Financial Analysis

Commitments and Contingencies The Companys U.S. Higher Education institutions participate in various federal student financial assistance programs which are subject to audit by agencies, including the Department of Education, the Veterans Administration, and the Department of Defense. Management believes that the potential effects of audit adjustments, if any, for the periods currently under audit will not have a material adverse effect, individually or in the aggregate, on the Companys consolidated financial position, results of operations, or cash flows. …

CommitmentsAndContingenciesDisclosureTextBlock · excerpt; the full note is in the filing

The following table presents the Companys revenues from contracts with customers disaggregated by material revenue category for the years ended December 31, 2023, 2024, and 2025 (in thousands): 2023 2024 2025 U.S. Higher Education Segment Tuition, net of discounts, grants and scholarships $ 784,066 $ 820,913 $ 830,061 Other (1) 34,887 36,977 38,178 Total U.S. Higher Education Segment 818,953 857,890 868,239 Australia/New Zealand Segment Tuition, net of discounts, grants and scholarships 226,393 249,336 245,513 Other (1) 7,125 7,783 6,071 Total Australia/New Zealand Segment 233,518 257,119 251,584 Education Technology Services Segment (2) 80,453 104,921 148,397 Consolidated revenue $ 1,132,924 $ 1,219,930 $ 1,268,220 ___________________________________________________________ (1) Other revenue is primarily comprised of academic fees, sales of course materials, placement fees and other non-tuition revenue streams. (2) Education Technology Services revenue is primarily derived from tuition revenue and administrative fees. …

DisaggregationOfRevenueTableTextBlock · excerpt; the full note is in the filing

Equity Awards In connection with the merger with Capella Education Company on August 1, 2018, the Capella Education Company 2014 Equity Incentive Plan (the 2014 Capella Plan) and the Capella Education Company 2005 Stock Incentive Plan (collectively, the Capella Plans) were assumed by the Company. Under the Capella Plans, shares of the Companys common stock were permitted to be issued upon the exercise or settlement of equity awards that were granted prior to the merger date or pursuant to awards granted after the closing of the merger to legacy Capella Education Company employees under the 2014 Capella Plan. On November 6, 2018, the Companys shareholders approved the Strategic Education, Inc. 2018 Equity Compensation Plan (the 2018 Plan), which replaced the Strayer Education, Inc. 2015 Equity Compensation Plan (the 2015 Plan). The 2018 Plan provides for the granting of restricted stock, restricted stock units, stock options intended to qualify as incentive stock options, options that do not qualify as incentive stock options, and other forms of equity compensation and performance-based awards to employees, officers, and directors of the Company, or to a consultant or advisor to the Company, at the discretion of the Board of Directors. Vesting provisions are at the discretion of the Board of Directors. Options may be granted at option prices based at or above the fair market value of the shares at the date of grant. The maximum term of the awards granted under the 2018 Plan is …

DisclosureOfCompensationRelatedCostsShareBasedPaymentsTextBlock · excerpt; the full note is in the filing

Fair Value Measurement Assets measured at fair value on a recurring basis consist of the following as of December 31, 2024 (in thousands): Fair Value Measurements at Reporting Date Using December 31, 2024 Quoted Prices in Active Markets for Identical Assets/Liabilities (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Money market funds $ 92,416 $ 92,416 $ $ Available-for-sale securities : Corporate debt securities 499 499 Total assets at fair value on a recurring basis $ 92,915 $ 92,416 $ 499 $ Assets measured at fair value on a recurring basis consist of the following as of December 31, 2025 (in thousands): Fair Value Measurements at Reporting Date Using December 31, 2025 Quoted Prices in Active Markets for Identical Assets/Liabilities (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Money market funds $ 88,239 $ 88,239 $ $ Total assets at fair value on a recurring basis $ 88,239 $ 88,239 $ $ The Company measures the above items on a recurring basis at fair value as follows: Money market funds Classified in Level 1 is excess cash the Company holds in money market funds, which are included in cash and cash equivalents in the accompanying consolidated balance sheets. The Companys other cash and cash equivalents as of December 31, 2024 and 2025 approximate fair value and are not disclosed in the above tables because of the short-term nature of the financial instrume …

FairValueDisclosuresTextBlock · excerpt; the full note is in the filing

Goodwill and Intangible Assets Goodwill The following table presents changes in the carrying value of goodwill by segment for the years ended December 31, 2024 and 2025 (in thousands): U.S. Higher Education Australia / New Zealand Education Technology Services Total Balance as of December 31, 2023 $ 632,075 $ 519,813 $ 100,000 $ 1,251,888 Additions Impairments Currency translation adjustments (45,005) (45,005) Balance as of December 31, 2024 632,075 474,808 100,000 1,206,883 Additions Impairments Currency translation adjustments 35,530 35,530 Balance as of December 31, 2025 $ 632,075 $ 510,338 $ 100,000 $ 1,242,413 The Company assesses goodwill at least annually for impairment during the fourth quarter, or more frequently if events occur or circumstances change between annual tests that would more likely than not reduce the fair value of the respective reporting unit below its carrying amount. In 2025, the Company performed a qualitative impairment assessment of goodwill assigned to its reporting units using the first day of the fourth quarter of 2025 as the assessment date. The Company evaluated the likelihood of impairment by considering qualitative factors relevant to the reporting units, such as macroeconomic conditions, industry and market considerations, cost factors, overall financial performance, and any other factors that could have a significant bearing on fair value. Based on the results of this qualitative impairment analysis, the Company concluded that no impairm …

GoodwillAndIntangibleAssetsDisclosureTextBlock · excerpt; the full note is in the filing

Income Taxes The income tax provision for the years ended December 31, 2023, 2024 and 2025 is summarized below (in thousands): 2023 2024 2025 Current: Federal $ 20,071 $ 25,896 $ 22,835 State 6,228 8,844 8,391 Foreign 10,962 14,295 11,787 Total current 37,261 49,035 43,013 Deferred: Federal (2,437) (843) 7,525 State (100) 838 350 Foreign (3,789) (282) (109) Total deferred (6,326) (287) 7,766 Total provision for income taxes $ 30,935 $ 48,748 $ 50,779 The U.S. and foreign components of income before income taxes for the years ended December 31, 2023, 2024 and 2025 are summarized below (in thousands): 2023 2024 2025 United States $ 76,893 $ 118,785 $ 139,429 Foreign 23,833 42,647 37,964 Total income before income taxes $ 100,726 $ 161,432 $ 177,393 The Company intends to indefinitely reinvest its foreign earnings and cash unless such repatriation results in no or minimal tax costs. State income taxes associated with the foreign earnings that the Company intends to repatriate in the future are not material. As such, no deferred tax liabilities have been recorded in the United States with respect to foreign subsidiary earnings. The tax effects of the principal temporary differences that give rise to the Companys net deferred tax liability are as follows as of December 31, 2024 and 2025 (in thousands): 2024 2025 Lease liabilities $ 15,182 $ 13,264 Allowance for credit losses 12,465 12,176 Stock-based compensation 9,758 10,085 Contract liabilities 8,972 9,201 Loss carryforward 3,08 …

IncomeTaxDisclosureTextBlock · excerpt; the full note is in the filing

Litigation The Company is involved in litigation and other legal proceedings arising out of the ordinary course of its business. Certain of these matters are discussed below. From time to time, certain matters may arise that are other than ordinary and routine. The outcome of such matters is uncertain, and the Company may incur costs in the future to defend, settle, or otherwise resolve them. The Company accrues for estimated costs related to existing lawsuits, claims and proceedings when it is probable that it will incur these costs in the future and the costs are reasonably estimable. The Company currently believes that the ultimate outcome of such matters will not, individually or in the aggregate, have a material adverse effect on its consolidated financial position, results of operations or cash flows. However, depending on the amount and timing, an unfavorable resolution of some or all of these matters could materially affect future results of operations in a particular period. On April 20, 2021, Capella University received a letter from the Department of Education referencing Wright, et al. v. Capella Education Co., et al. (subsequently captioned Ornelas, et al. v. Capella, et al. ), United States District Court for the District of Minnesota, Case No. 18-cv-1062, and indicating that the Department would require a fact-finding process pursuant to the borrower defense to repayment regulations to determine the validity of more than 1,000 borrower defense applications that …

LegalMattersAndContingenciesTextBlock · excerpt; the full note is in the filing

Leases The Company has long-term, non-cancelable operating leases for campuses and other administrative facilities. These leases generally range from 3 years to 15 years and may include renewal options to extend the lease term. In addition, the leases commonly include lease incentives in the form of rent abatements and tenant improvement allowances. The Company subleases certain portions of unused building space to third parties. The components of lease costs were as follows for the years ended December 31, 2023, 2024, and 2025 (in thousands) 2023 2024 2025 Lease Cost: Operating lease cost (1) $ 29,897 $ 19,012 $ 26,563 Short-term lease cost 360 429 311 Sublease income (906) (389) (303) Total lease costs $ 29,351 $ 19,052 $ 26,571 ___________________________________________________________ (1) During the years ended December 31, 2023 , 2024, and 2025, operating lease cost includes $5.1 million, $0.7 million, and $4.7 million of right-of-use lease asset impairment charges, respectively, related to redundant leased space that was vacated during the year. During the years ended December 31, 2023 , 2024 and 2025, operating lease cost includes $0.1 million, $6.2 million, and $0.4 million, respectively, of net benefits related to the early termination of leases. These net benefits reflect the reduction of the lease liability for payments that will no longer be required and the corresponding adjustment to the related right-of-use asset, if any, net of cash payments made in connectio …

LesseeOperatingLeasesTextBlock · excerpt; the full note is in the filing

Long-Term Debt On October 18, 2024, the Company entered into an amended credit facility (the Amended Credit Facility), which provides for a senior secured revolving credit facility (the Revolving Credit Facility) in an aggregate principal amount of up to $250 million. The Amended Credit Facility provides the Company with an option, subject to obtaining additional loan commitments and satisfaction of certain conditions, to increase the commitments under the Revolving Credit Facility or establish one or more incremental term loans (each, an Incremental Facility) in the future in an aggregate amount of up to the sum of (x) the greater of (A) $300 million and (B) 100% of the Companys consolidated EBITDA (earnings before interest, taxes, depreciation, amortization, and noncash charges, such as stock-based compensation) calculated on a trailing four-quarter basis and on a pro forma basis, and (y) if such Incremental Facility is incurred in connection with a permitted acquisition or other permitted investment, any amounts so long as the Companys leverage ratio (calculated on a trailing four-quarter basis) on a pro forma basis will be no greater than 1.75:1.00. In addition, the Amended Credit Facility provides for a subfacility for borrowings in certain foreign currencies in an amount equal to the U.S. dollar equivalent of $150 million. The maturity date of the Amended Credit Facility is October 18, 2029. The Company paid approximately $1.7 million in debt financing costs associated …

LongTermDebtTextBlock · excerpt; the full note is in the filing

Recently Adopted Accounting Pronouncements In December 2023, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (ASU 2023-09), which requires disclosure of specific categories in the effective tax rate reconciliation. Further, the standard requires certain disclosures of state versus federal income tax expense and taxes paid. The Company adopted ASU 2023-09 for its annual reporting period ended on December 31, 2025 and applied the amendments prospectively. See Note 19 for the required income tax disclosures. Recently Issued Accounting Standards Not Yet Adopted In November 2024, the FASB issued ASU 2024-03, Income StatementReporting Comprehensive IncomeExpense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (ASU 2024-03). ASU 2024-03 requires the disclosure of amounts related to purchases of inventory, employee compensation, depreciation, intangible asset amortization, and depletion within each income statement expense line item that contains any of these expenses. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and for interim periods beginning after December 15, 2027. Early adoption is permitted, and the amendments can be applied prospectively or retrospectively. The Company is currently evaluating the impact that ASU 2024-03 will have on its consolidated financial statement disclosures. In Sept …

NewAccountingPronouncementsPolicyPolicyTextBlock · excerpt; the full note is in the filing

Other Employee Benefit Plans The Company sponsors the Strategic Education, Inc. 401(k) Plan, which covers all eligible employees of the Company. The Company makes discretionary contributions to participants of the Strategic Education, Inc. 401(k) Plan through a Company match of 100% on the first 2%, and 50% on the next 2%, of the employee contributions, for a maximum company match of 3%. The Companys contributions to these plans totaled $8.2 million, $8.6 million and $8.9 million for the years ended December 31, 2023, 2024, and 2025, respectively. Pursuant to local laws, ANZ is required to make contributions on behalf of its employees for post-retirement superannuation benefits. In addition, ANZ has recorded a liability for long service leave, an entitlement for which employees meeting certain requirements are eligible for extended paid leave. The Company incurred $8.6 million, $9.3 million, and $10.9 million in expense related to these arrangements for the benefit of ANZ employees for the years ended December 31, 2023, 2024, and 2025, respectively. In May 1998, the Company adopted the Strayer Education, Inc. Employee Stock Purchase Plan (ESPP). Under the ESPP, eligible employees may purchase shares of the Companys common stock, subject to certain limitations, at 90% of its market value at the date of purchase. Purchases are limited to 10% of an employees eligible compensation. The aggregate number of shares of common stock that may be made available for purchase by participa …

PensionAndOtherPostretirementBenefitsDisclosureTextBlock · excerpt; the full note is in the filing

Restructuring and Related Charges The Company incurs severance and other employee separation costs related to employee terminations that are not tied to a formal restructuring plan. During the years ended December 31, 2023, 2024, and 2025, the Company incurred $12.0 million, $4.9 million and $13.3 million, respectively, of severance and other employee separation charges related to the elimination of certain positions. These severance and other employee separation charges are included in Restructuring costs on the consolidated statements of income. The following details the changes in the Companys severance and other employee separation costs restructuring liabilities for the years ended December 31, 2023, 2024, and 2025 (in thousands): Severance Restructuring Liability Balance as of December 31, 2022 $ Restructuring and other charges 12,015 Payments (11,220) Balance as of December 31, 2023 795 Restructuring and other charges 4,902 Payments (5,163) Balance as of December 31, 2024 (1) 534 Restructuring and other charges 13,326 Payments (13,000) Balance as of December 31, 2025 (1) $ 860 _________________________________________________________ (1) Restructuring liabilities are included in accounts payable and accrued expenses in the consolidated balance sheets. The Company evaluates its owned and leased real estate portfolio on an ongoing basis, which has resulted in the consolidation and sale of underutilized facilities. During the years ended December 31, 2023, 2024, and 2025, …

RestructuringAndRelatedActivitiesDisclosureTextBlock · excerpt; the full note is in the filing

Revenue Recognition The Companys revenues primarily consist of tuition revenue arising from educational services provided in the form of classroom instruction and online courses. Tuition revenue is deferred and recognized ratably over the period of instruction, which varies depending on the course format and chosen program of study. Capella Universitys GuidedPath classes and Strayer Universitys educational programs typically are offered on a quarterly basis, and such periods coincide with the Companys quarterly financial reporting periods, while Capella Universitys FlexPath courses are delivered over a twelve-week subscription period. Torrens University offers the majority of its education programs on a trimester system having three primary academic terms, which all occur within the calendar year. The following table presents the Companys revenues from contracts with customers disaggregated by material revenue category for the years ended December 31, 2023, 2024, and 2025 (in thousands): 2023 2024 2025 U.S. Higher Education Segment Tuition, net of discounts, grants and scholarships $ 784,066 $ 820,913 $ 830,061 Other (1) 34,887 36,977 38,178 Total U.S. Higher Education Segment 818,953 857,890 868,239 Australia/New Zealand Segment Tuition, net of discounts, grants and scholarships 226,393 249,336 245,513 Other (1) 7,125 7,783 6,071 Total Australia/New Zealand Segment 233,518 257,119 251,584 Education Technology Services Segment (2) 80,453 104,921 148,397 Consolidated revenue $ …

RevenueFromContractWithCustomerTextBlock · excerpt; the full note is in the filing

Segment and Geographic Information Strategic Education is an educational services company that provides access to high-quality education through campus-based and online post-secondary education offerings, as well as through programs to develop job-ready skills for high-demand markets. Strategic Educations portfolio of companies is dedicated to closing the skills gap by placing adults on the most direct path between learning and employment. The Companys organizational structure includes three operating and reportable segments: U.S. Higher Education, Education Technology Services, and Australia/New Zealand. The USHE segment provides flexible and affordable certificate and degree programs to working adults primarily through Capella University and Strayer University, including the Jack Welch Management Institute MBA, which is an offering of Strayer University. USHE also operates non-degree web and mobile application development courses through Hackbright Academy and Devmountain, which are offerings of Strayer University. The Education Technology Services segment primarily develops and maintains relationships with employers to build employee education benefits programs that provide employees access to affordable and industry-relevant training, certificate, and degree programs. The employer relationships developed by the Education Technology Services segment are an important source of student enrollment for Capella University and Strayer University, and a significant portion of the …

SegmentReportingDisclosureTextBlock · excerpt; the full note is in the filing

Significant Accounting Policies Financial Statement Presentation The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in the consolidated financial statements. Certain amounts in the prior periods have been reclassified to conform to the current periods presentation. Below is a description of the nature of the costs included in the Companys operating expense categories. Instructional and support costs generally contain items of expense directly attributable to activities that support students. This expense category includes salaries and benefits of faculty and academic administrators, as well as admissions and administrative personnel who support and serve student interests. Instructional and support costs also include course development costs and costs associated with delivering course content, including educational supplies, facilities, and all other physical plant and occupancy costs, with the exception of costs attributable to the corporate offices. Bad debt expense incurred on delinquent student account balances is also included in instructional and support costs. General and administration expenses include salaries and benefits of management and employees engaged in finance, human resources, legal, regulatory compliance, marketing and other corporate functions. Also included are the costs of advertising and production of marketing materials. General an …

SignificantAccountingPoliciesTextBlock · excerpt; the full note is in the filing

The following table presents the Companys revenues from contracts with customers disaggregated by material revenue category for the three and six months ended June 30, 2025 and 2026 (in thousands): For the three months ended June 30, For the six months ended June 30, 2025 2026 2025 2026 U.S. Higher Education Segment Tuition, net of discounts, grants and scholarships $ 206,714 $ 207,340 $ 418,460 $ 410,154 Other (1) 8,921 13,186 18,183 22,963 Total U.S. Higher Education Segment 215,635 220,526 436,643 433,117 Australia/New Zealand Segment Tuition, net of discounts, grants and scholarships 67,849 73,407 114,295 124,491 Other (1) 1,295 977 3,109 1,713 Total Australia/New Zealand Segment 69,144 74,384 117,404 126,204 Education Technology Services Segment (2) 36,692 42,354 71,014 83,871 Consolidated revenue $ 321,471 $ 337,264 $ 625,061 $ 643,192 _________________________________________ (1) Other revenue is primarily comprised of academic fees, sales of course materials, placement fees and other non-tuition revenue streams. (2) Education Technology Services revenue is primarily derived from tuition revenue and administrative fees. …

DisaggregationOfRevenueTableTextBlock · excerpt; the full note is in the filing

Equity Awards The following table sets forth the amount of stock-based compensation expense recorded in each of the expense line items for the three and six months ended June 30, 2025 and 2026 (in thousands): For the three months ended June 30, For the six months ended June 30, 2025 2026 2025 2026 Instructional and support costs $ 1,969 $ 1,147 $ 4,256 $ 2,891 General and administration 3,846 3,726 6,923 7,272 Restructuring costs 41 148 96 Stock-based compensation expense included in operating expense 5,856 4,873 11,327 10,259 Tax benefit 1,539 1,234 2,974 2,639 Stock-based compensation expense, net of tax $ 4,317 $ 3,639 $ 8,353 $ 7,620 …

DisclosureOfCompensationRelatedCostsShareBasedPaymentsTextBlock · excerpt; the full note is in the filing

Fair Value Measurement Assets measured at fair value on a recurring basis consist of the following as of December 31, 2025 (in thousands): Fair Value Measurements at Reporting Date Using December 31, 2025 Quoted Prices in Active Markets for Identical Assets/Liabilities (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Money market funds $ 88,239 $ 88,239 $ $ Total assets at fair value on a recurring basis $ 88,239 $ 88,239 $ $ Assets measured at fair value on a recurring basis consist of the following as of June 30, 2026 (in thousands): Fair Value Measurements at Reporting Date Using June 30, 2026 Quoted Prices in Active Markets for Identical Assets/Liabilities (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Money market funds $ 52,481 $ 52,481 $ $ Total assets at fair value on a recurring basis $ 52,481 $ 52,481 $ $ The Company measures the above items on a recurring basis at fair value as follows: Money market funds Classified in Level 1 is excess cash the Company holds in money market funds, which are included in cash and cash equivalents in the accompanying unaudited condensed consolidated balance sheets. The Companys other cash and cash equivalents as of December 31, 2025 and June 30, 2026 approximate fair value and are not disclosed in the above tables because of the short-term nature of the financial instruments. The Companys held-to-maturity marketable sec …

FairValueDisclosuresTextBlock · excerpt; the full note is in the filing

Goodwill and Intangible Assets Goodwill The following table presents changes in the carrying value of goodwill by segment for the six months ended June 30, 2025 (in thousands): U.S. Higher Education Australia / New Zealand Education Technology Services Total Balance as of December 31, 2024 $ 632,075 $ 474,808 $ 100,000 $ 1,206,883 Additions Impairments Currency translation adjustments 24,222 24,222 Balance as of June 30, 2025 $ 632,075 $ 499,030 $ 100,000 $ 1,231,105 The following table presents changes in the carrying value of goodwill by segment for the six months ended June 30, 2026 (in thousands): U.S. Higher Education Australia / New Zealand Education Technology Services Total Balance as of December 31, 2025 $ 632,075 $ 510,338 $ 100,000 $ 1,242,413 Additions Impairments Currency translation adjustments 16,123 16,123 Balance as of June 30, 2026 $ 632,075 $ 526,461 $ 100,000 $ 1,258,536 The Company assesses goodwill at least annually for impairment during the fourth quarter, or more frequently if events occur or circumstances change between annual tests that would more likely than not reduce the fair value of the respective reporting unit below its carrying amount. No events or circumstances occurred in the three and six months ended June 30, 2026 to indicate an impairment to goodwill at any of the Companys segments. There were no impairment charges related to goodwill recorded during the three and six months ended June 30, 2025 and 2026. Intangible Assets Indefinite-live …

GoodwillAndIntangibleAssetsDisclosureTextBlock · excerpt; the full note is in the filing

Income Taxes During the six months ended June 30, 2025 and 2026, the Company recorded income tax expense of $25.4 million and $24.2 million, respectively. Income tax expense for the six months ended June 30, 2025 and 2026 include windfall tax benefits of approximately $0.4 million and $2.6 million, respectively, related to share-based payment arrangements. The Company had no unrecognized tax benefits as of December 31, 2025 and June 30, 2026. Interest and penalties, including those related to uncertain tax positions, are included in the provision for income taxes in the unaudited condensed consolidated statements of income. The Company paid $29.2 million and $29.1 million in income taxes during the six months ended June 30, 2025 and 2026, respectively. The tax years since 2022 remain open for federal tax examination, the tax years since 2021 remain open to examination by certain states, and the tax years since 2021 remain open to examination by foreign taxing jurisdictions in which the Company is subject to taxation.

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Litigation The Company is involved in litigation and other legal proceedings arising out of the ordinary course of its business. There have been no material developments in the litigation and other legal proceedings that are described in our Annual Report on Form 10-K for the year ended December 31, 2025, other than as described below. As disclosed in its Quarterly Report on Form 10-Q for the period ended March 31, 2026, the Company experienced a cybersecurity incident on February 25, 2026 (the Incident). After detecting unusual activity that day within its U.S.-based network environment, the Company promptly isolated the affected portion of the environment and shut off access to contain the threat and minimize impact. Core business functions remained operational, as the majority of staff and student platforms are hosted in separate environments. The Company immediately took steps to further secure its systems and initiated a formal investigation of the Incident, with assistance from third-party experts. By proactively taking certain systems offline, the Company prevented the encryption of its data that could have limited access to its systems, and therefore the Company was able to resume normal operations in less than one week. The Incident affected only parts of the Companys U.S.-based network environment and did not affect the Companys Australia and New Zealand operations or our ETS operations, including Sophia Learning. The Company worked with a third-party vendor to iden …

LegalMattersAndContingenciesTextBlock · excerpt; the full note is in the filing

Long-Term Debt On October 18, 2024, the Company entered into an amended credit facility (the Amended Credit Facility), which provides for a senior secured revolving credit facility (the Revolving Credit Facility) in an aggregate principal amount of up to $250 million. The Amended Credit Facility provides the Company with an option, subject to obtaining additional loan commitments and satisfaction of certain conditions, to increase the commitments under the Revolving Credit Facility or establish one or more incremental term loans (each, an Incremental Facility) in the future in an aggregate amount of up to the sum of (x) the greater of (A) $300 million and (B) 100% of the Companys consolidated EBITDA (earnings before interest, taxes, depreciation, amortization, and noncash charges, such as stock-based compensation) calculated on a trailing four-quarter basis and on a pro forma basis, and (y) if such Incremental Facility is incurred in connection with a permitted acquisition or other permitted investment, any amounts so long as the Companys leverage ratio (calculated on a trailing four-quarter basis) on a pro forma basis will be no greater than 1.75:1.00. In addition, the Amended Credit Facility provides for a subfacility for borrowings in certain foreign currencies in an amount equal to the U.S. dollar equivalent of $150 million. The maturity date of the Amended Credit Facility is October 18, 2029. The Company paid approximately $1.7 million in debt financing costs associated …

LongTermDebtTextBlock · excerpt; the full note is in the filing

Recently Issued Accounting Standards Not Yet Adopted In November 2024, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2024-03, Income StatementReporting Comprehensive IncomeExpense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (ASU 2024-03). ASU 2024-03 requires the disclosure of amounts related to purchases of inventory, employee compensation, depreciation, intangible asset amortization, and depletion within each income statement expense line item that contains any of these expenses. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and for interim periods beginning after December 15, 2027. Early adoption is permitted, and the amendments can be applied prospectively or retrospectively. The Company is currently evaluating the impact that ASU 2024-03 will have on its consolidated financial statement disclosures. In September 2025, the FASB issued ASU 2025-06, IntangiblesGoodwill and OtherInternal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software (ASU 2025-06). ASU 2025-06 eliminates the existing guidance that categorizes software development into distinct project stages and replaces it with a recognition threshold based on managements authorization and commitment to fund the project, along with the probability of completion and intended use. ASU 2025-06 is effective for fiscal years beginning after December 15, 2027, a …

NewAccountingPronouncementsPolicyPolicyTextBlock · excerpt; the full note is in the filing

Restructuring and Related Charges The Company incurs severance and other employee separation costs related to employee terminations that are not tied to a formal restructuring plan. The Company incurred $1.3 million and $2.8 million of severance and other employee separation charges during the three and six months ended June 30, 2025, respectively, and $2.0 million and $3.5 million during the three and six months ended June 30, 2026, respectively, related to the elimination of certain positions. These severance and other employee separation charges are included in Restructuring costs on the unaudited condensed consolidated statements of income. The following details the changes in the Companys severance and other employee separation costs restructuring liabilities during the six months ended June 30, 2025 and 2026 (in thousands): Severance Restructuring Liability Balance as of December 31, 2024 $ 534 Restructuring and other charges 2,837 Payments (2,833) Balance as of June 30, 2025 $ 538 Balance as of December 31, 2025 (1) $ 860 Restructuring and other charges 3,531 Payments (2,687) Balance as of June 30, 2026 (1) $ 1,704 ____________________________________ (1) Restructuring liabilities are included in accounts payable and accrued expenses in the unaudited condensed consolidated balance sheets. The Company evaluates its real estate portfolio on an ongoing basis, which has resulted in the consolidation and sale of underutilized facilities. The Company recorded approximately $ …

