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What changed in PERDOCEO EDUCATION Corp's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of PERDOCEO EDUCATION Corp'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.

+686 added−639 removedSource: 10-K (2026-02-19) vs 10-K (2025-02-18)

Top changes in PERDOCEO EDUCATION Corp's 2025 10-K

686 paragraphs added · 639 removed · 476 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

379 edited+172 added−111 removed194 unchanged
Biggest changeExamples of discretionary triggers include: an accrediting agency or a federal, state, or other authority places the institution on probation, show cause, or comparable status; the institution is subject to a default or other specified adverse condition under a credit or financing arrangement (unless due to an action by the Department, which is a mandatory trigger); a “significant fluctuation” in Direct Loan or Pell Grant funds received by the institution over different award years that cannot be accounted for by changes in those programs; the institution has high annual dropout rates as calculated by the Department; the institution is under prior financial reporting obligations to the Department and has any of the following occurrences: negative cash flows, failure of other financial ratios, cash flows that significantly miss projections submitted to the Department, significant increases in withdrawal rates or other indicators of a significant change in the institution’s financial condition; pending group-process BDR claims; a discontinuation of programs that enroll more than 25% of the institution’s students who receive Title IV funds; a closure of locations that enroll more than 25% of its students who receive Title IV funds; a citation by a state licensing agency for failing to meet its requirements; the institution or a program loses eligibility to participate in another federal educational assistance program due to an administrative action; for an institution owned at least 50% by a publicly traded entity, a disclosure by the entity in a public filing that its owner is under investigation for possible violations of state, federal or foreign law; a citation and potential loss of education assistance funds from another federal agency if it does not comply with agency requirements; the institution is required to submit a teach-out plan or agreement, including programmatic teach-outs, by a state, the Department or another federal agency, an accrediting agency, or other oversight body; or any other event or condition that the Department learns about from the institution or other parties where the Department determines that the event or condition is likely to have a significant adverse effect on the financial condition of the institution.
Biggest changeExamples of discretionary triggers include: (i) an accrediting agency or a federal, state, or other oversight authority places the institution on probation, show cause, or comparable status; (ii) the institution is subject to a default or other specified adverse condition under a credit or financing arrangement (unless due to an action taken by the Department, which is a mandatory trigger); (iii) a “significant fluctuation” in Direct Loan or Pell Grant funds received by the institution over different award years that cannot be reasonably explained by changes in those programs; (iv) the institution has high annual dropout or withdrawal rates as calculated by the Department; (v) where the institution is under prior financial reporting obligations to the Department, the occurrence of negative cash flows, failure of other financial ratios, cash flows that significantly miss projections submitted to the Department, or significant increases in withdrawal rates or other indicators of a significant change in the institution’s financial condition; (vi) pending group-process BDR claims; (vii) a discontinuation of programs that enroll more than 25% of the institution’s students who receive Title IV funds; (viii) the closure of a location enrolling more than 25% of its students who receive Title IV funds; (ix) a citation or similar action by a state licensing agency for failing to meet its requirements; (x) the institution or a program loses eligibility to participate in another federal educational assistance program due to an administrative action; (xi) for an institution owned at least 50% by a publicly traded entity, a disclosure by the entity in a public filing that its owner is under investigation for possible violations of state, federal or foreign law; (xii) citation by, or potential loss of education assistance funds from, another federal agency for failure to comply with that agency’s requirements; (xiii) a requirement imposed by a state, the Department, another federal agency, an accrediting agency, or another oversight body that the institution submit a teach-out plan or teach-out agreement, including a programmatic teach-out; or (xiv) any other event or condition that the Department learns about from the institution or other parties where the Department determines that the event or condition is likely to have a significant adverse effect on the financial condition of the institution.
We are committed to investing in our academic institutions, including through course curriculum development and student support technology, which we believe enables our support teams to provide customized service that contributes to positive student experiences.
We are committed to investing in our academic institutions, including through course curriculum development and student support technology, which we believe enables our student support teams to provide customized service that contributes to positive student experiences.
To promote interest among potential students, our institutions develop and engage in a variety of marketing activities which build awareness of our academic programs and universities among prospective students.
To promote interest among potential students, our academic institutions develop and engage in a variety of marketing activities which build awareness of our academic programs and universities among prospective students.
Programmatic accreditation has been granted by the following accrediting agencies for the following degree program areas offered by our institutions. 9 Programmatic Accreditation Table (1) Accreditor Campus Program Area Accredited (2) ABET Colorado Technical University, Colorado Springs Electrical engineering and computer engineering Accreditation Council for Business Schools and Programs AIUS (all locations): American InterContinental University, California Southern University and Trident University International; Colorado Technical University (all locations) Business Accreditation Council for Occupational Therapy Education of the American Occupational Therapy Association University of St.
Programmatic accreditation has been granted by the following accrediting agencies for the following degree program areas offered by our institutions. 9 Programmatic Accreditation Table (1) Accreditor Campus Program Area Accredited (2) ABET Colorado Technical University, Colorado Springs Electrical engineering and computer engineering Accreditation Council for Business Schools and Programs AIUS: American InterContinental University (all locations), California Southern University and Trident University International; Colorado Technical University (all locations) Business Accreditation Council for Occupational Therapy Education of the American Occupational Therapy Association University of St.
The grounds on which a student may make a claim for BDR under these new rules include: • substantial misrepresentation, • substantial omission of fact, • breach of contract, • aggressive and deceptive recruitment, or • a federal, state judgment, departmental adverse action against an institution that could give rise to a borrower defense claim.
The grounds on which a student may make a claim for BDR under these new rules include: • substantial misrepresentation, • substantial omission of fact, • breach of contract, • aggressive and deceptive recruitment, or • a federal, state judgment, or departmental adverse action against an institution that could give rise to a borrower defense claim.
If a student withdraws from one of our institutions prior to the completion of the academic term, we refund the portion of tuition and fees already paid that we are not entitled to retain, pursuant to applicable federal and state law and accrediting agency standards and our refund policy.
If a student withdraws from one of our institutions prior to the completion of the academic term, we refund the portion of tuition and fees already paid that we are not entitled to retain, pursuant to applicable federal and state law, accrediting agency standards, and our refund policy.
In addition to the Department regulations, certain of the state and accrediting agencies with jurisdiction over our institutions have requirements that may affect our ability to open a new institution, open a start-up branch campus or location of one of our existing institutions, or begin offering a new educational program at one of our institutions.
In addition to the Department regulations, certain state, and accrediting agencies with jurisdiction over our institutions have requirements that may affect our ability to open a new institution, open a start-up branch campus or location of one of our existing institutions, or begin offering a new educational program at one of our institutions.
For example, a typical community college is subsidized by local or state government and, as a result, tuition rates for associate’s degree programs may be much lower at community colleges than at our institutions. Many states have adopted or proposed programs to enable residents to attend community colleges for free.
For example, a typical community college is subsidized by local or state government and, as a result, tuition rates for associate’s degree programs may be much lower at community colleges than at our institutions. Many states have adopted or proposed programs to enable residents to attend local community colleges for free.
Our financial performance depends on our ability to develop awareness among, and enroll and retain, students in our institutions and programs in a cost-effective manner. If our institutions are unable to successfully conduct outreach for and recruit prospective students for their educational programs, our institutions’ ability to attract and enroll prospective students in those programs could be adversely affected.
Our financial performance depends on our ability to develop awareness among, and enroll and retain, students in our institutions and their programs in a cost-effective manner. If our institutions are unable to successfully conduct outreach for and recruit prospective students for their educational programs, our institutions’ ability to attract and enroll prospective students in those programs could be adversely affected.
We rely on proprietary rights and intellectual property in conducting our business, which may not be adequately protected under current laws, and we may encounter disputes from time to time relating to our use of the intellectual property of third parties. Our success depends in part on our ability to protect our proprietary rights.
We rely on proprietary rights and intellectual property in conducting our business, which may not be adequately protected under current laws, and we may encounter disputes from time to time relating to our use of the intellectual property of third parties. Our success depends in part on our ability to protect our proprietary rights and intellectual property.
Our management’s attention may be diverted by these attempts, and we may need to use funds for lawsuits to protect our proprietary rights against any infringement or violation. We may encounter disputes from time to time over rights and obligations concerning intellectual property, and we may not prevail in these disputes.
Our management’s attention may be diverted by these attempts, and we may need to use funds for lawsuits to protect our proprietary rights and intellectual property against any infringement or violation. We may encounter disputes from time to time over rights and obligations concerning intellectual property, and we may not prevail in these disputes.
Any of these incidents could lead to interruptions or shutdowns of our platforms, disruptions in our ability to process service requests and record or analyze the use of our services, the loss or corruption of data or unauthorized access to, or acquisition of, personal information or other sensitive information, such as our intellectual property.
Any of these incidents could lead to interruptions or shutdowns of our platforms, disruptions in our ability to process service requests and record or analyze the use of our services, the loss or corruption of data or unauthorized access to, or acquisition of, personal or other sensitive information, such as our intellectual property.
We maintain policies and practices and operational safeguards, measures and controls aimed at reducing our cyber risk, protecting and recovering our data and ensuring business continuity, which include reasonable efforts that aim to ensure that our third-party vendors maintain reasonable security, including encryption and authentication technology, and will notify us promptly if a security incident occurs.
We maintain policies, practices, operational safeguards, measures and controls aimed at reducing our cyber risk, protecting, and recovering our data and ensuring business continuity, which include reasonable efforts that aim to ensure that our third-party vendors maintain reasonable security, including encryption and authentication technology, and will notify us promptly if a security incident occurs.
However, none of our or our vendors’ or external agencies’ security measures can provide absolute security.
However, none of our vendors’ or external agencies’ security measures can provide absolute security.
Failure of our systems to operate effectively or a compromise in the security of our systems, or the systems of our third-party vendors, external agencies or other third parties, that results in unauthorized persons or entities obtaining personal information or other sensitive information could materially and adversely affect our reputation, operations, operating results and financial condition.
Failure of our systems to operate effectively or a compromise in the security of our systems, or the systems of our third-party vendors, external agencies or other third parties, that results in unauthorized persons or entities obtaining personal or other sensitive information could materially and adversely affect our reputation, operations, operating results and financial condition.
In addition, we may incur other substantial costs in connection with remediating and otherwise responding to any data security incident, including potential liability for stolen client, student or employee data, repairing system damage, or providing credit monitoring or other benefits to clients, students or employees affected by the incident.
In addition, we may incur substantial costs in connection with remediating and otherwise responding to any data security incident, including potential liability for stolen client, student, or employee data, repairing system damage, or providing credit monitoring or other benefits to clients, students or employees affected by the incident.
Our primarily remote work environment may exacerbate the risks related to our business technology infrastructure. A significant portion of our employees work remotely, as do a number of our third-party service vendors.
Our primarily remote work environment may exacerbate the risks related to our business technology infrastructure. A significant portion of our employees work remotely, as do employees of a number of our third-party service vendors.
Such challenges, while ultimately dependent on the particular acquisition at hand, may include, among other things, the inability to maintain uniform standards, controls, policies and procedures; the acquired business not performing as expected; distraction of management’s attention from normal business operations during the integration process; the inability to attract and/or retain key management personnel to operate the acquired entity; the inability to obtain, or delays in obtaining, regulatory or other approvals necessary to operate the business; the risk that disruptions from the integration will harm our or the acquired entity’s businesses; potential adverse reactions or changes to business relationships resulting from the acquisition; the inability to correctly estimate the size of a target market or accurately assess market dynamics; expenses associated with the integration efforts; and our assumption of unexpected risks, liabilities and obligations of the acquired business, including issues not discovered in the due diligence process.
Such challenges, while ultimately dependent on the particular acquisition at hand, may include, among other things, the inability to maintain uniform standards, controls, policies and procedures; the acquired business not performing as expected; distraction of management’s attention from normal business operations during the integration process; the inability to attract and/or retain key management personnel to operate the acquired entity; the inability to obtain, or delays in obtaining, regulatory or other approvals necessary to operate the business; the risk that disruptions from the integration will harm our or the acquired entity’s businesses; potential adverse reactions or changes to business relationships resulting from an acquisition; the inability to correctly estimate the size of a target market or accurately assess market dynamics; expenses associated with the integration efforts; and our assumption of unexpected risks, liabilities and obligations of the acquired business, including issues not discovered in the due diligence process.
Some of the factors that could prevent us from successfully conducting outreach and recruitment for our institutions and the programs that they offer include, but are not limited to: student or employer dissatisfaction with our educational programs and services; diminished access to prospective students; our failure to maintain or expand our brand names or other factors related to our marketing or advertising practices; FTC or Federal Communications Commission restrictions on contacting prospective students and the use of internet, mobile phone and other advertising and marketing media; costs and effectiveness of internet, mobile phone and other advertising programs; and changing media preferences of our target audiences.
Some of the factors that could prevent us from successfully 37 conducting outreach and recruitment for our institutions and the programs that they offer include, but are not limited to: student or employer dissatisfaction with our educational programs and services; diminished access to prospective students; our failure to maintain or expand our brand names or other factors related to our marketing or advertising practices; FTC or Federal Communications Commission restrictions on contacting prospective students and the use of internet, mobile phone and other advertising and marketing media; costs and effectiveness of internet, mobile phone and other advertising programs; and changing media preferences of our target audiences.
