Stride reports first quarter fiscal year 2027 revenue of $639.4 million and operating income of $84.3 million.

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Stride reports first quarter 2027 financial results

RESTON, Va., Oct. 20, 2026 (GLOBE NEWSWIRE) -- Stride, Inc. (NYSE: LRN), one of the nation’s most successful technology-based education companies, today announced its results for the first quarter of fiscal year 2027 ended September 30, 2026. First Quarter Fiscal 2027 Highlights Compared to 2026 Revenue of $639.4 million, compared with $620.9 million Income from operations of $84.3 million, compared with $69.0 million Net income of $64.9 million, compared with $68.8 million Diluted net income per share of $1.45, compared with $1.40 Adjusted operating income of $78.6 million, compared with $81.1 million (1) Adjusted EBITDA of $111.8 million, compared with $108.4 million (1) Adjusted earnings per share of $1.37, compared with $1.52 (1) First Quarter Fiscal 2027 Summary Financial Metrics Three Months Ended September 30, Change 2026/2025 2026 2025 $ % (In thousands, except percentages and per share data) Revenues $ 639,378 $ 620,884 $ 18,494 3.0% Income from operations 84,268 68,983 15,285 22.2% Adjusted operating income (1) 78,646 81,138 (2,492) (3.1)% Net income 64,919 68,800 (3,881) (5.6)% Net income per share, diluted 1.45 1.40 0.05 3.6% Adjusted earnings per share (1) 1.37 1.52 (0.15) (9.9)% EBITDA (1) 119,202 98,217 20,985 21.4% Adjusted EBITDA (1) 111,810 108,439 3,371 3.1% (1) To supplement our financial statements presented in accordance with U.S. generally accepted accounting principles (GAAP), we also present non-GAAP financial measures including adjusted operating income (loss), EBITDA, adjusted EBITDA, and adjusted earnings per share. Management believes that these additional measures provide useful information to investors relating to our financial performance. A reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measures is provided below. Revenue Data Three Months Ended September 30, Change 2026/2025 2026 2025 $ % (In thousands, except percentages) General Education $ 356,606 $ 363,116 $ (6,510) (1.8)% Career Learning Middle - High School 272,098 241,500 30,598 12.7% Adult 10,674 16,268 (5,594) (34.4)% Total Career Learning 282,772 257,768 25,004 9.7% Total Revenues 639,378 620,884 18,494 3.0% Enrollment and Revenue Per Enrollment Data First quarter enrollments averaged 241.4K, down (2.5)% compared to 247.7K enrollments in the first quarter of fiscal year 2026. Of the total enrollments, 112.2K were Career Learning enrollments, up 2.0% compared to 110.0K Career Learning enrollments in the first quarter of fiscal 2026. Enrollments include those students in full service public or private programs where Stride provides a combination of curriculum, technology, and instructional and support services, inclusive of administrative support and may include enrollments for which Stride receives no public funding or revenue. Stride does not report enrollments for our Adult Learning business. Revenue per enrollment for the first quarter was $2,556, up 7.0% compared to $2,388 in the first quarter of fiscal year 2026. General Education revenue per enrollment was $2,670, up 5.0%, and Career Learning revenue per enrollment was $2,425, up 10.4%, compared to fiscal year 2026. If the mix of enrollments changes, our revenues will be impacted to the extent the average revenues per enrollment are significantly different. Cash Flow and Capital Allocation As of September 30, 2026, the Company’s cash and cash equivalents and marketable securities totaled $884.2 million, compared with $1,034.1 million reported at June 30, 2026. Capital expenditures for the three months ended September 30, 2026 were $24.5 million, compared to $21.7 million in the three months ended September 30, 2025, and were comprised of $17.9 million of capitalized software development and $6.6 million of capitalized curriculum development. Fiscal Year 2027 Outlook The Company is forecasting the following for the full fiscal year 2027: Revenue in the range of $2.530 billion to $2.610 billion Capital expenditures in the range of $70 million to $80 million. Note that capital expenditures include the purchase of property and equipment, and capitalized software and curriculum development costs as defined on our Statement of Cash Flows Effective tax rate of 24% to 26% Adjusted operating income in the range of $500 million to $530 million (2) The Company is forecasting the following for the second quarter of fiscal year 2027: Revenue in the range of $625 million to $645 million Capital expenditures in the range of $19 million to $21 million. Note that capital expenditures include the purchase of property and equipment, and capitalized software