RestructuringAndRelatedActivitiesDisclosureTextBlock · excerpt; the full note is in the filing

Revenue Recognition The Companys revenues primarily consist of tuition revenue arising from educational services provided in the form of classroom instruction and online courses. Tuition revenue is deferred and recognized ratably over the period of instruction, which varies depending on the course format and chosen program of study. Capella Universitys GuidedPath classes and Strayer Universitys educational programs typically are offered on a quarterly basis, and such periods coincide with the Companys quarterly financial reporting periods, while Capella Universitys FlexPath courses are delivered over a twelve-week subscription period. Torrens University offers the majority of its education programs on a trimester system having three primary academic terms, which all occur within the calendar year. The following table presents the Companys revenues from contracts with customers disaggregated by material revenue category for the three and six months ended June 30, 2025 and 2026 (in thousands): For the three months ended June 30, For the six months ended June 30, 2025 2026 2025 2026 U.S. Higher Education Segment Tuition, net of discounts, grants and scholarships $ 206,714 $ 207,340 $ 418,460 $ 410,154 Other (1) 8,921 13,186 18,183 22,963 Total U.S. Higher Education Segment 215,635 220,526 436,643 433,117 Australia/New Zealand Segment Tuition, net of discounts, grants and scholarships 67,849 73,407 114,295 124,491 Other (1) 1,295 977 3,109 1,713 Total Australia/New Zealand Segmen …

RevenueFromContractWithCustomerTextBlock · excerpt; the full note is in the filing

Segment Reporting Strategic Education is an educational services company that provides access to high-quality education through campus-based and online post-secondary education offerings, as well as through programs to develop job-ready skills for high-demand markets. Strategic Educations portfolio of companies is dedicated to closing the skills gap by placing adults on the most direct path between learning and employment. The Companys organizational structure includes three operating and reportable segments: U.S. Higher Education, Education Technology Services, and Australia/New Zealand. The USHE segment provides flexible and affordable certificate and degree programs to working adults primarily through Capella University and Strayer University, including the Jack Welch Management Institute MBA, which is an offering of Strayer University. USHE also operates non-degree web and mobile application development courses through Hackbright Academy and Devmountain, which are offerings of Strayer University. The ETS segment primarily develops and maintains relationships with employers to build employee education benefits programs that provide employees access to affordable and industry-relevant training, certificate, and degree programs. The employer relationships developed by the ETS segment are an important source of student enrollment for Capella University and Strayer University, and a significant portion of the revenue attributed to the ETS segment is driven by the volume of enr …

SegmentReportingDisclosureTextBlock · excerpt; the full note is in the filing

Significant Accounting Policies Financial Statement Presentation The condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in the consolidated financial statements. All information as of, and for the three and six months ended, June 30, 2025 and 2026 is unaudited but, in the opinion of management, contains all adjustments, consisting only of normal recurring adjustments, necessary to present fairly the condensed consolidated statements of financial position, results of operations, and cash flows of the Company. The condensed consolidated balance sheet as of December 31, 2025 has been derived from the audited consolidated financial statements at that date. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) have been condensed or omitted. These unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Companys Annual Report on Form 10-K for the fiscal year ended December 31, 2025. The results of operations for the three and six months ended June 30, 2026 are not necessarily indicative of the results to be expected for the full fiscal year. Below is a description of the nature of the costs included in the Companys …

SignificantAccountingPoliciesTextBlock · excerpt; the full note is in the filing