Some factors that management considers when determining if a triggering event has occurred include reviewing the significant inputs to the fair value calculation and any events or circumstances that could affect the significant inputs, including, but not limited to, financial performance, legal, regulatory, contractual, competitive, economic, political, business or other factors, industry and market conditions as well as the most recent quantitative fair value analysis for each reporting unit and the amount of the difference between the estimated fair value and the carrying value.
Some factors that management considers when determining if a triggering event has occurred include reviewing the significant inputs to the fair value calculation and any events or circumstances that could affect such significant inputs, including, but not limited to, financial performance, legal, regulatory, contractual, competitive, economic, political, business or other factors, industry and market conditions as well as the most recent quantitative fair value analysis for each reporting unit and the amount of the difference between the estimated fair value and the carrying value.
Given the highly regulated nature of our industry, we and our institutions are subject to and have regular audits, compliance reviews, inquiries, investigations, and claims of non-compliance by the Department, federal and state regulatory agencies, accrediting agencies, state attorney general offices, present and former students and employees, and others that may allege violations of statutes, regulations, accreditation standards, consumer protection and other legal and regulatory requirements applicable to us or our institutions.
Given the highly regulated nature of our industry, we and our institutions are subject to and have regular audits, compliance reviews, inquiries, investigations, and claims of non-compliance by the Department, federal and state regulatory agencies, accrediting agencies, state attorney general offices, present and former students and employees, and others that may allege violations of statutes, regulations, accreditation standards, consumer protection and other legal and regulatory requirements applicable to us or our academic institutions.
See Item 1A, “ Risk Factors – Risks Related to the Highly Regulated Field in Which We Operate – “If the Department denies, or significantly conditions, recertification of any of our institutions to participate in Title IV Programs, that institution could not conduct its business as it is currently conducted,” and other risk factors in Item 1A for additional information about the risks surrounding continued participation in Title IV Programs.
See Item 1A, “ Risk Factors – Risks Related to the Highly Regulated Field in Which We Operate – “If the Department denies, or significantly conditions, recertification of any of our institutions to participate in Title IV Programs, that institution could not operate its business as it is currently conducted,” and other risk factors in Item 1A for additional information about the risks surrounding continued participation in Title IV Programs.
Also, if we are unable to obtain the approvals from the Department, applicable state regulatory agencies, and accrediting agencies for any new institutions, branch campuses, or program offerings where such approvals are required, or to obtain such approvals in a timely manner, our ability to grow our business would be impaired and our financial condition, results of operations and cash flows could be materially adversely affected.
Also, if we are unable to obtain the requisite approvals from the Department, applicable state regulatory agencies, and accrediting agencies for any new institutions, branch campuses, or program offerings where such approvals are required, or to obtain such approvals in a timely manner, our ability to grow our business would be impaired and our financial condition, results of operations and cash flows could be materially adversely affected.
Our computer networks, those of our vendors that manage confidential information for us or provide services to our students or us and those of external agencies can be accessed globally through the internet and are vulnerable to unauthorized access, inadvertent access or display, theft or misuse, hackers, installation of ransomware and malware and computer viruses, during regular use and in connection with hardware and software upgrades and changes.
Our computer networks, those of our vendors that manage confidential information for us or provide services to our students or to us and those of external agencies can be accessed globally through the internet and are vulnerable to unauthorized access, inadvertent access or display, theft or misuse, hackers, installation of ransomware and malware and computer viruses, during regular use and in connection with hardware and 41 software upgrades and changes.
We and our institutions are regularly subject to audits and compliance reviews and periodically subject to inquiries, lawsuits, investigations, and/or claims of non-compliance from federal and state regulatory agencies, accrediting agencies, the Department, based on claims by present and former students and employees, and others that may 20 allege violations of statutes, regulations, accreditation standards or other regulatory requirements applicable to us or our institutions.
We and our institutions are regularly subject to audits and compliance reviews and periodically subject to inquiries, lawsuits, investigations, and/or claims of non-compliance from federal and state regulatory agencies, accrediting agencies and the Department, based on claims by present and former students and employees, and others that may allege violations of statutes, regulations, accreditation standards or other regulatory requirements applicable to us or our institutions.
We believe it is likely that legislative, regulatory and economic uncertainties will continue, and thus it is currently difficult to assess our long-term growth prospects. Reduced enrollments at our institutions, for any of the reasons mentioned herein or otherwise, generally reduce our profitability, which, depending on the level of the decline, could be material.
We believe it is likely that legislative, regulatory, and economic uncertainties will continue, and thus it is currently difficult to assess our long-term growth prospects. Reduced enrollments at our institutions, for any of the reasons mentioned herein or otherwise, generally reduce our revenues and profitability, which, depending on the level of the decline, could be material.
Changes in federal policy by the executive branch and regulatory agencies may occur over time through the new presidential administration’s and/or Congress’s policy and personnel changes, which could lead to changes involving the level of oversight and focus on for-profit postsecondary education providers; however, the nature, timing and economic and political effects of such potential changes remain 35 uncertain.
Changes in federal policy by the executive branch and regulatory agencies may occur over time through the new presidential administration’s and/or Congress’s policy and personnel changes, which could lead to changes involving the level of oversight and focus on for-profit postsecondary education providers. However, the nature, timing and economic and political effects of such potential changes remain uncertain.
Despite our history of paying dividends, the declaration and payment of all future dividends to holders of our common stock are subject to the discretion of our Board of Directors, which may amend, revoke or suspend our dividend policy at any time and for any reason, including earnings and cash flows, capital spending plans, financial conditions and other factors our Board of Directors may deem relevant.
Despite our recent history of paying dividends, the declaration and payment of all future dividends to holders of our common stock are subject to the discretion of our Board of Directors, which may amend, revoke or suspend our dividend policy at any time and for any reason, including earnings and cash flows, capital spending plans, financial conditions and other factors our Board of Directors may deem relevant.
In particular, limitations 31 on participation in Title IV Programs resulting from the failure to demonstrate financial responsibility or administrative capability could materially reduce the enrollments and revenue at the impacted institution, and a termination of participation would cause a dramatic decline in revenue and we would be unable to continue our business as it currently is conducted.
In particular, limitations on participation in Title IV Programs resulting from the failure to demonstrate financial responsibility or administrative capability could materially reduce the enrollments and revenue at the impacted institution, and a termination of participation would cause a dramatic decline in revenue, and we would be unable to continue our business as it currently is conducted.
In 2019, we entered into an agreement with the FTC to bring closure to inquiries by them. See Item 1, “Business – Accreditation, State Regulation and Other Compliance Matters – Other Compliance Matters” for information about this agreement. This agreement may ultimately result in negative impacts on our business, any one of which may be material.
In 2019, we entered into an agreement with the FTC to bring closure to inquiries made by them. See Item 1, “Business – Accreditation, State Regulation and Other Compliance Matters – Other Compliance Matters” for information about this agreement. This agreement may ultimately result in negative impacts on our business, any one of which may be material.
In addition, we may receive requests from states and other regulatory bodies to provide ongoing proof that we are complying with applicable laws and regulations and meeting our obligations pursuant to this agreement. Compliance with these requests results in significant additional costs and a failure to respond, whether required or not, could result in additional enforcement actions.
In addition, we may receive requests from states and other regulatory bodies to provide ongoing proof that we are complying with applicable laws and regulations and meeting our obligations pursuant to this agreement. Compliance with these potential requests results in significant additional costs and a failure to respond, whether required or not, could result in additional enforcement actions.
Faculty hired by our academic institutions are evaluated for proficiency in the following competencies: • communication; • assessment of student learning; • instructional methodology (pedagogy); • subject matter expertise; • utilization of technology to enhance teaching and learning; • acknowledgement and accommodation of diversity in learners; • student engagement; • promotion of active student learning; • compliance with academic institution policy; and • demonstration of scholarship.
Faculty hired by our academic institutions are evaluated for proficiency in the following competencies: • communication; • assessment of student learning; • instructional methodology (pedagogy); • subject matter expertise; • utilization of technology to enhance teaching and learning; • acknowledgement and accommodation of diversity in learners; • student engagement; • promotion of active student learning; • compliance with the applicable academic institution policy; and • demonstration of scholarship.
Through a recent temporary student loan initiative announced on April 6, 2022, students that had previously defaulted on a student loan were temporarily eligible for new loans which increased the number of prospective students who were able to continue their education at one of our academic institutions. This initiative expired in October 2024.
Through a temporary student loan initiative announced on April 6, 2022, students that had previously defaulted on a student loan were temporarily eligible for new loans, which increased the number of prospective students who were able to continue their education at one of our academic institutions. This initiative expired in October 2024.
The MOU requires that participating institutions provide meaningful information to students about the financial cost and attendance at an institution so military students can make informed decisions on where to attend school, not use unfair, deceptive, and abusive recruiting practices, and provide academic and student support services to service members and their families.
The MOU requires that participating institutions provide meaningful information to students about the financial cost of attendance at an institution so military students can make informed decisions on where to attend school, not use unfair, deceptive, and abusive recruiting practices, and provide academic and student support services to service members and their families.
These attacks have become more prevalent and sophisticated. Unauthorized access, misuse, theft or hacks can evade our intrusion detection and prevention precautions, and the intrusion detection and prevention precautions of our third-party providers and external agencies to which we report certain information, without alerting us to the breach or loss for some period of time or ever.
These attacks have become more prevalent and sophisticated. Unauthorized access, misuse, theft, or hacks can evade our intrusion detection and prevention measures, and the intrusion detection and prevention precautions of our third-party providers and external agencies to which we report certain information, without alerting us to the breach or loss for some period of time or ever.
Additionally, 3D printers and virtual headsets provide students with immersive learning experiences that enable students to see, interact with, experience diverse clinical and patient settings. 5 Learning Management System Construction of, and ongoing enhancement to, a virtual campus that engages online students with their instructor, peers and content is critical to the achievement of student learning outcomes.
Additionally, 3D printers and virtual headsets provide students with immersive learning experiences that enable students to see, interact with and experience diverse clinical and patient settings. Learning Management System Construction of, and ongoing enhancement to, a virtual campus that engages online students with their instructor, peers and content is critical to the achievement of student learning outcomes.
The Department subsequently used the settlement of a lawsuit (discussed below) that was primarily seeking improvements in the Department's processing of claims as a means of providing loan forgiveness, including previously denied and/or meritless claims and further adopting yet a new BDR process and set of standards applicable to claims pending as of that date.
The Department subsequently used the settlement of a lawsuit (discussed below) that was primarily seeking improvements in the Department's processing of claims as a means of providing loan forgiveness, including previously denied and/or meritless claims and further adopting yet another new BDR process and set of standards applicable to claims pending as of that date.
If the results of any such audits, reviews, inquiries, investigations, claims, or actions are unfavorable to us, we may be required to pay monetary damages or be subject to fines, operational limitations, loss of federal funding, injunctions, undertakings, additional oversight and reporting, or other civil or criminal penalties.
If the results of any such audits, reviews, inquiries, investigations, 34 claims, or actions are unfavorable to us, we may be required to pay monetary damages or be subject to fines, operational limitations, loss of federal funding, injunctions, undertakings, additional oversight, and reporting, or other civil or criminal penalties.
For example, to establish a new educational program or substantive changes to existing programs, we are required to obtain the appropriate approvals from the Department and applicable state and accrediting regulatory agencies. Staffing levels at the Department and other regulatory agencies and the volume of applications and other requests may delay our receipt of necessary approvals.
For example, to establish a new educational program or make substantive changes to existing programs, we are required to obtain the appropriate approvals from the Department and applicable state and accrediting regulatory agencies. Staffing levels at the Department and other regulatory agencies and the volume of applications and other requests may delay our receipt of necessary approvals.
Existing students may also decrease their use of our services or cease using our services altogether. The impact of security threats, incidents and other disruptions are difficult to predict. Our insurance coverage for such security threats, incidents and other disruptions may not be adequate to cover all related costs, and we may not otherwise be fully indemnified for them.
Existing students may also decrease their use of our services or cease using our services altogether. The impact of security threats, incidents and other disruptions are difficult to predict. Our insurance coverage for such security threats, incidents and other disruptions may not be adequate to cover all related costs, and we may not otherwise be fully indemnified for such costs.
In addition, if the institution violates the 90-10 Rule for two consecutive fiscal years and becomes ineligible to participate in Title IV Programs, but continues to disburse Title IV Program funds, the Department would require the repayment of all Title IV Program funds received by it after the effective date of the loss of eligibility.
If the institution violates the 90-10 Rule for two consecutive fiscal years and becomes ineligible to participate in Title IV Programs, but continues to disburse Title IV Program funds, the Department would require the repayment of all Title IV Program funds received by it after the effective date of the loss of eligibility.
An acquisition related to an institution or other educational business often requires various regulatory approvals and in the case of a Title IV eligible institution, like USAHS, has recently required growth restrictions, reporting obligations and temporary conditions on operations that limit changes to the institution after acquisition.
An acquisition related to an institution or other educational business often requires various regulatory approvals and in the case of a Title IV eligible institution, like USAHS, has recently required growth restrictions, reporting obligations and temporary conditions on operations that limit changes to the institution after its acquisition.
