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What changed in Stride, Inc.'s 10-K — 2024 vs 2025

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

+194 added−225 removedSource: 10-K (2025-08-06) vs 10-K (2024-08-07)

Top changes in Stride, Inc.'s 2025 10-K

194 paragraphs added · 225 removed · 170 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeMarket Opportunity The traditional education model has not fully utilized technology and digital content, leading to significant parental dissatisfaction with the current state of education in the U.S. All learners should be entitled to access educational platforms that can deliver technology-enriched educational content that leads to strong student outcomes.
Biggest changeMarket Opportunity Increasingly more parents are seeking viable education options for their children, including access to educational platforms that can deliver technology-enriched educational content that improves student outcomes. The traditional education model has not fully utilized technology and digital content.
Through our Career 4 Table of Contents Learning programs, we provide middle and high school students content pathways that include job-ready skills and work experiences and, for high school students, that can lead toward an industry certification and/or college credits.
Through our Career Learning programs, we provide middle and high school students content pathways that include job-ready skills and work 4 Table of Contents experiences and, for high school students, that can lead toward an industry certification and/or college credits.
We believe that the primary factors on which we compete are: ● extensive experience in, and understanding of, virtual education delivery; ● comprehensive suite of academic programs; ● customer satisfaction; ● quality of integrated curriculum and materials with an online delivery platform; 9 Table of Contents ● qualifications, experience and training teachers for online instruction; ● comprehensiveness of school management and student support services; ● integrated K-12 solutions, with components designed and built to work together; ● student outcomes for math and reading, graduation and job placement; ● scale and ability to leverage our assets across our business; and ● sophisticated government affairs knowledge and experience in virtual and blended school regulatory environments. ​ Parents in search of an alternative to their full time local public school have a number of alternatives beyond virtual schools, including private schools, public charter schools and home schooling.
We believe that the primary factors on which we compete are: ● extensive experience in, and understanding of, virtual education delivery; ● comprehensive suite of academic programs; ● customer satisfaction; ● quality of integrated curriculum and materials with an online delivery platform; ● qualifications, experience and training teachers for online instruction; ● comprehensiveness of school management and student support services; ● integrated K-12 solutions, with components designed and built to work together; ● student outcomes for math and reading, graduation and job placement; ● scale and ability to leverage our assets across our business; and ● sophisticated government affairs knowledge and experience in virtual and blended school regulatory environments. ​ 9 Table of Contents Parents in search of an alternative to their full-time local public school have a number of alternatives beyond virtual schools, including private schools, public charter schools and home schooling.
Other federal laws also apply to virtual managed schools, in some cases depending on the demographics associated with a school. For example, Title VI of the Civil Rights Act of 1964 has been deemed to apply to English language learners (“ELL”) Students, as further defined in the joint guidance issued by the U.S.
Other Federal Laws. Other federal laws also apply to virtual managed schools, in some cases depending on the demographics associated with a school. For example, Title VI of the Civil Rights Act of 1964 has been deemed to apply to English language learners (“ELL”) Students, as further defined in the joint guidance issued by the U.S.
Statutes or regulations that hinder our ability to serve certain jurisdictions include: restrictions on student eligibility, such as mandating attendance at a traditional public school prior to enrolling in a virtual or blended public school; caps on the total number of students in a virtual or blended public school; restrictions on grade levels served; geographic limitations on enrollments; fixing the percentage of per pupil funding that must be paid to teachers; state-specific curriculum requirements; limits on the number of charters that can be granted in a state; and requirements to obtain approval from a student’s resident school district.
Statutes or regulations that hinder our ability to serve certain jurisdictions include: restrictions on student eligibility, such as mandating attendance at a traditional public school prior to enrolling in a virtual or blended public school; caps on the total number of students in a virtual or blended public school; restrictions on grade levels served; geographic limitations on enrollments; fixing the percentage of per pupil funding that must be paid to teachers; states’ specific curriculum requirements; limits on the number of charters that can be granted in a state; and requirements to obtain approval from a student’s resident school district.
Our platform can be used to deliver our products and services in a number of implementation models, including our school-as-a-service offering, integration with existing school LMSs, and to deliver stand-along offerings to consumers. Our platform, along with our back-office support systems, runs on cloud infrastructure from Amazon Web Services (“AWS”) and Microsoft Azure.
Our platform can be used to deliver our products and services in a number of implementation models, including our school-as-a-service offering, integration with existing school LMSs, and to deliver stand-alone offerings to consumers. Our platform, along with our back-office support systems, runs on cloud infrastructure from Amazon Web Services (“AWS”) and Microsoft Azure.
If we fail to meet this requirement, we, the virtual public school or blended school could lose federal funding and could be liable for compensatory educational services, reimbursement to the parent for educational service the parent provided and payment of the parent’s attorney’s fees. The Rehabilitation Act of 1973 and the Americans with Disabilities Act.
If we fail to meet this requirement, we, the virtual public school or blended school could lose federal funding and could be liable for compensatory educational services, reimbursement to the parent for educational services the parent provided and payment of the parent’s attorney’s fees. The Rehabilitation Act of 1973 and the Americans with Disabilities Act.
To address this challenge, companies are partnering with training providers to prepare candidates for entry-level positions as well as to upskill their existing workforce. ​ Our Lines of Revenue General Education Products and services for the General Education market are predominantly focused on core subjects, including math, English, science and history, for kindergarten through twelfth grade students to help build a common foundation of knowledge.
To address this challenge, companies are partnering with training providers to prepare candidates for entry-level positions as well as to upskill their existing workforce. ​ Our Lines of Revenue General Education General Education products and services are predominantly focused on core subjects, including math, English, science and history, for kindergarten through twelfth grade students to help build a common foundation of knowledge.
Career Learning Career Learning products and services are focused on developing skills to enter and succeed in careers in high-growth, in-demand industries—including information technology, healthcare and general business. We provide middle and high school students with Career Learning programs that complement their core general education coursework. Stride offers multiple career pathways through a diverse catalog of courses.
Career Learning Career Learning products and services are focused on developing skills to enter and succeed in careers in high-growth, in-demand industries—including information technology, healthcare and general business. We provide middle and high school students with Career Learning programs that complement their core general education coursework. Stride offers multiple career pathways through a broad catalog of courses.
Our individualized learning approach allows students to optimize their educational experience and, therefore, their chances of achieving their goals, regardless of their unique challenges. ​ The pandemic changed the awareness and acceptance of online learning, and although we expect that most students in the United States will be educated in traditional school settings, we believe that a fundamental shift has taken place, and that states and districts will continue to expand virtual solutions.
Our individualized learning approach allows students to optimize their educational experience and, therefore, their chances of achieving their goals, regardless of their unique challenges. 5 Table of Contents The pandemic changed the awareness and acceptance of online learning, and although we expect that most students in the United States will be educated in traditional school settings, we believe that a fundamental shift has taken place, and that states and districts will continue to expand virtual solutions.
Galvanize also provides training services to active duty service members subject to the Federal Acquisition Regulations and Defense Federal Acquisition Regulation Supplement. ​ 15 Table of Contents Laws and Regulations Applicable to Our Products offered Directly to Consumers ​ Our business also encompasses individual products packaged and sold directly to consumers, including elements of Galvanize, Tech Elevator and MedCerts, along with products for child education, including individual online courses and supplemental educational products.
Galvanize also provides training services to active duty service members subject to the Federal Acquisition Regulations and Defense Federal Acquisition Regulation Supplement. ​ Laws and Regulations Applicable to Our Products offered Directly to Consumers ​ Our business also encompasses individual products packaged and sold directly to consumers, including elements of Galvanize, Tech Elevator and MedCerts, along with products for child education, including individual online courses and supplemental educational products.
To the extent these schools receive federal funds, such as through a grant 11 Table of Contents program or financial support dedicated for the education of low income families, these schools also become subject to additional federal regulation. State Laws Authorizing or Restricting Virtual and Blended Public Schools.
To the extent these schools receive federal funds, such as through a grant program or financial support dedicated for the education of low income families, these schools also become subject to additional federal regulation. State Laws Authorizing or Restricting Virtual and Blended Public Schools.
A virtual public school or blended school receiving federal funds is subject to Section 504 of the Rehabilitation Act of 1973 (“Section 504”) insofar as the regulations implementing the Act govern the education of students with disabilities as well as personnel and parents.
A virtual public school or blended school receiving federal funds is subject to Section 504 of the Rehabilitation Act of 1973 (“Section 504”) insofar as the regulations 13 Table of Contents implementing the Act govern the education of students with disabilities as well as personnel and parents.
This strategy consists of the following key elements: ● Grow Enrollments. ● Introduce New and Improved Products and Services. ● Improve Student Outcomes. ● Improve Retention. 7 Table of Contents Key Products and Services We continue to invest in our educational platform to educate students more effectively and efficiently.
This strategy consists of the following key elements: ● Grow Enrollments. ● Introduce New and Improved Products and Services. ● Improve Student Outcomes. ● Improve Retention. Key Products and Services We continue to invest in our educational platform to educate students more effectively and efficiently.
The authorizers who issue the charters to our school-as-a-service customers can renew, revoke, or modify those charters as well. 6 Table of Contents The majority of our revenue is derived from these school-as-a-service service agreements with the governing authorities of our public school partners.
The authorizers who issue the charters to our school-as-a-service customers can renew, revoke, or modify those charters as well. The majority of our revenue is derived from these school-as-a-service service agreements with the governing authorities of our public school partners.
Full time virtual and blended school students access online lessons over the internet and utilize offline learning materials we provide. Students receive assignments, complete lessons, take assessments, and are instructed by teachers with whom they interact via email, telephonically, in synchronous virtual classroom environments, and sometimes face to face.
Full-time 6 Table of Contents virtual and blended school students access online lessons over the internet and utilize offline learning materials we provide. Students receive assignments, complete lessons, take assessments, and are instructed by teachers with whom they interact via email, telephonically, in synchronous virtual classroom environments, and sometimes face to face.
The board or governing authority of the not-for-profit virtual or blended public school must retain ultimate accountability and control for the school’s operations to retain its tax-exempt status. It may not delegate its responsibility and accountability for the school’s operations.
The board or governing authority of the not-for-profit virtual or blended public school must retain ultimate accountability and control for the school’s operations to retain its 11 Table of Contents tax-exempt status. It may not delegate its responsibility and accountability for the school’s operations.
None of our employees are represented by a labor union or covered by a 10 Table of Contents collective bargaining agreement; however, certain schools we serve employ unionized teachers. We believe that our employee relations are good.
None of our employees are represented by a labor union or covered by a collective bargaining agreement; however, certain schools we serve employ unionized teachers. We believe that our employee relations are good.
Laws and regulations vary significantly from one state to the next and are constantly evolving, with regulatory authority vesting under various state agencies. Galvanize, Tech Elevator and MedCerts each currently operate in a multi-jurisdictional regulatory environment, maintaining licenses in several states.
Laws and regulations vary significantly from one state to the next and are constantly evolving, with regulatory authority vesting under various state agencies. Galvanize, 14 Table of Contents Tech Elevator and MedCerts each currently operate in a multi-jurisdictional regulatory environment, maintaining licenses in several states.
There continues to be strong demand for full-time virtual education options driven 5 Table of Contents by individual needs and desires to address technology, safety, disabilities, flexibility, athletes, career pathways, supplemental learning, medical needs, and frequent movers, just to list a few examples.
There continues to be strong demand for full-time virtual education options driven by individual needs and desires to address technology, safety, disabilities, flexibility, athletes, career pathways, supplemental learning, medical needs, and frequent movers, just to list a few examples.
During the 2023-2024 school year, we provided our school-as-a-service offering to 91 schools in 31 states and the District of Columbia in the General Education market, and 56 schools or programs in 27 states and the District of Columbia in the Career Learning market.
During the 2024-2025 school year, we provided our school-as-a-service offering to 89 schools in 31 states and the District of Columbia in the General Education market, and 56 schools or programs in 27 states and the District of Columbia in the Career Learning market.
Prior to the COVID-19 pandemic, the number of students was 2.5 million, and estimates showed home-educated student enrollments growing by 2% per year since 2016. ● April 2024 data from the Bureau of Labor Statistics estimates that demand for occupations that require nondegree postsecondary education will grow 5.5% by 2032, a faster rate than overall employment.
Prior to the COVID-19 pandemic, the number of students was 2.5 million, and estimates showed home-educated student enrollments growing by 2% per year since 2016. ● April 2025 data from the Bureau of Labor Statistics estimates that demand for occupations that require nondegree postsecondary education will grow 6.0% by 2033, a faster rate than overall occupations.
Department of Education to demonstrate compliance with ESSA. Individuals with Disabilities Education Act (“IDEA”). The IDEA is implemented through regulations governing every aspect of the special education of a child with one or more specific disabilities that fit within any of the disability categories listed in the Act.
Individuals with Disabilities Education Act (“IDEA”). The IDEA is implemented through regulations governing every aspect of the special education of a child with one or more specific disabilities that fit within any of the disability categories listed in the Act.
While we may believe that a virtual public school or blended school we serve is compliant with state law, an agency’s different interpretation of law in a particular state, or the application of facts to such law, could result in findings of non-compliance, potentially affecting future funding or repayment of past funding.
While we may believe that a virtual public school or blended school we serve is compliant with state law, an agency’s different interpretation of law in a particular state, or the application of facts to such law, could result in findings of non-compliance, potentially affecting future funding or repayment of past funding. 12 Table of Contents Regulations Restricting Virtual and Blended Public School Growth and Funding.
Notwithstanding these federal limitations, states are 13 Table of Contents still required under ESSA to test students in reading or language arts and math annually in grades 3-8 and once in grades 10-12, and in science once in each of the following grade spans: 3-5, 6-9 and 10-12. All states have plans approved by the U.S.
Notwithstanding these federal limitations, states are still required under ESSA to test students in reading or language arts and math annually in grades 3-8 and once in grades 10-12, and in science once in each of the following grade spans: 3-5, 6-9 and 10-12. All states have plans approved by the U.S. Department of Education to demonstrate compliance with ESSA.
Our success depends in large part on continued employment of senior management and key personnel who can effectively operate our business, which is necessary in the highly regulated public education sector involving a publicly traded for profit company. We believe a critical component to our success depends on the ability to attract, develop and retain key personnel.
Our success depends in large part on continued employment of senior management and key personnel who can effectively operate our business, which is necessary in the highly regulated public education sector involving a publicly traded for-profit company.
Human Capital Resources As of June 30, 2024, we had approximately 7,800 employees (including teachers), and substantially all of these employees are located in the United States.
