Executive Summary
Adtalem Global Education (ATGE) delivered a solid start to fiscal 2025 (QQ1), led by robust enrollment momentum and continued execution of the Growth with Purpose strategy. Revenue rose 13.2% year over year to $417.4 million, with consolidated adjusted EBITDA up 20.1% and an expanded EBITDA margin of 23.2%. Enrollment across the three segments improved meaningfully: Chamberlain up 11.7%, Walden up 12.2%, and total enrollment exceeding 90,000 students for the 10th straight quarter. Management raised full-year guidance, projecting revenue of $1.69â$1.73 billion and adjusted EPS of $5.75â$5.95, signaling confidence in sustained growth and operating leverage. The quarter also showcased disciplined capital allocation (share repurchases, debt refi, and a cash-rich balance sheet) and strategic investments in marketing, student support, AI-enabled learning, and partnerships to sustain higher-level growth. Near-term headwinds include marketing mix timing and ongoing remediation within the Medical & Veterinary segment, but the overall health of the business remains favorable as demand for healthcare education persists and the company invests to expand capacity and outcomes.
Key Performance Indicators
QoQ: -3.48% | YoY:149.12%
QoQ: -6.58% | YoY:333.64%
QoQ: -6.87% | YoY:369.23%
Key Insights
Revenue: $417.4 million, up 13.2% YoY; Gross margin: 55.44%; Operating margin: 16.83%; EBITDA: $92.44 million; EBITDA margin: 23.12%; Net income: $46.17 million; Net margin: 11.06%; Diluted EPS: $1.18; GAAP EPS: $1.22; Weighted average shares (diluted): 39.09 million; Free cash flow (TTM): $243 million; Free cash flow (quarter): $78.9 million; Cash and equivalents: $265 million; Net debt: $578.5 million; Net debt/Adjusted EBITDA: 1.0x; Total enrollments: >90,000; Chamberlain revenue: $167.9 m...
Financial Highlights
Revenue: $417.4 million, up 13.2% YoY; Gross margin: 55.44%; Operating margin: 16.83%; EBITDA: $92.44 million; EBITDA margin: 23.12%; Net income: $46.17 million; Net margin: 11.06%; Diluted EPS: $1.18; GAAP EPS: $1.22; Weighted average shares (diluted): 39.09 million; Free cash flow (TTM): $243 million; Free cash flow (quarter): $78.9 million; Cash and equivalents: $265 million; Net debt: $578.5 million; Net debt/Adjusted EBITDA: 1.0x; Total enrollments: >90,000; Chamberlain revenue: $167.9 million (+17.8% YoY); Walden revenue: $161.5 million (+14.1% YoY); Medical & Veterinary revenue: $88.0 million (+3.9% YoY); Capex: ~$10.4 million; Shares repurchased: 462k in QQ1; Guidance: FY2025 revenue $1.69â$1.73 billion; Adj. EPS $5.75â$5.95; Tax rate: ~23% (normalized).
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
417.40M |
13.16% |
1.83% |
| Gross Profit |
231.41M |
15.57% |
-2.55% |
| Operating Income |
70.24M |
149.12% |
-3.48% |
| Net Income |
46.17M |
333.64% |
-6.58% |
| EPS |
1.22 |
369.23% |
-6.87% |
Key Financial Ratios
operatingProfitMargin
16.8%
operatingCashFlowPerShare
$2.37
freeCashFlowPerShare
$2.09
Management Commentary
Key takeaways from management commentary on the earnings call: (1) Growth with Purpose is delivering tangible momentum across segments, with management emphasizing enrollment gains and improved persistence as core drivers of profitability. (2) Enrollment strength is broad-based, with Chamberlain and Walden posting double-digit YoY growth and Ross Vet near capacity, underpinning confidence in continued demand for healthcare education. (3) Marketing strategy is being managed dynamically, with some increase in marketing investments front-loaded to create longer-term brand and programmatic opportunities, but with expected leverage to keep full-year EBITDA expansion ~100 bps. (4) The company raised FY2025 guidance to reflect momentum, highlighting a revenue trajectory of roughly 6.5%â9% YoY growth and EPS of $5.75â$5.95, supported by targeted investments in student support, AI learning capabilities, and strategic partnerships. (5) Balance sheet and cash flow remain robust, with free cash flow of $79 million in the quarter and a trailing-12-month FCF of $243 million, and leverage at a healthy ~1.0x net debt to EBITDA. (6) Management signaled ongoing remediation in the Med & Vet segment but framed it as progress aligned with broader enrollment strength and capacity expansion.
"We've commenced year two of our three-year Growth with Purpose strategy, which is driving strong momentum through our programmatic focus on operational excellence."
â Steve Beard
"Fiscal year 2025 is off to a strong start and we expect our Growth with Purpose strategy to deliver further growth in both revenue and profitability. With this positive momentum, we're raising our fiscal year 2025 guidance to project revenue between $1.69 billion and $1.73 billion and adjusted earnings per share of $5.75 to $5.95."
â Steve Beard
Forward Guidance
Management issued stronger FY2025 guidance, signaling confidence in continued enrollment momentum and operating leverage. Key points: (1) Revenue target raised to $1.69â$1.73 billion (approx. 6.5%â9% YoY growth) and adjusted EPS guidance of $5.75â$5.95 (+14.5% to +18.5% YoY). (2) Expect approximately 100 basis points of consolidated EBITDA margin expansion for the year, aided by operating leverage and measured investments in growth initiatives. (3) Marketing spend will be reallocated across the year, with some Q1 spend pushed to Q2 and beyond; long-run ROI targeted through a balance of performance and brand marketing. (4) Tax rate guidance around 23% for the year. (5) The pace of revenue growth is expected to be stronger in the first half of the year than the second half due to marketing timing and program mix. Investors should monitor: enrollment trends at Chamberlain and Walden, remediation progress in Med Vet, capacity expansion initiatives (e.g., Stockbridge campus and Ross Vet capacity), AI-enabled learning adoption, and the pace of higher-margin program enrollments across nursing and health professions.