Grand Canyon Education(US:LOPE)2026-02-18 21:05Revenue Performance - Service revenue for the year ended December 31, 2025 was $1,106.1 million, an increase of $73.1 million, or 7.1%, compared to $1,033.0 million for 2024, driven by a 7.1% increase in university partner enrollments to 136,239[4] - For the three months ended December 31, 2025, service revenue was $308.1 million, an increase of $15.5 million, or 5.3%, compared to $292.6 million for the same period in 2024, also due to a 7.1% increase in university partner enrollments[5] - Service revenue for Q4 2025 was $308,119,000, an increase of 5.3% from $292,573,000 in Q4 2024[25] - Full year 2026 diluted EPS guidance is projected to be between $9.79 and $10.40, with service revenue expected between $1,167.5 million and $1,189.0 million[13] Income and Earnings - Operating income for the year ended December 31, 2025 was $265.9 million, a decrease of $9.5 million, or 3.4%, compared to $275.4 million for 2024, with an operating margin of 24.0%[8] - Net income for the year ended December 31, 2025 was $216.2 million, a decrease of $10.0 million, or 4.4%, compared to $226.2 million for 2024, with adjusted net income of $254.5 million[8] - Operating income for Q4 2025 was $108,079,000, up from $100,027,000 in Q4 2024, representing an 8.2% increase[25] - Basic earnings per share for Q4 2025 was $3.16, compared to $2.86 in Q4 2024, marking a 10.5% increase[25] - Net income for Q4 2025 was $86.7 million, compared to $81.9 million in Q4 2024, reflecting a 4.5% increase[36] - Non-GAAP net income for Q4 2025 was $88.7 million, compared to $85.1 million in Q4 2024, indicating a 4.2% increase[36] - GAAP diluted income per share for Q4 2025 was $3.14, up from $2.84 in Q4 2024, marking a 10.6% increase[36] Enrollment Growth - GCU enrollments increased to 131,826 at December 31, 2025, a 7.0% increase over 2024, while online enrollments rose to 107,148, an increase of 8.7%[5] - The company plans to open five new off-campus sites in 2025, contributing to enrollment growth[5] Costs and Expenses - Total costs and expenses for the year ended December 31, 2025, were $840,160,000, an increase of 10.9% from $757,603,000 in 2024[25] - The company incurred $40.5 million in litigation and regulatory costs for the year ended December 31, 2025, significantly higher than $6.2 million in 2024[35] - The company reported a litigation settlement expense of $35,000,000 for the year ended December 31, 2025[25] - Contributions in lieu of state income taxes amounted to $5.0 million for the year ended December 31, 2025, compared to $4.5 million in 2024[35] - The company reported a loss on fixed asset disposal of $0.9 million for the year ended December 31, 2025, compared to $0.1 million in 2024[35] Adjusted EBITDA - Adjusted EBITDA increased 8.4% to $368.6 million for the year ended December 31, 2025, compared to $340.0 million for 2024[8] - Adjusted EBITDA for Q4 2025 was $123.3 million, up from $116.6 million in Q4 2024, representing a 2.5% increase year-over-year[35] - For the year ended December 31, 2025, Adjusted EBITDA reached $368.6 million, an increase of 8.4% from $340.0 million in 2024[35] Tax and Compliance - The effective tax rate for the year ended December 31, 2025 was 22.8%, compared to 22.3% for 2024, influenced by higher state income taxes[8] - The company plans to continue expanding its services and managing risks associated with strategic initiatives and regulatory compliance[19] - The company expects to continue facing unusual, non-routine, or non-recurring expenses in the future, which may affect Adjusted EBITDA[33] Assets and Cash Flow - Total assets as of December 31, 2025, were $992,305,000, down from $1,018,425,000 in 2024, a decrease of 2.6%[27] - Cash and cash equivalents decreased to $111,762,000 from $324,623,000, a decline of 65.5% year-over-year[29] - Amortization of intangible assets for the year ended December 31, 2025, was $8.4 million, consistent with the previous year[36]