Human Capital Resources As of June 30, 2025, we had approximately 8,600 employees (including teachers), and substantially all of these employees are located in the United States.
Regulations Restricting Virtual and Blended Public School Growth and Funding. As a public schooling alternative, some state and regulatory authorities have elected to proceed cautiously with virtual and blended public schools.
As a public schooling alternative, some state and regulatory authorities have elected to proceed cautiously with virtual and blended public schools.
In total, we manage approximately 8,400 teachers, 4,600 of whom are employees and 3,800 who are employed by virtual or blended public schools that we manage under contracts with those schools but are not direct employees of Stride.
In total, we manage approximately 9,100 teachers, 5,300 of whom are employees and 3,800 who are employed by virtual or blended public schools that we manage under contracts with those schools but are not direct employees of Stride.
Of those who were considering switching, 21.8% of parents visited, inquired about, or researched full-time online school . ● In 2022, the National Home Education Research Institute estimated that there were approximately 3.1 million home educated students in the United States during School Year 2021-2022.
Of those who were considering switching, 27% of parents considered full-time online school options . ● In 2022, the National Home Education Research Institute estimated that there were approximately 3.1 million home educated students in the United States during School Year 2021-2022.
Public Affairs and School Development We seek to increase public awareness of the educational and fiscal benefits of our online learning. We receive numerous inquiries from school districts, legislators, public charter school boards, community leaders, state departments of education, educators and parents who express the desire to have a choice in public school options.
We receive numerous inquiries from school districts, legislators, public charter school boards, community leaders, state departments of education, educators and parents who express the desire to have a choice in public school options.
Much of our investment has been in the development of improved functionality of our curriculum and technology systems. Areas of focus include: (i) integration and user experience (ii) mobile enabled products; (iii) portability; (iv) personalization; (v) flexibility; (vi) reading and oral fluency scoring; (vii) state standard alignment; (viii) tutoring & support; and (ix) automated and artificial intelligence (AI)-assisted learning.
Areas 7 Table of Contents of focus include: (i) integration and user experience (ii) mobile enabled products; (iii) portability; (iv) personalization; (v) flexibility; (vi) reading and oral fluency scoring; (vii) state standard alignment; (viii) tutoring & support; and (ix) automated and artificial intelligence (AI)-assisted learning.
These campaigns are continuously optimized using data analytics and market research. The marketing team also 8 Table of Contents assists in enhancing and reducing friction in the onboarding experience of new students to online schooling. Additionally, our marketing team is working to ensure awareness and conversion in our adult learning offerings.
These campaigns are continuously optimized using data analytics and market research. The marketing team also assists in enhancing and reducing friction in the onboarding experience of new students to online schooling.
An increasing number of states are also enacting more general laws about personal information that apply regardless of whether the individual is a student. 12 Table of Contents As with any public school, virtual and blended public schools must comply with state laws and regulations applicable to governmental entities, such as open meetings or sunshine laws, which may require the board of trustees of a virtual or blended public school to provide advance public notice of and hold its meetings open to the public unless an exception in the law allows an executive session.
As with any public school, virtual and blended public schools must comply with state laws and regulations applicable to governmental entities, such as open meetings or sunshine laws, which may require the board of trustees of a virtual or blended public school to provide advance public notice of and hold its meetings open to the public unless an exception in the law allows an executive session.
We offer our employees many different professional development opportunities through job related training and a number of benefit programs, including a Tuition Assistance Benefit, discount tuition options with several participating colleges and universities, and discounted options to access K-12 curriculum. At our Company, we uphold a workplace culture that celebrates diversity and embraces inclusion.
We offer our employees many different professional development opportunities through job-related training and a number of benefit programs, including a Tuition Assistance Benefit, discount tuition options with several participating colleges and universities, and discounted options to access K-12 curriculum. Corporate Information Our website address is www.stridelearning.com.
Competition As a general matter, we face varying degrees of competition from a variety of education companies because the scope of our offerings and the customers we serve encompass many separate and distinct segments of the education business.
To monitor student learning progress during the school year, we use multiple equivalent assessments at the lesson, unit and semester level to provide intervention points to improve outcomes. ​ Competition As a general matter, we face varying degrees of competition from a variety of education companies because the scope of our offerings and the customers we serve encompass many separate and distinct segments of the education business.
A variety of federal, state and non-U.S. laws and regulations apply to this aspect of our business, including laws and regulations related to consumer protection, payments, marketing and advertising, taxation, privacy, and data security. ​ 16 Table of Contents
A variety of federal, state and non-U.S. laws and regulations apply to this aspect of our business, including laws and regulations related to consumer protection, payments, marketing and advertising, taxation, privacy, data security, and artificial intelligence. ​ See risk factors under Item 1A, "Risk Factors – Risks Related to Government Funding and Regulation of Public Education” for additional information about the risks that may impact our business. ​ 15 Table of Contents
While the CDA affords us with some protection from liability 14 Table of Contents associated with the interactive online services we offer, there are exceptions to the CDA that could result in successful actions against us that give rise to financial liability. Other Federal Laws.
We also conduct live classroom sessions using Internet-based collaboration software and we may offer certain online community platforms for students and parents. While the CDA affords us with some protection from liability associated with the interactive online services we offer, there are exceptions to the CDA that could result in successful actions against us that give rise to financial liability.
A virtual or blended public school must also comply with requirements for performing criminal background checks on school staff, reporting criminal activity by school staff and reporting suspected child abuse.
A virtual or blended public school must also comply with requirements for performing criminal background checks on school staff, reporting criminal activity by school staff and reporting suspected child abuse. An increasing number of states are also enacting more general laws about personal information that apply regardless of whether the individual is a student.
We support professional development opportunities that reflect our desire to ‘hire from within’ and to enhance employees’ skillsets in ways that improve their effectiveness and sense of fulfillment.
In addition to our annual goals and individual job duties, performance appraisals take into consideration important behavioral attributes that align to our core values of Passion, Accountability, Customer Focus and Teamwork. We support professional development opportunities that reflect our desire to ‘hire from within’ and to enhance employees’ skillsets in ways that improve their effectiveness and sense of fulfillment.
For example: ● A January 2024 survey by the National School Choice Awareness Foundation, found that 72% of parents had considered, searched for, or chosen a new school for their school-aged child within the past year.
For example: ● A January 2025 survey by the National School Choice Awareness Foundation, found that more than 60% of parents had considered sending at least one of their children to a different school last year.
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Academic Performance Our fundamental goal for every child who enrolls in our school-as-a-service offerings is to improve their academic performance. In addition to the complexities involved in measuring academic performance of students, we believe that online schools face unique challenges impacting academic success not necessarily encountered to the same extent by traditional brick and mortar schools.
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Much of our investment has been in the development of improved functionality of our curriculum and technology systems.
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These challenges include students who enter behind grade level or under credited, high student mobility, and lack of control over the student learning environment. ​ While measuring academic performance is necessary, taking meaningful steps to improve academic performance and student outcomes is an integral part of our mission.
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Additionally, our marketing team is working to ensure awareness and conversion in our adult learning offerings. ​ 8 Table of Contents Public Affairs and School Development We seek to increase public awareness of the educational and fiscal benefits of our online learning.
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Accordingly, we continually strive to achieve that objective by undertaking new initiatives and improving existing programs that support students and families. To monitor student learning progress during the school year, we use multiple equivalent assessments at the lesson, unit and semester level to provide intervention points to improve outcomes.
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Academic Performance Our fundamental goal for every child who enrolls in our school-as-a-service offerings is to meet the needs of the family, which often includes improving academic performance. While many students come to us behind grade level or under credited, we continually strive to achieve that objective by undertaking new initiatives and improving existing programs that support students and families.
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We select and hire based upon our values of making an impact on the lives of our students. In addition to annual goals, and individual job duties, we consider demonstration of our core values—passion, accountability, courage, trust, and inclusiveness—an important factor in performance appraisals.
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We believe a critical component to our success depends on the ability to attract, develop and retain key personnel. 10 Table of Contents We are an equal opportunity employer.
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We are proud of our diverse workforce and recognize the value diversity brings to our team. ● 55% of our Board is comprised of minorities and 33% are women. ● 67% of our executive leadership team is comprised of minorities and women. ● 83% of our full-time employees are women. ● For direct education-related roles, largely the K-12 teacher population, employee demographics mirror national averages for these positions.
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We select and hire based on merit without regard to race, color, religion, sex, sexual orientation, gender identity, national origin, disability or protected veteran status, or any other basis prohibited by federal, state, or local law.
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We continue to recognize opportunities to improve our gender equity and minority representation. Various efforts are underway to create a more diverse workforce that supports our learner community, including robust professional, managerial, and leadership development programs.
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In addition, we offer customized training for teams, as well as training that focuses on diversity and inclusion topics, including unconscious bias training for all employees. Corporate Information Our website address is www.stridelearning.com.
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We also conduct live classroom sessions using Internet-based collaboration software and we may offer certain online community platforms for students and parents.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeOur business, results of operations and financial conditions, as well as your investment in our common stock, could be materially and adversely affected by any of the following material risks: ● The majority of our revenues come from our school-as-a-service offering and depends on per pupil funding amounts and payment formulas remaining near levels existing at the time we execute service agreements with the schools we serve; ● Any failure to comply with regulatory requirements, poor academic performance or misconduct by us or operators of other virtual public schools; ● Opponents of public charter schools could prevail in challenging the establishment and expansion of such schools through the judicial process; ● Any failure to comply with the laws and regulations applicable to our business, resulting in a loss of public funding and an obligation to repay funds previously received; ● Disputes over our inability to invoice and receive payments for our services due to ambiguous enabling legislation and interpretive discrepancies by regulatory authorities; ● Any failure to renew an authorizing charter for a virtual or blended public school; ● Actual or alleged misconduct by current or former directors, officers, key employees or officials; ● Enactment of new laws or regulations not currently applicable to for-profit education companies in the K-12 sector; ● Changes in the objectives or priorities of the independent governing bodies of the schools we serve; ● Any failure to renew a contract for a school-as-a-service offering, which is subject to periodic renewal; ● Any failure to enroll or re-enroll a significant number of students by the schools we serve; ● The enrollment data we present may not fully capture trends in our business performance; ● Any nonpayment or nonperformance by our customers, including due to actions taken by the independent governing authorities of our customers; ● Our marketing efforts may not be effective and changes in our marketing efforts and enrollment activities could lead to declines in enrollment; ● The student demographics of the schools we serve can lead to higher costs; ● The ability to meet state accountability testing standards and achieve parent and student satisfaction; ● Compliance with curriculum standards and assessments for individual state determinations under the ESSA; ● Risks due to mergers, acquisitions and joint ventures; 17 Table of Contents ● Negative impacts caused by the actions of activist stockholders; ● Market demand for online options in public schooling may decrease or not continue, or additional states may not authorize or adequately fund virtual or blended public schools; ● Increasing competition in the education industry sectors that we serve; ● The continuous evolution of regulatory frameworks on the accessibility of technology and curriculum; ● Differences between our quarterly estimates and the actual funds received and expenses incurred by the schools we serve; ● Seasonal fluctuations in our business; ● Our ability to create new products, expand distribution channels and pilot innovative educational programs; ● Our ability to recruit, train and retain quality certified teachers; ● Higher operating expenses and loss of management flexibility due to collective bargaining agreements; ● Our reliance on third-party service providers to host some of our solutions; ● Any problems with our Company-wide enterprise resource planning (“ERP”) and other systems; ● Our ability to maintain and enhance our product and service brands; ● Our ability to protect our valuable intellectual property rights, or lawsuits against us alleging the infringement of intellectual property rights of others; ● Any legal liability from the actions of third parties; ● Any failure to maintain and support customer facing services, systems, and platforms; ● Any failure to prevent or mitigate a cybersecurity incident affecting our systems, or any significant interruption in the operation of our data centers; ● Our reliance on the Internet to enroll students and to deliver our products and services; ● Failure to comply with data privacy regulations; ● Any failure by the single vendor we use to manage, receive, assemble and ship our learning kits and printed educational materials; ● Any significant interruption in the operation of AWS or Azure could cause a loss of data and disrupt our ability to manage our technological infrastructure; ● Scale and capacity limits on some of our technology, transaction processing systems and network hardware and software; ● Our ability to keep pace with changes in our industry and advancements in technology, including AI; ● AI technology is new and developing, and may present business, compliance, and reputational challenges, that could lead to operational or reputational damage, competitive harm, legal and regulatory risk, and additional costs; 18 Table of Contents ● Our ability to attract and retain key executives and skilled employees; and ● Our ability to obtain additional capital in the future on acceptable terms.
Biggest changeOur business, results of operations and financial condition, as well as your investment in our common stock, could be materially and adversely affected by any of the following material risks: ● The majority of our revenues come from our school-as-a-service offering and depends on per pupil funding amounts and payment formulas remaining near levels existing at the time we execute service agreements with the schools we serve; ● Any failure to comply with regulatory requirements, poor academic performance or misconduct by us or operators of other virtual public schools; ● Opponents of public charter schools could prevail in challenging the establishment and expansion of such schools through the judicial process; ● Any failure to comply with the laws and regulations applicable to our business, resulting in a loss of public funding and an obligation to repay funds previously received; ● Disputes over our inability to invoice and receive payments for our services due to ambiguous enabling legislation and interpretive discrepancies by regulatory authorities; ● Any failure to renew an authorizing charter for a virtual or blended public school; ● Actual or alleged misconduct by current or former directors, officers, key employees or officials; ● Risks from enactment of new laws or regulations; ● Changes in the objectives or priorities of the independent governing bodies of the schools we serve; ● Any failure to renew a contract for a school-as-a-service offering, which is subject to periodic renewal; ● Any failure to enroll or re-enroll a significant number of students by the schools we serve or in our Career Learning programs; ● The enrollment data we present may not fully capture trends in our business performance; ● Any nonpayment or nonperformance by our customers, including due to actions taken by the independent governing authorities of our customers; ● Our marketing efforts may not be effective and changes in our marketing efforts and enrollment activities could lead to declines in enrollment; ● The student demographics of the schools we serve can lead to higher costs; ● The ability to meet state accountability testing standards and achieve parent and student satisfaction; ● Compliance with curriculum standards and assessments for individual state determinations under the ESSA; ● Risks due to mergers, acquisitions and joint ventures; 16 Table of Contents ● Negative impacts caused by the actions of activist stockholders; ● Market demand for online options in public schooling may decrease or not continue, or additional states may not authorize or adequately fund virtual or blended public schools; ● Increasing competition in the education industry sectors that we serve; ● The continuous evolution of regulatory frameworks on the accessibility of technology and curriculum; ● Differences between our quarterly estimates and the actual funds received and expenses incurred by the schools we serve; ● Seasonal fluctuations in our business; ● Our ability to create new products, expand distribution channels and pilot innovative educational programs; ● Our ability to recruit, train and retain quality certified teachers; ● Higher operating expenses and loss of management flexibility due to collective bargaining agreements; ● Our reliance on third-party service providers to host some of our solutions; ● Any problems with our Company-wide enterprise resource planning (“ERP”) and other systems; ● Our ability to maintain and enhance our product and service brands; ● Our ability to protect our valuable intellectual property rights, or lawsuits against us alleging the infringement of intellectual property rights of others; ● Any legal liability from the actions of third parties; ● Any failure to maintain and support customer-facing services, systems, and platforms; ● Any failure to prevent or mitigate a cybersecurity incident affecting our systems; ● Our reliance on the Internet to enroll students and to deliver our products and services; ● Our failure, or failure of our vendors, to comply with federal, state, and foreign laws and other requirements relating to the handling of information about individuals; ● Any failure by the single vendor we use to manage, receive, assemble and ship our learning kits and printed educational materials; ● Any significant interruption in the operation of AWS or Azure could cause a loss of data and disrupt our ability to manage our technological infrastructure; ● Scale and capacity limits on some of our technology, transaction processing systems and network hardware and software; ● Our ability to keep pace with changes in our industry and advancements in technology, including AI; ● AI technology is new and developing, and may present business, compliance, and reputational challenges, that could lead to operational or reputational damage, competitive harm, legal and regulatory risk, and additional costs; 17 Table of Contents ● Our ability to attract and retain key executives and skilled employees; and ● Our ability to obtain additional capital in the future on acceptable terms.