We may experience business interruptions or casualty losses resulting from natural disasters, inclement weather, transit disruptions or other events in one or more of the geographic areas in which we operate, particularly in California, Colorado, Florida, Georgia and Texas, where our physical campuses are located.
We may experience business interruptions or casualty losses resulting from natural disasters, inclement weather, transit disruptions or other extraordinary events in one or more of the geographic areas in which we operate, particularly in California, Colorado, Florida, Georgia, and Texas, where our physical campuses are located.
These initiatives emphasize the importance of students’ compliance with loan repayment requirements and provide for loan counseling and communication with students after they cease enrollment. Our efforts supplement the counseling, processing and other student loan servicing work performed by the Department through contracts it has with select third parties.
These initiatives emphasize with our students the importance of compliance with loan repayment requirements and provide for loan counseling and communication with students after they cease enrollment. Our efforts supplement the counseling, processing and other student loan servicing work performed by the Department through contracts it has with select third parties.
Our institutions could lose their eligibility to participate in federal student financial aid programs, face limitations on their ability to serve new or former students or have other limitations placed upon them if the percentage of their revenues derived from certain federal programs is too high.
Our institutions could lose their eligibility to participate in federal student financial aid programs, face significant limitations on their ability to serve new or former students or have other limitations placed upon them if the percentage of their revenues derived from certain federal programs is too high.
Third parties may raise a claim against us alleging an infringement or violation of the intellectual property of that third party. Some third-party intellectual property rights may be extremely broad, and it may not be possible for us to conduct our operations in such a way as to avoid those intellectual property rights.
Third parties may raise a claim against us alleging an infringement or violation of the intellectual property of that third party. Some third-party intellectual property rights may be extremely broad, and it may not be possible for us to conduct our 39 operations in such a way as to avoid those intellectual property rights.
While most of the operating costs for our institutions do not fluctuate significantly on a quarterly basis, we may see variability within our marketing spend based on the back to school season and prospective student interest levels at any given time.
While 6 most of the operating costs for our institutions do not fluctuate significantly on a quarterly basis, we may see variability within our marketing spend based on the back-to-school season and prospective student interest levels at any given time.
Because the process agreed to by the Department in the Sweet Settlement does not follow the claim adjudication procedures set out in applicable regulations, while uncertain, we believe the claims covered by the Sweet Settlement cannot form the basis of a claim for recoupment against the Company or our institutions.
Because the process agreed to by the Department in the Sweet 20 Settlement does not follow the claim adjudication procedures set out in applicable regulations, while uncertain, we believe the claims covered by the Sweet Settlement cannot form the basis of a claim for recoupment against the Company or our institutions.
Excessive three-year cohort default rates will result in the loss of an institution’s Title IV eligibility, as follows: • Annual test . If the three-year cohort default rate for any given year exceeds 40%, the institution will cease to be eligible to participate in Title IV Programs; and • Three consecutive years test .
Excessive three-year cohort default rates will result in the loss of an institution’s Title IV eligibility, as follows: • Annual test . If the three-year cohort default rate for any given year exceeds 40%, the institution will cease to be eligible to participate in Title IV Programs. • Three consecutive years test .
Student Loan Default Rates An institution may lose eligibility to participate in some or all Title IV Programs if the rates at which its former students default on the repayment of their federally-guaranteed or federally-funded student loans exceed specified percentages.
Student Loan Cohort Default Rates An institution may lose eligibility to participate in some or all Title IV Programs if the rates at which its former students default on the repayment of their federally guaranteed or federally funded student loans exceed specified percentages.
The extensive regulatory requirements applicable to our business may change, in particular as a result of the scrutiny of the for-profit postsecondary education sector which could require us to make substantial changes to our business, reduce our profitability and make compliance more difficult.
The extensive and evolving regulatory requirements applicable to our business may change, in particular as a result of the scrutiny of the for-profit postsecondary education sector, which could require us to make substantial changes to our business, reduce our profitability and make compliance more difficult.
We are continuing to evaluate the regulation, but given the complexity of the rules and the lack of our access to, and the lack of the Department providing transparency regarding, the earnings data used to calculate the metrics, we are unable to determine the ultimate impact of the regulation on our business at this time.
We are continuing to evaluate the regulations but given the complexity of the rules and the lack of our access to, and the lack of the Department providing transparency regarding, the earnings data used to calculate the metrics, we are unable to determine the ultimate impact of the regulation on our business at this time.
The Improvements Act did not change the Post-9/11 GI Bill’s provision that allows veterans to receive up to $1,000 per academic year for books, supplies, equipment and other education costs. 12 U.S.
The Improvements Act did not change the Post-9/11 GI Bill’s provision that allows veterans to receive up to $1,000 per academic year for books, supplies, equipment, and other education costs. U.S.
The regulations establish a non-exhaustive list of conditions that the Department may apply to provisionally certified institutions, such as the submission of teach-out plans, the release of holds on student transcripts, restrictions or limitations on the addition of new programs or locations, requirements related to enrollment in programs that lead to state licensure, restrictions on growth in enrollments or Title IV volume, restrictions on the ability to provide a teach-out on behalf of another institution, restrictions on the acquisition of other institutions, additional financial reporting requirements, and limitations on entering into written arrangements with other institutions for the provision of educational instruction.
The regulations established a non-exhaustive list of conditions that the Department may apply to provisionally certified institutions, such as the submission of teach-out plans, the release of holds on student transcripts, restrictions or limitations on the addition of new programs or locations, requirements related to enrollment in programs that lead to state licensure, restrictions on growth in enrollments or Title IV volume, restrictions on the ability to provide a teach-out on behalf of another institution, restrictions on the acquisition of other institutions, additional financial reporting requirements, and limitations on entering into written arrangements with other institutions for the provision of educational instruction.
Considering the broad definition of “substantial misrepresentation,” it is possible that, despite our training efforts and compliance programs, our institutions' employees or service providers may make 27 statements that could be construed as substantial misrepresentations.
Considering the broad definition of “substantial misrepresentation,” it is possible that, despite our training efforts and compliance programs, our institutions' employees or service providers may make statements that could be construed as substantial misrepresentations.
Furthermore, accrediting agencies that evaluate institutions offering online programs, must require such institutions to have processes through which the institution establishes that a student who registers for such a program is the same student who participates in and receives 32 credit for the program.
Furthermore, accrediting agencies that evaluate institutions offering online programs must require such institutions to have processes through which the institution establishes that a student who registers for such a program is the same student who participates in and receives credit for the program.
These criteria relate to, among other things, institutional staffing, operational standards such as procedures for disbursing and safeguarding Title IV Program funds, timely submission of accurate reports to the Department and various other procedural matters.
These criteria relate to, among other things, institutional staffing, operational standards such as policies and procedures for disbursing and safeguarding Title IV Program funds, timely submission of accurate reports to the Department and various other procedural matters.
During the suspended period, student loan borrowers had their loans placed in forbearance, and as such, were no longer required to make payments on their federal student loans. Consequently, no further defaults could occur during this period.
During the suspended period, all student loan borrowers had their loans placed in forbearance, and as such, were no longer required to make payments on their federal student loans. Consequently, no further defaults could occur during this period.
The negative publicity surrounding our industry sometimes makes it difficult and more expensive to attract, hire and retain qualified and experienced personnel, and the Department’s regulations related to incentive compensation affect our ability to compensate admissions and financial aid personnel.
The negative publicity surrounding our industry sometimes makes it difficult and more expensive to attract, hire and retain qualified and experienced personnel, and the Department’s regulations related to incentive compensation negatively affect our ability to compensate admissions and financial aid personnel.
Future cyberattacks against us, our third-party vendors or external agencies could lead to operational disruptions that could have an adverse effect on our ability to provide services to students and on our results of operations and financial results.
Future cyberattacks against us, our third-party vendors or external agencies could lead to operational disruptions that could have an adverse effect on our ability to provide services to students and on our results of operations and financial condition.
However, should we encounter unexpected economic conditions or operational results, have unforeseen complications with integration of newly acquired businesses or need to take additional actions not currently foreseen to comply with current and future regulations, the assumptions used to calculate the fair value of our assets, estimates of future cash flows, revenue growth, and discount rates could be negatively impacted and could result in an impairment of goodwill which could materially adversely affect our results of operations.
However, should we encounter unexpected economic conditions or operational results, have unforeseen complications with integration of newly acquired businesses or need to take additional actions not currently foreseen to comply with current and future regulations, the assumptions used to calculate the fair value of our assets, estimates of future cash flows, revenue growth, and discount rates could be negatively impacted and could result in an impairment of goodwill which could materially adversely affect our financial condition and results of operations.
As a result, changes in the academic calendar may have an impact on quarterly comparability as each quarter may have non-comparable 6 revenue-earning days because the academic calendar may align differently with each calendar year and the quarters therein.
As a result, changes in the academic calendar may have an impact on quarterly comparability as each quarter may have non-comparable revenue-earning days because the academic calendar may align differently with each calendar year and the quarters therein.
Because of these regulatory requirements, we are subject to compliance reviews and audits, as well as claims of noncompliance and lawsuits by government agencies based on claims by students, current and former employees and other third parties.
Because of these regulatory requirements, we are subject to compliance reviews and audits, as well as claims of noncompliance and lawsuits by government agencies based on claims by current and former students or employees and other third parties.
Department Settlement of Pending BDR Applications, Inducement of New Claims On November 16, 2022, a California federal court in Sweet v. Cardona , No. 3:19-cv-3674 (N.D.
Department Settlement of Pending BDR Applications, Inducement of New Claims On November 16, 2022, a California federal district court in Sweet v. Cardona , No. 3:19-cv-3674 (N.D.
Our institutions compete with traditional public and private two-year and four-year colleges and universities, other for-profit institutions, other online education providers and alternatives to higher education, such as immediate employment and military service.
Our institutions compete with traditional public and private two-year and four-year colleges and universities, other for-profit institutions, other online education providers and alternatives to higher education, such as employment and military service.
The Department may issue full certification to an institution, it may deny certification or it may elect to issue provisional certification, in which case the program participation agreement outlines additional requirements that the institution must meet.
The Department may issue full certification to an institution, it may deny certification, or it may elect to issue provisional certification, in which case the program participation agreement outlines additional requirements that 16 the institution must meet.
Under the new standard, an individual borrower may assert a defense to repayment based on the institution’s statement, act, or omission that is false, misleading, or deceptive.
Under that standard, an individual borrower may assert a defense to repayment based on the institution’s statement, act, or omission that is false, misleading, or deceptive.
An institution that is found to be in non-compliance with the Department refund requirements for either of the last two completed fiscal years must post a letter of credit in favor of the Department in an amount equal to 25% of the total Title IV Program returns that were paid or should have been paid by the institution during its most recently completed fiscal year.
An institution that is found to be in non-compliance with the Department refund requirements for either of the last two completed fiscal years must post a letter of credit in favor of the Department in an amount equal to 25% of the total Title IV 25 Program returns that were repaid or should have been repaid by the institution during its most recently completed fiscal year.
Provisional certification does not generally limit an institution’s access to Title IV Program funds. The Department may withdraw an institution’s provisional certification without advance notice if the Department determines that the institution is not fulfilling all material requirements. In February 2025, both CTU and AIUS received renewals of their program participation agreements through June 30, 2027.
Provisional certification does not generally limit an institution’s access to Title IV Program funds. The Department may withdraw an institution’s provisional certification without advance notice if the Department determines that the institution is not fulfilling all material requirements. In February 2025, both CTU and AIUS received recertifications of their program participation agreements through June 30, 2027.
If a natural disaster, power outage, connectivity issue or other event occurs that impacts the ability of employees to work remotely, it may be difficult or, in certain cases, impossible for us to continue our business for a period of time, which could materially harm our growth prospects, financial condition, business and reputation.
If a natural disaster, power outage, connectivity issue or other event occurs that impacts the ability of employees to work remotely, it may be difficult or, in certain cases, impossible for us to continue our business for a period of time, which could materially harm our growth prospects, results of operations, financial condition and reputation.
If we fail to enter new corporate engagements or if existing corporate partners pause or reduce participation in their tuition assistance programs, total student enrollments may suffer. We remain focused on investing in and improving processes that support our corporate engagement programs. These programs have been a meaningful driver of total enrollment growth through 2024.
If we fail to enter new corporate engagements or if existing corporate partners pause or reduce participation in their tuition assistance programs, our total student enrollments may suffer. We remain focused on investing in and improving processes that support our corporate engagement programs. These programs have been a meaningful driver of total enrollment growth through 2025.
The new BDR rules remove any statute of limitations on student claims and create a rebuttable presumption in favor of full loan forgiveness as opposed to partial relief for most approved applications, eliminating the Department’s approach under the previous rules of assessing whether and to what extent a student had been financially harmed.
The 2022 BDR rules remove any statute of limitations on student claims and create a rebuttable presumption in favor of full loan forgiveness as opposed to partial relief for most approved applications, eliminating the Department’s approach under the previous rules of assessing whether and to what extent a student had been financially harmed.
On an interim basis, we review our assets and liabilities to determine if a triggering event had occurred that would result in it being more likely than not that the fair value would be less than the carrying amount for any of our reporting units or indefinite-lived intangible assets.