and curriculum development costs as defined on our Statement of Cash Flows Adjusted operating income in the range of $135 million to $145 million (2) (2) In addition to providing an outlook for revenue and capital expenditures, adjusted operating income is provided as a supplemental non-GAAP financial measure as management believes that it provides useful information to our investors. A reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measures is provided below. Please also see Special Note on Forward-Looking Statements below. Conference Call The Company will discuss its first quarter fiscal year 2027 financial results during a conference call scheduled for Tuesday, October 20, 2026 at 5:00 p.m. Eastern Time (ET). A live webcast of the call will be available at investors.stridelearning.com/events-and-presentations . To participate in the live call, investors and analysts should dial (833) 461-5787 (domestic) or +1 (585) 542-9983 (international) and provide the conference ID number 305 592 627. Please access the website at least 15 minutes prior to the start of the call. A replay of the call will be posted at investors.stridelearning.com/events-and-presentations . About Stride Inc. Stride Inc. (NYSE: LRN) is redefining lifelong learning with innovative, high-quality education solutions. Serving learners in primary, secondary, and postsecondary settings, Stride provides a wide range of services including K-12 education, career learning, professional skills training, and talent development. Stride reaches learners in all 50 states and over 100 countries. Learn more at stridelearning.com . Investor Contact ir@k12.com Media Contact press@k12.com Special Note on Forward-Looking Statements This press release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that involve substantial risks and uncertainties. All statements other than statements of historical facts contained in this press release are forward-looking statements, such as any statements that look to future events and include, among other things, our expectations regarding: mix of enrollment, revenue per enrollment, future financial and other trends, forecasts, assumptions and guidance, and future share repurchases. We have tried, whenever possible, to identify these forward-looking statements using words such as “outlook,” “forecasts,” “anticipates,” “trends,” “believes,” “estimates,” “continues,” “likely,” “may,” “opportunity,” “potential,” “projects,” “will,” “will be,” “expects,” “plans,” “intends,” “should,” “would” and similar expressions to identify forward-looking statements, whether in the negative or the affirmative. These statements reflect our current beliefs and are based upon information currently available to us. Accordingly, such forward-looking statements involve known and unknown risks, uncertainties and other factors which could cause our actual results, performance or achievements to differ materially from those expressed in, or implied by, such statements. These risks, uncertainties, factors and contingencies include, but are not limited to: reduction of per pupil funding amounts at the schools we serve; inability to achieve a sufficient level of new enrollments to sustain our business model or to meet financial or operational guidance; limitations of the enrollment data we present, which may not fully capture trends in the performance of our business; failure to enter into new school contracts or renew existing contracts, in part or in their entirety; failure of the schools we serve, our vendors, or us to comply with our contracts, or federal, state and local laws and regulations, resulting in a loss of funding, an obligation to repay funds previously received, contractual remedies, or actions or proceedings against us; governmental investigations that could result in fines, penalties, settlements, or injunctive relief; declines or variations in academic performance outcomes of the students and schools we serve, including due to the evolution of curriculum standards, testing programs and state accountability metrics; harm to our reputation resulting from poor performance or misconduct by operators or us in any school in our industry and/or in any school which we operate; legal and regulatory challenges from opponents of virtual public education or for-profit education companies; potential violation of laws and regulations relating to privacy and data protection, including such laws and regulations as may apply to children’s data; changes in national and local economic and business conditions and other factors, such as natural disasters, pandemics and outbreaks of contagious diseases and other adverse public health developments; discrepancies in interpretation of legislation by regulatory agencies that may lead to payment or