Q2 2026 Stride Inc Earnings Call Transcript
Key Points
- Stride Inc (LRN) reported revenue of $631.3 million, up nearly 8% from the second quarter of fiscal year 2025.
- Adjusted operating income increased by 17% to $159 million, reflecting strong financial performance.
- The company achieved an adjusted EPS of $2.50, up $0.13 from the previous year.
- Enrollment in career learning programs grew by 17.6% year over year, driving a 29% increase in revenue for these programs.
- Gross margins improved by 30 basis points to 41.1%, aided by exiting a non-core business commitment.
- General education revenue declined by 3.6% to $341.4 million compared to last year.
- Revenue per enrollment in general education was down 3.6%, largely due to mix changes.
- Free cash flow decreased significantly to $75.9 million from $208.6 million last year, impacted by timing of payments.
- The company continues to face additional expenses related to platform implementation, affecting gross margins.
- Despite strong demand, Stride Inc (LRN) is prioritizing stability over growth, potentially turning away students due to capacity constraints.
Thank you for standing by. My name is Tina, and I will be your conference operator today. At this time, I would like to welcome everyone to the stride second quarter fiscal year 2026 earnings call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer the session. To ask a question, simply press star on your telephone keypad. To withdraw your question, press one again. It is now my pleasure to turn the call over to Tim Casey, Vice President of Investor relations. You may begin.
Thank you and good afternoon. Welcome to Stride's second quarter earnings call for fiscal year 2026. With me on today's call are James Rou, Chief Executive Officer, and Don Blackman, Chief Financial Officer. As a reminder, today's conference call and webcast are accompanied by a presentation that can be found on the Stride Investor Relations website.
Please be advised that today's discussion of our financial results may include certain non
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