What is Grand Canyon Education's gross profit margin?

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What does Grand Canyon Education do and what are its main business segments?

What were the key takeaways from Grand Canyon Education's earnings call?

What were the key takeaways from Grand Canyon Education’s earnings call?

What is the revenue and EPS growth rate for Grand Canyon Education year over year?

What guidance did Grand Canyon Education's management provide for the next earnings period?

Did Grand Canyon Education beat or miss consensus estimates last quarter?

- **Enrollment Growth**: Online +9.6% YoY, hybrid +17.4% YoY, driven by nursing prereq courses and corporate partnerships.
- **Financial Performance**: Non-GAAP EPS $1.78, service revenue +9.6% YoY. Q4 at risk of $3M loss due to government shutdown.
- **Strategic Shifts**: Social media marketing boosts traditional campus registrations, 33% of new starts from corporate partnerships.
- **Diversification**: 30% of students in health care, 33% of new starts from corporate programs, reducing reliance on high school pipelines.
- **Risk**: Higher benefit costs and technology expenses pressure margins; nursing program diversification mitigates risk.

**【Management Opening Remarks】**
- Sarah Collins introduced the call, noting the presence of Brian Mueller (CEO) and Dan Bachus (CFO). She emphasized the forward-looking nature of the discussion and reminded investors to review SEC filings for risk factors.

**【CEO Commentary】**
- **Online Campus Growth**: New starts up mid-single digits, total enrollment +9.6% YoY. Growth driven by 20+ new programs, employer partnerships, and competitive pricing. Students aged 18-25 increasingly choosing fully online programs.
- **Ground Traditional Campus**: New enrollments up high single digits YoY, total flat YoY due to FAFSA issues and summer graduations. Fall 2026 registrations ahead of last year after marketing strategy shift to social media.
- **Hybrid Campus**: Enrollment +17.4% YoY (19.3% ex-closed sites), driven by ABSN program expansion. 19,410 students took prerequisite courses, with 66% of hybrid students in summer 2025 taking ≥1 course. Graduation rate mid-80s, NCLEX pass rate 90%.
- **Center for Workforce Development**: 4 programs launched, 212 students completed electrician pre-apprenticeship, 33 in CNC machinist program. Partnerships with companies addressing labor shortages.
- **Overall Impact**: GCE helped GCU graduate 206,709 students since 2018, including 26,099 first-time teachers and 3,383 pre-licensure nurses. Service revenue $261.1M (+9.6% YoY), driven by partner enrollments (+7.9% YoY).

**【CFO Financial Commentary】**
- **Financial Results**: GAAP net income $16.3M, GAAP EPS $0.58. Non-GAAP EPS $1.78, in line with estimates. Operating income $18M (6.9% margin), adjusted $58.2M (22.3% margin).
- **Revenue Drivers**: Higher-than-expected hybrid enrollments (+17.4% YoY). Online revenue up due to higher revenue per student, offset by lower traditional campus revenue.
- **Cost Pressures**: Higher benefit costs (+$0.06 EPS impact) and technology expenses. Government shutdown may reduce Q4 revenue by $3M due to military tuition assistance delays.
- **Guidance**: Full-year 2025 non-GAAP EPS expected $6.80-$7.00. Q4 revenue growth in top half of prior guidance, excluding military impact. Share buybacks accelerated due to undervaluation.

**【Q&A Highlights】**
- **Nursing Program Diversification**: 30% of students in health care, diversified across pre- and post-licensure programs. Post-licensure programs (RN-to-BSN, MSN) less impacted by market trends.
- **Marketing Strategy Shift**: Increased social media spending to reach younger students, resulting in ahead-of-schedule 2026 registrations. Reduced reliance on high school partnerships.
- **Diversification Beyond Nursing**: Growth in education (teacher shortage), business, counseling/social work, and technology/engineering programs. 33% of new starts from corporate partnerships.
- **Enrollment Efficiency**: Consistent lead-to-enrollment conversion rates despite reduced enrollment adviser growth. Sustainability driven by corporate partnerships and program diversity.


Grand Canyon Education, Inc.(LOPE)-20251106-2025 Q3 Earnings call transcript

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