faculty costs, partially offset by increased headcount to support our 22 university partners and their increased enrollment growth, tenure-based salary adjustments, benefit costs and the increased number of off-campus classroom and laboratory sites year over year.
The increase in employee compensation and related expenses is primarily due to increased headcount to support our 20 university partners and their increased enrollment growth, tenure-based salary adjustments, a significant year over year increase in benefit costs and the increased number of off-campus classroom and laboratory sites year over year.
Since 2011, we have repurchased 23.9 million shares of common stock at an aggregate cost of $1,945.4 million, which includes 1,141,678 shares of common stock at an aggregate cost of $165.4 million during the year ended December 31, 2024.
Since 2011, we have repurchased 25.4 million shares of common stock at an aggregate cost of $2,200.6 million, which includes 1,479,796 shares of common stock at an aggregate cost of $255.3 million during the year ended December 31, 2025.
University partner enrollments at our off-campus classroom 50 Table of Contents and laboratory sites were 4,919, an increase of 9.8% over enrollments at December 31, 2023, which includes 913 and 510 GCU students at December 31, 2024 and 2023, respectively, and an increase in revenue per student year over year.
University partner enrollments at our off-campus 53 Table of Contents classroom and laboratory sites were 5,738, an increase of 16.6% over enrollments at December 31, 2024, which includes 1,325 and 913 GCU students at December 31, 2025 and 2024, respectively.
We anticipate that technology and academic services expenses as a percentage of revenue will increase in the future as we open more off-site classroom and laboratory sites and the growing curriculum cost reimbursements although these increases might be offset by lower faculty reimbursements if more partners choose to adjust their contracts. Counseling services and support .
We anticipate that technology and academic services expenses will increase in the future as we open more off-site classroom and laboratory sites and due to increased technology costs and curriculum cost reimbursements and that these costs as a percentage of revenue could grow as these costs grow at rates higher than revenue growth. Counseling services and support .
(d) Reflects primarily the write-off of an internal use software project and costs related to exiting from off-campus classroom and laboratory sites. (e) Represent loss on fixed asset disposals. (f) Represents severance costs related to an executive that resigned effective June 30, 2024.
In 2024, reflects the write-off of an internal use software project that the Company had been attempting to develop for its other university partners that has been terminated and costs relating to exiting certain off-campus classroom and laboratory sites . (e) Represents loss on fixed asset disposals. (f) Represents severance costs.
Our technology and academic services expenses as a percentage of revenue decreased by 0.1% to 16.0% for the year ended December 31, 2024, from 16.1% for the year ended December 31, 2023. This decrease was primarily due to the decreased faculty reimbursements between years partially offset by the growing curriculum cost reimbursement.
Our technology and academic services expenses as a percentage of revenue decreased by 0.2% to 15.8% for the year ended December 31, 2025, from 16.0% for the year ended December 31, 2024.
In the year ended December 31, 2023, the purchase of available-for-sale securities, net of proceeds from the sale of investments were $35.0 million. In the year ended December 31, 2024 and 2023 cash used in investing activities also included capital expenditures totaling $37.2 million and $44.5 million, respectively.
In the year ended December 31, 2025 and 2024 cash used in investing activities also included capital expenditures totaling $34.8 million and $37.2 million, respectively.
Our effective tax rate was 22.3% during the year ended December 31, 2024 compared to 21.1% during the year ended 52 Table of Contents December 31, 2023. The effective tax rate increased year over year due to higher state income taxes.
Our effective tax rate was 22.8% during the year ended December 31, 2025 compared to 22.3% during the year ended December 31, 2024. The increase in the effective tax rate was primarily due to the tax treatment of the litigation settlement recorded in the year ended December 31, 2025 and changes in state income taxes.
Investment interest and other for the year ended December 31, 2024 was $15.9 million, an increase of $5.4 million, as compared to $10.5 million for the year ended December 31, 2023 due to higher investment balances and higher returns on those balances. Income tax expense .
Investment interest and other for the year ended December 31, 2025 was $13.9 million, a decrease of $2.0 million, as compared to $15.9 million for the year ended December 31, 2024 due to slightly lower investment balances and returns on our investment balances and the recognition of a loss on an equity investment in the second quarter of 2025 of $0.5 million.
