Adtalem's Q1 Earnings & Revenues Top Estimates, 2025 View Up

Adtalem Global Education Inc. ATGE posted better-than-expected results in first-quarter fiscal 2025. Earnings and revenues surpassed their respective Zacks Consensus Estimate and increased year over year, given strong enrollment growth and strategic initiatives.Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.Adtalem registered strong quarterly performance, which was led by significant gains at Chamberlain University and Walden University. These gains were due to continued demand for healthcare-related programs. Adtalem's "Growth with Purpose" strategy continued to support its results. Partnerships, such as the new oncology training program with the Oncology Nursing Society and the AI curriculum collaboration with Hippocratic AI, were instrumental in driving growth and enhancing educational offerings.The company raised its fiscal 2025 guidance, projecting revenues between $1.69 billion and $1.73 billion, reflecting confidence in sustained growth momentum.However, shares of this leading education provider lost 5.3% in the after-hours trading session on Oct. 29.Adtalem Global Education Inc. Price, Consensus and EPS Surprise Adtalem Global Education Inc. price-consensus-eps-surprise-chart | Adtalem Global Education Inc. QuoteEarnings & Revenue DiscussionAdjusted earnings of $1.29 per share topped the consensus mark of $1.12 by 15.2% and increased 38.7% from 93 cents in the year-ago quarter.Revenues of $417.4 million beat the consensus mark of $398 million by 4.8% and increased 13.2% year over year. Strong demand at Chamberlain University and Walden University (led by nursing programs) drove results. In the fiscal first quarter, enrollment of total students rose 11.2% year over year to 90,140 students. Our Zacks model predicted a total student enrollment of 84,298 for the reported quarter.Adjusted operating income increased 19.7% from the prior-year quarter’s level to $75.8 million. Adjusted operating margin expanded 100 basis points (bps) to 18.2%.Adjusted EBITDA was $96.7 million, up 20.1% from the prior-year quarter’s level. Adjusted EBITDA margin expanded 140 bps to 23.2% year over year. We expected the adjusted EBITDA margin to be 21.7% for the reported quarter.ATGE's Segment DetailsChamberlain: Revenues in the segment were up 17.8% from the year-ago quarter’s level, totaling $167.9 million. Total student enrollment increased 11.7% to 38,987 students, driven by growth in pre-licensure and post-licensure nursing programs.Adjusted operating income increased 14.4% from the prior-year quarter’s level to $27.8 million. Adjusted operating margin contracted 50 bps to 16.6%. Adjusted EBITDA was $37 million, up 17.2% from the prior-year quarter’s level. Adjusted EBITDA margins contracted 10 bps to 22%.Walden: The segment generated revenues of $161.5 million, up 14.1% year over year. Total student enrollment in the quarter increased 12.2% year over year to 45,979 students, driven by growth in healthcare and non-healthcare programs.Adjusted operating income came in at $42.6 million, up 37% year over year. Adjusted operating margin expanded 440 bps to 26.4%. Adjusted EBITDA was $47.8 million, up 35.9% from the prior-year period’s level. Adjusted EBITDA margins increased 480 bps to 29.6%.Medical and Veterinary: Revenues in the segment increased 3.9% to $88 million from the year-ago quarter’s figure. Total student enrollment fell 0.7% from the prior-year quarter’s level to 5,174 students due to the drop in medical programs.Adjusted operating income increased 1.7% from the prior-year quarter’s figure to $14.7 million. Adjusted operating margin contracted 40 bps to 16.7%. Adjusted EBITDA was $19.2 million, up 0.7% from the prior-year quarter’s level. Adjusted EBITDA margins decreased 20 bps to 21.8%.Liquidity & Cash FlowAs of Sept. 30, 2024, Adtalem had cash and cash equivalents of $264.8 million compared with $272.2 million at the end of the fiscal 2023. Long-term debt was $649.3 million, down from $695.1 million at the end of fiscal 2023.In the fiscal first quarter, cash provided by operating activities (continuing operations) totaled $86.1 million, down from $89.6 million in the year-ago period. Free cash flow in the quarter was $75.7 million, down from $79.2 million a year ago.Fiscal 2025 Guidance RaisedFor fiscal 2025, ATGE now expects revenues within $1,690-$1,730 million (compared with $1,660-$1,700 million expected earlier). It now expects adjusted earnings of $5.75 to $5.95 per share compared with $5.60-$5.85 per share of earlier projection.ATGE’s Zacks Rank & Peer ReleasesAdtalem currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Stride, Inc.’s LRN first quarter of fiscal 2025 earnings and revenues surpassed the consensus mark by 370% and 10.2%, respectively. Revenues grew 14.8% on 18.5% enrollment growth. EPS grew significantly to 94 cents from 11 cents a year ago.For fiscal 2025, the company expects revenues in the range of $2.225 billion to $2.300 billion.Strategic Education, Inc. STRA is scheduled to report its third-quarter 2024 results on Nov. 7, before market open.STRA’s quarterly EPS is expected to register a 16.5% decline on 4.5% revenue growth from a year ago.American Public Education, Inc. APEI is scheduled to report its third-quarter 2024 results on Nov. 12.APEI’s quarterly EPS is expected to register a 100% decline on 1.8% revenue growth from a year ago.Zacks Names #1 Semiconductor StockIt's only 1/9,000th the size of NVIDIA which skyrocketed more than +800% since we recommended it. NVIDIA is still strong, but our new top chip stock has much more room to boom.With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $803 billion by 2028.See This Stock Now for Free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report American Public Education, Inc. (APEI): Free Stock Analysis Report Strategic Education Inc. (STRA): Free Stock Analysis Report Stride, Inc. (LRN): Free Stock Analysis Report Adtalem Global Education Inc. (ATGE): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks