Adtalem Global Education (ATGE -0.49%), a major provider of healthcare-focused education, released its earnings for the fiscal fourth quarter of 2025 on August 7, 2025. Key highlights include a revenue figure of $457.1 million (GAAP), topping analyst expectations of $440.93 million, and an adjusted, non-GAAP earnings per share (EPS) of $1.66 versus a $1.53 estimate. Both revenue (GAAP) and profit (non-GAAP EPS) metrics exceeded consensus by 3.7% and 8.5%, respectively. Momentum in student enrollment, increa ...

分组1 - Adtalem Global Education reported quarterly earnings of $1.66 per share, exceeding the Zacks Consensus Estimate of $1.51 per share, and showing an increase from $1.37 per share a year ago, resulting in an earnings surprise of +9.93% [1] - The company achieved revenues of $457.11 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 3.97%, and up from $409.91 million year-over-year [2] - Adtalem has consistently outperformed consensus EPS and revenue estimates over the last four quarters, indicating strong financial performance [2] 分组2 - The stock has gained approximately 31.9% since the beginning of the year, significantly outperforming the S&P 500's gain of 7.9% [3] - The company's earnings outlook is crucial for future stock performance, with current consensus EPS estimates at $1.63 for the coming quarter and $7.47 for the current fiscal year [4][7] - The Zacks Industry Rank places the Schools industry in the top 15% of over 250 Zacks industries, suggesting a favorable environment for Adtalem's stock performance [8]

Financial Data and Key Metrics Changes - Revenue reached $1,790,000,000, up 12.9% year over year [8] - Adjusted EBITDA margin expanded 190 basis points to 25.7% [8] - Adjusted earnings per share grew 33% to $6.67 [8] - Free cash flow generated was $283,000,000 [8] - Term Loan B balance reduced by $100,000,000, lowering borrowing costs by 75 basis points [8] Business Line Data and Key Metrics Changes - Chamberlain University reported fourth quarter revenue of $184,300,000, an increase of 10.3% year over year, with total student enrollment increasing 5.8% [24] - Walden University achieved fourth quarter revenue of $182,200,000, up 16.6% year over year, with total student enrollment up 15% [25] - Medical and Veterinary segment reported fourth quarter revenue of $90,600,000, an increase of 4.7% year over year, with total student enrollment up 1% [27] Market Data and Key Metrics Changes - Total enrollment grew every quarter, averaging over 10% for the year [8] - Proprietary institutions supply 17% of registered nurses entering the workforce, with graduates from for-profit bachelor's degree programs having lower unemployment rates [9][10] Company Strategy and Development Direction - The company is focused on a "growth with purpose" strategy, emphasizing sustainable growth and community impact [6][7] - Partnerships with healthcare employers, such as SSM Health, are aimed at creating direct employment pathways for students [12] - The company plans to continue investing in student-facing technologies and marketing to maximize current capacity and expand access [30] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence entering fiscal year 2026, expecting revenue of $1,900,000,000 to $1,940,000,000 and adjusted EPS of $7.6 to $7.90 [16][29] - The demand for career-aligned healthcare programs is expected to grow as the national workforce shortage deepens [15] Other Important Information - The company returned $211,000,000 in excess capital to shareholders through share repurchases [8] - A new $150,000,000 Board authorization for share repurchases was announced [23] Q&A Session Summary Question: Operational performance and share gain drivers - Management attributed share gains to program flexibility, commitment to student success, and strong employer relationships [33] Question: Impact of regulatory changes on student demand - Management reported no dampening in demand for programs, with confidence in alternative financing options for students [35][36] Question: Long-term growth strategies and potential challenges - Management highlighted robust demand trends in healthcare professions and ongoing discussions with providers about new program needs [41][42] Question: Marketing success and brand strategy - Management noted improved brand awareness and targeted marketing strategies as key drivers of enrollment success [53]

FY25 Performance - Adtalem's revenue reached $1,788.3 million, a 12.9% increase compared to the prior year[15] - Adjusted EBITDA margin was 25.7%, up by 190 bps from the previous year[15] - Adjusted EPS was $6.67, a 33.1% increase compared to the prior year[15] Q4 FY25 Performance - Revenue was $457.1 million, an 11.5% increase compared to the prior year[19, 20] - Adjusted EBITDA margin was 24.1%, up by 30 bps from the prior year[20] - Adjusted EPS was $1.66, a 21.2% increase compared to the prior year[20] - Total enrollment grew by 10.2% year-over-year[18] Enrollment Trends - Total enterprise enrollments reached 91,780, a 10.2% increase year-over-year[33] - Chamberlain's enrollment increased by 5.8% year-over-year[31] - Walden's enrollment increased by 15.0% year-over-year[31] - Medical & Veterinary enrollments increased by 1.0% year-over-year[31] Financial Position - Free Cash Flow was $283 million, up $44 million compared to the prior year[17] - The company returned $211 million in capital to shareholders through share repurchases[17] FY26 Guidance - Revenue is projected to be between $1,900 million and $1,940 million, representing a year-over-year growth of approximately 6.0% to 8.5%[53] - Adjusted EPS is projected to be between $7.60 and $7.90, representing a year-over-year growth of approximately 14.0% to 18.5%[53]

PART I [Item 1. Business](index=3&type=section&id=Item%201.%20Business) Adtalem is a leading U.S. healthcare educator with three segments, serving over 90,000 students and subject to extensive federal financial aid and accreditation regulations [Overview](index=3&type=section&id=Overview) Adtalem is a leading U.S. healthcare educator with five institutions, serving over 90,000 students and focusing on expanding access through technology - **Adtalem** is the leading U.S. healthcare educator, comprising five institutions including Chamberlain and Walden[12](index=12&type=chunk)[13](index=13&type=chunk) - The company serves over **90,000 students** across campuses and online, with **350,000 alumni**[13](index=13&type=chunk) - Adtalem's strategy emphasizes expanding student access via innovative learning technologies and its "Growth with Purpose" operating model[15](index=15&type=chunk) [Segments Overview](index=5&type=section&id=Segments%20Overview) Adtalem operates through three reportable segments: Chamberlain, Walden, and Medical and Veterinary schools - Adtalem operates through three reportable segments[17](index=17&type=chunk) - **Chamberlain** offers degree and certificate programs in nursing and health professions[17](index=17&type=chunk) - **Walden** provides degree and certificate programs in nursing, education, business, and psychology[18](index=18&type=chunk) - **Medical and Veterinary** includes AUC, RUSM, and RUSVM, offering medical and veterinary degrees[19](index=19&type=chunk) [Market Trends and Competition](index=13&type=section&id=Market%20Trends%20and%20Competition) Adtalem's segments compete in diverse education markets, with strong positions in nursing, online higher education, and medical/veterinary fields - **Chamberlain** competes in a market with over **2,000 nursing programs** and held the largest pre-licensure BSN, MSN, FNP, and DNP programs by enrollment in Fall 2024[55](index=55&type=chunk)[56](index=56&type=chunk)[58](index=58&type=chunk) - **Walden** competes in the growing online higher education market and is a leading conferrer of doctoral and master's degrees in fields like nursing and education[59](index=59&type=chunk)[61](index=61&type=chunk)[62](index=62&type=chunk) - **Medical and Veterinary** schools (AUC, RUSM, RUSVM) compete with U.S. and international institutions, with demand driven by the supply/demand imbalance for healthcare professionals[63](index=63&type=chunk)[64](index=64&type=chunk) [Accreditation and Regulatory Approvals](index=15&type=section&id=Accreditation%20and%20Regulatory%20Approvals) Adtalem's institutions and programs hold essential institutional and programmatic accreditations, crucial for Title IV eligibility and student progression - Both **Chamberlain** and **Walden** are institutionally accredited by the Higher Learning Commission (HLC), with many programs holding specific programmatic accreditations[66](index=66&type=chunk)[67](index=67&type=chunk) - **AUC** is accredited by ACCM and **RUSM** by CAAM-HP, with their standards affirmed comparable to U.S. LCME, enabling U.S. residency eligibility[69](index=69&type=chunk)[70](index=70&type=chunk) - **RUSVM's** Doctor of Veterinary Medicine degree is accredited by the American Veterinary Medical Association Council on Education (AVMA COE)[71](index=71&type=chunk) [Legislative and Regulatory Requirements](index=17&type=section&id=Legislative%20and%20Regulatory%20Requirements) Adtalem's institutions are highly dependent on federal financial aid programs (Title IV) and are subject to extensive regulatory oversight, including financial responsibility and the 90/10 rule - Adtalem's institutions heavily rely on U.S. federal financial aid (Title IV programs), regulated extensively by the Department of Education (ED) under the Higher Education Act (HEA)[72](index=72&type=chunk)[74](index=74&type=chunk) - Adtalem's FY2022 financial responsibility composite score declined to **0.2** due to the Walden acquisition, leading to provisional certifications and **$179.0 million** in required letters of credit[80](index=80&type=chunk) 90/10 Rule Rates | Institution | FY 2024 (New Rule) | FY 2023 (Old Rule) | | :--- | :--- | :--- | | Chamberlain University | 68% | 65% | | Walden University | 82% | 78% | | American University of the Caribbean | 87% | 81% | | Ross University School of Medicine | 87% | 87% | | Ross University School of Veterinary Medicine | 78% | 79% | | **Consolidated** | **77%** | **75%** | Cohort Default Rates (CDR) | Institution | 2021 | 2020 | 2019 | | :--- | :--- | :--- | :--- | | Chamberlain University | 0.0% | 0.0% | 0.5% | | Walden University | 0.0% | 0.0% | 1.1% | | AUC | 0.0% | 0.0% | 0.2% | | RUSM | 0.0% | 0.0% | 0.2% | | RUSVM | 0.0% | 0.0% | 0.2% | *Note: Default rates for 2020 and 2021 were 0.0% due to COVID-19 relief measures* - New Gainful Employment (GE) and Financial Value Transparency (FVT) rules, effective July 1, 2024, require programs to meet specific debt-to-earnings and earnings premium tests for Title IV eligibility, with a reporting deadline of September 30, 2025[89](index=89&type=chunk)[90](index=90&type=chunk) [Human Capital](index=27&type=section&id=Human%20Capital) Adtalem's human capital strategy focuses on talent development, leadership pipeline, and fostering a performance-driven culture, reflected in improved organizational health Employee Count as of June 30, 2025 | Category | Full-Time Staff | Part-Time Staff | Temporary Staff | Visiting Professors | Total | | :--- | :--- | :--- | :--- | :--- | :--- | | Chamberlain | 1,393 | 16 | 182 | 2,861 | 4,452 | | Walden | 1,298 | 12 | 2 | 2,412 | 3,724 | | Medical and Veterinary | 765 | 14 | 51 | 102 | 932 | | Home Office | 1,247 | 5 | 11 | — | 1,263 | | **Total** | **4,703** | **47** | **246** | **5,375** | **10,371** | - The company's talent strategy prioritizes building a leadership pipeline, upskilling, and fostering a performance-driven culture[116](index=116&type=chunk) - A January 2024 Organizational Health Index (OHI) survey indicated a **4-point increase** in overall score, moving Adtalem up a full quartile against the global benchmark, with improvements in customer focus and shared vision[117](index=117&type=chunk)[121](index=121&type=chunk) [Item 1A. Risk Factors](index=31&type=section&id=Item%201A.%20Risk%20Factors) Adtalem faces significant risks from its highly regulated industry, including Title IV eligibility and accreditation, and business operations, such as competition, cybersecurity, and substantial debt [Risks Related to Adtalem's Regulated Industry](index=31&type=section&id=Risks%20Related%20to%20Adtalem's%20Regulated%20Industry) Risks include potential loss of Title IV eligibility, adverse regulatory actions, changes in financial aid laws, and failure to maintain accreditation or state authorizations - The company is subject to extensive regulation and audits, where unfavorable outcomes could result in monetary penalties, loss of Title IV eligibility, or operational restrictions[126](index=126&type=chunk) - A significant portion of consolidated revenue, **77%**, derives from Title IV programs, making the company vulnerable to changes in the HEA or reductions in federal student aid funding[137](index=137&type=chunk)[140](index=140&type=chunk) - Failure to demonstrate financial responsibility or administrative capability could lead to loss of Title IV eligibility or require posting substantial letters of credit[135](index=135&type=chunk)[148](index=148&type=chunk) - Loss of institutional or programmatic accreditation would render an institution ineligible for Title IV programs, materially harming the business[151](index=151&type=chunk) - A material change of ownership or control could necessitate recertification by the ED and reevaluation by accreditors and state agencies, potentially disrupting Title IV eligibility[152](index=152&type=chunk) [Risks Related to Adtalem's Business](index=47&type=section&id=Risks%20Related%20to%20Adtalem's%20Business) Business risks include intense competition, dependency on student enrollment, cybersecurity threats, challenges in integrating acquisitions, and risks associated with substantial debt and goodwill - Future revenue and growth depend on successful student recruitment and retention within a highly competitive postsecondary market, including increasing online options[173](index=173&type=chunk)[176](index=176&type=chunk) - Cybersecurity threats pose a significant risk, where a breach of personal information could result in reputational damage, liability, and operational disruptions[179](index=179&type=chunk)[182](index=182&type=chunk)[184](index=184&type=chunk) - Goodwill and intangible assets, totaling **$961.3 million** and **$765.5 million** respectively as of June 30, 2025, represent **63% of total assets**, and a decline in performance could lead to significant non-cash impairment charges[194](index=194&type=chunk) - The company's ability to service its debt obligations relies on generating sufficient cash flow, subject to various uncontrollable economic, competitive, and regulatory factors[199](index=199&type=chunk) [Item 1C. Cybersecurity](index=57&type=section&id=Item%201C.