On an interim basis, we review our assets and liabilities to determine if a triggering event has occurred that would result in it being more likely than not that the fair value would be less than the carrying amount for any of our reporting units or indefinite-lived intangible assets.
Breaches in our data security or that of our third-party vendors, external agencies or other third parties could expose us to risks of data loss, inappropriate disclosure of confidential or proprietary information, potential claims, investigations, regulatory proceedings, litigation penalties and liability, could impede our processing of transactions and our financial reporting and could result in a disruption of our operations.
Breaches in our data security or that of our third-party vendors, external agencies or other third parties could expose us to risks of data loss, inappropriate disclosure of confidential or proprietary information, potential claims, investigations, regulatory proceedings, litigation penalties and other liabilities, could impede our processing of transactions and our financial reporting and could result in a disruption of our operations.
CTU and AIUS have implemented the use of sophisticated personalized learning technologies through our virtual campus that provide intelligent, adaptive systems to power the delivery of personalized learning. We have a perpetual license to this technology and our personalized learning content was developed by teams of our own instructors and has been integrated across many of our curricula.
CTU and AIU have implemented the use of sophisticated personalized learning technologies through our virtual campus that provide intelligent, adaptive systems to power the delivery of personalized learning. We have a perpetual license to this technology and our personalized learning content was developed by teams of our own instructors and has been integrated across many of our curricula.
A group of influential U.S. senators, consumer advocacy groups and some media outlets have strongly and repeatedly encouraged the Department, DoD and the VA and its state approving agencies to take action to limit or terminate the participation of institutions such as ours in existing tuition assistance programs.
A group of influential U.S. senators, consumer advocacy groups and some media outlets have strongly and repeatedly encouraged the Department, DoD and the VA and its state approving agencies to take action to limit or terminate the participation of institutions such as ours in existing financial aid and tuition assistance programs.
Programs offered by AIUS, CTU and USAHS are subject to the GE rule and could lose Title IV eligibility if their programs fail to pass the D/E rates and/or the EP measures. The rule also requires our institutions to warn current and prospective students if a program fails any metric in any year.
Programs offered by AIUS, CTU and USAHS are subject to the GE rule and could lose Title IV eligibility if they fail to pass the D/E rates and/or the EP measures. The rule also requires our institutions to warn current and prospective students if a program fails any metric in any year.
It establishes new supplementary performance measures the Department may consider in determining whether to certify or condition the participation of the institution, such as withdrawal rates, the amount of educational and pre-enrollment expenditures, and licensure pass rates where the institution is required by an accrediting agency or state to report licensure exam passage rates.
It established new supplementary performance measures the Department may consider in determining whether to certify or condition the participation of the institution, such as withdrawal rates, the amount of educational and pre-enrollment expenditures, and licensure pass rates where the institution is required by an accrediting agency or state to report licensure exam passage rates.
These measures may not be adequate, and we cannot be certain that we have secured, or will be able to secure, appropriate protections for all of our proprietary rights. Unauthorized third parties may attempt to duplicate the proprietary aspects of our curricula, online resource material and other content despite our efforts to protect these rights.
These measures may not be adequate, and we cannot be certain that we have secured, or will be able to secure, appropriate protections for all of our proprietary rights and intellectual property. Unauthorized third parties may attempt to duplicate the proprietary aspects of our curricula, online resource material and other content despite our efforts to protect these rights.
The Administrative Capability regulations expand the requirements for institutions to demonstrate that they are administratively capable of providing the education they promise and of properly managing Title IV program funds, adding new standards related to financial counseling and career services, adequate clinical and externship opportunities, timely disbursement of Title IV funds, compliance with high school diploma verification requirements, aggressive and deceptive recruitment tactics or conduct, gainful employment requirements, and significant negative actions by a federal, state or accreditation agencies.
These regulations expand the requirements for institutions to demonstrate that they are administratively capable of providing the education they promise and of properly managing Title IV program funds, adding new standards related to financial counseling and career services, adequate clinical and externship opportunities, timely disbursement of Title IV funds, compliance with high school diploma verification requirements, aggressive and deceptive recruitment tactics or conduct, gainful employment requirements, and significant negative actions by a federal, state or accreditation agencies.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeWe focus significant resources on protecting our technology infrastructure and the personal information therein regarding applicants, our students, their families, our alumni and our employees. Our principal cybersecurity risks include, among other things, operational risks; intellectual property theft; fraud; extortion; harm to employees or customers; violation of privacy or security laws and other litigation and legal risk; and reputational risks.
Biggest changeOur principal cybersecurity risks include, among other things, operational risks, intellectual property theft, fraud, extortion, harm to employees or customers, violation of privacy or security laws and other litigation and legal risks, and reputational risks. The Board of Directors, as a whole, oversees the Company’s risk management through both the Company’s enterprise risk management program and the internal audit function.
As part of these efforts to assess and mitigate the risks posed by cybersecurity incidents and cyber-attacks, we employ a range of tools and services, including regular network and endpoint monitoring, vulnerability assessments, penetration testing, and tabletop exercises to help inform our cybersecurity risk identification 41 and assessment.
As part of these efforts to assess and mitigate the risks posed by cybersecurity incidents and cyber-attacks, we employ a range of tools and services, including regular network and endpoint monitoring, vulnerability assessments, penetration testing, and tabletop exercises to help inform our cybersecurity risk identification and assessment.
The Board has delegated oversight of the Company’s management of cybersecurity risk to the Compliance and Risk Committee (the “ Committee ”). Directors with experience in cybersecurity are appointed to this Committee to assist in developing strategies and processes for protecting against, responding to, and remediating information security breaches. Those directors are Dennis Chookaszian, Patrick Gross and Leslie Thornton.
Directors with experience in cybersecurity are appointed to this Committee to assist in developing strategies and processes for protecting against, responding to, and remediating information security breaches. Those directors are Dennis Chookaszian, Patrick Gross and Leslie Thornton. The Committee reviews information security matters quarterly.
The Board of Directors, as a whole, oversees the Company’s risk management through both the Company’s enterprise risk management program and the internal audit function. To identify and assess material risks from cybersecurity threats, our enterprise risk management program considers cybersecurity threat risks alongside other Company risks as part of our overall risk assessment process.
To identify and assess material risks from cybersecurity threats, our enterprise 43 risk management program considers cybersecurity threat risks alongside other Company risks as part of our overall risk assessment process. The Board has delegated oversight of the Company’s management of cybersecurity risk to the Compliance and Risk Committee (the “ Committee ”).
He has worked in the technology field since 1986, joined the Company in 2001, and has been its Chief Information Officer since 2013.
Czeszewski has a Bachelor of Arts degree in business and computer studies and a Master in Business Administration. He has worked in the technology field since 1986, joined the Company in 2001, and has been its Chief Information Officer since 2013.
The Chief Information Officer reports on, among other things, our cyber risks and threats, the status of projects to strengthen our information security systems, an assessment of the information security program, and the emerging threat landscape. Mr. Czeszewski has a Bachelor of Arts degree in business and computer studies and a Master in Business Administration.
In addition, the full Board regularly receives updates on cybersecurity matters from our Chief Information Officer, David C. Czeszewski, at each board meeting. The Chief Information Officer reports on, among other things, our cyber risks and threats, the status of projects to strengthen our information security systems, an assessment of the information security program, and the emerging threat landscape. Mr.
Removed
The Committee reviews information security matters quarterly. In addition, the full Board regularly receives updates on cybersecurity matters from our Chief Information Officer, David C. Czeszewski, at each board meeting.
Added
We focus significant resources on protecting our technology infrastructure and the personal information contained therein regarding applicants, our students, their families, our alumni and our employees.
Removed
We have not encountered risks from cybersecurity threats, including as a result of any previous cybersecurity incidents in the last three fiscal years, which have materially affected or are reasonably likely to materially affect the Company, including our business strategy, results of operations, or financial condition, and the expense we have incurred from cybersecurity incidents were immaterial.
Added
In fiscal year 2025, we did not identify any cybersecurity threats that have materially impacted or are likely to materially impact our business strategy, operational results, or financial condition. However, despite our proactive measures, we cannot entirely eliminate cybersecurity risks or guarantee that no undetected incidents have occurred.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeAs of December 31, 2024, we leased approximately 0.8 million square feet under lease agreements that have remaining terms ranging from less than one year through 2049. The facility in Houston, Texas, is used by AIUS and is less than 0.1 million square feet of real property.
Biggest changeAs of December 31, 2025, we leased approximately 0.8 million square feet under lease agreements that have remaining terms ranging from less than one year through 2050. The facility in Houston, Texas, is used by AIUS and is less than 0.1 million square feet of real property.
We have transitioned our workforce to a primarily remote work environment, supported by our scalable and innovative technology infrastructure and we continue to look for ways to optimize our lease portfolio. All of our campus and administrative facilities are leased except one in Houston, Texas.
We have transitioned our workforce to a primarily remote work environment, supported by our scalable and innovative technology infrastructure and we continue to look for ways to optimize our lease portfolio. 44 All of our campus and administrative facilities are leased except one in Houston, Texas.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThe Board of Directors approved the aforementioned stock repurchase programs believing it advantageous to the Company and its stockholders to repurchase shares of the Company’s common stock from time to time at prices below what the Board of Directors believed to be the intrinsic value of the Company’s common stock. 43 Issuer Purchases of Equity Securities Period Total Number of Shares Purchased (1) Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Maximum Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (2) December 31, 2023 $ 18,528,794 January 1, 2024 - January 31, 2024 - $ - - 18,528,794 February 1, 2024 - February 29, 2024 220,000 17.63 220,000 14,646,422 March 1, 2024 - March 31, 2024 358,669 17.64 164,571 47,106,022 April 1, 2024 - April 30, 2024 - - - 47,106,022 May 1, 2024 - May 31, 2024 - - - 47,106,022 June 1, 2024 - June 30, 2024 - - - 47,106,022 July 1, 2024 - July 31, 2024 - - - 47,106,022 August 1, 2024 - August 31, 2024 - - - 47,106,022 September 1, 2024 - September 30, 2024 - - - 47,106,022 October 1, 2024 - October 31, 2024 - - - 47,106,022 November 1, 2024 - November 30, 2024 - - - 47,106,022 December 1, 2024 - December 31, 2024 - - - 47,106,022 Total 578,669 384,571 (1) Includes 194,098 shares delivered back to the Company for payment of withholding taxes from employees for vesting restricted stock units pursuant to the terms of the Perdoceo Education Corporation Amended and Restated 2016 Incentive Compensation Plan.
Biggest changeThe Board of Directors approved the aforementioned stock repurchase programs believing it advantageous to the Company and its stockholders to repurchase shares of the Company’s common stock from time to time at prices below what the Board of Directors believed to be the intrinsic value of the Company’s common stock. 46 Issuer Purchases of Equity Securities Period Total Number of Shares Purchased (1) Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Maximum Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (2) December 31, 2024 $ 47,106,022 January 1, 2025 - January 31, 2025 - $ - - 47,106,022 February 1, 2025 - February 28, 2025 350,000 25.81 350,000 38,065,303 March 1, 2025 - March 31, 2025 941,657 25.17 635,000 21,894,476 April 1, 2025 - April 30, 2025 - - - 21,894,476 May 1, 2025 - May 31, 2025 240,000 31.11 240,000 14,422,532 June 1, 2025 - June 30, 2025 410,000 32.74 410,000 990,720 July 1, 2025 - July 31, 2025 - - - 75,000,000 August 1, 2025 - August 31, 2025 545,000 30.89 545,000 58,154,087 September 1, 2025 - September 30, 2025 115,000 33.07 115,000 54,348,316 October 1, 2025 - October 31, 2025 - - - 54,348,316 November 1, 2025 - November 30, 2025 1,225,000 29.67 1,225,000 17,976,513 December 1, 2025 - December 31, 2025 621,668 28.51 621,668 239,095 4,448,325 4,141,668 (1) Includes 306,657 shares delivered back to the Company for payment of withholding taxes from employees for vesting restricted stock units pursuant to the terms of the Perdoceo Education Corporation Amended and Restated 2016 Incentive Compensation Plan.
COMPARISON OF CUMULATIVE FIVE-YEAR TOTAL RETURN (Based on $100 invested on December 31, 2019 and assumes the reinvestment of all dividends.) The information contained in the performance graph shall not be deemed “soliciting material” or to be “filed” with the Securities and Exchange Commission nor shall such information be deemed incorporated by reference into any future filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, as both are amended from time to time, except to the extent specifically incorporated by reference into such filing.
COMPARISON OF CUMULATIVE FIVE-YEAR TOTAL RETURN (Based on $100 invested on December 31, 2020 and assumes the reinvestment of all dividends.) The information contained in the performance graph shall not be deemed “soliciting material” or to be “filed” with the Securities and Exchange Commission nor shall such information be deemed incorporated by reference into any future filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, as both are amended from time to time, except to the extent specifically incorporated by reference into such filing.
See Item 12, “Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters,” for information as of December 31, 2024, with respect to shares of our common stock that may be issued under our existing share-based compensation plans.
See Item 12, “Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters,” for information as of December 31, 2025, with respect to shares of our common stock that may be issued under our existing share-based compensation plans.
The timing of purchases and the number of shares repurchased under the program are determined by the Company’s management and depend on a variety of factors, including stock price, trading volume and other general market and economic conditions, its assessment of alternative uses of capital, regulatory requirements and other factors.