If we fail to protect adequately our intellectual property through patents, trademarks and copyrights, license agreements, employment agreements, confidentiality agreements, nondisclosure agreements or similar agreements, our intellectual property rights may be misappropriated by others, invalidated or challenged, and our competitors could duplicate our technology or may otherwise limit any competitive technology advantage we may have.
If we fail to adequately protect our intellectual property through patents, trademarks and copyrights, license agreements, employment agreements, confidentiality agreements, nondisclosure agreements or similar agreements, our intellectual property rights may be misappropriated by others, invalidated or challenged, and our competitors could duplicate our technology or may otherwise limit any competitive technology advantage we may have.
As we create and acquire new products, expand our existing customer base and pilot new educational programs, we expect to face challenges distinct from those we currently encounter, including: ● our continual efforts to innovate and pilot new programs to enhance student learning and to foster college and career opportunities, such as our Stride Career Prep schools which offer pathways for Career Learning, and including new AI-enabled products and programs, may not receive sufficient market acceptance to be economically viable; ● our use of third-party educational platforms that we do not control, could create issues with customer satisfaction, early withdrawals and declines in re-registrations, and potentially harm our reputation; ● the acquisition or opening of additional school-as-a-service offering in states where we already have a contract with other schools can potentially complicate the school selection process for prospective parents, and present marketing differentiation challenges depending on the facts and circumstances in that state; ● our development of public blended schools has raised different operational challenges than those we face with full-time virtual schools.
As we create and acquire new products, expand our existing customer base and pilot new educational programs, we expect to face challenges distinct from those we currently encounter, including: ● our continual efforts to innovate and pilot new programs to enhance student learning and to foster college and career opportunities, such as our Stride Career Prep schools which offer pathways for Career Learning, 27 Table of Contents and including new AI-enabled products and programs, may not receive sufficient market acceptance to be economically viable; ● our use of third-party educational platforms that we do not control, could create issues with customer satisfaction, early withdrawals and declines in re-registrations, and potentially harm our reputation; ● the acquisition or opening of additional school-as-a-service offering in states where we already have a contract with other schools can potentially complicate the school selection process for prospective parents, and present marketing differentiation challenges depending on the facts and circumstances in that state; ● our development of public blended schools has raised different operational challenges than those we face with full-time virtual schools.
We may also be required to expend significant capital and other resources in response to a security incident, including notification under data privacy laws and regulations, and incur expenses related to investigating and containing the incident, restoring lost or corrupted data, and remediating our IT Systems.
We may also be required to expend significant capital and other resources in response to a security incident, including notification under data privacy and breach notification laws and regulations, and incur expenses related to investigating and containing the incident, restoring lost or corrupted data, and remediating our IT Systems.
We may face contingencies related to intellectual property, financial disclosures, and accounting practices or internal controls. Finally, we may not be able to retain key executives of an acquired company.
We may face contingencies related to intellectual property, financial disclosures, accounting practices, or internal controls. Finally, we may not be able to retain key executives of an acquired company.
Further, market demand and acceptance of AI technologies are uncertain, and we may be unsuccessful in our efforts related to deploying AI in our business. 35 Table of Contents We may be unable to attract and retain key executives and skilled employees, and because our employees are located throughout the United States, we may incur additional compliance and litigation costs that could adversely impact our business, financial condition and our results of operations.
Further, market demand and acceptance of AI technologies are uncertain, and we may be unsuccessful in our efforts related to deploying AI in our business. 34 Table of Contents We may be unable to attract and retain key executives and skilled employees, and because our employees are located throughout the United States, we may incur additional compliance and litigation costs that could adversely impact our business, financial condition and our results of operations.
As implementation proceeds at the state level, and use of the assessments previously developed by the Partnership for Assessment of Readiness for College and Careers and Smarter Balanced Assessment Consortium consortia continues to erode, a multitude of different standards and assessments may emerge and result in temporary misalignments of our curriculum offerings with state standards, cause 25 Table of Contents academic performance to decline, create a need for additional teacher training and product investments, all of which could adversely affect our relationship with public school contracting with us for a school-as-a-service offering and school district customers, financial condition, contract renewals and reputation.
As implementation proceeds at the state level, and use of the assessments previously developed by the Partnership for Assessment of Readiness for College and Careers and Smarter Balanced Assessment Consortium consortia continues to erode, a multitude of different standards and assessments may emerge and result in temporary misalignments of our curriculum offerings with state standards, cause academic performance to decline, create a need for additional teacher training and product investments, all of which could adversely affect our relationship with public school contracting with us for a school-as-a-service offering and school district customers, financial condition, contract renewals and reputation.
If AWS or Azure encounter financial difficulty, such as bankruptcy or other events beyond our control, that causes it to fail to secure adequately and maintain its hosting facilities or provide the required data communications capacity, students of the schools we serve may experience interruptions in our service or the loss or theft of important customer data.
If AWS or Azure encounter financial difficulty, such as bankruptcy or other events beyond our control, that causes them to fail to secure adequately and maintain its hosting facilities or provide the required data communications capacity, students of the schools we serve may experience interruptions in our service or the loss or theft of important customer data.
In fiscal year 2024, a majority of our revenue was derived from our comprehensive school-as-a-service offerings in both the General Education and Career Learning markets, the majority of which were virtual and blended public schools operating under a charter. The service and products agreements for these schools are with the charter holder or the charter board.
In fiscal year 2025, a majority of our revenue was derived from our comprehensive school-as-a-service offerings in both the General Education and Career Learning markets, the majority of which were virtual and blended public schools operating under a charter. The service and products agreements for these schools are with the charter holder or the charter board.
We face several technological risks associated with online product service delivery, information technology security (including virus and cyber-attacks, ransomware, as well as software related bugs, misconfigurations or other vulnerabilities), e-commerce and enterprise resource planning system implementation and upgrades.
We face several technological risks associated with online product service delivery, information technology security (including virus and cyber-attacks, ransomware, as well as software related bugs, misconfigurations or other vulnerabilities), e-commerce and enterprise resource planning system implementations and upgrades.
In addition, teachers in the public schools we manage or who provide instruction in connection with 29 Table of Contents the online programs we offer to school districts, must be state certified (with limited exceptions or temporary waiver provisions in various states), and we must implement effective internal controls in each jurisdiction to ensure valid teacher certifications, as well as the proper matching of certifications with student grade levels and subjects to be taught.
In addition, teachers in the public schools we manage or who provide instruction in connection with the online programs we offer to school districts, must be state certified (with limited exceptions or temporary waiver provisions in various states), and we must implement effective internal controls in each jurisdiction to ensure valid teacher certifications, as well as the proper matching of certifications with student grade levels and subjects to be taught.
These payment delays have occurred in the past and can deprive us of significant working capital until the matter is resolved, 19 Table of Contents which could hinder our ability to implement our growth strategies and conduct our business.
These payment delays have occurred in the past and can deprive us of significant working capital until the matter is resolved, 18 Table of Contents which could hinder our ability to implement our growth strategies and conduct our business.
If the schools we serve fail to enroll or re-enroll a sufficient number of students, or we fail to enroll a significant number of students in the Career Learning programs for adult learners, our business, financial condition and results of operations will be adversely affected.
If the schools we serve fail to enroll or re-enroll a sufficient number of students, or we fail to enroll a significant number of students in the programs for adult learners, our business, financial condition and results of operations will be adversely affected.
We cannot assure that we will have the financial resources, technical expertise, marketing, distribution or support capabilities to compete effectively. 27 Table of Contents Regulatory frameworks on the accessibility of technology and curriculum are continually evolving due to legislative and administrative developments and the rapid evolution of technology, which could result in increased product development costs and compliance risks.
We cannot assure that we will have the financial resources, technical expertise, marketing, distribution or support capabilities to compete effectively. Regulatory frameworks on the accessibility of technology and curriculum are continually evolving due to legislative and administrative developments and the rapid evolution of technology, which could result in increased product development costs and compliance risks.
In the absence of compatible business processes, adequate employee training, integration with other dependent systems, and sufficient staffing, this expanded capacity alone may not result in improved performance or outcomes. We may be unable to keep pace with changes in our industry and advancements in technology as our business and market strategy evolves, including AI.
In the absence of compatible business processes, adequate employee training, integration 33 Table of Contents with other dependent systems, and sufficient staffing, this expanded capacity alone may not result in improved performance or outcomes. We may be unable to keep pace with changes in our industry and advancements in technology as our business and market strategy evolves, including AI.
The teachers in many public schools we serve are not our employees and the ultimate authority relating to those teachers resides with an independent not-for-profit governing body, which oversees the schools. However, under many of our service and product agreements with virtual and blended public schools, we have responsibility to recruit, train and manage these teachers.
The teachers in many public schools we serve are not our employees and the ultimate authority relating to those teachers resides with an independent not-for-profit governing body, which oversees the schools. However, under many of our service and product agreements with virtual and blended public schools, we have responsibility to recruit, train and 28 Table of Contents manage these teachers.
The success of our business depends in part on the choice of a family to have their child begin or continue his or her education in a virtual or blended public school that we serve. This decision is based on many factors, including student performance and parent and student satisfaction.
The success of our business depends in part on the choice of a family to have their child begin or continue his or her education in a virtual or blended public school that we serve. This decision is based on many factors, including student 23 Table of Contents performance and parent and student satisfaction.
As a result, specific federal, state and other jurisdictional laws that could have an impact on our business include the following: ● the COPPA, as implemented by regulations of the Federal Trade Commission (revised July 2013), imposes restrictions on the ability of online companies to collect and use personal information from children under the age of 13; ● the FERPA, which imposes parental or student consent requirements for specified disclosures of student information to third parties, and emerging state student data privacy laws; ● the CDA, which provides website operators immunity from most claims arising from the publication of third-party content; ● numerous state cyberbullying laws which require schools to adopt policies on harassment through the Internet or other electronic communications; ● rapidly emerging state student data privacy laws which require schools to adopt privacy policies and/or require certain contractual commitments from education technology providers are applicable to virtual schools and can significantly vary from one state to another; ● federal and state laws that govern schools’ obligations to ELL students and students with disabilities; and ● the European Union General Data Protection Regulation (“GDPR”), which may apply to certain aspects of our private schools.
As a result, specific federal, state and other jurisdictional laws that could have an impact on our business include the following: ● the COPPA, as implemented by regulations of the Federal Trade Commission (revised July 2013), imposes restrictions on the ability of online companies to collect and use personal information from children under the age of 13; ● the FERPA, which imposes parental or student consent requirements for specified disclosures of student information to third parties, and certain state student data privacy laws; ● the CDA, which provides website operators immunity from most claims arising from the publication of third-party content; ● numerous state cyberbullying laws which require schools to adopt policies on harassment through the Internet or other electronic communications; ● rapidly emerging state student data privacy laws which require schools to adopt privacy policies and/or require certain contractual commitments from education technology providers are applicable to virtual schools and can significantly vary from one state to another; ● federal and state laws that govern schools’ obligations to ELL students and students with disabilities; and ● various jurisdictions’ privacy laws and regulations which may apply to certain aspects of our private schools.
Our online curriculum is made available to students through websites, computers and other display devices connected to the Internet. The website platforms and online curriculum include a combination of software applications that include graphics, pictures, videos, animations, sounds and interactive content that may present challenges to individuals with disabilities.
Our online curriculum is made available to students through websites, computers and other display devices connected to the Internet. The website platforms and online curriculum include a combination of software applications that include graphics, pictures, videos, animations, sounds and interactive content that may present challenges to 26 Table of Contents individuals with disabilities.
For example, for-profit education companies that own and operate post-secondary colleges and programs depend in significant part on student loans provided by the federal government to cover tuition expenses and 21 Table of Contents income sharing agreements, and federal laws prohibit incentive compensation for success in securing enrollments or financial aid to any person engaged in student recruiting or admission activities.
For example, for-profit education companies that own and operate post-secondary colleges and programs depend in significant part on student loans provided by the federal government to cover tuition expenses and income sharing agreements, and federal laws prohibit incentive compensation for success in securing enrollments or financial aid to any person engaged in student recruiting or admission activities.
In the event of accidents or injuries or other harm to students, we could face claims alleging that we were negligent, provided inadequate supervision or were otherwise liable for their injuries and our insurance may not cover the expenses of litigation or settlement amounts.
In the event of accidents or injuries or other harm to students, we could face claims alleging that we were negligent, provided inadequate supervision or were otherwise liable for their injuries and our 30 Table of Contents insurance may not cover the expenses of litigation or settlement amounts.
If a final determination of non-compliance is made, funds may be withheld, which could impair that school’s ability to pay us for services in a timely manner, or the school could be required to repay funds received during the period of non-compliance.
If a final determination of non-compliance is made, funds may be withheld, which could impair that school’s 19 Table of Contents ability to pay us for services in a timely manner, or the school could be required to repay funds received during the period of non-compliance.
