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Grand Canyon Education, Inc. Reports Fourth Quarter 2025 Results

Grand Canyon Education, Inc. (NASDAQ: LOPE), a prominent player in the education services industry, recently announced its financial results for the fourth quarter of 2025, reflecting a healthy upward trend in both service revenue and enrollments across its university partners. This growth exemplifies GCE's strategic positioning and robust operational capabilities.

Financial Highlights

For the quarter ending December 31, 2025, GCE reported service revenue of $308.1 million. This figure represents a 5.3% increase from the $292.6 million reported in the same period of 2024. The primary catalyst for this growth was a 7.1% increase in university partner enrollments, reaching 136,239 from 127,155 in the prior year.

However, revenue per student saw a slight dip due to several factors: adjustments in contractual agreements with certain university partners and a shift in the enrollment mix toward students with lower net tuition rates. Additionally, a shift in the start date for ground campus programs at Grand Canyon University (GCU), GCE's most significant partner, impacted financial results for the quarter by $0.9 million.

Despite these adjustments, revenue from Accelerated Bachelor of Science in Nursing (ABSN) programs at off-campus sites contributed positively, as these agreements provide a higher revenue share percentage. Specifically, enrollments at GCU surpassed 131,826, a 7.0% increase compared to the previous year. Enrollment at off-campus sites also increased significantly, demonstrating GCE's successful expansion strategy.

Operating income for the quarter reached $108.1 million, marking an 8.1% increase from $100.0 million in Q4 2024. The operating margin improved to 35.1%, compared to 34.2% the prior year, signifying enhanced efficiency in operations.

Yearly Performance Overview

For the entire year of 2025, GCE reported total service revenue of $1,106.1 million, representing a 7.1% increase from $1,033.0 million in 2024. While revenue per student remained relatively stable, the overall growth was again primarily driven by increased enrollments across its partner universities.

Operating income for the year fell slightly to $265.9 million, a 3.4% decline from $275.4 million in 2024, largely impacted by a $35 million litigation settlement and various costs associated with lease terminations. However, adjusted operating income showed positive growth, highlighting the resilience of GCE’s core operations.

Net income for 2025 was reported at $216.2 million, down 4.4% from the previous year but adjusted net income rose to $254.5 million, affirming the company’s strength when excluding certain one-time costs. The diluted earnings per share for the year were $7.71, representing a slight dip from $7.73 in 2024, while the adjusted figure increased to $9.08 from $8.04.

Positive Outlook for 2026

Looking ahead to the first quarter of 2026, GCE forecasts service revenue between $307 million and $308 million, with an operating margin projected between 30.0% and 30.3%. Additionally, the company aims for a diluted EPS of $2.70 to $2.73, showcasing confidence in its growth trajectory.

Overall, Grand Canyon Education, Inc. has demonstrated resilience amid challenges and is well-positioned for continued success in the evolving landscape of education services. With strategic expansions and a focus on increasing enrollments, GCE remains a key player in delivering high-quality educational support to its partners.

Conclusion

As Grand Canyon Education continues to adapt and thrive in the competitive education sector, its commitment to providing superior services and fostering partnerships will likely drive future growth. By maintaining a proactive stance on enrollment and managing operational efficiencies, GCE is set to navigate the coming years effectively.