Covista — First Quarter Fiscal Year 2027 Earnings Summary

Financial Performance:

• Revenue increased 10.7% year-over-year to $511.5 million for the three months ended September 30, 2026.
• Diluted earnings per share (EPS) were $1.95, compared to $1.67 in the prior year; adjusted EPS was $2.19, representing 25.1% growth year-over-year.
• GAAP net income was $67.4 million, up from $61.8 million in the prior year; adjusted net income was $75.8 million, up from $64.9 million.
• Adjusted EBITDA reached $131.2 million, a 17.1% increase year-over-year, with an adjusted EBITDA margin of 25.6% compared to 24.2% in the prior year.
• Operating income was $98.0 million, up from $85.5 million; adjusted operating income was $106.6 million, up from $90.3 million.
• Net leverage was 0.5x as of September 30, 2026.
• Deferred revenue increased to $365.1 million from $259.1 million at the end of the prior quarter.
• Free cash flow for the quarter was $355.2 million (calculated as $114.0 million net cash provided by operating activities less $37.6 million capital expenditures).

Guidance and Future Outlook:

• Fiscal Year 2027 revenue guidance was raised to a range of $2,060 million to $2,095 million, implying 5.5% to 7% year-over-year growth (previously $2,050 million to $2,090 million).
• Fiscal Year 2027 adjusted EPS guidance was raised to a range of $9.00 to $9.20, implying 9% to 11.5% year-over-year growth (previously $8.90 to $9.15).
• The company launched "Purpose at Scale," a three-year strategy focused on operational excellence, platform extension, employer integration, and technology.
• Management indicated that demand behind the strategy is durable and that Covista is positioned to create lasting value for shareholders.

Business Segments and Product Lines:

• Total student enrollment reached 104,713, up 7.6% year-over-year, marking the 13th consecutive quarter of growth.
• Chamberlain University: Revenue was $192.4 million (up 7.4%); total enrollment was 40,351 (up 1.3%); achieved 17th straight quarter of pre-licensure BSN enrollment growth.
• Walden University: Revenue was $216.7 million (up 14.1%); total enrollment was 58,881 (up 12.8%), the highest in university history; achieved 13th straight quarter of total enrollment growth.
• Medical and Veterinary: Revenue was $102.5 million (up 10.0%); total enrollment was 5,481 (up 3.5%).
• Chamberlain University opened campuses in Cincinnati and Salt Lake City; a 27th campus in Nashville is expected to begin classes in January 2027.
• Walden University launched four new programs, with over 2,000 students already enrolled in programs heading into the 2026 academic year.
• Covista expanded a strategic nursing collaboration with Advocate Health to three Chicago-area campuses following a successful launch in Wisconsin.

Market and Competitive Landscape:

• Covista is identified as America's largest healthcare educator, serving 100,000 students across five accredited institutions.
• New analysis indicates students at Ross University School of Medicine and American University of the Caribbean School of Medicine passed the USMLE Step 1 on their first attempt at rates comparable to or higher than U.S. MD students with similar MCAT scores.
• The company received national recognition including TIME's America's Growth Leaders 2027, World's Best Companies 2026, Newsweek's America's Greenest Companies 2027, and America's Greatest Companies 2026.

Risks and Challenges:

• The press release includes a standard cautionary disclosure regarding forward-looking statements, noting that actual results could differ materially due to risks and uncertainties disclosed in Item 1A of the Annual Report on Form 10-K.
• A reconciliation of non-GAAP guidance measures to corresponding GAAP measures is not available on a forward-looking basis without unreasonable effort due to the uncertainty of special items.

Management Commentary and Tone:

• Steve Beard, Chairman and CEO, stated that "Purpose at Scale is delivering" and that all four pillars of the strategy are contributing to momentum, powering double-digit revenue growth and margin expansion.
• Chief Financial Officer Robert Phelan announced his planned retirement after nearly seven years; he will remain in the role until a successor is named to support the transition.
• Management described the demand for their strategy as durable and emphasized Covista's role as critical infrastructure for American healthcare.

Other Key Points:

• The company repurchased $84 million of shares in the first quarter.
• Covista repriced its $510 million Term Loan B, reducing the interest rate margin by 25 basis points to SOFR plus 2.00%.
• Capital expenditures for the quarter were $37.6 million.
• The company will hold a conference call to discuss results at 4:00 p.m. CT on October 29, 2026.