The pursuit of acquisitions and their integrations may divert the resources that could otherwise be used to support and grow our existing lines of business. The combination of two or more independent enterprises is a complex, costly and time-consuming process.
The pursuit of 24 Table of Contents acquisitions and their integrations may divert the resources that could otherwise be used to support and grow our existing lines of business. The combination of two or more independent enterprises is a complex, costly and time-consuming process.
System delays or malfunctioning could also disrupt our ability to timely and accurately process and report results of our 30 Table of Contents operations, financial position and cash flows, which could impact our ability to timely complete important business processes. The continued development of our product and service brands is important to our business.
System delays or malfunctioning could also disrupt our ability to timely and accurately process and report results of our operations, financial position and cash flows, which could impact our ability to timely complete important business processes. The continued development of our product and service brands is important to our business.
As we continue to seek to increase enrollments and extend our geographic reach and product and service offerings, maintaining quality and consistency across all our services and products may become more difficult to achieve, and any significant and well-publicized failure to maintain this quality and consistency will have a detrimental effect on our brands.
As we continue to seek to increase enrollments and extend our geographic reach and product and service offerings, maintaining quality and consistency across all our services and products may become more difficult to achieve, and any 29 Table of Contents significant and well-publicized failure to maintain this quality and consistency will have a detrimental effect on our brands.
In contrast, while students in virtual or blended public K-12 schools are entitled to a public education with no federal or state loans necessary for tuition, laws could be enacted that make for-profit management companies serving such schools subject to similar recruitment or other restrictions.
In contrast, while students in virtual or 20 Table of Contents blended public K-12 schools are entitled to a public education with no federal or state loans necessary for tuition, laws could be enacted that make for-profit management companies serving such schools subject to similar recruitment or other restrictions.
This decision may potentially reduce the value of the programs they purchase from us by structurally separating the HoS from regular involvement with our virtual school management experts, employee-based professional development programs, and internal understanding of the proprietary curriculum and innovations we develop to improve academic performance.
This decision may potentially reduce the value of the programs they purchase from us by structurally separating the Principal or ED from regular involvement with our virtual school management experts, employee-based professional development programs, and internal understanding of the proprietary curriculum and innovations we develop to improve academic performance.
In fiscal year 2024, we had contracts for our school-as-a-service offerings for 91 schools in 31 states and the District of Columbia. A portion of these contracts are scheduled to expire in any given year and may not be renewed or may be renewed on terms much less favorable to us.
In fiscal year 2025, we had contracts for our school-as-a-service offerings for 89 schools in 31 states and the District of Columbia. A portion of these contracts are scheduled to expire in any given year and may not be renewed, or may be renewed on terms much less favorable to us.
While AI-powered applications may help provide more tailored or personalized learner experiences, if the content, analyses, or recommendations that AI applications assist in producing on our platform are, or are perceived to be, deficient, inaccurate, or biased, our reputation, competitive position, and business may be materially and adversely affected.
While AI-powered applications may help provide more tailored or personalized learner experiences, if the content, analyses, or recommendations that AI applications assist in producing on our platform are, or are perceived to be, deficient, inaccurate, or biased or non-compliant with the law, our reputation, competitive position, and business may be materially and adversely affected.
For example, a non-practicing entity sued us alleging that our proprietary learning 31 Table of Contents systems infringed three of its patents although its lawsuit was ultimately dismissed on the merits in 2014.
For example, a non-practicing entity sued us alleging that our proprietary learning systems infringed three of its patents although its lawsuit was ultimately dismissed on the merits in 2014.
Monetary damages, regulatory fines or penalties and other costs or losses, as well as injunctive remedies that require changes to our business model or practices, could be significant and may exceed insurance policy limits or may not be covered by our insurance at all.
Monetary damages, regulatory fines or penalties and other costs or losses, as well as injunctive remedies that 31 Table of Contents require changes to our business model or practices, could be significant and may exceed insurance policy limits or may not be covered by our insurance at all.
While historically we grew by opening new virtual public schools in new states, in recent years the pace of state expansion has declined while opening more schools in existing states has increased. In fiscal year 2024, we served 91 virtual public schools and blended schools in 31 states and the District of Columbia.
While historically we grew by opening new virtual public schools in new states, in recent years the pace of state expansion has declined while opening more schools in existing states has increased. In fiscal year 2025, we served 89 virtual public schools and blended schools in 31 states and the District of Columbia.
State and federal funding authorities conduct regular program and financial audits of the public schools we serve to ensure compliance with applicable 20 Table of Contents regulations.
State and federal funding authorities conduct regular program and financial audits of the public schools we serve to ensure compliance with applicable regulations.
In the United States, several states have introduced legislation mandating transparency in AI algorithms and their decision-making processes to prevent discriminatory practices. Notably, the Illinois Student Online Personal Protection Act (SOPPA) sets specific guidelines for protecting student data used by educational technology companies.
In the United States, certain states have introduced and passed legislation mandating, among other requirements, transparency in AI algorithms and their decision-making processes to prevent discriminatory practices. Notably, the Illinois Student Online Personal Protection Act (SOPPA) sets specific guidelines for protecting student data used by educational technology companies.
If activist stockholders were to emerge, their activities could 26 Table of Contents interfere with our ability to execute our strategic plan and divert resources from our business.
If activist stockholders were to emerge, their activities could interfere with our ability to execute our strategic plan and divert resources from our business.
However, this data may not fully capture trends in the performance of our business for a number of reasons, including: ● Enrollments for General Education and Career Learning only include those students in full service public or private programs where Stride provides a combination of curriculum, technology, instructional and support services inclusive of administrative support; ● This data includes enrollments for which Stride receives no public funding or revenue; ● No enrollments are included in Career Learning for Galvanize, Tech Elevator or MedCerts; and ● Over time a student may move from being counted as a General Education enrollment to being counted as a Career Learning enrollment, or vice versa, depending on the educational choices made by each student, which choices in certain cases may be impacted by counseling from Stride employees, and this may result in enrollment growth in one line of revenue being offset by a corresponding decrease in enrollments for the other line of revenue. 23 Table of Contents Accordingly, changes in enrollment data may not entirely correspond with changes in the financial performance of our business, and if the mix of enrollments changes, our revenues will be impacted to the extent the average revenues per enrollments are significantly different.
However, this data may not fully capture trends in the performance of our business for a number of reasons, including: ● Enrollments for General Education and Career Learning only include those students in full service public or private programs where Stride provides a combination of curriculum, technology, instructional and support services inclusive of administrative support; ● This data includes enrollments for which Stride receives no public funding or revenue; ● No enrollments are included in Career Learning for Galvanize, Tech Elevator or MedCerts; and ● Over time a student may move from being counted as a General Education enrollment to being counted as a Career Learning enrollment, or vice versa, depending on the educational choices made by each student, which choices in certain cases may be impacted by counseling from Stride employees, and this may result in enrollment growth in one line of revenue being offset by a corresponding decrease in enrollments for the other line of revenue.
Moreover, any use or integration of generative or other AI in our, or any third party’s, operations, products or services will pose new and/or unknown cybersecurity risks and challenges. ​ The failure to prevent a cybersecurity incident affecting our systems could result in the disruption of our services and the disclosure or misappropriation of sensitive information, which could harm our reputation, decrease demand for our services and products, expose us to liability, penalties, and remedial costs, or otherwise adversely affect our financial performance.
Moreover, any use or integration of generative or other AI in our, or any third party’s, operations, products or services will pose new and/or unknown cybersecurity risks and challenges. ​ The failure to prevent a cybersecurity incident affecting our systems, including, but not limited to, disruption of services, could harm our reputation, decrease demand for our services and products, expose us to liability, penalties, and remedial costs, or otherwise adversely affect our financial performance.
If student performance or satisfaction declines, students may decide not to remain enrolled in a virtual or blended public school that we serve and our business, financial condition and results of operations could be adversely affected.
If student performance or satisfaction declines, students may decide not to remain enrolled in a virtual or blended public school that we serve, charters may not be renewed or enrollment caps could be put in place, or enrollment practices could be limited, and our business, financial condition and results of operations could be adversely affected.
As a result, we believe that sequential quarterly comparisons of our financial results may not provide an accurate assessment of our financial position. 28 Table of Contents Risks Related to Our Operations We plan to continue to create new products, expand distribution channels and pilot innovative educational programs to enhance academic performance.
As our business grows, these seasonal fluctuations may become more pronounced. As a result, we believe that sequential quarterly comparisons of our financial results may not provide an accurate assessment of our financial position. Risks Related to Our Operations We plan to continue to create new products, expand distribution channels and pilot innovative educational programs to enhance academic performance.
The governing boards of the schools we serve in which we hire the Principal or Head of School (“HoS”) may seek to employ their own HoS as a condition for contract renewal.
The governing boards of the schools we serve in which we hire the Principal or Executive Director (“ED”) may seek to employ their own Principal or ED as a condition for contract renewal.
If our customers were to cause or be subjected to situations that lead to a weakened financial condition, dispute our invoices, withhold payments, or file for bankruptcy, we could experience difficulty and prolonged delays in collecting receivables, if at all. Any nonpayment or nonperformance by our customers could adversely affect our business, financial condition, results of operations and cash flows.
If our customers were to cause or be subjected to situations that lead 22 Table of Contents to a weakened financial condition, dispute our invoices, withhold payments, or file for bankruptcy, we could experience difficulty and prolonged delays in collecting receivables, if at all.
As the relative percentage of high school students increases as part of the total average enrollment in our school-as-a-service offerings, our costs are likely to increase. 24 Table of Contents As our cost structure evolves due to the demographics, educational profile and mix of the students enrolled in our school-as-a-service offerings, our profit margins may decline, and we may have increasing difficulty in sustaining or growing our operating income commensurate with our revenues.
As our cost structure evolves due to the demographics, educational profile and mix of the students enrolled in our school-as-a-service offerings, our profit margins may decline, and we may have increasing difficulty in sustaining or growing our operating income commensurate with our revenues.
In addition, we may not be able to expand and upgrade our systems and network hardware and software capabilities to accommodate significant unexpected increased or peak use.
In addition, we may not be able to expand and upgrade our systems and network hardware and software capabilities to accommodate significant unexpected increased or peak use. If we are unable to appropriately upgrade our systems and network hardware and software in a timely manner, our operations and processes may be temporarily disrupted.
We utilize a single logistics vendor for the management, receiving, assembly and shipping of all of our learning kits and printed educational materials. In addition, we utilize the same vendor at a second location for the reclamation and redeployment of our student computers. This partnership depends upon execution on the part of us and the vendor.
In addition, we utilize the same vendor at a second location for the reclamation and redeployment of our student computers. This partnership depends upon execution on the part of both us and the vendor.
Education of high school students is generally more costly than K-8 as more teachers with subject matter expertise (e.g., chemistry, calculus) must be hired to support an expansive curriculum, electives, and counseling services.
Education of high school students is generally more costly than K-8 as more teachers with subject matter expertise (e.g., chemistry, calculus) must be hired to support an expansive curriculum, electives, and counseling services. As the relative percentage of high school students increases as part of the total average enrollment in our school-as-a-service offerings, our costs are likely to increase.
In addition, remote and hybrid working arrangements that started during the COVID-19 pandemic may continue in the future, which presents additional opportunities for threat actors to engage in social engineering (for example, phishing) and to exploit vulnerabilities present in many non-corporate networks. 32 Table of Contents Furthermore, we may acquire companies or enter into IT systems integrations with companies that have cybersecurity vulnerabilities or unsophisticated security measures, which would expose us to increased risks. ​ Any security incident that results in Confidential Information, including personal information, being stolen, accessed, used or modified without authorization, or that otherwise disrupts or negatively impacts our operations or IT Systems, could harm our reputation, lead to customer attrition, and expose us to regulatory investigations, enforcement actions or litigation, including class actions.
Furthermore, we may acquire companies or enter into IT systems integrations with companies that have cybersecurity vulnerabilities or unsophisticated security measures, which would expose us to increased risks. ​ Any security incident that results in Confidential Information, including personal information, being stolen, accessed, used or modified without authorization, or that otherwise disrupts or negatively impacts our operations or IT Systems, could harm our reputation, lead to customer attrition, and expose us to regulatory investigations, enforcement actions or litigation, including class actions.
As we have grown to serve more schools, students and families in an increasing number of states and countries, we have invested in infrastructure systems and technology to keep pace such as new communication systems, enterprise hardware and software systems.
Our efforts to expand capacity may not produce the operational and financial results for which those investments were intended. As we have grown to serve more schools, students and families in an increasing number of states and countries, we have invested in infrastructure systems and technology to keep pace such as new communication systems, enterprise hardware and software systems.
If our school-as-a-service offerings experience higher 22 Table of Contents withdrawal rates during the year and/or enroll fewer new students as the year progresses than we have experienced in the past, our revenues, results of operations and financial condition would be adversely affected.
If our school-as-a-service offerings experience higher withdrawal rates during the year and/or enroll fewer new students as the year progresses than we have experienced in the past, our revenues, results of operations and financial condition would be adversely affected. 21 Table of Contents Similarly, at the start of each new school year, students who had remained enrolled through the end of the previous year may have graduated from the terminal grade in a school or have left our school-as-a-service offerings for any number of reasons.
As a result, our business and revenues would be adversely affected. New laws or regulations not currently applicable to for-profit education companies in the K-12 sector could be enacted and negatively impact our operations and financial results.
As a result, our business and revenues would be adversely affected. New laws or regulations could be enacted and negatively impact our operations and financial results.
As a result, we may be exposed to substantial liability, including significant expenses necessary to comply with such laws and regulations and indemnification of schools we operate for liabilities resulting from a school’s failure to comply with such laws and regulations. 33 Table of Contents Failure to comply with data privacy regulations could result in reputational damage to our brands and adversely affect our business, financial condition and results of operations .
As a result, we may be exposed to substantial liability, including significant expenses necessary to comply with such laws and regulations and indemnification of schools we operate for liabilities resulting from a school’s failure to comply with such laws and regulations.
Any perceived uncertainties as to our future direction also could affect the market price and volatility of our securities, cause key executives to leave the Company, adversely affect the relationships we have with our school board customers, and harm existing and new business prospects.
Any perceived uncertainties as to our future direction also could affect the market price and volatility of our securities, cause key executives to leave the Company, adversely affect the relationships we have with our school board customers, and harm existing and new business prospects. 25 Table of Contents If market demand for online options in public schooling does not increase or continue or if additional states do not authorize or adequately fund virtual or blended public schools, our business, financial condition and results of operations could be adversely affected.
Although we dedicate personnel and resources toward protecting against cybersecurity risks and threats, our efforts may fail to prevent a security incident.
