Stride (LRN) Q1 2027 earnings summary

Executive summary

• Q1 FY27 revenue rose 3.0% YoY to $639.4M; GAAP operating income increased 22.2% to $84.3M, while total enrollment fell 2.5% to 241.4K.

• Career Learning growth and lower SG&A supported results; management prioritized sharper focus, improved outcomes, family experience and consistent execution.

Financial highlights

• Revenue was $639.4M vs. $620.9M; gross margin dollars were $241.1M vs. $242.1M, and gross margin rate was 37.7% vs. 39.0%.

• GAAP operating income was $84.3M vs. $69.0M; adjusted operating income was $78.6M vs. $81.1M, down 3.1%.

• Adjusted EBITDA rose 3.1% to $111.8M; net income declined to $64.9M from $68.8M.

• Diluted EPS was $1.45 vs. $1.40; adjusted EPS declined to $1.37 from $1.52.

• SG&A fell 9.4% to $156.8M, primarily reflecting lower personnel costs and stock-based compensation; instructional costs rose 5.1% to $398.3M.

Outlook and guidance

• FY27 revenue guidance is $2.530B–$2.610B, adjusted operating income $500M–$530M, capex $70M–$80M, and effective tax rate 24%–26%.

• Q2 FY27 guidance: revenue $625M–$645M, adjusted operating income $135M–$145M, and capex $19M–$21M.

• FY27 revenue per enrollment is expected to rise 1.5%–2.5%; gross margin is expected to fall 100–200 bps and SG&A 10%–15% YoY.

• Guidance midpoint assumes enrollment growth in Q2 and Q3, partly offset by the typical Q3-to-Q4 decline; positive cash flow is expected over the rest of FY27.

• FY28 targets include 10% revenue CAGR and 20% CAGRs for adjusted operating income and diluted EPS, measured from FY23 to FY28.