funding disputes; termination of our contracts, or a reduction or termination in the scope of services, with schools; failure to develop the Career Learning business; entry of new competitors with superior technologies (including artificial intelligence (“AI”)) and lower prices; unsuccessful integration of mergers, acquisitions and joint ventures; failure to further develop, maintain and enhance our technology, products, services and brands; inadequate recruiting, training and retention of effective teachers and employees; infringement of our intellectual property; disruptions to our Internet-based learning and delivery systems, including, but not limited to, our data storage systems and third-party cloud infrastructure, systems and facilities, including as a result of cybersecurity attacks; misuse or unauthorized disclosure of student and personal data; failure to prevent or mitigate a cybersecurity incident that affects our systems or our data; problems in the implementation of new information technology systems and technology; failure by us or third parties to maintain and support information technology systems, including addressing quality issues and timely delivering new products and enhancements; risks related to the use, implementation and regulation of AI and other emerging technologies, including in the education of children, and their use by third-party vendors; risks related to our stock repurchase program; the extent to which we acquire businesses or change our capital allocation strategy or the implementation thereof; changes in our effective tax rate and additional liabilities; and other risks and uncertainties associated with our business described in the risk factors discussed in the Company’s Annual Report on Form 10-K for the year ended June 30, 2026 and any subsequently filed Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q or the Company’s other filings with the Securities and Exchange Commission. Forward-looking statements reflect our management’s expectations or predictions of future conditions, events or results based on various assumptions and estimates. They are not guarantees of future performance. Our actual results and financial condition may differ, possibly materially, from the anticipated results and financial condition indicated in these forward-looking statements. Readers are cautioned not to place undue reliance on forward-looking statements in this press release or that we make from time to time, and to consider carefully the factors discussed above. All information in this press release is as of today’s date, and the Company undertakes no obligation to update any forward-looking statement as a result of new information, future events or otherwise, except where we are expressly required to do so by law. Financial Statements The financial statements set forth below are not the complete set of Stride, Inc.’s financial statements for the three months ended September 30, 2026 and are presented below without footnotes. Readers are encouraged to obtain and carefully review Stride Inc.’s Quarterly Report on Form 10-Q for the three months ended September 30, 2026, including all financial statements contained therein and the footnotes thereto, filed with the SEC, which may be retrieved from the SEC’s website at www.sec.gov or from Stride Inc.’s Investor Relations website at investors.stridelearning.com . STRIDE, INC. UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS Three Months Ended September 30, 2026 2025 (In thousands except share and per share data) Revenues $ 639,378 $ 620,884 Instructional costs and services 398,261 378,761 Gross margin 241,117 242,123 Selling, general, and administrative expenses 156,849 173,140 Income from operations 84,268 68,983 Interest expense, net (2,906 ) (3,075 ) Other income, net 1,477 16,914 Income before income taxes and income (loss) from equity method investments 82,839 82,822 Income tax expense (17,840 ) (14,423 ) Income (loss) from equity method investments (80 ) 401 Net income attributable to common stockholders $ 64,919 $ 68,800 Net income attributable to common stockholders per share: Basic $ 1.57 $ 1.59 Diluted $ 1.45 $ 1.40 Weighted average shares used in computing per share amounts: Basic 41,479,826 43,371,952 Diluted 44,828,092 49,222,851 STRIDE, INC. UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS September 30, June 30, 2026 2026 (audited) ASSETS (In thousands except share and per share data) Current assets Cash and cash equivalents $ 547,750 $ 754,501 Accounts receivable, net of allowance of $31,751 and $31,302 854,808 664,788 Inventories, net 22,665 38,250 Prepaid expenses 75,345 43,052 Marketable securities 241,425 203,499 Other current assets 12,414 12,033 Total current assets 1,754,407 1,716,123 Property and equipment, net 