Perdoceo Education Q1 Earnings Call Highlights

Key Points

• Perdoceo Education beat Q1 expectations, with net income rising to $54 million, revenue up 4.1% to $221.7 million, and adjusted EPS increasing to $0.90 from $0.70 a year earlier.
• Enrollment trends were mostly positive, led by CTU’s 10th straight quarter of growth and gains at the University of St. Augustine, while AIU System saw a decline that management expects to improve later in the year.
• The company raised its 2026 outlook for adjusted operating income to $254 million-$263 million and adjusted EPS to $3.05-$3.16, citing strong retention, stable student interest and limited expected impact from regulatory changes.

Perdoceo Education NASDAQ: PRDO reported stronger-than-expected first-quarter 2026 results, with management citing enrollment gains, high student retention and continued investments in marketing, admissions and technology across its academic institutions.

President and Chief Executive Officer Todd Nelson said the company’s operating performance “exceeded our expectations” and reflected what he described as a balanced approach to running its institutions while investing in student onboarding, enrollment, academics and support processes.

Perdoceo reported first-quarter net income of $54 million, or $0.85 per diluted share, compared with $43.7 million, or $0.65 per diluted share, in the prior-year quarter. Adjusted earnings per diluted share rose to $0.90 from $0.70 a year earlier. Revenue increased 4.1% to $221.7 million from $213 million.

Chief Financial Officer Ashish Ghia said operating income increased 22% to $63.1 million, while adjusted operating income rose 14.1% to $72.5 million. He said the improvement was primarily supported by organic revenue growth across the company’s academic institutions, while operating efficiencies were partially reinvested in student-related processes.

Enrollment Trends Remain Positive Overall

Total student enrollment increased 1.1% year over year as of March 31, according to Ghia. The company’s Colorado Technical University, or CTU, posted a 1.9% increase in total enrollments to 34,050 students, marking its 10th consecutive quarter of enrollment growth.

Nelson said student retention continued to trend near multi-year highs, while the company increased investments in marketing and admissions to address interest from prospective students. He also said corporate student programs remained a meaningful contributor to enrollment growth, particularly at CTU.

At AIU System, total enrollments declined 2.2%, which management said was expected and primarily reflected lower enrollments at Trident University, part of AIU System. Ghia said the company expects reported total enrollments at AIU System to increase in the second quarter and accelerate further in the third quarter compared with the prior-year periods.

At the University of St. Augustine for Health Sciences, total enrollments rose 3.1%, with just under 4,400 students enrolled for the spring term. Ghia said growth was driven by programs including nursing and speech language pathology, as well as new modalities for the occupational therapy program. He said the company expects new student enrollment growth for both the summer and fall terms.

Segment Results Show Growth Across Institutions

CTU’s first-quarter revenue increased 4% to $120.8 million, while operating income rose 8.1% to $15.5 million. Ghia said the improvement reflected enrollment and revenue growth, with lower bad debt expense more than offsetting investments in marketing and admissions.

AIU System revenue rose to $57.8 million, and operating income increased 12% to $12.6 million. Ghia again pointed to lower bad debt expense offsetting marketing investments.

St. Augustine reported revenue of $43 million, up 9.8% from the prior-year quarter. Operating income increased to $6.3 million from an operating loss in the prior-year period. Adjusted operating income, excluding depreciation and amortization, increased to $13.3 million from $8.5 million.

Technology and AI Investments Continue

Nelson said Perdoceo is continuing to invest in technology to improve student experiences and operating effectiveness. He said artificial intelligence efforts are focused on student and classroom learning, as well as operating and functional processes.

Faculty are using AI in classrooms where feasible, with the goal of helping students leverage AI personally and professionally, Nelson said. He added that academic leadership is exploring AI-focused courses and programs, with plans to launch later this year pending required approvals.

The company is also using generative AI selectively to identify and engage prospective students who it believes are more likely to succeed at one of its academic institutions. Nelson said several pilots and tests are underway across student support and functional areas, including software engineering and development.

Balance Sheet and Capital Returns

Perdoceo generated $69.4 million in net cash flows from operations during the quarter, compared with $65.1 million in the prior-year quarter. The company ended the quarter with $680 million in cash, cash equivalents, restricted cash and available-for-sale short-term investments, up about $36.5 million from year-end.

Ghia said the company returned approximately $18 million to shareholders through quarterly dividends and stock repurchases during the quarter. It also used $10.3 million for employee tax payments through share repurchases related to stock vesting and spent $1.7 million on capital expenditures.

The company had $91.9 million remaining under its share repurchase authorization. The board declared a quarterly dividend of $0.15 per share, payable June 12, 2026, to shareholders of record as of June 1, 2026.

Perdoceo Raises 2026 Outlook

For full-year 2026, Perdoceo now expects adjusted operating income of $254 million to $263 million, compared with $237.6 million in 2025. Adjusted earnings per diluted share are expected to range from $3.05 to $3.16, compared with $2.61 in 2025.

Ghia said the outlook assumes continued high levels of student retention and engagement, stable prospective student interest and no meaningful operational impact from changes in the regulatory or legislative environment. He also said the company does not expect a material enrollment impact from the elimination of the Grad PLUS Loan program, annual and lifetime graduate loan limits, or students’ ability to finance education through private lending sources.

For the second quarter, the company expects adjusted operating income of $63 million to $64 million and adjusted earnings per diluted share of $0.79 to $0.80. The second-quarter earnings outlook includes a non-recurring $0.05 per-share benefit tied to the resolution of a prior-period state tax matter.

Nelson said Perdoceo remains focused on “sustainable and responsible long-term growth” and thanked faculty and staff for their work serving students.

About Perdoceo Education NASDAQ: PRDO

Perdoceo Education Corporation NASDAQ: PRDO is a for-profit postsecondary education provider offering certificate, associate, bachelor's and master's degree programs. The company operates primarily through two brand platforms—Colorado Technical University and American InterContinental University—delivering career-focused education both on campus and online. These programs span fields such as business, information technology, healthcare and criminal justice, targeting working adults seeking to advance or pivot their careers.

With headquarters in Schaumburg, Illinois, Perdoceo serves students across the United States and internationally through its online offerings.

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