Although we dedicate personnel and resources toward protecting against cybersecurity risks and threats, our efforts to protect against cybersecurity risks and threats may not be successful. We, and certain of our vendors who process Confidential Information on our behalf, have experienced security attacks and incidents, and we expect such attacks and incidents to continue in the future.
Removed
For example, a 2016 Nevada law expanded a charter authorizer’s ability to terminate a charter based upon academic performance or to reconstitute a school’s governing board, and a 2013 Tennessee law included academic performance criteria applicable only to virtual schools.
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A 2025 Arkansas law amends the state’s charter school law, requiring that a charter school that performs poorly for three consecutive years have its authorization to operate revoked.
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Similarly, at the start of each new school year, students who had remained enrolled through the end of the previous year may have graduated from the terminal grade in a school or have left our school-as-a-service offerings for any number of reasons.
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Accordingly, changes in enrollment data may not entirely correspond with changes in the financial performance of our business, and if the mix of enrollments changes, our revenues will be impacted to the extent the average revenues per enrollments are significantly different.
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If market demand for online options in public schooling does not increase or continue or if additional states do not authorize or adequately fund virtual or blended public schools, our business, financial condition and results of operations could be adversely affected.
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Any nonpayment or nonperformance by our customers could adversely affect our business, financial condition, results of operations and cash flows.
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As our business grows, these seasonal fluctuations may become more pronounced.
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While to date no attacks or incidents have had a material impact on our operations or financial results, we cannot guarantee that material incidents will not occur in the future.
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Any perceived or actual unauthorized access, disclosure of personally identifiable information, whether through breach of our network or a vendor’s network by an unauthorized party, employee theft, misuse or error or otherwise, could harm our reputation, impair our ability to attract and retain our customers, or subject us to claims or litigation arising from damages suffered by individuals.
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Any perceived or actual unauthorized access to or disclosure of Confidential Information could harm our reputation, decrease demand for our services and products, expose us to liability, penalties, and remedial costs, or otherwise adversely affect our financial performance.
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Failure to adequately protect personally identifiable information could potentially lead to penalties, significant remediation costs, reputational damage, the cancellation of existing contracts and difficulty in competing for future business.
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In addition, remote and hybrid working arrangements that started during the COVID-19 pandemic may continue in the future, which presents additional opportunities for threat actors to engage in social engineering (for example, phishing) and to exploit vulnerabilities present in many non-corporate networks.
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In addition, we could incur significant costs in complying with relevant laws and regulations regarding the unauthorized disclosure of personal information, which may be affected by any changes to data privacy legislation at both the federal and state levels.
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Compliance with ever-evolving federal, state, and foreign laws and other requirements relating to the handling of information about individuals necessitates significant expenditure and resources, and any failure by us or our vendors to comply may result in significant liability, negative publicity, and/or an erosion of trust, which could materially adversely affect our business, financial condition and results of operations .
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Because we serve students residing in foreign countries, we may be subject to privacy laws of other countries and regions, such as the GDPR.
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We and our vendors are subject to a variety of federal, state and foreign data privacy laws, rules, regulations, industry standards and other requirements, including those that apply generally to the handling of personal information, and these requirements, and their application, interpretation and amendment, are constantly evolving.
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In addition to the possibility of penalties, remediation costs and reputational damage, the cost of compliance with foreign laws may outweigh revenue from those countries to such an extent that we may discontinue or restrict our offerings to certain countries.
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It is possible that the requirements under new or existing laws, regulations, and other requirements, or amendments to or changes in interpretations of existing laws, regulations and other requirements, may require us to incur significant costs, implement new processes, or change our handling of information and business operations, which could ultimately hinder our ability to grow our business. 32 Table of Contents Even though we believe we and our vendors are generally in compliance with applicable laws, rules and regulations relating to privacy and data security, these laws are in some cases relatively new and the interpretation and application of these laws are uncertain.
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If we are unable to appropriately upgrade our systems and network hardware and software in a timely manner, our operations and processes may be temporarily disrupted. 34 Table of Contents Our efforts to expand capacity may not produce the operational and financial results for which those investments were intended.
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Any failure or perceived failure to comply with data privacy laws, rules, regulations, industry standards and other requirements could result in proceedings or actions against us by individuals, consumer rights groups, government agencies, or others. We could incur significant costs with such proceedings or actions against, significant negative publicity and an erosion of trust.
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If any of these events were to occur, our business, financial condition and results of operations could be materially adversely affected. We utilize a single logistics vendor for the management, receiving, assembly and shipping of all of our learning kits and printed educational materials.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeThe full 37 Table of Contents Board also receives briefings from management on our cyber risk management program. ​ Our management team, including our Chief Information Security Officer (CISO), is responsible for assessing and managing our material risks from cybersecurity threats.
Biggest changeThe full Board also receives briefings from management on our cyber risk management program. ​ Our management team, including our Chief Information Security Officer (CISO), is responsible for assessing and managing our material risks from cybersecurity threats.
In addition, management updates the Committee on any incidents it considers to be significant or potentially significant. ​ The Committee reports to the full Board regarding its activities, including those related to cybersecurity.
In addition, management updates the Committee on any incidents it considers to be significant or potentially significant. ​ 36 Table of Contents The Committee reports to the full Board regarding its activities, including those related to cybersecurity.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeITEM 2. PROPERTIES Our headquarters is located in approximately 23,000 square feet of office space in Reston, Virginia. The facility is under a lease that expires in July 2033. In addition, we lease approximately 399,000 square feet in multiple locations throughout the United States under individual leases that expire between August 2024 and July 2033. ITEM 3.
Biggest changeITEM 2. PROPERTIES Our headquarters is located in approximately 23,000 square feet of office space in Reston, Virginia. The facility is under a lease that expires in July 2033. In addition, we lease approximately 361,000 square feet in multiple locations throughout the United States under individual leases that expire between July 2025 and August 2030. ITEM 3.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeITEM 3. Legal Proceedings 38 ITEM 4 Mine Safety Disclosures 38 PART II ​ ​ ITEM 5 . Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 39 ITEM 6 . [Reserved] 40 ITEM 7 . Management’s Discussion and Analysis of Financial Condition and Results of Operations 41 ITEM 7A .
Biggest changeITEM 3. Legal Proceedings 37 ITEM 4 Mine Safety Disclosures 37 PART II ​ ​ ITEM 5 . Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 38 ITEM 6 . [Reserved] 39 ITEM 7 . Management’s Discussion and Analysis of Financial Condition and Results of Operations 40 ITEM 7A .
Quantitative and Qualitative Disclosures About Market Risk 54 ITEM 8 . Financial Statements and Supplementary Data 55
Quantitative and Qualitative Disclosures About Market Risk 51 ITEM 8 . Financial Statements and Supplementary Data 52

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeCOMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN(1)(2) Among Stride, Inc., S&P 500 Index, NASDAQ Composite Index, Russell 2000 Index and Peer Group Index ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 30-Jun-19 30-Jun-20 ​ 30-Jun-21 ​ 30-Jun-22 ​ 30-Jun-23 ​ 30-Jun-24 LRN 100 101 ​ 127 ​ 153 150 221 Peer Group Index 100 107 ​ 110 ​ 65 51 63 S&P 500 100 110 ​ 144 ​ 133 150 172 Nasdaq Composite 100 129 ​ 167 ​ 144 168 195 Russell 2000 100 101 ​ 153 ​ 125 135 145 39 Table of Contents (1) The information presented above in the stock performance graph shall not be deemed “soliciting material” or to be “filed” with the SEC or subject to Regulation 14A or 14C, except to the extent that we subsequently specifically request that such information be treated as soliciting material or specifically incorporate it by reference into a filing under the Securities Act of 1933, as amended (the “Securities Act”), or a filing under the Exchange Act.
Biggest changeCOMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN(1)(2) Among Stride, Inc., S&P 500 Index, NASDAQ Composite Index, Russell 2000 Index and Peer Group Index ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 30-Jun-20 30-Jun-21 ​ 30-Jun-22 ​ 30-Jun-23 ​ 30-Jun-24 ​ 30-Jun-25 LRN 100 126 ​ 152 ​ 150 220 300 Peer Group Index 100 103 ​ 61 ​ 47 59 79 S&P 500 100 134 ​ 124 ​ 141 162 176 Nasdaq Composite 100 139 ​ 115 ​ 139 166 182 Russell 2000 100 152 ​ 124 ​ 134 144 151 (1) The information presented above in the stock performance graph shall not be deemed “soliciting material” or to be “filed” with the SEC or subject to Regulation 14A or 14C, except to the extent that we subsequently specifically request that such information be treated as soliciting material or specifically incorporate it by reference into a filing under the Securities Act of 1933, as amended (the “Securities Act”), or a filing under the Exchange Act. 38 Table of Contents (2) The stock price performance shown on the graph is not necessarily indicative of future price performance.
Stock Performance Graph The graph below compares the cumulative return of holders of Stride, Inc.’s common stock with the cumulative returns of the S&P 500 index, the NASDAQ Composite Index, the Russell 2000 Index and our Peer Group Index, which is composed of 2U, Inc., Adtalem Global Education Inc., American Public Education Inc., Perdoceo Education Corporation, Chegg, Inc., Grand Canyon Education Inc., Udemy, Inc., Pearson PLC, Strategic Education Inc., and Coursera, Inc.
Stock Performance Graph The graph below compares the cumulative return of holders of Stride, Inc.’s common stock with the cumulative returns of the S&P 500 index, the NASDAQ Composite Index, the Russell 2000 Index and our Peer Group Index, which is composed of Adtalem Global Education Inc., American Public Education Inc., Perdoceo Education Corporation, Chegg, Inc., Grand Canyon Education Inc., Udemy, Inc., Pearson PLC, Strategic Education Inc., and Coursera, Inc.
The graph assumes that the value of the investment in our common stock in each index (including reinvestment of dividends) was $100 on June 30, 2019 and tracks it through June 30, 2024. All prices reflect closing prices on the last day of trading at the end of each calendar quarter.
The graph assumes that the value of the investment in our common stock in each index (including reinvestment of dividends) was $100 on June 30, 2020 and tracks it through June 30, 2025. All prices reflect closing prices on the last day of trading at the end of each calendar quarter.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Our common stock, par value $0.0001 per share, is traded on the New York Stock Exchange (the “NYSE”) under the symbol “LRN.” As of August 2, 2024, there were 342 registered holders of our common stock.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Our common stock, par value $0.0001 per share, is traded on the New York Stock Exchange (the “NYSE”) under the symbol “LRN.” As of August 1, 2025, there were 428 registered holders of our common stock.
(2) The stock price performance shown on the graph is not necessarily indicative of future price performance. Information used in the graph was obtained from a source we believe to be reliable, but we do not assume responsibility for any errors or omissions in such information.
Information used in the graph was obtained from a source we believe to be reliable, but we do not assume responsibility for any errors or omissions in such information. Dividend Policy We have never declared or paid any cash dividends on our common stock, and we currently do not anticipate paying any cash dividends.
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Dividend Policy We have never declared or paid any cash dividends on our common stock, and we currently do not anticipate paying any cash dividends.

Item 7. Management's Discussion & Analysis

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

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Biggest changeSupport Services – We provide a broad range of support services, including marketing and enrollment, supporting prospective students through the admission process, assessment management, administrative support (e.g., budget proposals, financial reporting, and student data reporting), and technology and materials support (e.g., provisioning of student computers, offline learning kits, internet access and technology support services). 49 Table of Contents Financial Information The following table sets forth statements of operations data and the amounts as a percentage of revenues for each of the periods indicated: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended June 30, ​ ​ ​ ​ 2024 ​ 2023 ​ 2022 ​ ​ ​ ​ ​ (In thousands, except percentages) ​ Revenues ​ ​ $ 2,040,069 100.0 % $ 1,837,358 100.0 % $ 1,686,666 100.0 % Instructional costs and services ​ ​ ​ ​ 1,276,466 ​ ​ 62.6 ​ ​ 1,190,288 ​ ​ 64.8 ​ ​ 1,090,191 ​ ​ 64.6 ​ Gross margin ​ ​ ​ ​ 763,603 ​ ​ 37.4 ​ ​ 647,070 ​ ​ 35.2 ​ ​ 596,475 ​ ​ 35.4 ​ Selling, general, and administrative expenses ​ ​ ​ ​ 514,003 ​ ​ 25.2 ​ ​ 481,571 ​ ​ 26.2 ​ ​ 439,847 ​ ​ 26.1 ​ Income from operations ​ ​ ​ ​ 249,600 ​ ​ 12.2 ​ ​ 165,499 ​ ​ 9.0 ​ ​ 156,628 ​ ​ 9.3 ​ Interest expense, net ​ ​ ​ ​ (8,812) ​ ​ (0.4) ​ ​ (8,404) ​ ​ (0.5) ​ ​ (8,277) ​ ​ (0.5) ​ Other income (expense), net ​ ​ ​ ​ 26,900 ​ ​ 1.3 ​ ​ 15,452 ​ ​ 0.8 ​ ​ (1,277) ​ ​ (0.1) ​ Income before income taxes and income (loss) from equity method investments ​ ​ ​ ​ 267,688 ​ ​ 13.1 ​ ​ 172,547 ​ ​ 9.4 ​ ​ 147,074 ​ ​ 8.7 ​ Income tax expense ​ ​ ​ ​ (64,482) ​ ​ (3.2) ​ ​ (45,346) ​ ​ (2.5) ​ ​ (40,088) ​ ​ (2.4) ​ Income (loss) from equity method investments ​ ​ ​ ​ 977 ​ ​ 0.0 ​ ​ (334) ​ ​ (0.0) ​ ​ 144 ​ ​ 0.0 ​ Net income attributable to common stockholders ​ ​ ​ $ 204,183 ​ ​ 10.0 % $ 126,867 ​ ​ 6.9 % $ 107,130 ​ ​ 6.4 % ​ Comparison of the Years Ended June 30, 2024 and 2023 ​ Revenues.
