Adtalem’s Healthcare Education Dominance Fuels Record Growth Amid Workforce Shortages

Adtalem Global Education Inc. has cemented its position as a bellwether in healthcare education with a stellar third-quarter performance, underscored by surging enrollment, robust revenue growth, and strategic initiatives aligning with critical labor market needs. The company’s fiscal Q3 2025 results—released ahead of its May 2025 share repurchase completion—paint a picture of disciplined execution in a sector increasingly vital to addressing global healthcare shortages.

The Power of Healthcare Programs
Adtalem’s growth is anchored in its healthcare-focused universities, which collectively delivered 9.8% year-over-year enrollment growth to 94,223 students. Chamberlain University, a leader in nursing education, expanded its student body by 6.8% to 40,564, driven by pre- and post-licensure programs. This segment’s revenue jumped 13.1% to $192.6 million, with adjusted EBITDA rising 12.6% to $56.8 million. Chamberlain’s new brand campaign, “You’ve Got This, We’ve Got You,” signals a sharpened focus on student support, a strategy that could further boost retention and recruitment.

Walden University, meanwhile, posted its seventh consecutive quarter of enrollment growth, up 13.5% to 48,526 students, with healthcare degrees comprising 80% of its 2025 graduates. Revenue soared 18.5% to $178.4 million, and operating income nearly doubled to $45.2 million, underscoring the scalability of its online, competency-based model.

A Mixed Bag in Medical & Veterinary Education
Not all segments shone equally. The Medical & Veterinary segment saw enrollment rise just 1.2% to 5,133 students, with revenue growing a modest 3.6% to $95.0 million. Operating income fell 21.8% to $17.8 million, and adjusted EBITDA dropped 15.3% to $22.9 million. While Ross University’s veterinary program maintained its internship placement rankings, the segment’s lag raises questions about pricing power and demand dynamics in specialized medical training—a potential risk as competition intensifies.

Financial Fortitude and Capital Allocation
The company’s financial discipline is equally notable. GAAP net income surged 65.2% to $60.8 million, while adjusted EBITDA rose 19.3% to $127.8 million. A net leverage ratio of 0.8x signals a pristine balance sheet, enabling Adtalem to return capital to shareholders: it completed a $300 million buyback and authorized an additional $150 million through 2028. This contrasts with peers in education that have faced liquidity challenges, positioning Adtalem as a stable play in an otherwise volatile sector.

Strategic Momentum
Adtalem’s success hinges on its “Growth with Purpose” strategy, which prioritizes programs feeding into high-demand fields. Medical residency attainment rates for its Ross and AUC schools hit 95%, with 450 graduates entering primary care in underserved areas—a metric that aligns with federal initiatives to address physician shortages. Similarly, RUSVM’s veterinary graduates secured top internships, reinforcing the brand’s prestige. These outcomes are not just academic; they create a positive feedback loop, attracting students and employers alike.

The Road Ahead
Adtalem raised its fiscal 2025 outlook to revenue of $1.76–$1.775 billion (11–12% growth) and adjusted EPS of $6.40–$6.60 (28–32% growth), reflecting confidence in its healthcare education tailwinds. Yet risks remain: regulatory scrutiny of for-profit education, competition from traditional universities, and the ever-present challenge of student retention.

Conclusion
Adtalem’s Q3 results are a masterclass in executing a niche strategy in a fragmented industry. With healthcare education demand projected to grow as aging populations strain existing workforces, the company’s focus on scalable, career-oriented programs—backed by strong financials and shareholder-friendly policies—positions it as a long-term winner. The 12.9% revenue surge and 28% EPS growth trajectory, paired with a deleveraged balance sheet, suggest this is a stock investors should watch closely.

While the Medical & Veterinary segment’s softness merits monitoring, the core nursing and graduate healthcare programs are too dominant to ignore. In a sector where many struggle, Adtalem’s Q3 performance isn’t just a snapshot—it’s a roadmap for how to profit from one of the 21st century’s most pressing needs.