172,974 102,042 Capitalized software, net 101,916 95,002 Capitalized curriculum development costs, net 59,963 56,895 Intangible assets, net 9,106 10,876 Goodwill 246,676 246,676 Deposits and other assets 185,914 207,938 Total assets $ 2,530,956 $ 2,435,552 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities Accounts payable $ 75,884 $ 46,742 Accrued liabilities 68,400 95,446 Accrued compensation and benefits 28,220 62,896 Deferred revenue 6,817 20,553 Current portion of finance lease liability 85,463 60,477 Current portion of operating lease liability 2,374 2,737 Current portion of debt 418,431 - Total current liabilities 685,589 288,851 Long-term finance lease liability 104,661 56,455 Long-term operating lease liability 8,106 8,316 Long-term debt — 417,995 Deferred tax liability 41,137 13,033 Other long-term liabilities 19,698 18,573 Total liabilities 859,191 803,223 Commitments and contingencies Stockholders’ equity Preferred stock, par value $0.0001; 10,000,000 shares authorized; zero shares issued or outstanding — — Common stock, par value $0.0001; 100,000,000 shares authorized; 49,681,525 and 49,126,917 shares issued; and 42,031,838 and 41,477,230 shares outstanding, respectively 4 4 Additional paid-in capital 714,347 739,829 Accumulated other comprehensive loss (60 ) (59 ) Retained earnings 1,249,564 1,184,645 Treasury stock of 7,649,687 shares at cost (292,090 ) (292,090 ) Total stockholders’ equity 1,671,765 1,632,329 Total liabilities and stockholders' equity $ 2,530,956 $ 2,435,552 STRIDE, INC. UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS Three Months Ended September 30, 2026 2025 (In thousands) Cash flows from operating activities Net income $ 64,919 $ 68,800 Adjustments to reconcile net income to net cash used in operating activities: Depreciation and amortization expense 34,934 29,234 Stock-based compensation expense (7,392 ) 10,222 Deferred income taxes 29,425 49,472 Provision for credit losses 2,143 3,377 Amortization of fees on debt 435 429 Noncash operating lease expense 352 2,661 Other 8,092 (3,989 ) Changes in assets and liabilities: Accounts receivable (191,894 ) (253,026 ) Inventories, prepaid expenses, deposits and other current and long-term assets (18,356 ) (36,322 ) Accounts payable 27,881 15,716 Accrued liabilities (28,566 ) (45,356 ) Accrued compensation and benefits (33,257 ) (30,882 ) Operating lease liability (899 ) (879 ) Deferred revenue and other liabilities (12,604 ) (5,237 ) Net cash used in operating activities (124,787 ) (195,780 ) Cash flows from investing activities Purchase of property and equipment (4 ) (306 ) Capitalized software development costs (17,911 ) (13,713 ) Capitalized curriculum development costs (6,567 ) (7,677 ) Sale of other investments 35,110 - Other acquisitions, loans and investments, net of distributions (886 ) (2,574 ) Proceeds from the maturity of marketable securities 61,638 61,767 Purchases of marketable securities (117,295 ) (62,220 ) Net cash used in investing activities (45,915 ) (24,723 ) Cash flows from financing activities Repayments on finance lease obligations (16,540 ) (11,961 ) Repurchase of restricted stock for income tax withholding (19,509 ) (31,594 ) Net cash used in financing activities (36,049 ) (43,555 ) Net change in cash, cash equivalents and restricted cash (206,751 ) (264,058 ) Cash, cash equivalents and restricted cash, beginning of period 754,501 782,497 Cash, cash equivalents and restricted cash, end of period $ 547,750 $ 518,439 Non-GAAP Financial Measures To supplement our financial statements presented in accordance with GAAP, we have presented adjusted operating income (loss), EBITDA, adjusted EBITDA, and adjusted earnings per share, which are not presented in accordance with GAAP. Adjusted operating income (loss) is defined as income (loss) from operations as adjusted for amortization of intangible assets, stock-based compensation, and other one-time charges or gains. EBITDA is defined as income (loss) from operations as adjusted for depreciation and amortization. Adjusted EBITDA is defined as income (loss) from operations as adjusted for depreciation and amortization, stock-based compensation, and other one-time charges or gains. Adjusted earnings per share (adjusted EPS) is defined as net income (loss) attributable to common stockholders as adjusted for the amortization of intangible assets, stock-based compensation, and other one-time charges or gains net of tax impact divided by the diluted weighted average number of common shares outstanding less the shares expected to be received for the capped call transaction related to Stride’s convertible senior notes. Adjusted operating income (loss), adjusted EBITDA, and adjusted EPS exclude stock-based compensation, which consists of expenses for