The timing of purchases and the number of shares repurchased under the Stock Repurchase Program is determined by the Company’s management and will depend on a variety of factors including stock price, trading volume and other general market and economic conditions, its assessment of alternative uses of capital, regulatory requirements and other factors.
As of February 11, 2025, there were approximately 94 holders of record of our common stock, including The Depository Trust Company, which holds shares of our common stock on behalf of an indeterminate number of beneficial owners. Our common stock transfer agent and registrar is Computershare Trust Company, N.A. They can be contacted at P.O.
As of February 13, 2026, there were approximately 86 holders of record of our common stock, including The Depository Trust Company, which holds shares of our common stock on behalf of an indeterminate number of beneficial owners. Our common stock transfer agent and registrar is Computershare Trust Company, N.A. They can be contacted at P.O.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOC KHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Our common stock is listed for trading on the Nasdaq Global Select Market (“Nasdaq”) under the symbol “PRDO”. The closing price of our common stock as reported on the Nasdaq on February 11, 2025 was $28.39 per share.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOC KHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Our common stock is listed for trading on the Nasdaq Global Select Market (“Nasdaq”) under the symbol “PRDO”. The closing price of our common stock as reported on the Nasdaq on February 13, 2026 was $31.43 per share.
Included in the peer index are the following companies whose primary business is postsecondary education: Adtalem Global Education Inc., American Public Education, Inc., Grand Canyon Education, Inc., Laureate 44 Education, Inc., and Strategic Education, Inc. The performance graph begins with Perdoceo’s $18.39 per share closing price on December 31, 2019.
Included in the peer index are the following companies whose primary business is postsecondary education: Adtalem Global Education Inc., American Public Education, Inc., Grand Canyon Education, Inc., Laureate 47 Education, Inc., and Strategic Education, Inc. The performance graph begins with Perdoceo’s $12.63 per share closing price on December 31, 2020.
Box# 43078, Providence, RI 02940-3078 or at their website www.computershare.com/investor . In 2024, the Company's Board of Directors continued to implement its dividend policy. Under this policy, the Board plans to distribute dividends on a quarterly basis. The declaration and payment of dividends on our common stock are subject to the discretion of our Board of Directors.
Box# 43006, Providence, RI 02940-3006 or at their website www.computershare.com/investor . In 2025, the Company's Board of Directors continued to declare and distribute dividends on a quarterly basis. The declaration and payment of dividends on our common stock are subject to the discretion of our Board of Directors.
The stock repurchase program does not obligate the Company to purchase shares and the Company may, in its discretion, begin, suspend or terminate repurchases at any time, without any prior notice. As of December 31, 2024, approximately $47.1 million was available under the stock repurchase program.
The Stock Repurchase Program does not obligate the Company to purchase shares and the Company may, in its discretion, begin, suspend or terminate repurchases at any time, without any prior notice.
(2) On February 20, 2024, the Board of Directors of the Company approved a new stock repurchase program of up to $50.0 million which commenced on March 1, 2024 and expires on September 30, 2025.
(2) On July 31, 2025, the Board of Directors of the Company approved a stock repurchase program of up to $75.0 million which commenced on July 31, 2025 and expires on January 31, 2027.
On February 20, 2024, the Board of Directors of the Company approved a new stock repurchase program for up to $50.0 million which commenced March 1, 2024 and expires September 30, 2025. The new stock repurchase program replaced the previous stock repurchase program.
On July 31, 2025, the Board of Directors of the Company approved a stock repurchase program for up to $75.0 million, which commenced July 31, 2025 and expires January 31, 2027. The stock repurchase program replaced the previous stock repurchase program. The other terms of the stock repurchase program are consistent with the Company’s previous stock repurchase program.
The other terms of the new stock repurchase program are consistent with the Company’s previous stock repurchase program. During 2024, we repurchased 0.4 million shares of our common stock for approximately $6.8 million at an average price of $17.60 per share under the Company’s current stock repurchase program.
During 2025, we repurchased 4.1 million shares of our common stock for approximately $120.8 million at an average price of $29.17 per share, of which approximately 1.6 million shares of our common stock for approximately $46.1 million were purchased under the previous stock repurchase program. As of December 31, 2025, approximately $0.2 million was available under the stock repurchase program.
Added
On January 2, 2026, the Board of Directors of the Company approved a new common stock repurchase program, authorizing the Company to repurchase up to $100.0 million of its outstanding common stock on the open market (the " Stock Repurchase Program ").
Added
This new Stock Repurchase Program, which expires on June 30, 2027, replaces the previous $75.0 million stock repurchase program, which was described above. The Stock Repurchase Program may be modified, suspended or discontinued at any time in the Company's discretion without prior notice, and does not commit the Company to repurchase shares of its common stock.
Added
On January 2, 2026, the Board of Directors of the Company approved a new common stock repurchase program, authorizing the Company to repurchase up to $100.0 million of its outstanding common stock on the open market. This new Stock Repurchase Program, which expires on June 30, 2027, replaces the previous $75.0 million stock repurchase program.

Item 7. Management's Discussion & Analysis

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

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Biggest changeFor the Year Ended December 31, 2024 % of Total Revenue 2023 % of Total Revenue 2022 % of Total Revenue TOTAL REVENUE $ 681,263 $ 710,004 $ 695,208 OPERATING EXPENSES Educational services and facilities (1) 120,860 17.7 % 130,324 18.4 % 116,723 16.8 % General and administrative (2) : Advertising and marketing 100,963 14.8 % 102,588 14.4 % 126,843 18.2 % Admissions 81,783 12.0 % 91,359 12.9 % 93,810 13.5 % Administrative 150,587 22.1 % 170,922 24.1 % 163,893 23.6 % Bad debt 33,719 4.9 % 33,215 4.7 % 41,574 6.0 % Total general and administrative expense 367,052 53.9 % 398,084 56.1 % 426,120 61.3 % Depreciation and amortization 14,645 2.1 % 16,887 2.4 % 19,734 2.8 % Asset impairment 4,453 0.7 % 14,263 2.0 % 2,994 0.4 % OPERATING INCOME 174,253 25.6 % 150,446 21.2 % 129,637 18.6 % PRETAX INCOME 201,440 29.6 % 192,121 27.1 % 134,269 19.3 % PROVISION FOR INCOME TAXES 53,850 7.9 % 44,469 6.3 % 38,402 5.5 % Effective tax rate 26.7 % 23.1 % 28.6 % NET INCOME $ 147,590 21.7 % $ 147,652 20.8 % $ 95,867 13.8 % _______________ (1) Educational services and facilities expense includes costs attributable to the educational activities of our campuses, including: salaries and benefits of faculty, academic administrators and student support personnel, and costs of educational supplies and facilities, such as rents on leased facilities.
Biggest changePlease refer to Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operation” in our Annual Report on Form 10-K for the year ended December 31, 2024 for a discussion of our results for the year ended December 31, 2024, as well as the year-over-year comparison of our 2024 financial performance to 2023. 51 For the Year Ended December 31, 2025 % of Total Revenue 2024 % of Total Revenue 2023 % of Total Revenue TOTAL REVENUE $ 846,096 $ 681,263 $ 710,004 OPERATING EXPENSES Educational services and facilities (1) 197,540 23.3 % 120,860 17.7 % 130,324 18.4 % General and administrative (2) : Advertising and marketing 112,858 13.3 % 100,963 14.8 % 102,588 14.4 % Admissions 88,957 10.5 % 81,783 12.0 % 91,359 12.9 % Administrative 179,616 21.2 % 150,587 22.1 % 170,922 24.1 % Bad debt 29,492 3.5 % 33,719 4.9 % 33,215 4.7 % Total general and administrative expense 410,923 48.6 % 367,052 53.9 % 398,084 56.1 % Depreciation and amortization 41,627 4.9 % 14,645 2.1 % 16,887 2.4 % Asset impairment 6 0.0 % 4,453 0.7 % 14,263 2.0 % OPERATING INCOME 196,000 23.2 % 174,253 25.6 % 150,446 21.2 % PRETAX INCOME 216,836 25.6 % 201,440 29.6 % 192,121 27.1 % PROVISION FOR INCOME TAXES 56,922 6.7 % 53,850 7.9 % 44,469 6.3 % Effective tax rate 26.3 % 26.7 % 23.1 % NET INCOME $ 159,914 18.9 % $ 147,590 21.7 % $ 147,652 20.8 % _______________ (1) Educational services and facilities expense includes costs attributable to the educational activities of our campuses, including: salaries and benefits of faculty, academic administrators and student support personnel, and costs of educational supplies and goods and services, including costs of textbooks and laptops, and rents on leased campus and administrative facilities.
The term “campus” refers to an individual main or branch campus operated by one of our institutions. The following Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) should be read in conjunction with the Company’s consolidated financial statements and the notes thereto appearing elsewhere in this Annual Report on Form 10-K.
The term “campus” refers to an individual main or branch campus operated by one of our institutions. The following Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) should be read in conjunction with the Company’s audited consolidated financial statements and the notes thereto appearing elsewhere in this Annual Report on Form 10-K.
Topic 740 also requires that deferred income tax assets be reduced by a valuation allowance if it is more likely than not that some portion of the deferred income tax asset will not be realized.
Topic 740 also requires that deferred 56 income tax assets be reduced by a valuation allowance if it is more likely than not that some portion of the deferred income tax asset will not be realized.
This section should be read in conjunction with Note 2 “Summary of Significant Accounting Policies” to our consolidated financial statements which includes a discussion of these and other significant accounting policies.
This section should be read in conjunction with Note 2 “Summary of Significant Accounting Policies” to our audited consolidated financial statements which includes a discussion of these and other significant accounting policies.
Our universities charge tuition and fees at varying amounts and bill students a single charge that covers tuition, certain fees and required program materials, 52 such as textbooks and supplies, which we treat as a single performance obligation.
Our universities charge tuition and fees at varying amounts and bill students a single charge that covers tuition, certain fees and required program materials, such as textbooks and supplies, which we treat as a single performance obligation.
Disputes over interpretations of the tax laws 54 may be subject to review/adjudication by the court systems in the various tax jurisdictions or may be settled with the taxing authority upon examination or audit.
Disputes over interpretations of the tax laws may be subject to review/adjudication by the court systems in the various tax jurisdictions or may be settled with the taxing authority upon examination or audit.
Congressional hearings and roundtable discussions were previously held regarding certain aspects of the education industry, including issues surrounding student debt as well as publicly reported student outcomes that may be used as part of an institution’s recruiting and admissions practices, and reports were issued that are highly critical of for-profit 46 colleges and universities.
Congressional hearings and roundtable discussions were previously held regarding certain aspects of the education industry, including issues surrounding student debt, as well as publicly reported student outcomes that may be used as part of an institution’s recruiting and admissions practices, and 49 reports were issued that are highly critical of for-profit colleges and universities.
We anticipate that we will be able to satisfy the cash requirements associated with, among other things, our working capital needs, capital expenditures, lease commitments and quarterly dividends payments through at least the next 12 months primarily with cash generated by operations and existing cash balances.
We anticipate that we will be able to satisfy the cash requirements associated with, among other things, our working capital needs, capital expenditures, lease commitments, share repurchases and quarterly dividends payments through at least the next 12 months primarily with cash generated by operations and existing cash balances.
Please refer to Part II Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operation” in our Annual Report on Form 10-K for the year ended December 31, 2023 for a discussion of our results for the year ended December 31, 2022, as well as the year-over-year comparison of our 2023 financial performance to 2022.
Please refer to Part II Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operation” in our Annual Report on Form 10-K for the year ended December 31, 2024 for a discussion of our results for the year ended December 31, 2024, as well as the year-over-year comparison of our 2024 financial performance to 2023.
The timing of purchases and the number of shares repurchased under the program will be determined by the Company’s management and will depend on a variety of factors including stock price, trading volume and other general market and economic conditions, its assessment of alternative uses of capital, regulatory requirements and other factors.
The timing of purchases and the number of shares repurchased under the program is determined by the Company’s management and will depend on a variety of factors including stock price, trading volume and other general market and economic conditions, its assessment of alternative uses of capital, regulatory requirements and other factors.
CONSOLIDATED RESULTS OF OPERATIONS 48 The summary of selected financial data table below should be referenced in connection with a review of the following discussion of our results of operations for the years ended December 31, 2024 and 2023 (dollars in thousands), including comparisons of our year-over-year performance between these years.
CONSOLIDATED RESULTS OF OPERATIONS The summary of selected financial data table below should be referenced in connection with a review of the following discussion of our results of operations for the years ended December 31, 2025 and 2024 (dollars in thousands), including comparisons of our year-over-year performance between these years.
For the years ended December 31, 2024 and 2023, approximately 77% and 76% of our institutions’ aggregate cash receipts from tuition payments came from Title IV Program funding.
For the years ended December 31, 2025 and 2024, approximately 76% and 77% of our institutions’ aggregate cash receipts from tuition payments came from Title IV Program funding.
We lease most of our administrative and educational facilities under non-cancelable operating leases expiring at various dates through 2049. As of December 31, 2024, we were not a party to any off-balance sheet financing or contingent payment arrangements, nor do we have any unconsolidated subsidiaries.
We lease most of our administrative and educational facilities under non-cancelable operating leases expiring at various dates through 2050. As of December 31, 2025, we were not a party to any off-balance sheet financing or contingent payment arrangements, nor do we have any unconsolidated subsidiaries.
SEGMENT RESULTS OF OPERATIONS The summary of segment financial information below should be referenced in connection with a review of the following discussion of our segment results from operations for the years ended December 31, 2024 and 2023 (dollars in thousands), including comparisons of our year-over-year performance between these years.
SEGMENT RESULTS OF OPERATIONS The summary of segment financial information below should be referenced in connection with a review of the following discussion of our segment results from operations for the years ended December 31, 2025 and 2024 (dollars in thousands), including comparisons of our year-over-year performance.
A one percentage point change in our allowance for credit losses as a percentage of gross earned student receivables as of December 31, 2024 would have resulted in a change in pretax income of $0.7 million during the year then ended.
A one percentage point change in our allowance for credit losses as a percentage of gross earned student receivables as of December 31, 2025 would have resulted in a change in pretax income of $0.8 million during the year then ended.
(2) General and administrative expense includes operating expenses associated with, including salaries and benefits of personnel in, corporate and campus administration, marketing, admissions, information technology, financial aid, accounting, human resources, legal and compliance. Other expenses within this expense category include costs of advertising and production of marketing materials and bad debt expense.
(2) General and administrative expense includes operating expenses associated with corporate and campus administration, marketing, admissions, information technology, financial aid, accounting, human resources, legal and compliance. Other expenses within this expense category include costs of advertising and production of marketing materials and bad debt expense.
In addition, our financial performance is dependent on the level of student enrollments which could be impacted by external factors. See Item 1A, “ Risk Factors .” 55 Sources and Uses of Cash Operating Cash Flows During the years ended December 31, 2024 and 2023, net cash flows provided by operating activities totaled $161.6 million and $112.0 million, respectively.
In addition, our financial performance is dependent on the level of student enrollments which could be impacted by external factors. See Item 1A, “ Risk Factors .” 57 Sources and Uses of Cash Operating Cash Flows During the years ended December 31, 2025 and 2024, net cash flows provided by operating activities totaled $225.2 million and $161.6 million, respectively.
LIQUIDITY, FINANCIAL POSITION AND CAPITAL RESOURCES As of December 31, 2024, cash, cash equivalents, restricted cash and available-for-sale short-term investments (“cash balances”) totaled $591.5 million. Restricted cash as of December 31, 2024 was $22.6 million and primarily relates to a letter of credit USAHS is required to maintain with the Department of Education.
LIQUIDITY, FINANCIAL POSITION AND CAPITAL RESOURCES As of December 31, 2025, cash, cash equivalents, restricted cash and available-for-sale short-term investments (“cash balances”) totaled $643.5 million. Restricted cash as of December 31, 2025 was $21.3 million and primarily relates to a letter of credit USAHS is required to maintain with the Department of Education.
Investing Cash Flows During the years ended December 31, 2024 and 2023, net cash flows used in investing activities totaled $107.8 million and $88.5 million, respectively. Purchases and Sales of Available-for-Sale Investments.
Investing Cash Flows During the years ended December 31, 2025 and 2024, net cash flows used in investing activities totaled $53.6 million and $107.8 million, respectively. Purchases and Sales of Available-for-Sale Investments.
A non-GAAP measure has limitations as an analytical tool, and you should not consider it in isolation, or as a substitute for net income, operating income, earnings per diluted share, or any other performance measure derived in accordance with and reported under GAAP or as an alternative to cash flow from operating activities or as a measure of our liquidity.
Adjusted operating income and adjusted earnings per diluted share have limitations as an analytical tool, and should not be considered in isolation, or as a substitute for net income, operating income, earnings per diluted share, or any other performance measure derived in accordance with and reported under GAAP or as an alternative to cash flow from operating activities or as a measure of our liquidity.
Total student enrollments do not include learners participating in: a) non-degree seeking and professional development programs, and b) degree seeking, non-Title IV, self-paced programs at our universities. Year Ended December 31, 2024 as Compared to the Year Ended December 31, 2023 CTU. Revenue for the current year decreased by 2.6% or $12.0 million as compared to the prior year.
Total student enrollments do not include learners participating in: a) non-degree seeking and professional development programs, and b) degree seeking, non-Title IV, self-paced programs at our universities. Year Ended December 31, 2025 as Compared to the Year Ended December 31, 2024 CTU. Revenue for the current year increased by 4.1% or $18.2 million as compared to the prior year.
Ultimately, our goal is to deploy resources in a way that drives long term stockholder value while supporting and enhancing the academic value of our institutions. On February 20, 2024, the Board of Directors of the Company approved a new stock repurchase program for up to $50.0 million which commenced March 1, 2024 and expires September 30, 2025.
Ultimately, our goal is to deploy resources in a way that drives long term stockholder value while supporting and enhancing the academic value of our institutions. On July 31, 2025, the Board of Directors of the Company approved a stock repurchase program for up to $75.0 million, which commenced July 31, 2025 and expires January 31, 2027.
Our cash flows from operating activities have historically been adequate to fulfill our liquidity requirements. We have historically financed our operating activities, organic growth and acquisitions primarily through cash generated from operations and existing cash balances. We generated cash in 2024 as a result of improved operating performance and expect to continue to do so in 2025.
We have historically financed our operating activities, organic growth and acquisitions primarily through cash generated from operations and existing cash balances. We generated cash in 2025 as a result of improved operating performance and expect to continue to generate cash in 2026.
Purchases and sales of available-for-sale investments resulted in a net cash inflow of $34.6 million for the year ended December 31, 2024 as compared to a net cash outflow of $76.1 million for the year ended December 31, 2023. Business acquisition.
Purchases and sales of available-for-sale investments resulted in a net cash outflow of $47.0 million for the year ended December 31, 2025 as compared to a net cash inflow of $34.6 million for the year ended December 31, 2024. Capital Expenditures.
Significant judgment is used in determining the appropriate portfolios to assess for meeting the criteria to recognize revenue under ASC Topic 606. We have determined that all of our students can be grouped into one portfolio. Based on our past experience, students at different universities, in different programs or with different funding all behave similarly.
We analyze revenue recognition on a portfolio approach under ASC Topic 606. Significant judgment is used in determining the appropriate portfolios to assess for meeting the criteria to recognize revenue under ASC Topic 606. We have determined that all of our students can be grouped into one portfolio.
Because a substantial portion of our revenue is derived from Title IV Programs, any legislative or regulatory action that significantly reduces the funding available under Title IV Programs, or the ability of our students or institutions to participate in Title IV Programs, would likely have a material impact on the realizability of our receivables. 53 Goodwill Impairment Description: Goodwill represents the excess of cost over fair market value of identifiable net assets acquired through business purchases.
Because a substantial portion of our revenue is derived from Title IV Programs, any legislative or regulatory action that significantly reduces the funding available under Title IV Programs, or the ability of our students or institutions to participate in Title IV Programs, would likely have a material impact on the realizability of future receivables.
During the year ended December 31, 2024, the Company made payments of $0.4 million for finance leases and $0.7 million for a failed sale leaseback, both related to the acquisition of USAHS.
Principal payments for finance leases and failed sale leaseback. During the years ended December 31, 2025 and 2024, the Company made payments of $5.5 million and $1.1 million, respectively, for finance leases and a failed sale leaseback, both related to the acquisition of USAHS. Earnout payments related to business acquisition.
Because students are required to provide documentation, and in some cases extensive documentation, to the Department to be eligible and approved for funding, the timeframe for this process can sometimes span between 90 to 120 days.
Significant judgment is also required to assess collectability, particularly as it relates to students seeking funding under Title IV Programs. Because students are required to provide documentation, and in some cases extensive documentation, to the Department to be eligible and approved for funding, the timeframe for this process can sometimes span between 90 to 120 days.
Enrollment agreements all contain similar terms, refund policies are similar across all institutions and students work with the university to obtain some type of funding, for example, Title IV Program funds, Veterans Administration funds, military funding, employer tuition assistance or self-pay. We have significant historical data for our students which allows us to analyze collectability.
Based on our past experience, students at different universities, in different programs or with different funding all behave similarly. Enrollment agreements all contain similar terms, refund policies are similar across all institutions and students work with the university to obtain some type of funding, for example, Title IV Program funds, Veterans Administration funds, military funding, employer tuition assistance or self-pay.
Financing Cash Flows During the years ended December 31, 2024 and 2023, net cash flows used in financing activities totaled $41.1 million and $23.4 million, respectively. Payments of employee tax associated with stock compensation.
For the year ended December 31, 2024, the Company made total cash payments of $137.8 million in relation to USAHS acquisition. Financing Cash Flows During the years ended December 31, 2025 and 2024, net cash flows used in financing activities totaled $171.1 million and $41.1 million, respectively. Payments of employee tax associated with stock compensation.
The Company believes it is useful to present non-GAAP financial measures, which exclude certain significant and non-cash items, as a means to understand the performance of its operations. Adjusted operating income was $192.2 million for the current year as compared to $174.9 million for the prior year.
The increase in operating income for the current year was a result of revenue growth and continued management of operating expenses. The Company believes it is useful to present non-GAAP financial measures, such as adjusted operating income, which exclude certain non-cash items, as a means to better understand the core performance of its operations.
Bad debt expense incurred by each of our segments during the years ended December 31, 2024, 2023 and 2022 was as follows (dollars in thousands): For the Year Ended December 31, 2024 % of Segment Revenue 2023 % of Segment Revenue 2022 % of Segment Revenue 2024 vs 2023 % Change 2023 vs 2022 % Change Bad debt expense by segment: CTU $ 20,386 4.5 % $ 20,223 4.3 % $ 21,640 5.2 % 0.8 % -6.5 % AIUS 13,133 6.1 % 13,008 5.4 % 19,971 7.3 % 1.0 % -34.9 % USAHS (1) 201 NM - NA - NA NM NA Corporate and Other (1 ) NM (16 ) NM (37 ) NM NM NM Total bad debt expense $ 33,719 4.9 % $ 33,215 4.7 % $ 41,574 6.0 % 1.5 % -20.1 % _______________ (1) USAHS includes results of operations starting from the acquisition date on December 2, 2024. 50 Bad debt expense remained relatively consistent with a slight increase of 1.5% or $0.5 million for the current year as compared to the prior year.
Bad debt expense incurred by each of our segments during the years ended December 31, 2025, 2024 and 2023 was as follows (dollars in thousands): For the Year Ended December 31, 2025 % of Segment Revenue 2024 % of Segment Revenue 2023 % of Segment Revenue 2025 vs 2024 % Change 2024 vs 2023 % Change Bad debt expense by segment: CTU $ 19,441 4.2 % $ 19,907 4.5 % $ 20,203 4.4 % -2.3 % -1.5 % AIUS 9,607 4.2 % 13,612 6.0 % 13,028 5.1 % -29.4 % 4.5 % USAHS (1) 442 0.3 % 201 NM - NA 119.9 % NA Corporate and Other 2 NM (1 ) NM (16 ) NM NM NM Total bad debt expense $ 29,492 3.5 % $ 33,719 4.9 % $ 33,215 4.7 % -12.5 % 1.5 % _______________ (1) USAHS includes results of operations starting from the acquisition date on December 2, 2024.
We encourage you to review Item 1, “Business,” and Item 1A, “Risk Factors,” to learn more about our highly regulated industry and related risks and uncertainties. Note Regarding Non-GAAP measures We believe it is useful to present non-GAAP financial measures which exclude certain significant and non-cash items as a means to understand the performance of our core business.
Note Regarding Non-GAAP measures We believe it is useful to present non-GAAP financial measures which exclude certain significant and non-cash items as a means to understand the performance of our core business.
Overall, our allowance estimation process for student receivables is validated by trending analysis and comparing estimated and actual performance. Assumptions and judgment: Management makes a range of assumptions to determine what is believed to be the appropriate level of allowance for credit losses.
Assumptions and judgment: Management makes a range of assumptions to determine what is believed to be the appropriate level of allowance for credit losses.
These tax laws are complex and subject to interpretation. As a result, significant judgments and interpretations are required in determining our income tax provisions (benefits) and evaluating our uncertain tax positions. We account for income taxes in accordance with FASB ASC Topic 740 – Income Taxes .
Income Taxes Description : We are subject to the income tax laws of the U.S. and various state, local and foreign jurisdictions. These tax laws are complex and subject to interpretation. As a result, significant judgments and interpretations are required in determining our income tax provisions (benefits) and evaluating our uncertain tax positions.
Repurchases of stock during 2024 and 2023 were funded by cash generated from operating activities and existing cash balances. See Part II, Item 5 for more information. Release of cash held in escrow . During the years ended December 31, 2024 and 2023, we released $0.3 million and $1.0 million of escrow associated with acquisitions.
During the year ended December 31, 2024, we repurchased 0.4 million shares of common stock for $6.8 million at an average price of $17.60 per share. Repurchases of stock during 2025 and 2024 were funded by cash generated from operating activities and existing cash balances. See Part II, Item 5 for more information. Release of cash held in escrow .
