Perdoceo Education 2025 Q2 Earnings Beats Expectations as Net Income Rises 6.8%

Perdoceo Education (PRDO) reported its fiscal 2025 Q2 earnings on Jul 31st, 2025. Perdoceo Education exceeded market expectations with a notable increase in both revenue and earnings. The company raised its full-year adjusted operating income outlook, citing strong enrollment growth and strategic investments in academic offerings. This guidance adjustment reflects a positive trajectory influenced by the recent acquisition and expanding program portfolio. Analysts had anticipated a solid performance, and Perdoceo delivered, showcasing its robust market position and financial health.

Revenue

The total revenue of Perdoceo Education rose by 26.0% to $208.38 million in 2025 Q2, compared to $165.40 million in 2024 Q2. The University Group topped the list with $209.39 million, followed by CTU contributing $117.97 million, AIUS adding $54.72 million, and USAHS providing $36.70 million. Corporate and Other segments combined for an additional $191,000, leading to a total revenue of $209.58 million.

Earnings/Net Income

Perdoceo Education's EPS increased 6.8% to $0.63 in 2025 Q2 from $0.59 in 2024 Q2, demonstrating continued earnings growth. The company's profitability improved with a net income of $41.03 million in 2025 Q2, reflecting a 6.8% rise from $38.43 million in 2024 Q2. The EPS performance indicates positive growth and stability.

Price Action

The stock price of Perdoceo Education edged up 0.95% during the latest trading day, increased 0.88% over the most recent full trading week, and tumbled 11.96% month-to-date.

Post-Earnings Price Action Review

The strategy of purchasing Perdoceo Education shares post-quarterly revenue gains and holding them for 30 days has proven highly successful in recent years. Over the past three years, this approach yielded an impressive 153.00% return, greatly surpassing the benchmark return of 85.57%, thus achieving an excess return of 67.43%. This strategy highlights PRDO's ability to leverage positive earnings momentum effectively. With a compound annual growth rate of 20.56% and a maximum drawdown of 0.00%, it showcases strong risk-adjusted returns and minimal downside risk, underlining its robustness as an investment strategy.

CEO Commentary

Todd S. Nelson, President and CEO, highlighted that Perdoceo Education's second-quarter performance exceeded expectations, with a net income of $41 million and a 17% total enrollment growth across academic institutions. He emphasized ongoing investments in student enrollment and support processes, which have enhanced academic outcomes. Nelson noted the strategic expansion of program offerings at St. Augustine and the positive momentum in student retention and engagement. He expressed optimism about the future, stating, "We have experienced good momentum through the first half of 2025 and are optimistic this year will end on a high note, which should set us up well for 2026 and beyond."

Guidance

Perdoceo Education is raising its full-year adjusted operating income outlook to a range of $230 million to $236 million, compared to $188.9 million in 2024. Adjusted earnings per diluted share are now expected to range between $2.48 and $2.55, influenced by incremental expenses related to the St. Augustine acquisition. For Q3 2025, the company anticipates adjusted operating income between $57 million and $59 million and adjusted EPS ranging from $0.60 to $0.62, reflecting strong prospective student interest and continued growth in enrollment and revenue.

Additional News

Recently, Perdoceo Education Corporation announced a significant 15.4% increase in its quarterly dividend, now at $0.15 per share, marking the second increase since dividends commenced in 2023. Additionally, the company authorized a new $75 million share buyback program, effective July 31, 2025, set to expire in 18 months. This strategic move aligns with its capital allocation strategy, emphasizing investments in student support and technology, while evaluating acquisitions. These actions reflect management's confidence in the company's financial health and commitment to enhancing shareholder value through dividends and buybacks.