Biggest changeThe following table sets forth statements of operations data and the amounts as a percentage of revenues for each of the periods indicated: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended June 30, ​ ​ ​ 2025 ​ ​ 2024 ​ ​ ​ ​ ​ (In thousands, except percentages) ​ Revenues ​ ​ $ 2,405,317 100.0 % $ 2,040,069 100.0 % Instructional costs and services ​ ​ ​ ​ 1,461,398 ​ ​ 60.8 ​ ​ ​ 1,276,466 ​ ​ 62.6 ​ Gross margin ​ ​ ​ ​ 943,919 ​ ​ 39.2 ​ ​ ​ 763,603 ​ ​ 37.4 ​ Selling, general, and administrative expenses ​ ​ ​ ​ 524,347 ​ ​ 21.8 ​ ​ ​ 514,003 ​ ​ 25.2 ​ Impairment of long-lived assets ​ ​ ​ ​ 59,478 ​ ​ 2.5 ​ ​ ​ — ​ ​ — ​ Income from operations ​ ​ ​ ​ 360,094 ​ ​ 15.0 ​ ​ ​ 249,600 ​ ​ 12.2 ​ Interest expense, net ​ ​ ​ ​ (10,504) ​ ​ (0.4) ​ ​ ​ (8,812) ​ ​ (0.4) ​ Other income, net ​ ​ ​ ​ 33,629 ​ ​ 1.4 ​ ​ ​ 26,900 ​ ​ 1.3 ​ Income before income taxes and income (loss) from equity method investments ​ ​ ​ ​ 383,219 ​ ​ 15.9 ​ ​ ​ 267,688 ​ ​ 13.1 ​ Income tax expense ​ ​ ​ ​ (93,007) ​ ​ (3.9) ​ ​ ​ (64,482) ​ ​ (3.2) ​ Income (loss) from equity method investments ​ ​ ​ ​ (2,271) ​ ​ (0.1) ​ ​ ​ 977 ​ ​ 0.0 ​ Net income attributable to common stockholders ​ ​ ​ $ 287,941 ​ ​ 12.0 % ​ $ 204,183 ​ ​ 10.0 % ​ Comparison of the Years Ended June 30, 2025 and 2024 ​ Revenues.
In the preparation of our consolidated financial statements, we are required to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, as well as the related disclosures of contingent assets and liabilities. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances.
In the preparation of our consolidated financial statements, we are required to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, as well as the related disclosures of contingent assets and liabilities. We base our estimates on historical experience and various other assumptions that we believe to be reasonable under the circumstances.
Shipments of materials for schools that occur in the fourth fiscal quarter and for the upcoming school year are recorded in deferred revenue. ​ We generate revenues under contracts with virtual and blended public schools and include the following components, where required: ​ ● providing each of a school’s students with access to our online school and lessons; ● offline learning kits, which include books and materials to supplement the online lessons; ● the use of a personal computer and associated reclamation services; ● internet access and technology support services; ● instruction by a state-certified teacher; and ● management and technology services necessary to support a virtual or blended school.
Shipments of materials for schools that occur in the fourth fiscal quarter and the upcoming school year are recorded in deferred revenue. ​ We generate revenues under contracts with virtual and blended public schools and include the following components, where required: ​ ● providing each of a school’s students with access to our online school and lessons; ● offline learning kits, which include books and materials to supplement the online lessons; ● the use of a personal computer and associated reclamation services; ● internet access and technology support services; ● instruction by a state-certified teacher; and ● management and technology services necessary to support a virtual or blended school.
Our end-to-end platform includes single-sign on capability for our content management, learning management, student information, data reporting and analytics, and various support systems that allow customers to provide a high-quality and personalized educational experience for students. Stand-alone products and services can provide curriculum and content hosting on customers’ LMSs, or integration with customers’ student information systems.
Our end-to-end platform includes single-sign on capability for our content management, learning management, student information, data reporting and analytics, and various support systems that allow customers to provide a high-quality and personalized educational experience for students. Stand-alone products and services can provide curriculum and content hosting on customers’ learning management systems, or integration with customers’ student information systems.
The following overview provides a summary of the sections included in our MD&A: ● Executive Summary —a general description of our business and key highlights of the year ended June 30, 2024. ● Key Aspects and Trends of Our Operations —a discussion of items and trends that may impact our business in the upcoming year. ● Critical Accounting Estimates —a discussion of critical accounting estimates requiring judgments and the application of critical accounting policies. ● Results of Operations —an analysis of our results of operations in our consolidated financial statements. ● Liquidity and Capital Resources —an analysis of cash flows, sources and uses of cash, commitments and contingencies, seasonality in the results of our operations, and quantitative and qualitative disclosures about market risk.
The following overview provides a summary of the sections included in our MD&A: ● Executive Summary —a general description of our business and key highlights of the year ended June 30, 2025. ● Key Aspects and Trends of Our Operations —a discussion of items and trends that may impact our business in the upcoming year. ● Critical Accounting Estimates —a discussion of critical accounting estimates requiring judgments and the application of critical accounting policies. ● Results of Operations —an analysis of our results of operations in our consolidated financial statements. ● Liquidity and Capital Resources —an analysis of cash flows, sources and uses of cash, commitments and contingencies, seasonality in the results of our operations, and quantitative and qualitative disclosures about market risk.
We believe that the following critical accounting policies affect the more significant judgments and estimates used in the preparation of our consolidated financial statements: 45 Table of Contents Revenue Recognition Revenue is recognized when control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services using the following steps: ​ ● identify the contract, or contracts, with a customer; ● identify the performance obligations in the contract; ● determine the transaction price; ● allocate the transaction price to the performance obligations in the contract; and ● recognize revenue when, or as, the Company satisfies a performance obligation. ​ Revenues related to the products and services that we provide to students in kindergarten through twelfth grade or adult learners are considered to be General Education or Career Learning based on the school or adult program in which the student is enrolled.
We believe that the following critical accounting policies affect the more significant judgments and estimates used in the preparation of our consolidated financial statements: Revenue Recognition Revenue is recognized when control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services using the following steps: ​ ● identify the contract, or contracts, with a customer; ● identify the performance obligations in the contract; ● determine the transaction price; ● allocate the transaction price to the performance obligations in the contract; and ● recognize revenue when, or as, the Company satisfies a performance obligation. ​ Revenues related to the products and services that we provide to students in kindergarten through twelfth grade or adult learners are considered to be General Education or Career Learning based on the school or adult program in which the student is enrolled.
Career Learning products and services are focused on developing skills to enter and succeed in careers in high-growth, in-demand industries—including information technology, healthcare and general business, for students in middle school through high school and adult learners. ​ The majority of our contracts are with the following types of customers: ​ ● a virtual or blended school whereby the amount of revenue is primarily determined by funding the school receives; ● a school or individual who licenses certain curriculum on a subscription or course-by-course basis; or ● an enterprise who contracts with the Company to provide job training. ​ Funding-based Contracts ​ We provide an integrated package of systems, services, products, and professional expertise that is administered together to support a virtual or blended public school.
Career Learning products and services are focused on developing skills to enter and succeed in careers in high-growth, in-demand industries—including information technology, healthcare and general business, for students in middle school through high school and adult learners. ​ The majority of our contracts are with the following types of customers: ​ ● a virtual or blended school whereby the amount of revenue is primarily determined by funding the school receives; ● a school or individual who licenses certain curriculum on a subscription or course-by-course basis; or ● an enterprise who contracts with the Company to provide job training. ​ 44 Table of Contents Funding-based Contracts ​ We provide an integrated package of systems, services, products, and professional expertise that is administered together to support a virtual or blended public school.
Our growth strategy includes increasing revenues in other distribution channels, expanding our adult learning training programs, adding enrollments in our private schools, and expanding our traditional public schools sales channel. Combined revenues from these other sectors were significantly smaller than those from the virtual and blended public schools we served in the year ended June 30, 2024.
Our growth strategy includes increasing revenues in other distribution channels, expanding our adult learning training programs, adding enrollments in our private schools, and expanding our traditional public schools sales channel. Combined revenues from these other sectors were significantly smaller than those from the virtual and blended public schools we served in the year ended June 30, 2025.
We provide middle and high school students with Career Learning programs that complement their core general education coursework. Stride offers multiple career pathways through a diverse catalog of courses. The middle school program exposes students to a variety of career options and introduces career skill development.
We provide middle and high school students with Career Learning programs that complement their core general education coursework. Stride offers multiple career pathways through a broad catalog of courses. The middle school program exposes students to a variety of career options and introduces career skill development.
Factors affecting our revenues include: (i) the number of enrollments; (ii) the mix of enrollments across grades and states; (iii) administrative services and curriculum sales provided to the schools and school districts; (iv) state or district per student funding levels and attendance requirements; (v) prices for our products and services; 43 Table of Contents (vi) growth in our adult learning programs; and (vii) revenues from new initiatives, mergers and acquisitions.
Factors affecting our revenues include: (i) the number of enrollments; (ii) the mix of enrollments across grades and states; (iii) administrative services and curriculum sales provided to the schools and school districts; (iv) state or district per student funding levels and attendance requirements; (v) prices for our products and services; (vi) growth in our adult learning programs; and (vii) revenues from new initiatives, mergers and acquisitions.
Each of these contracts are considered to be one performance obligation. We recognize these revenues pro rata over the maximum term of the customer contract based on the defined contract price. ​ Enterprise Contracts ​ We provide job training over a specified contract period to enterprises. Each of these contracts are considered to be one performance obligation.
Each of these contracts is considered to be one performance obligation. We recognize these revenues pro rata over the maximum term of the customer contract based on the defined contract price. ​ Enterprise Contracts ​ We provide job training over a specified contract period to enterprises. Each of these contracts is considered to be one performance obligation.
For the years ended June 30, 2023, 2022 and 2021, the Company’s aggregate funding estimates differed from actual reimbursements impacting total reported revenue by approximately 2.8%, 1.6%, and 1.4%, respectively. Each state and/or school district has variations in the school funding formulas and methodologies that it uses to estimate funding for revenue recognition at its respective schools.
For the years ended June 30, 2024, 2023 and 2022, the Company’s aggregate funding estimates differed from actual reimbursements impacting total reported revenue by approximately 1.8%, 2.8%, and 1.6%, respectively. Each state and/or school district has variations in the school funding formulas and methodologies that it uses to estimate funding for revenue recognition at its respective schools.
Our accounts receivable balance fluctuates throughout the fiscal year based on the timing of customer billings and collections and tends to be highest in our 51 Table of Contents first fiscal quarter as we begin billing for students.
Our accounts receivable balance fluctuates throughout the fiscal year based on the timing of customer billings and collections and tends to be highest in our 49 Table of Contents first fiscal quarter as we begin billing for students.
The average duration of the agreements for our school-as-a-service offering is greater than five years, and most provide for automatic renewals absent a customer notification of non-renewal. ​ During the 2023-2024 school year, we provided our school-as-a-service offering to 91 schools in 31 states and the District of Columbia in the General Education market, and 56 schools or programs in 27 states and the District of Columbia in the Career Learning market. ​ In 2020, we significantly expanded our Career Learning opportunity by acquiring three adult learning companies, Galvanize, Tech Elevator, and MedCerts.
The average duration of the agreements for our school-as-a-service offering is greater than five years, and most provide for automatic renewals absent a customer notification of non-renewal. ​ During the 2024-2025 school year, we provided our school-as-a-service offering to 89 schools in 31 states and the District of Columbia in the General Education market, and 56 schools or programs in 27 states and the District of Columbia in the Career Learning market. ​ In 2020, we significantly expanded our Career Learning opportunity by acquiring three adult learning companies, Galvanize, Tech Elevator, and MedCerts.
If the mix of enrollments changes, our revenues will be impacted to the extent the average revenue per enrollment is significantly different. We do not award or permit incentive compensation to be paid to our public school program enrollment staff or contractors based on the number of students enrolled.
If the mix of enrollments changes, our revenues will be impacted to the extent the average revenue per enrollment is significantly different. We do not award or permit incentive compensation to be paid to our public school program 46 Table of Contents enrollment staff or contractors based on the number of students enrolled.
Actual school net operating losses may vary from these estimates or revisions, and the impact of these differences could have a material impact on results of operations. ​ Subscription-based Contracts ​ We provide certain online curriculum and services to schools and school districts under subscription agreements.
Actual school net operating losses may vary from these estimates or revisions, and the impact of these differences could have a material impact on results of operations. ​ 45 Table of Contents Subscription-based Contracts ​ We provide certain online curriculum and services to schools and school districts under subscription agreements.
In addition, our cash and accounts receivable were significantly in excess of our accounts payable and short-term accrued liabilities at June 30, 2024. ​ During the first quarter of fiscal year 2021, we issued $420.0 million aggregate principal amount of 1.125% Convertible Senior Notes due 2027 (“Notes”). The Notes are governed by an indenture (the “Indenture”) between us and U.S.
In addition, our cash and accounts receivable were significantly in excess of our accounts payable and short-term accrued liabilities at June 30, 2025. ​ During the first quarter of fiscal year 2021, we issued $420.0 million aggregate principal amount of 1.125% Convertible Senior Notes due 2027 (“Notes”). The Notes are governed by the indenture between us and U.S.
The Credit Facility has a five-year term and incorporates customary financial and other covenants, including, but not limited to, a maximum leverage ratio and a minimum interest coverage ratio. The majority of our borrowings under the Credit Facility were at LIBOR plus an additional rate ranging from 0.875% - 1.50% based on our leverage ratio as defined in the agreement.
The Credit Facility had a five-year term and incorporated customary financial and other covenants, including, but not limited to, a maximum leverage ratio and a minimum interest coverage ratio. The majority of our borrowings under the Credit Facility were at LIBOR plus an additional rate ranging from 0.875% - 1.50% based on our leverage ratio as defined in the agreement.
We review its estimates of funding periodically, and updates as necessary, by adjusting its year-to-date earned revenues to be proportional to the total expected revenues to be earned during the fiscal year. Actual school funding may vary from these estimates and the impact of these differences could impact our results of operations.
We review our estimates of funding periodically and update as necessary by adjusting our year-to-date earned revenues to be proportional to the total expected revenues to be earned during the fiscal year. Actual school funding may vary from these estimates and the impact of these differences could impact our results of operations.
A student enrolled in a school that offers Stride’s General Education program may elect to take career courses, but that student and the associated revenue is reported as a General Education enrollment and General Education revenue. ​ Career Learning ​ Career Learning products and services are focused on developing skills to enter and succeed in careers in high-growth, in-demand industries—including information technology, healthcare and general business.
A 40 Table of Contents student enrolled in a school that offers Stride’s General Education program may elect to take career courses, but that student and the associated revenue is reported as a General Education enrollment and General Education revenue. ​ Career Learning ​ Career Learning products and services are focused on developing skills to enter and succeed in careers in high-growth, in-demand industries—including information technology, healthcare and general business.
Since the end of the school year coincides with the end of our fiscal year, annual revenues are generally based on actual 46 Table of Contents school funding and actual costs incurred (including costs for our services to the schools plus other costs the schools may incur).
Since the end of the school year coincides with the end of our fiscal year, annual revenues are generally based on actual school funding and actual costs incurred (including costs for our services to the schools plus other costs the schools may incur).