%20Cybersecurity) Adtalem's cybersecurity program, managed by a CISO and based on NIST 800-53, includes continuous risk assessments and incident response, with no material threats identified in the past three fiscal years - The Cyber Risk Management Framework is based on the **NIST 800-53 Framework**, harmonized with standards like ISO 27001 and regulations such as FERPA and GDPR[205](index=205&type=chunk) - The Chief Information Security Officer (CISO) manages the program, reporting to the CFO, and provides regular updates to executive management and the Audit and Finance Committee[206](index=206&type=chunk) - Governance is provided by the Audit and Finance Committee, overseeing cybersecurity risks and receiving quarterly briefings from the CISO[214](index=214&type=chunk) - Adtalem has not identified any cybersecurity threats over the past three fiscal years that have materially impacted its business, operations, or financial condition[210](index=210&type=chunk) [Item 2. Properties](index=61&type=section&id=Item%202.%20Properties) Adtalem owns **775,000 square feet** of facilities and leases additional space, with Chamberlain operating 23 campuses, Walden primarily online, and Medical/Veterinary schools having both owned and leased campuses - Adtalem owns **775,000 square feet** of facilities worldwide, none subject to a mortgage[215](index=215&type=chunk) - **Chamberlain** operates **23 campuses**, with **20 leased** and **3 owned** by Adtalem[216](index=216&type=chunk) - The **AUC** campus in St. Maarten and **RUSVM** campus in St. Kitts are owned, while the **RUSM** campus in Barbados consists of leased facilities[218](index=218&type=chunk)[219](index=219&type=chunk)[220](index=220&type=chunk) [Information About Our Executive Officers](index=63&type=section&id=Information%20About%20Our%20Executive%20Officers) This section outlines the business experience, age, and current positions of Adtalem's executive officers, including the Chairman and CEO, CFO, and segment presidents Key Executive Officers | Name | Age | Position | | :--- | :--- | :--- | | Stephen W. Beard | 54 | Chairman and Chief Executive Officer | | Robert J. Phelan | 60 | Senior Vice President, Chief Financial Officer | | Douglas G. Beck | 58 | Senior Vice President, General Counsel, Corporate Secretary and Institutional Support Services | | Dr. Karen Cox | 65 | President, Chamberlain University | | Michael Betz | 52 | Chief Digital Officer and President, Walden University | | Scott Liles | 59 | President, Medical and Veterinary | PART II [Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=66&type=section&id=Item%205.%20Market%20for%20Registrant's%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) Adtalem's common stock trades on NYSE under "ATGE", with no dividends paid in FY2023-2025, and **$62.4 million** in share repurchases during Q4 FY2025 - Adtalem's common stock is listed on the New York Stock Exchange and NYSE Texas under the symbol **"ATGE"**[228](index=228&type=chunk) - The company did not pay dividends in fiscal years **2023, 2024, or 2025** and does not anticipate paying cash dividends in the foreseeable future[230](index=230&type=chunk) Share Repurchases (Q4 FY2025) | Period | Total Shares Purchased | Average Price Paid per Share | Total Cost (Approx.) | | :--- | :--- | :--- | :--- | | April 2025 | 521,165 | $103.29 | $53.8M | | May 2025 | 71,962 | $118.87 | $8.6M | | June 2025 | — | — | $0 | | **Total** | **593,127** | **$105.18** | **$62.4M** | - As of June 30, 2025, **$150.0 million** remained available for repurchase under the company's fifteenth share repurchase program, authorized through May 6, 2028[195](index=195&type=chunk)[251](index=251&type=chunk) [Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)](index=69&type=section&id=Item%207.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations%20%28MD%26A%29) In FY2025, Adtalem's revenue grew **12.9%** to **$1.79 billion**, with net income up **73.3%** to **$237.1 million**, driven by enrollment growth and tuition increases, while cash flow from operations reached **$333.7 million** [Fiscal Year 2025 Highlights](index=71&type=section&id=Fiscal%20Year%202025%20Highlights) FY2025 highlights include significant revenue and net income growth, increased student enrollment across segments, and substantial share repurchases FY2025 Financial Highlights vs. Prior Year | Metric | FY 2025 | Change vs. FY 2024 | % Change | | :--- | :--- | :--- | :--- | | Revenue | $1,788.3 M | +$203.6 M | +12.9% | | Net Income | $237.1 M | +$100.3 M | +73.3% | | Diluted EPS | $6.18 | +$2.79 | +82.3% | | Adjusted Net Income | $255.6 M | +$53.8 M | +26.7% | | Diluted Adjusted EPS | $6.67 | +$1.66 | +33.1% | - Average total student enrollment for FY2025 increased by **9.3%** at Chamberlain, **13.5%** at Walden, and **0.5%** at the medical and veterinary schools year-over-year[251](index=251&type=chunk) - The company repurchased **2.3 million shares** for **$211.4 million** in FY2025 and authorized a new **$150.0 million** repurchase program[251](index=251&type=chunk) [Results of Operations](index=75&type=section&id=Results%20of%20Operations) Consolidated operating income increased significantly due to revenue growth, lower business integration expenses, and reduced amortization and litigation reserves Revenue by Segment (FY2025 vs. FY2024) | Segment | FY2025 Revenue | FY2024 Revenue | % Change | | :--- | :--- | :--- | :--- | | Chamberlain | $725.8 M | $633.5 M | +14.6% | | Walden | $693.4 M | $595.3 M | +16.5% | | Medical and Veterinary | $369.1 M | $355.8 M | +3.7% | | **Total** | **$1,788.3 M** | **$1,584.7 M** | **+12.9%** | - Consolidated operating income increased **57.4%** to **$341.5 million**, driven by revenue growth and decreases in business integration expense, amortization, and litigation reserves[273](index=273&type=chunk) - Adjusted operating income increased **19.9%** to **$370.2 million**, primarily due to higher revenue, partially offset by increased costs for enrollment support and marketing[273](index=273&type=chunk)[275](index=275&type=chunk) - Interest expense decreased to **$52.3 million** from **$63.7 million** year-over-year, primarily due to lower Term Loan B borrowings[279](index=279&type=chunk) [Liquidity and Capital Resources](index=85&type=section&id=Liquidity%20and%20Capital%20Resources) Adtalem's liquidity is supported by **$199.6 million** in cash, **$400.0 million** revolving credit facility, and **$333.7 million** in net cash from operations, despite substantial debt obligations Cash Flow Summary (in millions) | Activity | FY 2025 | FY 2024 | | :--- | :--- | :--- | | Net Cash from Operations | $333.7 | $288.4 | | Net Cash used in Investing | ($41.9) | ($47.9) | | Net Cash used in Financing | ($316.0) | ($301.8) | - Cash and cash equivalents were **$199.6 million** as of June 30, 2025, a decrease from **$219.3 million** a year prior[287](index=287&type=chunk) - As of June 30, 2025, outstanding principal debt included **$405.0 million** in Senior Secured Notes and **$153.3 million** under its Term Loan B[293](index=293&type=chunk) - The company maintained a **$400.0 million** revolving credit facility, fully available as of June 30, 2025, and subsequently increased to **$500.0 million** in August 2025[296](index=296&type=chunk) [Critical Accounting Estimates](index=87&type=section&id=Critical%20Accounting%20Estimates) Critical accounting estimates involve significant judgment in areas such as allowance for credit losses, impairment of long-lived assets, goodwill, income taxes, and legal contingencies - Key estimates requiring significant judgment include allowance for credit losses, impairment of long-lived assets, goodwill and intangibles, income taxes, and legal contingencies[299](index=299&type=chunk)[300](index=300&type=chunk)[301](index=301&type=chunk)[302](index=302&type=chunk)[311](index=311&type=chunk)[313](index=313&type=chunk) - The annual goodwill impairment test as of May 31, 2025, for the RUSM reporting unit, showed its fair value exceeded carrying value by approximately **165%**, resulting in no impairment[306](index=306&type=chunk)[308](index=308&type=chunk) [Item 8. Financial Statements and Supplementary Data](index=97&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section presents Adtalem's consolidated financial statements for FY2025, with an unqualified audit opinion from PricewaterhouseCoopers LLP, highlighting the goodwill impairment assessment for RUSM as a critical audit matter - The independent auditor, **PricewaterhouseCoopers LLP**, issued an unqualified opinion on the consolidated financial statements and internal control over financial reporting as of June 30, 2025[336](index=336&type=chunk) - A Critical Audit Matter was identified regarding the Goodwill Impairment Assessment for the **Ross University School of Medicine (RUSM)** reporting unit, due to significant management judgment in fair value estimation[343](index=343&type=chunk)[344](index=344&type=chunk) Consolidated Balance Sheet Highlights (as of June 30, 2025) | Account | Amount (in thousands) | | :--- | :--- | | Total Assets | $2,752,352 | | Goodwill | $961,262 | | Intangible assets, net | $765,474 | | Total Liabilities | $1,318,727 | | Long-term debt | $552,669 | | Total Shareholders' Equity | $1,433,625 | Consolidated Statement of Income Highlights (for year ended June 30, 2025) | Account | Amount (in thousands) | | :--- | :--- | | Revenue | $1,788,290 | | Operating Income | $341,542 | | Net Income | $237,065 | | Diluted EPS | $6.18 | [Item 9A. Controls and Procedures](index=157&type=section&id=Item%209A.%20Controls%20and%20Procedures) Adtalem's CEO and CFO concluded that disclosure controls and internal control over financial reporting were effective as of June 30, 2025, with no material changes in Q4 FY2025 - Management, including the CEO and CFO, concluded that Adtalem's disclosure controls and procedures were effective as of June 30, 2025[520](index=520&type=chunk) - Management's assessment concluded that the company's internal control over financial reporting was effective as of June 30, 2025, based on the COSO 2013 framework[522](index=522&type=chunk) - No material changes in internal control over financial reporting occurred during the fourth quarter of fiscal year 2025[524](index=524&type=chunk) [Item 9B. Other Information](index=159&type=section&id=Item%209B.