Adtalem Global Education Inc. Q2 FY2026 earnings call

• This quarter marks the tenth consecutive quarter of enrollment growth. The company remains on track for full-year revenue growth of 6% to 8.5% and has raised adjusted earnings per share guidance to 17% to 20% growth.
• Deployed $165 million to share repurchases, with $728 million remaining on the current authorization.
• Chamberlain's fundamentals are strong, with application volumes for pre-licensure and post-licensure nursing programs up double digits in the second quarter. Walden achieved record total enrollments of 52,400 students, with new programs like the master in applied behavioral analysis and clinical psychology attracting students. The medical and veterinary segment shows momentum in enrollment indicators, with enhancements in curriculum and pass rates.

Chamberlain: Second-quarter revenue was $183.8 million, a 1.6% increase year over year, driven by pricing optimization. Total student enrollment declined 1% due to growth in pre-licensure programs offset by declines in post-licensure programs. Adjusted EBITDA was $45.2 million, a 14% decrease. Walden: Second-quarter revenue was $217.6 million, a 27% increase year over year (excluding a one-week academic calendar shift, revenue was up 16.5%). Total student enrollment was up 13%, the tenth consecutive quarter of growth. Adjusted EBITDA was $86.7 million, a 66.5% increase. Medical and Veterinary: Second-quarter revenue was $102 million, a 6.9% increase year over year. Adjusted EBITDA was $31.4 million, a 17.6% increase year over year.

• Annual revenue guidance remains in the range of $1.9 to $1.94 billion, or approximately 6% to 8.5% growth year over year.
• Adjusted EPS guidance has been raised to a range of $7.80 to $8.00, or 17% to 20% growth. The increase contemplates a commitment to expanding fiscal year 2026 adjusted EBITDA margin by approximately 100 basis points.
• Anticipates quarter-to-quarter margin fluctuations due to targeted investments, with a one-week revenue shift at Walden impacting the third-quarter margin profile. Also expects an effective tax rate higher than fiscal year 2025.

Q: Jeffrey Marc Silber asks about Walden's growth, including if they're taking share from other schools.

A: Stephen W. Beard says Walden's growth is consistent across programs, most pronounced in behavioral sciences, nursing, and MSN credential, with balanced growth across the program mix.

Q: Jeffrey Marc Silber asks about regulatory issues regarding loan caps and the Sallie Mae partnership.

A: Stephen W. Beard says they're working with Sallie Mae on definitive documentation for the partnership, with Sallie Mae pulling together capital sources, and they're excited about the partnership's implications for the portfolio.

Q: Jack Garner Slevin asks about Chamberlain's double-digit growth in applications and lead time.

A: Stephen W. Beard mentions they addressed gaps in marketing effectiveness and enrollment funnel conversion, with application volumes up for pre- and post-licensure nursing programs, confident in the recovery trajectory heading into the fall cycle.

Q: Jack Garner Slevin asks about meeting the high end of revenue guidance.

A: Stephen W. Beard says it could come from a quicker return to form at Chamberlain and additional acceleration at the medical and veterinary segment, with Walden already moving at an optimal clip.