restricted stock, restricted stock units, and performance stock units. Management believes that the presentation of these non-GAAP financial measures provides useful information to investors relating to our financial performance. Adjusted operating income (loss), adjusted EBITDA and adjusted EPS remove stock-based compensation, which is a non-cash charge that varies based on market volatility and the terms and conditions of the awards. EBITDA and adjusted EBITDA remove depreciation and amortization, which can vary depending upon accounting methods and the book value of assets. Adjusted operating income (loss), adjusted EBITDA and adjusted earnings per share remove one-time charges or gains which are not related to core operating activities and are not indicative of our ongoing operating performance. Additionally, adjusted EPS includes the impact from shares expected to be received by the Company to offset potential dilution from the convertible senior notes. EBITDA and adjusted EBITDA provide a measure of corporate performance exclusive of capital structure and the method by which assets were acquired. Management uses these non-GAAP financial measures: as additional measures of operating performance because they assist in comparing the Company’s performance on a consistent basis; and in presentations to the members of the Company’s Board of Directors to enable the Board to review the same measures used by management to compare the Company’s current operating results with corresponding prior periods. Other companies may define these non-GAAP financial measures differently and, as a result, these non-GAAP financial measures may not be directly comparable to similar non-GAAP financial measures used by other companies. Although these non-GAAP financial measures are used to assess the performance of the business, the use of non-GAAP financial measures is limited as they include and/or do not include certain items included and/or not included in the most directly comparable GAAP financial measure. These non-GAAP financial measures should be considered in addition to, and not as a substitute for, revenues, income (loss) from operations, net income (loss) and diluted net income (loss) per share or other related financial information prepared in accordance with GAAP. Adjusted EBITDA is not intended to be a measure of liquidity. You are cautioned not to place undue reliance on these non-GAAP financial measures. Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures are provided below. First Quarter Fiscal Year 2027 Reconciliation of Income from Operations to Adjusted Operating Income Three Months Ended September 30, 2026 2025 (In thousands) Income from operations $ 84,268 $ 68,983 Amortization of intangible assets 1,770 1,933 Stock-based compensation expense (7,392 ) 10,222 Adjusted operating income $ 78,646 $ 81,138 Reconciliation of Net Income to EBITDA and Adjusted EBITDA Three Months Ended September 30, 2026 2025 (In thousands) Net income $ 64,919 $ 68,800 Interest expense, net 2,906 3,075 Other income, net (1,477 ) (16,914 ) Income tax expense 17,840 14,423 (Income) loss from equity method investments 80 (401 ) Depreciation and amortization 34,934 29,234 EBITDA 119,202 98,217 Stock-based compensation expense (7,392 ) 10,222 Adjusted EBITDA $ 111,810 $ 108,439 Reconciliation of Net Income Attributable to Common Stockholders and Diluted Net Income Per Share to Adjusted Earnings Per Share Three Months Ended September 30, 2026 2025 (In thousands) Net income attributable to common stockholders $ 64,919 $ 68,800 Amortization of intangible assets 1,770 1,933 Stock-based compensation expense (7,392 ) 10,222 Income tax effect from adjustments above (2,038 ) (8,969 ) Adjusted net income attributable to common stockholders $ 57,259 $ 71,986 Share computation: Weighted average common shares — diluted 44,828,092 49,222,851 Effect of capped call transactions (2,958,006 ) (1,803,506 ) Adjusted weighted average common shares — diluted 41,870,086 47,419,345 Adjusted earnings per share $ 1.37 $ 1.52 Three Months Ended September 30, 2026 2025 (per share) Diluted net income per share $ 1.45 $ 1.40 Amortization of intangible assets 0.04 0.04 Stock-based compensation expense (0.16 ) 0.20 Income tax effect from adjustments above (0.05 ) (0.18 ) Effect of capped call transactions 0.09 0.06 Adjusted earnings per share $ 1.37 $ 1.52 Fiscal Year 2027 Outlook Reconciliation of Income from Operations to Adjusted Operating Income (unaudited) Three Months Ended Year Ended December 31, 2026 June 30, 2027 Low High Low High (In millions) Income from operations $ 126.0 $ 134.5 $ 479.5 $ 503.5 Amortization of intangible assets 1.5 2.0 5.5 7.5 Stock-based compensation expense 7.5 8.5 15.0 19.0 Adjusted operating income $ 135.0 $ 145.0 $ 500.0 $ 530.0