Perdoceo Education Corporation — Third Quarter 2026 Earnings Summary

Financial Performance:

• Third quarter 2026 revenue increased 1.9% year-over-year to $215.9 million, compared to $211.9 million in the prior year quarter.
• Year-to-date 2026 revenue increased 2.6% to $651.0 million, compared to $634.5 million in the prior year period.
• Third quarter 2026 earnings per diluted share increased 16.7% to $0.70, compared to $0.60 in the prior year quarter; adjusted earnings per diluted share grew 18.5% to $0.77.
• Year-to-date 2026 earnings per diluted share were $2.31, compared to $1.87 in the prior year period; adjusted earnings per diluted share were $2.48.
• Third quarter 2026 operating income increased 8.1% to $55.1 million, compared to $51.0 million in the prior year quarter; adjusted operating income increased 8.4% to $66.1 million.
• Year-to-date 2026 operating income increased 12.3% to $173.1 million, compared to $154.1 million in the prior year period; adjusted operating income increased 9.0% to $203.1 million.
• Third quarter 2026 net income was $44.4 million, compared to $39.9 million in the prior year quarter.
• Year-to-date 2026 net income was $146.3 million, compared to $124.6 million in the prior year period.
• Third quarter 2026 net cash provided by operating activities was $79.7 million, compared to $41.2 million in the prior year quarter.
• Year-to-date 2026 net cash provided by operating activities was $223.8 million, compared to $185.1 million in the prior year period.
• As of September 30, 2026, total cash, cash equivalents, restricted cash, and available-for-sale short-term investments totaled $776.9 million, compared to $643.5 million as of December 31, 2025.
• Deferred revenue as of September 30, 2026, was $81.4 million, compared to $37.8 million as of December 31, 2025.

Guidance and Future Outlook:

• Fourth quarter 2026 operating income is expected to be between $47.9 million and $50.9 million, compared to $41.9 million in the prior year quarter.
• Full year 2026 operating income is expected to be between $221.0 million and $224.0 million, compared to $196.0 million in the prior year.
• Fourth quarter 2026 adjusted operating income is expected to be between $56.9 million and $59.9 million, compared to $51.6 million in the prior year quarter.
• Full year 2026 adjusted operating income is expected to be between $260.0 million and $263.0 million, compared to $237.9 million in the prior year.
• Fourth quarter 2026 earnings per diluted share is expected to be between $0.63 and $0.67, compared to $0.54 in the prior year quarter.
• Full year 2026 earnings per diluted share is expected to be between $2.93 and $2.97, compared to $2.42 in the prior year.
• Fourth quarter 2026 adjusted earnings per diluted share is expected to be between $0.68 and $0.72, compared to $0.59 in the prior year quarter.
• Full year 2026 adjusted earnings per diluted share is expected to be between $3.15 and $3.19, compared to $2.61 in the prior year.
• The acquisition of South University is expected to be completed as early as April 2027.
• The South University acquisition is expected to be immediately accretive to adjusted operating income beginning in 2027 and provide further growth in adjusted operating income in 2028.

Business Segments and Product Lines:

• Total student enrollments as of September 30, 2026, were 47,260, an increase of 1.6% compared to 46,520 in the prior year.
• Colorado Technical University (CTU) enrollments were 31,870, a decrease of 0.5% year-over-year; CTU revenue increased 0.3% in the quarter and 1.7% year-to-date.
• American InterContinental University System (AIUS) enrollments were 10,830, an increase of 7.5% year-over-year; AIUS revenue decreased 0.1% in the quarter and 0.5% year-to-date.
• University of St. Augustine for Health Sciences (USAHS) enrollments were 4,560, an increase of 3.2% year-over-year; USAHS revenue increased 9.8% in the quarter and 9.9% year-to-date.
• CTU operating income for the quarter and year-to-date included increased legal fees related to previously disclosed legal matters; excluding these fees, operating income would have increased compared to prior year periods.
• USAHS operating income for the quarter was $4.6 million compared to $66,000 in the prior year quarter; year-to-date operating income was $14.6 million compared to a loss of $2.0 million in the prior year period.

Market and Competitive Landscape:

• Management reported strong prospective student interest and student retention trends near historical highs.
• The company anticipates that any impact on inquiry volume due to increased use of Artificial Intelligence by prospective students will be offset by inquiry growth from other channels.
• The company assumes no material impact from the elimination of the Grad PLUS loan program as prospective students are expected to have access to private lending sources.

Risks and Challenges:

• CTU operating income was impacted by increased legal fees related to previously disclosed legal matters.
• Future results are subject to risks including declines in enrollment, changes in federal student aid availability, regulatory changes, and the successful completion of the South University acquisition.

Management Commentary and Tone:

• Todd Nelson, President and CEO, stated that third quarter operating performance was ahead of expectations.
• Management remains committed to investing in student support and technology to enhance student experiences and academic outcomes.
• Management expressed confidence in generating long-term, sustainable, and responsible growth.

Other Key Points:

• On November 5, 2026, the board declared a quarterly dividend of $0.17 per share, payable December 11, 2026.
• During the quarter ended September 30, 2026, the company repurchased 0.6 million shares for $19.9 million, with $65.1 million remaining under the current share repurchase program.
• On September 14, 2026, the company entered into a definitive agreement to acquire 100% of South University for approximately $130 million to $150 million at closing, plus $18 million in deferred consideration and up to $56 million in earn-out payments.
• The South University acquisition is expected to be funded fully using the company's available cash balances.
• The company expects both quarterly dividend payments and share repurchases to be an integral and growing part of its balanced capital allocation strategy.