Assumptions and judgment : Revenue recognition includes assumptions and significant judgments including determination of the appropriate portfolios to assess for meeting the criteria to recognize revenue under ASC Topic 606 as well as the assessment of collectability. We analyze revenue recognition on a portfolio approach under ASC Topic 606.
These fees are generally earned over the applicable term and are not considered separate performance obligations. Assumptions and judgment : Revenue recognition includes assumptions and significant judgments including determination of the appropriate portfolios to assess for meeting the criteria to recognize revenue under ASC Topic 606 as well as the assessment of 55 collectability.
We do not expect that revenue earned for the portfolio is significantly different as compared to revenue that would be earned if we were to assess each student contract separately. Significant judgment is also required to assess collectability, particularly as it relates to students seeking funding under Title IV Programs.
We have significant historical data for our students which allows us to analyze collectability. We do not expect that revenue earned for the portfolio is significantly different as compared to revenue that would be earned if we were to assess each student contract separately.
CTU's total student enrollments increased 8.1% as compared to the prior year end, driven by student enrollment growth within our corporate engagement programs as well as continued improvement in prospective student interest levels, student retention and student engagement.
CTU's total student enrollments increased 6.6% as compared to the prior year end, supported by high levels of student retention and engagement, growth within the corporate student program and strong levels of prospective student interest.
Many of the most highly criticized institutions have been closed now for several years. See “ Scrutiny of the For-Profit Postsecondary Education Sector ” for additional information on this matter. The November 2024 federal elections resulted in a new President and Congress.
Many of the most highly criticized institutions have been closed now for several years. The November 2024 federal elections resulted in a new President and Congress. We cannot predict the actions that the new Administration or Congress may take or their effect on the higher education sector.
Capital expenditures represented approximately 0.7% and 0.9% of revenue for the years ended December 31, 2024 and 2023, respectively. For the year ending December 31, 2025, we expect capital expenditures to be approximately 2.0% of revenue.
Capital expenditures increased to $8.6 million for the year ended December 31, 2025 as compared to $4.6 million for the year ended December 31, 2024. Capital expenditures represented approximately 1.0% and 0.7% of revenue for the years ended December 31, 2025 and 2024, respectively.
During the year ended December 31, 2024, we repurchased 0.4 million shares of our common stock for approximately $6.8 million at an average price of $17.60 per share as compared to 0.5 million shares of common stock repurchased for $8.3 million at an average price of $15.38 per share for the year ended December 31, 2023.
During the year ended December 31, 2025, we repurchased 4.1 million shares of our common stock for approximately $120.8 million at an average price of $29.17 per share. Shares of stock repurchased under the program are held as treasury shares.
Non-GAAP financial measures should be considered as a supplement to, and not as a substitute for, or superior to, the respective financial results presented in accordance with GAAP. 2024 Review During the year ended December 31, 2024 (" current year "), our academic institutions continued to execute on our goal of changing lives through education and preparing learners for job skills necessary in today’s world.
Non-GAAP financial measures should be considered as a supplement to, and not as a substitute for, or superior to, the respective financial results presented in accordance with GAAP. 2025 Review During the year ended December 31, 2025 (" current year "), our academic institutions remained focused on enhancing student experiences and academic outcomes while aligning their academic programs with the current demands of the workforce.
General and Administrative Expense (dollars in thousands) For the Year Ended December 31, 2024 2023 2022 2024 vs 2023 % Change 2023 vs 2022 % Change General and administrative: Advertising and marketing $ 100,963 $ 102,588 $ 126,843 -1.6 % -19.1 % Admissions 81,783 91,359 93,810 -10.5 % -2.6 % Administrative 150,587 170,922 163,893 -11.9 % 4.3 % Bad Debt 33,719 33,215 41,574 1.5 % -20.1 % Total general and administrative expense $ 367,052 $ 398,084 $ 426,120 -7.8 % -6.6 % The general and administrative expense for the current year decreased by 7.8% or $31.0 million, compared to the prior year.
These increases were primarily attributable to a full year of expenses related to USAHS in the current year, as compared to only one month of such expenses in the prior year period. 52 General and Administrative Expense (dollars in thousands) For the Year Ended December 31, 2025 2024 2023 2025 vs 2024 % Change 2024 vs 2023 % Change General and administrative: Advertising and marketing $ 112,858 $ 100,963 $ 102,588 11.8 % -1.6 % Admissions 88,957 81,783 91,359 8.8 % -10.5 % Administrative 179,616 150,587 170,922 19.3 % -11.9 % Bad Debt 29,492 33,719 33,215 -12.5 % 1.5 % Total general and administrative expense $ 410,923 $ 367,052 $ 398,084 12.0 % -7.8 % The general and administrative expense for the current year increased by 12.0% or $43.9 million as compared to the prior year.
Recent Accounting Pronouncements See Note 4 “ Recent Accounting Pronouncements ” to our consolidated financial statements for a discussion of recent accounting pronouncements that may affect us.
The decrease in construction financing liability is primarily due to the recategorization of the failed sale leaseback upon lease commencement. Recent Accounting Pronouncements See Note 4 “ Recent Accounting Pronouncements ” to our consolidated financial statements for a discussion of recent accounting pronouncements that may affect us.
See Note 18 “ Segment Reporting ” for a description of each of our current reporting segments along with revenues, operating income and total assets by reporting segment. Regulatory Environment and Political Uncertainty As indicated in “ Scrutiny of the For-Profit Postsecondary Education Sector ” section, the for-profit industry is scrutinized by various policymakers, agencies and interest groups.
Regulatory Environment and Political Uncertainty As indicated in “ Scrutiny of the For-Profit Postsecondary Education Sector ” section within Item 1, "Business", the for-profit education industry is scrutinized by various policymakers, regulatory agencies and interest groups.
(2) AIUS includes results of operations from CalSouthern beginning on the acquisition date of July 1, 2022.
(2) USAHS includes results of operations beginning on the acquisition date of December 2, 2024.
The increase in cash flow from operations as compared to the prior year is primarily driven by the increase in operating income as compared to the prior year as well as a negative working capital timing impact on the prior year operating cash flows. Our primary source of cash flows from operating activities is tuition collected from our students.
The increase in net cash flows from operating activities for the current year was primarily driven by increased operating income. Our primary source of cash flows from operating activities is tuition collected from our students.
USAHS is among the nation's reputable universities offering graduate health sciences degrees, primarily in physical therapy, occupational therapy, speech language therapy and nursing, as well as continuing education programs. Perdoceo's academic institutions are committed to providing quality education that closes the gap between learners who seek to advance their careers and employers needing a qualified workforce.
Perdoceo's academic institutions are committed to providing quality education that closes the gap between learners who seek to advance their careers and employers and communities needing a qualified workforce.
The current year's revenue benefited from the acquisition completed on December 2, 2024, which was not included in the full comparative period of the prior year. 49 Educational Services and Facilities Expense (dollars in thousands) For the Year Ended December 31, 2024 2023 2022 2024 vs 2023 % Change 2023 vs 2022 % Change Educational services and facilities: Academics & student related $ 112,216 $ 120,023 $ 99,410 -6.5 % 20.7 % Occupancy 8,644 10,301 17,313 -16.1 % -40.5 % Total educational services and facilities $ 120,860 $ 130,324 $ 116,723 -7.3 % 11.7 % Educational services and facilities expense for the current year decreased by 7.3% or $9.5 million as compared to the prior year, supported by improvements in both academics and student related costs and occupancy expenses, compared to the prior year.
Educational Services and Facilities Expense (dollars in thousands) For the Year Ended December 31, 2025 2024 2023 2025 vs 2024 % Change 2024 vs 2023 % Change Educational services and facilities: Academics & student related $ 173,015 $ 112,216 $ 120,023 54.2 % -6.5 % Occupancy 24,525 8,644 10,301 183.7 % -16.1 % Total educational services and facilities $ 197,540 $ 120,860 $ 130,324 63.4 % -7.3 % Educational services and facilities expense for the current year increased by 63.4% or $76.7 million as compared to the prior year.
The new stock repurchase program replaced the previous stock repurchase program.
The stock repurchase program replaced the previous stock repurchase program approved on February 20, 2024.
Total Corporate and Other operating loss for the current year improved by 21.4% or $8.3 million as compared to the prior year, primarily as a result of lower legal expenses.
This category includes unallocated costs that are incurred on behalf of the entire company. Total Corporate and Other operating loss for the current year improved by 22.2% or $6.8 million as compared to the prior year, primarily due to lower acquisition-related expenses.
We continue to expect quarterly fluctuations in bad debt expense. Operating Income Operating income for the current year increased by 15.8% or $23.8 million as compared to the prior year. The current year improvement was supported by lower operating expenses across most categories which more than offset the decrease in revenue as compared to the prior year.
Operating Income Operating income for the current year increased by 12.5% or $21.7 million as compared to the prior year. This improvement was primarily driven by increased revenue, which more than offset the increases in operating expenses, as compared to the prior year.
We cannot predict the actions that the new Administration or Congress may take or their effect on the higher education sector. The new Congress or Administration may delay, block, modify, or eliminate certain Title IV and other regulations applicable to higher education institutions.
The new Congress or Administration may delay, block, modify, or eliminate certain Title IV and other regulations applicable to higher education institutions. In addition, the new Administration may interpret, apply, and enforce Title IV and other regulations in a manner different from current Department guidance and practice.
Payments of employee tax associated with stock compensation were $3.4 million for the year ended December 31, 2024 and $2.2 million for the year ended December 31, 2023. Repurchase of stock.
Payments of employee tax associated with stock compensation were $7.5 million for the year ended December 31, 2025 and $3.4 million for the year ended December 31, 2024. Repurchase of stock. During the year ended December 31, 2025, we repurchased 4.1 million shares of our common stock for approximately $120.8 million at an average price of $29.17 per share.
Contractual Obligations As of December 31, 2024, future minimum cash payments due under contractual obligations for our non-cancelable operating and finance lease arrangements were $74.4 million and $18.5 million, respectively. Of these amounts, approximately $11.1 million for 56 operating leases and $6.3 million for finance leases are due within the next 12 months.
Of these amounts, approximately $9.0 million for operating leases and $6.0 million for finance leases are due within the next 12 months. Additionally, future minimum cash payments due under a failed sale leaseback transition were $154.1 million.
Operating income for the current year increased to $174.3 million as compared to operating income of $150.4 million in the prior year.
Operating income for the current year increased by 12.5% to $196.0 million as compared to operating income of $174.3 million in the prior year, driven by increased operating income within all three of our academic institutions as well as reduced operating losses within Corporate and Other.
Payments of cash dividends and dividend equivalents . During the years ended December 31, 2024 and 2023, the Company made dividend payments of $31.7 million and $14.4 million, respectively. Principal payments for finance leases and failed sale leaseback.
During each of the years ended December 31, 2025 and 2024, we released $0.3 million of escrow funds associated with acquisitions. Payments of cash dividends and dividend equivalents . During the years ended December 31, 2025 and 2024, the Company made dividend and dividend equivalent payments of $36.9 million and $31.7 million, respectively.
This increase was primarily driven by the return to normalized operating levels starting in late 2023, which contributed to increasing student enrollments throughout 2024. Current year operating income for AIUS decreased by 20.1% or $9.1 million as compared to the prior year, driven by the revenue decline mentioned above which was only partially offset with decreased operating expenses. USAHS.
Current year operating income for CTU increased by 3.4% or $5.9 million as compared to the prior year. This improvement in operating income was driven by the increase in revenue discussed above, which more than offset increased operating expenses to support the student enrollment growth. AIUS.
Admissions expense decreased by 10.5% or $9.6 million as compared to the prior year. The current year improvement was primarily driven by decreased expenses within both CTU and AIUS as a result of operational changes made during the prior year.
Bad debt expense decreased by 12.5% or $4.2 million for the current year as compared to the prior year. The improvement for the current year was primarily driven by decreases in bad debt expense at both CTU and AIUS as we experienced stronger student engagement and retention within our academic institutions.
(2) Non-cash gain associated with the sale of the LCB tradename in exchange for outstanding shares of Perdoceo's stock. (3) The tax effect of adjustments was calculated by multiplying the pre-tax adjustments with a tax rate of 25%. This tax rate is intended to reflect federal and state taxable jurisdictions as well as the nature of the adjustments.
This tax rate is intended to reflect federal and state taxable jurisdictions as well as the nature of the adjustments.
For the Year Ended December 31, 2024 2023 2022 2024 vs 2023 % Change 2023 vs 2022 % Change REVENUE: CTU (1) $ 456,899 $ 468,926 $ 419,617 -2.6 % 11.8 % AIUS (2) 213,547 240,300 274,479 -11.1 % -12.5 % USAHS (3) 10,041 - - NM NA Corporate and Other 776 778 1,112 NM NM Total $ 681,263 $ 710,004 $ 695,208 -4.0 % 2.1 % OPERATING INCOME (LOSS): CTU (1) $ 171,260 $ 144,008 $ 141,622 18.9 % 1.7 % AIUS (2) 36,182 45,283 33,315 -20.1 % 35.9 % USAHS (3) (2,640 ) - - NM NA Corporate and Other (30,549 ) (38,845 ) (45,300 ) -21.4 % -14.2 % Total $ 174,253 $ 150,446 $ 129,637 15.8 % 16.1 % OPERATING INCOME (LOSS) MARGIN: CTU (1) 37.5 % 30.7 % 33.8 % AIUS (2) 16.9 % 18.8 % 12.1 % USAHS (3) NM NA NA Corporate and Other NM NM NM Total 25.6 % 21.2 % 18.6 % ______________________ (1) CTU includes results of operations from Coding Dojo beginning on the acquisition date of December 1, 2022.