We have a valuation allowance on net deferred tax assets of $7.4 million and $6.8 million as of June 30, 2024 and 2023, respectively, for the amount that will likely not be realized.
We have a valuation allowance on net deferred tax assets of $7.6 million and $7.4 million as of June 30, 2025 and 2024, respectively, for the amount that will likely not be realized.
These programs provide an alternative to traditional school options and address a range of student needs. Products and services are delivered as a comprehensive school-as-a-service offering for schools or as stand-alone products 41 Table of Contents and services.
These programs provide an alternative to traditional school options and address a range of student needs. Products and services are delivered as a comprehensive school-as-a-service offering for schools or as stand-alone products and services.
Public schools and school districts are increasingly adopting digital educational solutions to augment teaching practices, launch new learning models, cost effectively expand course offerings, provide schedule flexibility, improve student engagement, increase graduation rates, replace textbooks, and retain students.
Public schools and school districts are increasingly adopting digital educational solutions to augment teaching practices, launch new learning models, cost effectively expand course offerings, provide schedule flexibility, improve student engagement, increase graduation rates, replace textbooks, 42 Table of Contents and retain students.
We can also provide these programs directly to enterprises to create customized, tailored education plans to help companies train, upskill, and reskill their employees. 44 Table of Contents Instructional Costs and Services Expenses Instructional costs and services expenses include expenses directly attributable to the educational products and services we provide.
We can also provide these programs directly to enterprises to create customized, tailored education plans to help companies train, upskill, and reskill their employees. ​ Instructional Costs and Services Expenses Instructional costs and services expenses include expenses directly attributable to the educational products and services we provide.
Curriculum and Content – Stride has one of the largest digital research-based curriculum portfolios for the K-12 online education industry that includes some of the best - in - class content available in the market.
Curriculum and Content – We have one of the largest digital research-based curriculum portfolios for the K-12 online education industry that includes some of the best - in - class content available in the market.
Instructional costs and services expenses were 62.6% of revenues during the year ended June 30, 2024, a decrease from 64.8% for the year ended June 30, 2023. ​ Selling, general, and administrative expenses.
Instructional costs and services expenses were 60.8% of revenues during the year ended June 30, 2025, a decrease from 62.6% for the year ended June 30, 2024. ​ Selling, general, and administrative expenses.
In addition, we continue to explore acquisitions, strategic investments and joint ventures related to our business that we may acquire using cash, stock, debt, contribution of assets or a combination thereof. ​ Operating Activities Net cash provided by operating activities for the year ended June 30, 2024 was $278.8 million compared to $203.2 million for the year ended June 30, 2023.
In addition, we continue to explore acquisitions, strategic investments and joint ventures related to our business that we may acquire using cash, stock, debt, contribution of assets or a combination thereof. ​ 50 Table of Contents Operating Activities Net cash provided by operating activities for the year ended June 30, 2025 was $432.8 million compared to $278.8 million for the year ended June 30, 2024.
Our comprehensive school-as-a-service offering supports our clients in operating full-time virtual schools in the K-12 market.Together with our network of online schools, Stride has served millions of students with our products and services. ​ Our platform addresses two markets in the K-12 space: General Education and Career Learning. ​ General Education ​ Products and services for the General Education market are predominantly focused on core subjects, including math, English, science and history, for kindergarten through twelfth grade students to help build a common foundation of knowledge.
Together with our network of online schools, Stride has served millions of students with our products and services. ​ Our platform addresses two markets in the K-12 space: General Education and Career Learning. ​ General Education ​ General Education products and services are predominantly focused on core subjects, including math, English, science and history, for kindergarten through twelfth grade students to help build a common foundation of knowledge.
Accounts receivable balances tend to be at the highest levels in the first quarter of our fiscal year as we begin billing for all enrolled students and our billing arrangements include upfront fees for many of the elements of our offering. These upfront fees result in seasonal fluctuations to our deferred revenue balances.
As our enrollments and revenues grow, we expect these seasonal trends to be amplified. Accounts receivable balances tend to be at the highest levels in the first quarter of our fiscal year as we begin billing for all enrolled students and our billing arrangements include upfront fees for many of the elements of our offering.
The following represents our current enrollment for each of the periods indicated: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended June 30, ​ 2024 / 2023 ​ 2023 / 2022 ​ 2024 2023 2022 Change Change % Change Change % ​ ​ (In thousands, except percentages) General Education (1) ​ ​ 121.6 ​ ​ 112.3 ​ ​ 143.2 ​ ​ 9.3 ​ 8.3% ​ ​ (30.9) ​ (21.6%) Career Learning (1) (2) ​ ​ 72.7 ​ ​ 65.9 ​ ​ 41.9 ​ ​ 6.8 ​ 10.3% ​ ​ 24.0 ​ 57.3% Total Enrollment ​ ​ 194.3 ​ ​ 178.2 ​ ​ 185.1 ​ ​ 16.1 ​ 9.0% ​ ​ (6.9) ​ (3.7%) (1) Enrollments reported for the first quarter are equal to the official count date number, which was September 30, 2023 for the first quarter of fiscal year 2024, September 30, 2022 for the first quarter of fiscal year 2023, and September 30, 2021 for the first quarter of fiscal year 2022.
The following represents our current enrollment for each of the periods indicated: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended June 30, ​ 2025 / 2024 ​ 2024 / 2023 ​ ​ ​ 2025 2024 2023 Change Change % Change Change % ​ ​ ​ ​ ​ (In thousands, except percentages) General Education (1) ​ ​ ​ ​ ​ 137.7 ​ ​ 121.6 ​ ​ 112.3 ​ ​ 16.1 ​ 13.2% ​ ​ 9.3 ​ 8.3% Career Learning (1) (2) ​ ​ ​ ​ ​ 96.3 ​ ​ 72.7 ​ ​ 65.9 ​ ​ 23.6 ​ 32.5% ​ ​ 6.8 ​ 10.3% Total Enrollment ​ ​ ​ ​ ​ 234.0 ​ ​ 194.3 ​ ​ 178.2 ​ ​ 39.7 ​ 20.4% ​ ​ 16.1 ​ 9.0% (1) Enrollments reported for the first quarter are equal to the official count date number, which was September 30, 2024 for the first quarter of fiscal year 2025, September 30, 2023 for the first quarter of fiscal year 2024, and September 30, 2022 for the first quarter of fiscal year 2023.
Income tax expense was $64.5 million for the year ended June 30, 2024, or 24.0% of income before taxes, as compared to $45.3 million, or 26.3% of income before taxes for the year ended June 30, 2023.
Income tax expense was $93.0 million for the year ended June 30, 2025, or 24.4% of income before taxes, as compared to $64.5 million, or 24.0% of income before taxes for the year ended June 30, 2024.
Instructional costs and services expenses for the year ended June 30, 2024 were $1,276.5 million, representing an increase of $86.2 million, or 7.2%, from $1,190.3 million for the year ended June 30, 2023. This increase in expense was due to hiring of personnel in growth states and salary increases.
Instructional costs and services expenses for the year ended June 30, 2025 were $1,461.4 million, representing an increase of $184.9 million, or 14.5%, from $1,276.5 million for the year ended June 30, 2024. This increase in expense was due to hiring of personnel in growth states and salary increases.
Additionally, we use the non-financial metric of total enrollments to assess performance, as enrollment is a key driver of our revenues. Total enrollments for the year ended June 30, 2024 were 194.3 thousand, an increase of 16.1 thousand, or 9.0%, over the prior year.
Additionally, we use the non-financial metric of total enrollments to assess performance, as enrollment is a key driver of our revenues. Total enrollments for the year ended June 30, 2025 were 234.0 thousand, an increase of 39.7 thousand, or 20.4%, over the prior year.
The increase in net interest expense was primarily due to an increase in interest expense related to our finance leases. ​ Other income (expense), net. Other income, net for the year ended June 30, 2024 was $26.9 million as compared to $15.5 million for the year ended June 30, 2023.
Net interest expense for the year ended June 30, 2025 was $10.5 million as compared to $8.8 million for the year ended June 30, 2024. The increase in net interest expense was primarily due to our finance leases. ​ Other income, net.
Our working capital includes cash and cash equivalents of $500.6 million and accounts receivable of $472.8 million. Our working capital provides a significant source of liquidity for our normal operating needs.
Our working capital includes cash and cash equivalents of $782.5 million and accounts receivable of $559.7 million. Our working capital provides a significant source of liquidity for our normal operating needs.
The Credit Facility is secured by our assets. The Credit Facility agreement allows for an amendment to establish a new benchmark interest rate when LIBOR is discontinued during the five-year term. As of June 30, 2024, we were in compliance with the financial covenants.
The Credit Facility was secured by our assets. The Credit Facility agreement allowed for an amendment to establish a new benchmark interest rate when LIBOR was discontinued during the five-year term. Up through its expiration, we were in compliance with the financial covenants.
We believe that the 52 Table of Contents combination of funds to be generated from operations, borrowing on our Credit Facility and net working capital on hand will be adequate to finance our ongoing operations on a short-term (the next 12 months) and long-term (beyond the next 12 months) basis.
We expect to make future payments on existing leases from cash generated from operations. We believe that the combination of funds to be generated from operations and net working capital on hand will be adequate to finance our ongoing operations on a short-term (the next 12 months) and long-term (beyond the next 12 months) basis.
Systems – We have established a secure and reliable technology platform, which integrates proprietary and third-party systems, to provide a high-quality educational environment and gives us the capability to grow our customer programs and enrollment.
We provide high-quality, engaging, online coursework and content in software engineering, healthcare, and medical fields. 47 Table of Contents Systems – We have established a secure and reliable technology platform, which integrates proprietary and third-party systems, to provide a high-quality educational environment and gives us the capability to grow our customer programs and enrollment.
During the year ended June 30, 2024, revenues increased to $2,040.1 million from $1,837.4 million in the prior year, an increase of 11.0%. Over the same period, operating income increased to $249.6 million from $165.5 million in the prior year, an increase of 50.8%. The increase in operating income was driven by revenue growth and an increase in gross margin.
During the year ended June 30, 2025, revenues increased to $2,405.3 million from $2,040.1 million in the prior year, an increase of 17.9%. Over the same period, operating income increased to $360.1 million from $249.6 million in the prior year, an increase of 44.3%. The increase in operating income was driven by revenue growth and an increase in gross margin.
Selling, general and administrative expenses for the year ended June 30, 2024 were $514.0 million, representing an increase of $32.4 million, or 6.7% from $481.6 million for the year ended June 30, 2023.
Selling, general and administrative expenses for the year ended June 30, 2025 were $524.3 million, representing an increase of $10.3 million, or 2.0% from $514.0 million for the year ended June 30, 2024.
The increase in other income, net was primarily due to the increase in our investments in marketable securities and the returns on those investments year over year. ​ Income tax expense.
Other income, net for the year ended June 30, 2025 was $33.6 million as compared to $26.9 million for the year ended June 30, 2024. The increase in other income, net was primarily due to the increase in our investments in marketable securities and the returns on those investments year over year. ​ Income tax expense.
Periodically, a middle school or high school student enrollment may change line of revenue classification. ​ 48 Table of Contents The following represents our current revenues for each of the periods indicated: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended June 30, ​ Change 2024 / 2023 ​ Change 2023 / 2022 ​ 2024 2023 2022 $ % $ % ​ ​ (In thousands, except percentages) General Education ​ $ 1,289,193 ​ $ 1,131,391 ​ $ 1,273,783 ​ $ 157,802 ​ 13.9% ​ $ (142,392) ​ (11.2%) Career Learning ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Middle - High School ​ ​ 651,191 ​ ​ 586,770 ​ ​ 321,416 ​ ​ 64,421 ​ 11.0% ​ ​ 265,354 ​ 82.6% Adult ​ ​ 99,685 ​ ​ 119,197 ​ ​ 91,467 ​ ​ (19,512) ​ (16.4%) ​ ​ 27,730 ​ 30.3% Total Career Learning ​ ​ 750,876 ​ ​ 705,967 ​ ​ 412,883 ​ ​ 44,909 ​ 6.4% ​ ​ 293,084 ​ 71.0% Total Revenues ​ $ 2,040,069 ​ $ 1,837,358 ​ $ 1,686,666 ​ $ 202,711 ​ 11.0% ​ $ 150,692 ​ 8.9% ​ Products and Services Stride has invested over $700 million in the last twenty years to develop curriculum, systems, instructional practices and support services that enable us to support hundreds of thousands of students.
Periodically, a middle school or high school student enrollment may change line of revenue classification. ​ The following represents our current revenues for each of the periods indicated: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended June 30, ​ Change 2025 / 2024 ​ Change 2024 / 2023 ​ ​ ​ 2025 2024 2023 $ % $ % ​ ​ ​ ​ ​ (In thousands, except percentages) General Education ​ ​ ​ ​ $ 1,448,676 ​ $ 1,289,193 ​ $ 1,131,391 ​ $ 159,483 ​ 12.4% ​ $ 157,802 ​ 13.9% Career Learning ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Middle - High School ​ ​ ​ ​ ​ 876,287 ​ ​ 651,191 ​ ​ 586,770 ​ ​ 225,096 ​ 34.6% ​ ​ 64,421 ​ 11.0% Adult ​ ​ ​ ​ ​ 80,354 ​ ​ 99,685 ​ ​ 119,197 ​ ​ (19,331) ​ (19.4%) ​ ​ (19,512) ​ (16.4%) Total Career Learning ​ ​ ​ ​ ​ 956,641 ​ ​ 750,876 ​ ​ 705,967 ​ ​ 205,765 ​ 27.4% ​ ​ 44,909 ​ 6.4% Total Revenues ​ ​ ​ ​ $ 2,405,317 ​ $ 2,040,069 ​ $ 1,837,358 ​ $ 365,248 ​ 17.9% ​ $ 202,711 ​ 11.0% ​ Products and Services We have developed curriculum, systems, instructional practices and support services that enable us to support hundreds of thousands of students.
The decrease in the effective income tax rate for the year ended June 30, 2023, as compared to the effective tax rate for the year ended June 30, 2022, was primarily due to the decrease in the amount of non-deductible compensation, which was partially offset by the decrease in excess tax benefit of stock-based compensation.
The increase in the effective income tax rate for the year ended June 30, 2025, as compared to the effective tax rate for the year ended June 30, 2024, was primarily due to the increase in non-deductible compensation, which was partially offset by the increase in excess tax benefit of stock-based compensation. ​ Discussion of Seasonality of Financial Condition Certain accounts in our balance sheet are subject to seasonal fluctuations.
