Q2 FY2026 Earnings Presentation January 27, 2026 These risks, uncertainties, factors and contingencies include, but are not limited to: reduction of per pupil funding amounts at the schools we serve; inability to achieve a sufficient level of new enrollments to sustain our business model or meet guidance; limitations of the enrollment data we present, which may not fully capture trends in the performance of our business; failure to enter into new school contracts or renew existing contracts, in part or in t ...

Core Viewpoint - Kirby McInerney LLP is investigating potential claims against Stride, Inc. for possible violations of federal securities laws and other unlawful business practices [1]. Group 1: Legal Issues - The Gallup-McKinley County Schools Board of Education filed a verified complaint against Stride, alleging fraud, deceptive trade practices, and systemic violations of law, particularly affecting Native American students [3]. - Stride's share price fell by $8.09, or approximately 4.9%, from $166.11 on September 9, 2025, to $158.02 on September 10, 2025, following the announcement of the complaint [3]. Group 2: Financial Performance - On October 29, 2025, Stride issued a negative annual revenue forecast, citing difficulties in enrolling new students, which led to a significant drop in share price [4]. - The share price declined by $83.48, or approximately 54.4%, from $153.53 on October 28, 2025, to close at $70.05 on October 29, 2025, after the revenue forecast was released [4].

Q1 FY2026 Performance - Total enrollments reached 247700, an increase of 113% year-over-year[8] - Adjusted Operating Income was $811 million, up 39% year-over-year[12] - Adjusted EBITDA was $1084 million, up 29% year-over-year[12] - Adjusted EPS was $152, up 39% year-over-year[12] Financial Growth and Guidance - Q1 FY26 total revenue was $6209 million, representing a 127% increase year-over-year[21] - The company is guiding for FY26 revenue between $248 billion and $2555 billion, representing approximately 5% year-over-year growth at the midpoint[23, 24] - The company is guiding for FY26 Adjusted Operating Income between $475 million and $500 million, representing approximately 5% year-over-year growth at the midpoint[23, 24] Secular Trends and Market Demand - 60% of parents searched for new schools for their children in the last year, with 27% considering full-time online education options[13] - 44% of parents fear for their children's safety at school[13] - 81% of K-12 parents support making K-12 education more flexible[13] - Only 35% of Americans are satisfied with K-12 education in the US[13] Balance Sheet and Capital Allocation - The company has a strong balance sheet with $7496 million in cash, cash equivalents, and marketable securities[25] - Total debt obligations are $5418 million, resulting in a leverage ratio of 004x[25] - The company prioritizes organic growth, new product and technology development, and synergistic M&A[28]

Core Viewpoint - The Gallup-McKinley County Schools (GMCS) Board of Education has filed a complaint against Stride, Inc., alleging fraud and misconduct aimed at maximizing profits at the expense of students, particularly Native American students [1][2]. Allegations of Profit Before Students - The complaint details that Stride executives rejected requests to hire additional teachers, violating New Mexico law, and instead cut staff to meet profit targets [2]. - Whistleblower testimony indicates that Stride's leadership engaged in a disinformation strategy to distract from their misconduct [2]. Financial and Reputational Risk - GMCS Board President Chris Mortensen stated that Stride's financial model prioritized profit over the education of children, resulting in a significant drop in graduation rates from 54% in 2023 to 27.67% in 2024 [3]. - The lawsuit highlights substandard test scores and a loss of public trust as long-term consequences of Stride's practices [3]. Broader Implications - The complaint seeks compensatory and punitive damages, as well as restitution of taxpayer funds, emphasizing the risks associated with publicly traded education models that prioritize shareholder value over educational quality [4]. - Stride is accused of inflating enrollment numbers by retaining "ghost students" to secure state funding and assigning teachers excessive caseloads, exceeding statutory limits [5]. Compliance Violations - Stride allegedly ignored compliance requirements, including background checks and special education services, while suppressing whistleblowers who reported financial directives to delay hiring and deny services [5].

FY2025 Performance Highlights - Revenue reached $24053 million, a year-over-year increase of 18%[11] - Adjusted Operating Income was $4662 million, up 59% year-over-year[11] - Adjusted EBITDA amounted to $5710 million, reflecting a 46% year-over-year growth[11] - Adjusted EPS stood at $810[11] Q4 FY2025 Performance - Revenue for the quarter was $6536 million, a 22% increase year-over-year[11] - Adjusted Operating Income for the quarter reached $1306 million, up 49% year-over-year[11] - Adjusted EBITDA for the quarter was $1584 million, a 41% increase year-over-year[11] - Adjusted EPS for the quarter was $229[11] Enrollment Trends - Total revenues increased by 179% to $24053 million[18] - Average enrollment increased by 204% to 2340K[18] - General Education average enrollments increased 161K, up 13% year-over-year[19] - Career Learning average enrollments increased 236K, up 33% year-over-year[19] Balance Sheet - Cash, Cash Equivalents & Marketable Securities totaled $10114 million[20] - Total Debt Obligations were $5032 million[20]

Financial Performance - Q3 FY25 revenue reached $613.4 million, an 18% year-over-year increase[9] - Adjusted Operating Income for Q3 FY25 was $141.7 million, a 47% year-over-year increase[9] - Adjusted EBITDA for Q3 FY25 was $168.3 million, a 40% year-over-year increase[9] - Revenue for the first nine months of FY25 reached $1751.7 million, a 16% year-over-year increase[9] - Adjusted Operating Income for the first nine months of FY25 was $335.7 million, a 63% year-over-year increase[9] - Adjusted EBITDA for the first nine months of FY25 was $412.6 million, a 48% year-over-year increase[9] Enrollment Trends - Average Q3 enrollments reached 240200, up 21.1% from the prior year[7] - General Education enrollments increased by 16900, up 14% year-over-year[17] - Career Learning enrollments increased by 24900, up 34% year-over-year[17] Guidance and Targets - The company increased its full-year revenue guidance to a range of $2370 billion to $2385 billion[18] - The company increased its full-year Adjusted Operating Income guidance to a range of $455 million to $465 million[18]