GCU online enrollments were 98,597 at December 31, 2024, up from 92,070 at December 31, 2023, an increase of 7.1% between years. Technology and academic services .
This has also positively impacted the enrollment growth. Enrollments for GCU ground students were 24,678 at December 31, 2025 up from 24,552 at December 31, 2024. GCU online enrollments were 107,148 at December 31, 2025, up from 98,597 at December 31, 2024, an increase of 8.7% between years. Technology and academic services .
This was partially offset by an increase in excess tax benefits of $1.5 million as compared to $0.9 million in the years ended December 31, 2024 and 2023, respectively, and a higher contribution in lieu of state income taxes of $4.5 million in 2024 compared to $3.5 million in 2023.
The effective tax rate increases were partially offset due to an increase in excess tax benefits of $2.7 million as compared to $1.5 million in the years ended December 31, 2025 and 2024, respectively.
We compensate for these limitations by relying primarily on our GAAP results and use Adjusted EBITDA only as a supplemental performance measure.
We compensate for these limitations by relying primarily on our GAAP results and use Adjusted EBITDA only as a supplemental performance measure. For more information, see our consolidated financial 58 Table of Contents statements and the notes to those consolidated financial statements included elsewhere in this Annual Report on Form 10-K.
Contract modifications for some of our university partners in which the revenue share percentage was reduced in exchange for us no longer reimbursing the partner for certain faculty costs and the termination of one university partner contract at the end of the Spring 2024 semester had the effect of reducing revenue per student.
This decrease was primarily due to the contract modifications for some of our university partners in which the revenue share percentage was reduced in exchange for us no longer reimbursing these partners for certain faculty costs, partially offset by increased technology costs and curriculum cost reimbursements.
This increase was primarily attributable to an increase in professional fees including legal costs of $2.2 million, employee compensation, including share-based compensation and benefits of $1.4 million, which includes $1.1 million in severance costs recorded for an executive that resigned June 30, 2024, an increase in contributions in lieu of state income taxes of $1.0 million and increases in occupancy and depreciation costs of $0.2 million.
These increases were partially offset by a decrease in employee compensation, including share-based compensation of $0.9 million, which is primarily due to $1.1 million in severance costs recorded in the prior year for an executive that resigned June 30, 2024.
We anticipate that general and administrative expenses will increase in the future and these costs as a percentage of revenue might increase if legal costs continue to rise faster than our revenue growth rate. Impairment and other.
We anticipate that general and administrative expenses will increase in the future and these costs as a percentage of revenue could increase in the future. Litigation settlement. A litigation settlement of $35.0 million was recorded in the year ended December 31, 2025 related to the settlement of the qui tam lawsuit. Lease termination, impairment and other.
Our restricted stock vests in March each year so any benefit or expense will primarily impact the first quarter each year. Net income .
Our restricted stock awards vest in March each year so any benefit or expense will primarily impact the first quarter each year. The effective tax rate was also favorably impacted by an increase in contributions made in lieu of state income taxes to $5.0 million as compared to $4.5 million in the prior year. Net income .
We opened five sites in the year ended December 31, 2023, six sites in the year ended December 31, 2024 and closed one site increasing the total number of these sites to 45 at December 31, 2024, which has also positively impacted the enrollment growth.
We opened six sites in the year ended December 31, 2024 and opened five new sites in the year ended December 31, 2025 while closing two sites in which we stopped recruiting new students in 2024 and merged two sites that were located in the same market bringing the total number of these sites to 47 at December 31, 2025.
Removed
The increase in revenue per student in the year ended December 31, 2024 was also due to the additional day for leap year in 2024 which added additional service revenue of $1.5 million as compared to the prior year and we earned revenue in 2024 with a university partner in which we helped the partner develop an ABSN program under a cost plus arrangement.
Added
Revenue per student was flat between years primarily due to the additional day for leap year in 2024 which added additional service revenue of $1.5 million as compared to the current year, due to contract modifications for some of our university partners in which the revenue share percentage was reduced in exchange for us no longer reimbursing these partners for certain faculty costs, a slight decline year over year in revenue per student for online students due to the continued mix shift to students that have a slightly lower net tuition rate, and due to a slight decline in residential students between years.