State standards are continually evolving, and we continually invest in our curriculum to meet these changing requirements. We provide high-quality, engaging, online coursework and content in software engineering, healthcare, and medical fields.
State standards are continually evolving, and we continually invest in our curriculum to meet these changing requirements.
Selling, general, and administrative expenses were 25.2% of revenues during the year ended June 30, 2024, a decrease from 26.2% for the year ended June 30, 2023. ​ Interest income (expense), net. Net interest expense for the year ended June 30, 2024 was $8.8 million as compared to $8.4 million for the year ended June 30, 2023.
Selling, general, and administrative expenses were 21.8% of revenues during the year ended June 30, 2025, a decrease from 25.2% for the year ended June 30, 2024. ​ Impairment of long-lived assets. Impairment of long-lived assets for the year ended June 30, 2025 was $59.5 million.
The Credit Facility also includes a $200.0 million accordion feature. ​ We are a lessee under finance lease obligations for student computers and peripherals under loan agreements with Banc of America Leasing & Capital, LLC (“BALC”) and CSI Leasing, Inc. (“CSI Leasing”).
The Credit Facility expired on January 27, 2025 and was not renewed. ​ We are a lessee under finance leases for computers and peripherals under agreements with Banc of America Leasing & Capital, LLC (“BALC”) and CSI Leasing, Inc. (“CSI Leasing”).
The increase was primarily due to higher net purchases of marketable securities of $24.4 million, partially offset by a decrease in capital expenditures year over year of $4.8 million. ​ Net cash used in investing activities for the year ended June 30, 2023 increased $7.4 million from the year ended June 30, 2022.
The $51.9 million decrease in cash used in investing activities between periods was primarily due to higher net maturities of marketable securities of $65.8 million and a decrease in capital expenditures year over year of $1.7 million, partially offset by an increase in other equity purchases of $15.5 million.
As of June 30, 2024 and 2023, the finance lease liability was $55.6 million and $56.9 million, respectively, with lease interest rates ranging from 2.10% to 6.72%. ​ We entered into an agreement with BALC in April 2020 for $25.0 million (increased to $41.0 million in July 2020) to provide financing for our leases through March 2021 at varying rates.
As of June 30, 2025 and 2024, the finance lease liability was $86.9 million and $55.6 million, respectively, with lease interest rates ranging from 4.42% to 6.72%. ​ We entered into agreements with BALC and CSI Leasing in April 2020 and August 2022, respectively, to provide financing for our computers and peripherals.
The increase was primarily due to an increase of $31.3 million in personnel and related benefit costs and $17.4 million in professional services and marketing expenses, partially offset by a decrease of $6.5 million in bad debt expense and $1.5 million in net operating lease expense.
The increase was primarily due to an increase of $14.2 million in personnel and related benefit costs, including stock-based compensation, partially offset by a decrease of $7.6 million in bad debt expense.
As part of the proceeds received from the Notes, we repaid our $100.0 million outstanding balance and as of June 30, 2024, we had no amounts outstanding on the Credit Facility.
As part of the proceeds received from the Notes, we repaid our $100.0 million outstanding balance under the Credit Facility. The Credit Facility also included a $200.0 million accordion feature.
We provide a wide range of products and services across our platform with the ability to deliver customized solutions.
We provide a wide range of products and services across our platform with the ability to deliver customized solutions. Our comprehensive school-as-a-service offering supports our clients in operating full-time virtual schools in the K-12 market.
We exercise significant judgment in determining our provisions for income taxes, our deferred tax assets and liabilities and our future taxable income for purposes of assessing our ability to utilize any future tax benefit from our deferred tax assets. 47 Table of Contents Although we believe that our tax estimates are reasonable, the ultimate tax determination involves significant judgments that could become subject to examination by tax authorities in the ordinary course of business.
We exercise significant judgment in determining our provisions for income taxes, our deferred tax assets and liabilities and our future taxable income for purposes of assessing our ability to utilize any future tax benefit from our deferred tax assets.
Selling, General and Administrative Expenses Selling, general, and administrative expenses include the salaries and benefits of employees engaged in business development, public affairs, sales and marketing, and administrative functions, and transaction and due diligence expenses related to mergers and acquisitions.
If we are successful, we will incur start-up costs and other expenses associated with the initial launch of a school, including the funding of building leases and leasehold improvements. 43 Table of Contents Selling, General and Administrative Expenses Selling, general, and administrative expenses include the salaries and benefits of employees engaged in business development, public affairs, sales and marketing, and administrative functions, and transaction and due diligence expenses related to mergers and acquisitions.
Net cash used in financing activities for the year ended June 30, 2022 decreased $297.9 million from the year ended June 30, 2021.
Financing Activities Net cash used in financing activities for the year ended June 30, 2025 was $62.9 million compared to $49.1 million for the year ended June 30, 2024.
The decrease was primarily due to a decrease in the repurchase of restricted stock for income tax withholding of $5.3 million, a payment of contingent consideration of $7.0 million in fiscal year 2023, and a decrease in the repayment of finance lease obligations incurred for the acquisition of student computers of $2.1 million.
The $13.8 million increase in cash used in financing activities between periods was primarily due to an increase in the repurchase of restricted stock for income tax withholding of $13.2 million and an increase in the repayment of finance lease obligations incurred for the acquisition of computers of $0.6 million.
Our revenues for the year ended June 30, 2024 were $2,040.1 million, representing an increase of $202.7 million, or 11.0%, from $1,837.4 million for the year ended June 30, 2023. General Education revenues increased $157.8 million, or 13.9%, year over year.
Our revenues for the year ended June 30, 2025 were $2,405.3 million, representing an increase of $365.2 million, or 17.9%, from $2,040.1 million for the year ended June 30, 2024. General Education revenues increased $159.5 million, or 12.4%, year over year. The primary drivers for the increase in revenue were a 13.2% increase in enrollments, and changes to school mix.
We routinely monitor state legislative activity and regulatory proceedings that might impact the funding received by the schools we serve and to the extent possible, factor potential outcomes into our business planning decisions. Liquidity and Capital Resources As of June 30, 2024, we had net working capital, or current assets minus current liabilities, of $1,001.2 million.
These upfront fees result in seasonal fluctuations to our deferred revenue balances. We routinely monitor state legislative activity and regulatory proceedings that might impact the funding received by the schools we serve and to the extent possible, factor potential outcomes into our business planning decisions.
We pledged the assets financed to secure the outstanding leases. ​ We entered into an agreement with CSI Leasing in August 2022 to provide financing for our leases. Individual leases under the agreement with CSI Leasing include 36-month payment terms, but do not include a stated interest rate.
Individual leases with BALC include 36-month payment terms, fixed rates ranging from 4.42% to 6.72%, and a $1 purchase option at the end of each lease term. We pledged the assets financed to secure the outstanding leases. Individual leases under the agreement with CSI Leasing include 36-month payment terms, but do not include a stated interest rate.
Our meetings are most often held virtually using digital first presentations rather than paper. ​ Key Aspects and Trends of Our Operations Revenues—Overview We generate a significant portion of our revenues from the sale of curriculum, administration support and technology services to virtual and blended public schools.
Historically, aggregate funding estimates have differed from actual reimbursements, generally in the range of 2% of annual revenue or less, which may vary from year to year. ​ ​ 41 Table of Contents Key Aspects and Trends of Our Operations Revenues—Overview We generate a significant portion of our revenues from the sale of curriculum, administration support and technology services to virtual and blended public schools.
We are pursuing expansion into new states for both virtual public and other specialized charter schools. If we are successful, we will incur start-up costs and other expenses associated with the initial launch of a school, including the funding of building leases and leasehold improvements.
We are pursuing expansion into new states for both virtual public and other specialized charter schools.
The $75.6 million increase in cash provided by operations between periods was primarily due to the increase in net income. ​ Net cash provided by operating activities for the year ended June 30, 2023 was $203.2 million compared to $206.9 million for the year ended June 30, 2022.
The $154.0 million increase in cash provided by operating activties between periods was primarily due to higher net income adjusted for non-cash items, along with favorable changes in working capital, driven principally by a change in accrued liabilities. ​ Investing Activities Net cash used in investing activities for the year ended June 30, 2025 was $88.0 million compared to $139.9 million for the year ended June 30, 2024.
The increase in General Education revenues was primarily due to the 8.3% increase in enrollments, and changes to school mix (distribution of enrollments by school). Career Learning revenues increased $44.9 million, or 6.4%, primarily due to a 10.3% increase in enrollments and school mix. ​ Instructional costs and services expenses.
Career Learning revenues increased $205.8 million, or 27.4%, primarily due to a 32.5% increase in enrollments and school mix. In addition, revenue recognized in each of the periods includes certain adjustments resulting from the completion of state and district audits and reconciliation processes related to services provided in prior years.
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Historically, aggregate funding estimates have differed from actual reimbursements, generally in the range of 2% of annual revenue or less, which may vary from year to year. ​ Environmental, Social and Governance ​ As overseers of risk and stewards of long-term enterprise value, Stride’s Board of Directors play a vital role in 42 Table of Contents assessing our organization’s environmental and social impacts.
Added
Although we believe that our tax estimates are reasonable, the ultimate tax determination involves significant judgments that could become subject to examination by tax authorities in the ordinary course of business.
Removed
They are also responsible for understanding the potential impact and related risks of environmental, social and governance (“ESG”) issues on the organization’s operating model. Our Board and management aim to identify those ESG issues most likely to impact business operations and growth.
Added
Support Services – We provide a broad range of support services, including marketing and enrollment, supporting prospective students through the admission process, assessment management, administrative support (e.g., budget proposals, financial reporting, and student data reporting), and technology and materials support (e.g., provisioning of student computers, offline learning kits, internet access and technology support services).
Removed
We craft policies that are appropriate for our industry and that are of concern to our employees, investors, customers and other key stakeholders. Our Board helps ensure that the Company’s leaders have ample opportunity to leverage ESG for the long-term good of the organization, its stakeholders, and society.
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Financial Information In this section of the Form 10-K, we provide our financial information comparison for the years ended June 30, 2025 and 2024.
Removed
Each Committee of the Board monitors ESG efforts in their respective areas, with the Nominating and Governance Committee coordinating across all Committees. ​ Since our inception more than 20 years ago, we have removed barriers that impact academic equity.
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Our financial information comparison for the years ended June 30, 2024 and 2023 can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7. of our Annual Report on Form 10-K for the fiscal year ended June 30, 2024 filed with the Securities and Exchange Commission (“SEC”) on August 6, 2024.
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We provide high-quality education for anyone—particularly those in underserved communities—as a means to foster economic empowerment and address societal inequities from kindergarten all the way through college and career readiness.
Added
These adjustments were not material and were recognized in the period in which the audit or 48 Table of Contents reconciliation was finalized and the outcome became known and reasonably estimable. While these items contributed to reported revenue in each period, they were not a significant driver of the year over year change. ​ Instructional costs and services expenses.
Removed
We reinforced our commitment in this area by launching several initiatives including initially offering scholarships to advance education and career opportunities for students in underserved communities, expanding career pathways in socially responsible law enforcement and increasing employment of teachers in underserved communities at Stride-powered schools.
Added
The impairment relates to the intangible assets and operating lease right-of-use assets associated with an asset group unrelated to our core operations, comprised entirely of Galvanize, a wholly-owned subsidiary. We did not have any impairments of long-lived assets during the year ended June 30, 2024. ​ Interest expense, net.
Removed
We developed interactive, modular courses focused on racial equity and social justice that are being made available for free to every public school. ​ Among the many ESG issues we support within the Company, we endeavor to promote diversity and inclusion across every aspect of the organization.
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Liquidity and Capital Resources In this section of the Form 10-K, we provide our discussion of the changes in liquidity and capital resources for the years ended June 30, 2025 and 2024.
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We sponsor employee resource groups to provide support for female, minority, differently abled, LGBTQ+, and veteran employees and support employee volunteer efforts. Our commitment is evident in the make-up of our leadership team. We have more minorities in executive management and more women in executive management than the representative population.
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Our discussion of the changes in liquidity and capital resources for the years ended June 30, 2024 and 2023 can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7. of our Annual Report on Form 10-K for the fiscal year ended June 30, 2024 filed with the SEC on August 6, 2024. ​ As of June 30, 2025, we had net working capital, or current assets minus current liabilities, of $1,329.9 million.
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Importantly, our Board of Directors is also diverse with female, Hispanic, and black or African American members. ​ Our commitment to ESG initiatives is an endeavor both the Board and management undertake for the general betterment of those both inside and outside of our Company. ​ The nature of our business supports environmental sustainability.

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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 June 30, 2024, we had no outstanding balance on our Credit Facility. ​ Foreign Currency Exchange Risk We currently operate in several foreign countries, but we do not transact a material amount of business in a foreign currency.
Biggest changeAdditionally, the fair value of our investment portfolio is subject to changes in market interest rates. ​ Foreign Currency Exchange Risk We currently operate in several foreign countries, but we do not transact a material amount of business in a foreign currency.
Exchange rates between U.S. dollars and many foreign currencies have fluctuated significantly over the last few years and may continue to do so in the future. Accordingly, we may decide in the future to undertake hedging strategies to minimize the effect of currency fluctuations on our financial condition and results of operations. ​ 54 Table of Contents
Exchange rates between U.S. dollars and many foreign currencies have fluctuated significantly over the last few years and may continue to do so in the future. Accordingly, we may decide in the future to undertake hedging strategies to minimize the effect of currency fluctuations on our financial condition and results of operations. 51 Table of Contents
There can be no assurance that future inflation will not have an adverse or material impact on our operating results and financial condition. ​ Interest Rate Risk At June 30, 2024 and 2023, we had cash and cash equivalents totaling $500.6 million and $410.8 million, respectively.
There can be no assurance that future inflation will not have an adverse or material impact on our operating results and financial condition. ​ Interest Rate Risk At June 30, 2025 and 2024, we had cash and cash equivalents totaling $782.5 million and $500.6 million, respectively.
Our excess cash has been invested in money market funds, government securities, corporate debt securities and similar investments. At June 30, 2024, a 1% gross increase in interest rates for our variable-interest instruments would result in a $5.0 million annualized increase in interest income.
Our excess cash has been invested in money market funds, government securities, corporate debt securities and similar investments. At June 30, 2025, a 1% gross increase in interest rates for our variable-interest instruments would result in a $7.8 million annualized increase in interest income.
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Additionally, the fair value of our investment portfolio is subject to changes in market interest rates. ​ Our short-term debt obligations under our Credit Facility are subject to interest rate exposure.

Other LRN 10-K year-over-year comparisons