Strategic Education reported a sharp third-quarter swing to a loss after recording a $134.1 million non-cash impairment tied to Torrens University and related assets in Australia and New Zealand. The company said tighter international-student immigration conditions led it to lower its near-term growth expectations for the region.
Revenue rose modestly, while adjusted operating income was close to the year-earlier level. Education Technology Services and the company’s healthcare-related higher-education programs showed enrollment growth.
Third-quarter results
- Revenue increased 1.6% to $325.1 million from $319.9 million a year earlier. Excluding currency effects, revenue was nearly unchanged, up 0.1% to $320.1 million.
- The impairment drove an operating loss of $87.6 million, compared with operating income of $37.0 million a year earlier. Excluding the impairment and currency effects, adjusted operating income was $50.2 million, down from $51.3 million, and the adjusted operating margin was 15.7%, versus 16.0%.
- The company recorded a net loss of $98.3 million, compared with net income of $26.6 million in the third quarter of 2025. Adjusted net income, excluding the impairment and currency effects, was $36.4 million, versus $37.7 million.
- Adjusted EBITDA was $71.0 million, up from $69.6 million.
- Diluted loss per share was $4.68, compared with earnings of $1.15 per share a year earlier. Adjusted diluted earnings per share, on a constant-currency basis, increased to $1.69 from $1.63.
Business and capital allocation
- Education Technology Services revenue rose 11.9% to $42.8 million, from $38.3 million. Segment operating income increased to $18.2 million from $16.0 million.
- Sophia Learning’s average subscriber count grew about 22%. Its revenue increased 19.8% to $21.3 million from $17.8 million.
- Workforce Edge had 83 corporate agreements covering employers with about 4.03 million employees.
- Enrollment across the U.S. Higher Education healthcare portfolio increased 9% year over year.
- Strategic Education repurchased 347,472 shares for $28.5 million during the quarter. For the first nine months of 2026, it bought back 1,261,201 shares for $101.3 million.
The reported loss primarily reflects a non-cash write-down, rather than a comparable deterioration in adjusted quarterly earnings. At the same time, revenue was essentially flat after removing currency effects, and adjusted operating income and adjusted net income were slightly lower than a year earlier. The company’s revised outlook for Australia and New Zealand reflects the stated impact of immigration constraints on near-term growth expectations.