%20Other%20Information) In June 2025, two executive officers established Rule 10b5-1 trading plans for the sale of Adtalem common stock, totaling **108,000** and **15,384 shares**, respectively, with sales starting no earlier than September 12, 2025 - On June 10, 2025, Chairman and CEO Stephen W. Beard entered a 10b5-1 plan to sell **108,000 shares** of common stock, with sales estimated to begin after September 12, 2025[525](index=525&type=chunk) - On June 13, 2025, SVP and General Counsel Douglas Beck entered a 10b5-1 plan to sell **15,384 shares** of common stock, with sales also beginning no earlier than September 12, 2025[526](index=526&type=chunk) PART III [Items 10-14](index=159&type=section&id=Items%2010-14) Information for Items 10-14, covering directors, executive compensation, security ownership, related transactions, and accountant fees, is incorporated by reference from Adtalem's 2025 proxy statement - Information regarding Directors, Executive Officers, and Corporate Governance (Item 10) is incorporated by reference from the Proxy Statement[528](index=528&type=chunk) - Details on Executive Compensation (Item 11) are incorporated by reference from the Proxy Statement[529](index=529&type=chunk) - Information on Security Ownership (Item 12), Certain Relationships and Related Transactions (Item 13), and Principal Accountant Fees and Services (Item 14) is incorporated by reference from the Proxy Statement[530](index=530&type=chunk)[531](index=531&type=chunk)[532](index=532&type=chunk) PART IV [Item 15. Exhibits and Financial Statement Schedules](index=161&type=section&id=Item%2015.%20Exhibits%20and%20Financial%20Statement%20Schedules) This section lists the financial statements filed under Item 8 and all exhibits included with the Form 10-K, with financial statement schedules omitted as not applicable - This item lists the financial statements filed under Item 8 and all exhibits filed with the Form 10-K[533](index=533&type=chunk) - All financial statement schedules have been omitted as they are not applicable or the required information is included in the consolidated financial statements[533](index=533&type=chunk)

[Performance Highlights](index=1&type=section&id=Performance%20Highlights) Adtalem Global Education reported exceptional results for fiscal year 2025, driven by strong year-over-year growth in total enrollment (up 10.2% in Q4) and revenue (up 12.9% for the full year), with Adjusted EPS increasing 33.1% to $6.67 Fiscal Year 2025 Key Performance Indicators | Metric | Fiscal Year 2025 | YoY Growth | | :--- | :--- | :--- | | Revenue | $1,788.3 million | 12.9% | | Diluted EPS | $6.18 | - | | Adjusted EPS | $6.67 | 33.1% | | Adjusted EBITDA | $459.7 million | 21.8% | Fourth Quarter 2025 Key Performance Indicators | Metric | Fourth Quarter 2025 | YoY Growth | | :--- | :--- | :--- | | Revenue | $457.1 million | 11.5% | | Total Student Enrollment | 91,780 | 10.2% | | Adjusted EBITDA | $110.2 million | 13.2% | - The company's strong performance is attributed to its 'Growth with Purpose' strategy, focusing on disciplined investments, positive student outcomes, and strategic partnerships to create pathways from education to employment in the healthcare sector[7](index=7&type=chunk) [Financial Highlights](index=2&type=section&id=Financial%20Highlights) For the full fiscal year 2025, Adtalem's revenue grew 12.9% to $1.79 billion, and net income increased significantly to $237.1 million from $136.8 million in the prior year, with Adjusted EBITDA margin expanding to 25.7% Fiscal Year 2025 Financial Results ($ in millions) | Metric | FY 2025 | FY 2024 | % Change | | :--- | :--- | :--- | :--- | | Revenue | $1,788.3 | $1,584.7 | 12.9% | | Operating Income | $341.5 | $217.1 | 57.3% | | Net Income | $237.1 | $136.8 | 73.3% | | Diluted EPS | $6.18 | $3.39 | 82.3% | | Adjusted EPS | $6.67 | $5.01 | 33.1% | | Adjusted EBITDA | $459.7 | $377.5 | 21.8% | Fourth Quarter 2025 Financial Results ($ in millions) | Metric | Q4 2025 | Q4 2024 | % Change | | :--- | :--- | :--- | :--- | | Revenue | $457.1 | $409.9 | 11.5% | | Operating Income | $76.9 | $68.5 | 12.3% | | Net Income | $54.2 | $49.4 | 9.7% | | Diluted EPS | $1.44 | $1.28 | 12.5% | | Adjusted EPS | $1.66 | $1.37 | 21.2% | | Adjusted EBITDA | $110.2 | $97.4 | 13.2% | [Business and Segment Highlights](index=2&type=section&id=Business%20and%20Segment%20Highlights) All three operating segments demonstrated enrollment growth in Q4 2025, with Walden University leading at 15.0%, followed by Chamberlain University at 5.8% and Medical and Veterinary at 1.0%, supported by strategic partnerships and accreditations [Business Highlights](index=2&type=section&id=Business%20Highlights) Adtalem advanced its strategic goals through key partnerships and academic achievements, including a nursing talent pipeline program, 'Opportunity Colleges and Universities' recognition, and prestigious accreditations for its programs - Chamberlain University and SSM Health launched the 'Aspiring Nurse Program' to fund nursing education and create a talent pipeline, aiming to graduate over **400 new nurses annually**[8](index=8&type=chunk)[10](index=10&type=chunk)[11](index=11&type=chunk) - Walden