For the Year Ended December 31, 2025 2024 2023 2025 vs 2024 % Change 2024 vs 2023 % Change REVENUE: CTU (1) $ 461,602 $ 443,374 $ 456,169 4.1 % -2.8 % AIUS (1) 226,220 227,072 253,057 -0.4 % -10.3 % USAHS (2) 157,576 10,041 - 1469.3 % NA Corporate and Other 698 776 778 NM NM Total $ 846,096 $ 681,263 $ 710,004 24.2 % -4.0 % OPERATING INCOME (LOSS): CTU (1) $ 180,597 $ 174,686 $ 150,699 3.4 % 15.9 % AIUS (1) 35,950 32,756 38,592 9.8 % -15.1 % USAHS (2) 3,211 (2,640 ) - 221.6 % NA Corporate and Other (23,758 ) (30,549 ) (38,845 ) 22.2 % 21.4 % Total $ 196,000 $ 174,253 $ 150,446 12.5 % 15.8 % OPERATING INCOME (LOSS) MARGIN: CTU (1) 39.1 % 39.4 % 33.0 % AIUS (1) 15.9 % 14.4 % 15.3 % USAHS (2) 2.0 % -26.3 % NA Corporate and Other NM NM NM Total 23.2 % 25.6 % 21.2 % ______________________ (1) The prior year operating results for CTU and AIUS were recast to reflect the transition of Hippo Education from CTU to AIUS.
Adjusted operating income for the years ended December 31, 2024 and 2023 is presented below (dollars in thousands, unless otherwise noted): For the Year Ended December 31, Adjusted Operating Income 2024 2023 Operating income $ 174,253 $ 150,446 Depreciation and amortization 14,645 16,887 Legal fee expense related to certain matters (1) 3,309 7,579 Adjusted Operating Income $ 192,207 $ 174,912 For the Year Ended December 31, Adjusted Earnings Per Diluted Share 2024 2023 Reported Earnings Per Diluted Share $ 2.19 $ 2.18 Pre-tax adjustments included in operating expenses: Amortization for acquired intangible assets 0.09 0.11 Legal fee expense related to certain matters (1) 0.05 0.11 Gain on sale of intangible assets (2) - (0.32 ) Total pre-tax adjustments 0.14 (0.10 ) Tax effect of adjustments (3) (0.04 ) 0.02 Total adjustments after tax 0.10 (0.08 ) Adjusted Earnings Per Diluted Share $ 2.29 $ 2.10 ___________________________ (1) Legal fee expense associated with (i) responses to the Department relating to borrower defense to repayment applications from former students, and (ii) acquisition efforts.
Adjusted operating income and adjusted earnings per diluted share for the years ended December 31, 2025 and 2024 is presented below (dollars in thousands, except per share amounts): For the Year Ended December 31, Adjusted Operating Income 2025 2024 Operating income $ 196,000 $ 174,253 Depreciation and amortization 41,627 14,645 Adjusted Operating Income $ 237,627 $ 188,898 For the Year Ended December 31, Adjusted Earnings Per Diluted Share 2025 2024 Reported Earnings Per Diluted Share $ 2.42 $ 2.19 Pre-tax adjustments included in operating expenses: Amortization for acquired intangible assets 0.26 0.09 Total pre-tax adjustments 0.26 0.09 Tax effect of adjustments (1) (0.07 ) (0.02 ) Total adjustments after tax 0.19 0.07 Adjusted Earnings Per Diluted Share $ 2.61 $ 2.26 ___________________________ (1) The tax effect of adjustments was calculated by multiplying the pre-tax adjustments with a tax rate of 25%.
This increase was driven by student enrollment growth within our corporate engagement programs as well as continued improvement in prospective student interest levels, student retention and student engagement.
The increase was driven by total student enrollment growth of 6.6% at December 31, 2025 as compared to December 31, 2024. CTU's total student enrollment growth was supported by high levels of student retention and engagement, growth in the corporate student program and higher levels of prospective student interest.
Financial Highlights Revenue for the current year decreased by 4.0% or $28.7 million as compared to the prior year, resulting from a decrease in revenue for CTU of 2.6% or $12.0 million and a decrease for AIUS of 11.1% or $26.8 million, which more than offset the revenue of $10.0 million from the USAHS acquisition in December of 2024.
Financial Highlights 50 Revenue for the current year increased by 24.2% or $164.8 million as compared to the prior year, primarily due to an increase of $147.5 million of revenue from the USAHS acquisition which was completed in December 2024 and therefore did not have comparable results in the prior year.
Cash, cash equivalents, restricted cash and short-term investments. The decrease in total cash, cash equivalents, restricted cash and short-term investments is primarily due to payments associated with a business acquisition and dividend payments, which were mostly offset with cash from operations.
The increase in total cash, cash equivalents, restricted cash and short-term investments is primarily due to increased operating income, partially offset with payments for share repurchases and dividends. Goodwill: The increase in goodwill during the period was due to the finalization of purchase accounting for the USAHS acquisition.
Full year revenue is expected to be higher for 2025 primarily due to the USAHS acquisition as well as growth in revenue and student enrollments within CTU and AIUS.
Excluding the impact of the USAHS, revenue increased due to higher revenue at CTU as a result of growth in total student enrollments for the current year as compared to the prior year.
Changes in Financial Position – December 31, 2024 Compared to December 31, 2023 Selected consolidated balance sheet account changes from December 31, 2023 to December 31, 2024 were as follows (dollars in thousands): As of December 31, 2024 2023 % Change ASSETS CURRENT ASSETS: Cash, cash equivalents, restricted cash and short-term investments $ 591,548 $ 604,156 -2 % Prepaid expenses (1) 16,910 11,712 44 % NON-CURRENT ASSETS: Property and equipment, net of accumulated depreciation (1) 95,508 21,371 347 % Right of use assets, net - operating (1) 50,099 19,096 162 % Right of use assets, net - finance (1) 15,375 - NA Goodwill (1) 258,012 241,162 7 % Intangible assets, net of amortization (1) 95,006 36,219 162 % LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES: Lease liabilities - operating (1) 7,792 5,701 37 % Lease liabilities - finance (1) 5,466 - NA NON-CURRENT LIABILITIES: Lease liabilities - operating (1) 50,224 21,346 135 % Lease liabilities - finance (1) 11,555 - NA Construction financing (1) 56,500 - NA ________________________________ (1) The increases in these assets and liability categories are driven by the USAHS acquisition.
Changes in Financial Position – December 31, 2025 Compared to December 31, 2024 Selected consolidated balance sheet account changes from December 31, 2024 to December 31, 2025 were as follows (dollars in thousands): As of December 31, 2025 2024 % Change ASSETS CURRENT ASSETS: Cash, cash equivalents, restricted cash and short-term investments $ 643,491 $ 591,548 9 % NON-CURRENT ASSETS: Goodwill 265,697 258,012 3 % LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES: Payroll and related benefits 44,363 35,059 27 % NON-CURRENT LIABILITIES: Sale lease-back financing 56,992 - NA Construction financing - 56,500 -100 % Cash, cash equivalents, restricted cash and short-term investments.
The decrease was primarily driven by lower administrative, admissions and advertising and marketing expenses. Administrative expense for the current year decreased by 11.9% or $20.3 million as compared to the prior year, primarily driven by operational efficiencies within our academic institutions and decreased legal fees within Corporate and Other for the current year.
Excluding the impact of USAHS, expenses increased by 1.3% or $4.9 million, primarily driven by higher expenses at CTU to support the growth in total student enrollments for the current year as compared to the prior year. Advertising and marketing expense for the current year increased by 11.8% or $11.9 million as compared to the prior year.
In addition, the new Administration may interpret, apply, and enforce Title IV and other regulations in a manner different from current Department guidance and practice. We expect to continue to need to operate nimbly, making necessary changes to the extent possible to comply with new rules or interpretations as well as new interpretations of existing rules.
We expect to continue to need to operate nimbly, making necessary changes to the extent possible to comply with new rules or interpretations as well as new interpretations of existing rules. We encourage you to review Item 1, “Business,” and Item 1A, “Risk Factors,” to learn more about our highly regulated industry and related risks and uncertainties.
Year Ended December 31, 2024 as Compared to the Year Ended December 31, 2023 Revenue Revenue for the year ended December 31, 2024 (" current year ") decreased 4.0%, or $28.7 million, primarily due to decreases in revenue from both CTU and AIUS.
Year Ended December 31, 2025 as Compared to the Year Ended December 31, 2024 Revenue Revenue for the year ended December 31, 2025 (" current year ") increased by 24.2% or $164.8 million, as compared to the prior year.
Provision for Income Taxes For the year ended December 31, 2024, we recorded a tax provision of $53.9 million, resulting in an effective tax rate of 26.7% as compared to a tax provision of $44.5 million, with an effective rate of 23.1% for the prior year.
Provision for Income Taxes The effective income tax rate for the current year was 26.3% compared to 26.7% for the prior year. The decrease in the effective income tax rate was primarily due a reduction in nondeductible compensation. For the full year 2026, we expect our effective tax rate to be between 23.5% and 24.5%.
(3) USAHS includes results of operations beginning on the acquisition date of December 2, 2024. 51 As of December 31, 2024 2023 2022 2024 vs 2023 % Change 2023 vs 2022 % Change TOTAL STUDENT ENROLLMENTS: CTU 28,100 26,000 25,200 8.1 % 3.2 % AIUS 9,500 8,500 14,000 11.8 % -39.3 % USAHS (1) 3,800 - - NM NA Total 41,400 34,500 39,200 20.0 % -12.0 % ______________________ (1) Perdoceo completed the acquisition of USAHS on December 2, 2024.
Operating income (loss) for the current year includes $30.3 million of depreciation and amortization expense associated with acquired tangible and intangible assets, as well as finance leases, as compared to $2.5 million in the prior year. 54 As of December 31, 2025 2024 2023 2025 vs 2024 % Change 2024 vs 2023 % Change TOTAL STUDENT ENROLLMENTS: CTU 29,950 28,090 25,970 6.6 % 8.2 % AIUS 10,560 9,500 8,490 11.2 % 11.9 % USAHS (1) 3,890 3,790 - 2.6 % NA Total 44,400 41,380 34,460 7.3 % 20.1 % ______________________ (1) Perdoceo completed the acquisition of USAHS on December 2, 2024.
USAHS is among the nation's reputable universities offering graduate health sciences degrees, primarily in physical therapy, occupational therapy, speech language therapy and nursing, as well as continuing education programs. Founded in 1979, USAHS educates students through its network of campuses in San Marcos, California; St. Augustine and Miami, Florida; and Austin and Dallas, Texas and through its online programs.
USAHS prepares medical professionals to provide quality medical care to communities across the country primarily through its graduate health sciences degree offerings in physical therapy, occupational therapy, speech language therapy and nursing, as well as continuing education programs.
The increase in operating income for the current year was a result of decreased operating expenses, primarily in the areas of administrative, asset impairment, admissions and academics expenses, which more than offset the decrease in revenue during the current year as compared to the prior year.
The increase was primarily attributable to a full year of administrative expenses related to the USAHS acquisition in the current year, as compared to only one month of such expenses in the prior year.
Removed
We believe certain non-GAAP measures allow us to compare our current operating results with respective historical periods and with the operational performance of other companies in our industry because it does not give effect to potential differences caused by items we do not consider reflective of underlying operating performance.
Added
See Note 17 “ Segment Reporting ” for a description of each of our current reporting segments along with revenues, operating income, significant segment expenses and total assets by reporting segment.
Removed
We believe the items we are adjusting for are operating expenses which are not reflective of our underlying business. In evaluating the use of non-GAAP measures, investors should be aware that in the future we may incur expenses similar to the adjustments presented below.
Added
Student retention continued to trend near multi-year highs and we made purposeful investments in marketing and admissions to efficiently serve the prospective student interest our academic institutions experienced.
Removed
Our presentation of non-GAAP measures should not be construed as an inference that our future results will be unaffected by expenses that are unusual, non-routine or non-recurring.

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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 changeAt December 31, 2024, a 100 basis point increase or decrease in average interest rates applicable to our investments or borrowings would not have a material impact on our future earnings, fair values or cash flows. Our financial instruments are recorded at their fair values as of December 31, 2024 and December 31, 2023.
Biggest changeAt December 31, 2025, a 100 basis point increase or decrease in average interest rates applicable to our investments would not have had a material impact on our future earnings, fair values or cash flows. Our financial instruments are recorded at their fair values as of December 31, 2025 and December 31, 2024.
Despite the investment risk mitigation strategies 57 we employ, we may incur investment losses as a result of unusual and unpredictable market developments and may experience reduced investment earnings if the yields on investments deemed to be low risk remain low or decline.
Despite the investment risk mitigation strategies 59 we employ, we may incur investment losses as a result of unusual and unpredictable market developments and may experience reduced investment earnings if the yields on investments deemed to be low risk remain low or decline.

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