Removed
We will earn limited revenue with this partner going forward.
Added
Our marketing and communication expenses as a percentage of revenue slightly increased by 0.1% to 20.7% for the year ended December 31, 2025, from 20.6% for the year ended December 31, 2024.
Removed
Partner enrollments totaled 127,155 at December 31, 2024 as compared to 121,250 at December 31, 2023. Although partner enrollments at our off-campus classroom and laboratory sites returned to year over year growth in 2024, some existing partners continue to experience reduced incoming cohort sizes which has slowed the growth.
Added
This increase was primarily attributable to an increase in other general and administrative expenses of $1.7 million and an increase in professional fees including legal costs of $0.3 million.
Removed
We believe the growth in the number of ABSN students continues to be negatively impacted by the strong job market as these students have historically been individuals with already completed bachelor’s degrees choosing to re-career into one of these health professions.
Added
The increase in other general and administrative expenses is due to an increase in contributions in lieu of state income taxes of $0.5 million, an increase in charitable contributions of $0.5 million and an increase in fixed asset disposals of $0.5 million from the downsizing of our Indiana office space.
Removed
To address this challenge, we have been working with our university partners to adjust their programs to allow students with the required education experience but without a completed bachelor’s degree to enter their programs.
Added
We incurred $2.4 million in lease termination and impairment charges in the year ended December 31, 2025 related to leases. In the third quarter of 2025, we agreed to pay $1.3 million to early terminate our Indiana office space lease effective in June 2027.
Removed
The majority of those partners that have made the adjustment to admit students without a completed bachelor’s degree had new enrollment growth on a year over year basis in the Summer and Fall 2024 semesters.
Added
We also entered into a sublease of that space for the period from January 2026 to June 2027 and entered into a new lease for a much smaller space effective January 2026.
Removed
Enrollments for GCU ground students were 24,552 at December 31, 2024 down from 25,209 at December 31, 2023 due to a small decline in traditional ground students year over year and the continued decline in professional studies students (working adults attending the university’s traditional campus at night), partially offset by an increase in ABSN students between years.
Added
Additionally, an impairment was recorded in the amount of $1.1 million in the year ended December 31, 2025 for the two off-campus classroom and laboratory sites that were closed during the year.
Removed
These increases were partially offset by a decrease in other administrative expenses of $1.7 million primarily due to lower travel costs.
Added
Income tax receivable/payable amounts decreased by $0.9 million between December 31, 2023 and December 31, 2024 compared to the decrease of $7.1 million between December 31, 2024 and December 31, 2025, a $6.2 million decrease year over year in cash provided by operating activities due to timing of income tax payments.
Removed
Our general and administrative expenses as a percentage of revenue stayed flat at 4.5% for the years ended December 31, 2024 and 2023 due to our ability to leverage our general and administrative expenses across an increasing revenue base partially offset by the severance costs and the increase in professional fees including legal costs.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeItem 7A. Quantitative and Qualitative Disclosures about Market Risk Market risk . As of December 31, 2024, we have no derivative financial instruments or derivative commodity instruments.
Biggest changeItem 7A. Quantitative and Qualitative Disclosures about Market Risk Market risk . As of December 31, 2025, we have no derivative financial instruments or derivative commodity instruments. We invest cash in excess of current operating requirements in money market instruments, municipal and corporate bond portfolios or commercial paper at multiple financial institutions. Interest rate risk .
At December 31, 2024, we do not currently have any investments, and therefore a 10% increase or decrease in interest rates would not have a material impact on our future earnings, fair values, or cash flows. 56 Table of Contents
At December 31, 2025 a 10% increase or decrease in interest rates would not have a material impact on our future earnings, fair values, or cash flows. 59 Table of Contents
Removed
Although we do not currently have any investments, we have historically, and may in the future invest cash in excess of current operating requirements in short term certificates of deposit and money market instruments, municipal bond portfolios, or municipal mutual funds at multiple financial institutions. Interest rate risk .

Other LOPE 10-K year-over-year comparisons