University and Chamberlain University were recognized as 'Opportunity Colleges and Universities' in the 2025 Carnegie Classification for delivering strong economic outcomes for graduates[11](index=11&type=chunk) - Walden University's Doctor of Social Work (DSW) program became one of only four in the U.S. to be accredited by the Council on Social Work Education (CSWE)[11](index=11&type=chunk) - The Medical and Veterinary schools graduated over **1,100 students** in fiscal year 2025 and launched a partnership with Massachusetts General Hospital to offer a Master's in Healthcare Data Analytics[11](index=11&type=chunk) [Chamberlain Segment Performance](index=5&type=section&id=Chamberlain%20Segment%20Performance) Chamberlain University's revenue grew 14.6% to $725.8 million for the full fiscal year, driven by a 5.8% increase in total student enrollment in Q4, indicating strong annual performance despite quarterly fluctuations in adjusted operating income - Total student enrollment increased **5.8% year-over-year** in Q4 to **38,891**, driven by growth in both pre-licensure and post-licensure nursing programs[12](index=12&type=chunk) Chamberlain Financial Performance ($ in millions) | Period | Revenue | % Change | Adj. Operating Income | % Change | Adj. EBITDA | % Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Q4 2025 | $184.3 | 10.3% | $35.7 | (11.7)% | $45.0 | (4.8)% | | FY 2025 | $725.8 | 14.6% | $153.4 | 11.3% | $191.4 | 15.2% | [Walden Segment Performance](index=5&type=section&id=Walden%20Segment%20Performance) Walden University was a key growth driver, with a 15.0% year-over-year increase in Q4 student enrollment, fueling a 16.5% rise in full-year revenue to $693.4 million and significant operating leverage with adjusted operating income surging by 40.6% - Total student enrollment surged **15.0% year-over-year** in Q4 to **48,116**, with growth across both healthcare and non-healthcare programs[13](index=13&type=chunk) Walden Financial Performance ($ in millions) | Period | Revenue | % Change | Adj. Operating Income | % Change | Adj. EBITDA | % Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Q4 2025 | $182.2 | 16.6% | $46.8 | 25.1% | $52.7 | 28.0% | | FY 2025 | $693.4 | 16.5% | $183.6 | 40.6% | $206.5 | 40.7% | [Medical and Veterinary Segment Performance](index=5&type=section&id=Medical%20and%20Veterinary%20Segment%20Performance) The Medical and Veterinary segment achieved a 1.0% increase in Q4 student enrollment, leading to a 3.7% rise in full-year revenue to $369.1 million, though full-year adjusted operating income and adjusted EBITDA saw slight declines - Total student enrollment saw a modest increase of **1.0% year-over-year** in Q4 to **4,773**[14](index=14&type=chunk) Medical and Veterinary Financial Performance ($ in millions) | Period | Revenue | % Change | Adj. Operating Income | % Change | Adj. EBITDA | % Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Q4 2025 | $90.6 | 4.7% | $15.1 | 25.8% | $20.0 | 21.7% | | FY 2025 | $369.1 | 3.7% | $69.3 | (3.2)% | $88.8 | (0.1)% | [Capital Allocation and Financial Position](index=1&type=section&id=Capital%20Allocation%20and%20Financial%20Position) Adtalem maintained a disciplined capital allocation strategy in fiscal 2025, completing a $211 million share repurchase authorization, initiating a new $150 million authorization, and improving its debt profile to achieve a low net leverage ratio of 0.8x - Completed a prior share repurchase authorization by buying back **$211 million of shares**[5](index=5&type=chunk) - A new **$150 million share repurchase authorization** was approved by the Board, extending through May 2028[5](index=5&type=chunk) - Strengthened the balance sheet by repricing a **$253 million Term Loan B** to reduce the interest rate by **75 bps** and repaying **$100 million** of the outstanding balance[5](index=5&type=chunk) - Ended the fiscal year with a net leverage ratio of **0.8x**[5](index=5&type=chunk)[50](index=50&type=chunk) [Fiscal Year 2026 Outlook](index=7&type=section&id=Fiscal%20Year%202026%20Outlook) Adtalem has initiated guidance for fiscal year 2026, projecting continued strong growth with revenue expected between $1.90 billion and $1.94 billion, and adjusted earnings per share forecasted to be in the range of $7.60 to $7.90 Fiscal Year 2026 Guidance ($ in millions) | Metric | Guidance Range | YoY Growth (%) | | :--- | :--- | :--- | | Revenue | $1,900 - $1,940 | 6.0% - 8.5% | | Adjusted EPS | $7.60 - $7.90 | 14.0% - 18.5% | [Consolidated Financial Statements](index=10&type=section&id=Consolidated%20Financial%20Statements) The consolidated financial statements for the year ended June 30, 2025, show a stable balance sheet with total assets of $2.75 billion, a 12.9% revenue increase to $1.79 billion, and strong operating cash flow of $337.9 million supporting share repurchases and debt repayments Consolidated Balance Sheet Highlights (as of June 30, 2025, $ in thousands) | Account | 2025 | 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $199,601 | $219,306 | | Total Assets | $2,752,352 | $2,741,417 | | Long-term debt | $552,669 | $648,712 | | Total Liabilities | $1,318,727 | $1,372,282 | | Total Shareholders' Equity | $1,433,625 | $1,369,135 | Consolidated Income Statement Highlights (Year Ended June 30, $ in thousands) | Account | 2025 | 2024 | | :--- | :--- | :--- | | Revenue | $1,788,290 | $1,584,652 | | Operating Income | $341,542 | $217,054 | | Net Income | $237,065 | $136,777 | | Diluted EPS | $6.18 | $3.39 | Consolidated Cash Flow Highlights (Year Ended June 30, $ in thousands) | Account | 2025 | 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $337,899 | $295,775 | | Net cash used in investing activities | ($41,921) | ($47,850) | | Net cash used in financing activities | ($316,016) | ($301,798) | [Non-GAAP Financial Measures and Reconciliations](index=14&type=section&id=Non-GAAP%20Financial%20Measures%20and%20Reconciliations) Adtalem uses non-GAAP measures such as Adjusted Net Income, Adjusted EPS, Adjusted Operating Income, and Adjusted EBITDA to provide insight into underlying business performance by excluding items like restructuring expenses, amortization of acquired intangibles, and business integration costs - The company provides non-GAAP metrics to supplement GAAP results, offering a view of ongoing operations by excluding special items such as restructuring, acquisition-related costs, and certain litigation reserves[33](index=33&type=chunk)[34](index=34&type=chunk)[35](index=35&type=chunk) FY 2025 GAAP to Non-GAAP Reconciliation Summary ($ in millions) | Metric | GAAP | Adjustments | Non-GAAP | | :--- | :--- | :--- | :--- | | Operating Income | $341.5 | $28.7 | $370.2 | | Net Income | $237.1 | $18.5 | $255.6 | | Diluted EPS | $6.18 | $0.49 | $6.67 | FY 2025 Adjusted EBITDA Reconciliation Summary ($ in thousands) | Metric | Amount | | :--- | :--- | | Net Income (GAAP) | $237,065 | | Plus: Interest, Taxes, D&A, etc. | $140,289 | | Plus: Other Adjustments | $82,351 | | **Adjusted EBITDA (Non-GAAP)** | **$459,705** |

Key Takeaways Investors prefer to invest in businesses that reap profits on a regular basis. To gauge the extent of profits, there is no better metric than the net profit margin. A higher net margin reflects a company's efficiency in converting sales into actual profits. The Chefs' Warehouse, Inc. (CHEF) , Perdoceo Education Corporation (PRDO) , Adtalem Global Education Inc. (ATGE) and Nomad Foods Limited (NOMD) boast solid net profit margins. Net Profit Margin = Net profit/Sales * 100 In simple terms, net ...

Core Insights - Investors are comparing Adtalem Global Education (ATGE) and Universal Technical Institute (UTI) to determine which stock is more attractive for value investing [1] Valuation Metrics - ATGE has a Zacks Rank of 2 (Buy), indicating stronger earnings estimate revision trends compared to UTI, which has a Zacks Rank of 3 (Hold) [3] - ATGE's forward P/E ratio is 15.30, significantly lower than UTI's forward P/E of 30.47, suggesting ATGE may be undervalued [5] - ATGE's PEG ratio is 1.02, while UTI's PEG ratio is 2.03, indicating ATGE has a more favorable growth outlook relative to its valuation [5] - ATGE's P/B ratio is 2.97, compared to UTI's P/B of 5.96, further supporting ATGE's valuation attractiveness [6] - ATGE has a Value grade of B, while UTI has a Value grade of C, reinforcing the perception that ATGE is the better option for value investors [6]

Group 1 - Boyd Gaming (BYD) is a notable stock in the Consumer Discretionary sector, which consists of 255 individual stocks and holds a Zacks Sector Rank of 9 [2] - Boyd Gaming currently has a Zacks Rank of 1 (Strong Buy), indicating strong potential for outperforming the market in the near term [3] - Year-to-date, Boyd Gaming has gained approximately 17%, outperforming the average gain of 7.3% in the Consumer Discretionary group [4] Group 2 - Boyd Gaming is part of the Gaming industry, which includes 39 companies and is currently ranked 92 in the Zacks Industry Rank [6] - The Gaming industry has seen an average gain of about 22.8% year-to-date, indicating that Boyd Gaming is slightly underperforming its industry peers [6] - Another stock in the Consumer Discretionary sector, Adtalem Global Education (ATGE), has outperformed with a year-to-date increase of 25.8% and holds a Zacks Rank of 2 (Buy) [5][7]

Group 1 - Adtalem Global Education (ATGE) has experienced significant selling pressure, resulting in a 7.1% decline in stock price over the past four weeks, but analysts anticipate better earnings than previously predicted [1] - The Relative Strength Index (RSI) for ATGE is currently at 29.62, indicating that the stock is in oversold territory and may be due for a trend reversal [5] - There is a consensus among sell-side analysts that earnings estimates for ATGE have remained stable, with a 0% increase in the consensus EPS estimate over the last 30 days, suggesting potential price appreciation [7] Group 2 - ATGE holds a Zacks Rank 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks based on earnings estimate revisions and EPS surprises, indicating a strong potential for a turnaround [8]