Revenue: $236 million for the first quarter, up 10% year over year on an organic constant currency basis. Adjusted EBITDA: $5 million for the first quarter, increased by 132% year over year. Net Loss: $20 million for the first quarter, resulting in a Loss Per Share of $0.13. Adjusted Net Loss: $17 million for the first quarter, with an Adjusted Loss Per Share of $0.11. Enrollment Growth: New enrollments increased 8% in Mexico and 6% in Peru year over year. Total Enrollments: Increased 7% in Mexico and 5% in Peru for the cycle. Cash and Debt Position: $110 million in cash and $115 million in gross debt, resulting in a net debt position of $5 million. Stock Repurchase: $42 million of stock repurchased during the quarter, with $56 million remaining under authorization. 2025 Revenue Guidance: $1.560 billion to $1.575 billion, reflecting flat to 1% growth on an as-reported basis. 2025 Adjusted EBITDA Guidance: $473 million to $480 million, reflecting 5% to 7% growth on an as-reported basis. Second Quarter 2025 Guidance: Revenue between $499 million and $504 million; Adjusted EBITDA between $191 million and $194 million.

Release Date: May 01, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

Laureate Education Inc (NASDAQ:LAUR) reported a year-over-year new enrollment growth of 8% in Mexico and 6% in Peru, indicating strong demand for their programs. The company has increased its full-year guidance for Total Enrollments, Revenue, and Adjusted EBITDA, reflecting confidence in their business model. Laureate Education Inc (NASDAQ:LAUR) has a strong balance sheet with $110 million in cash and a net debt position of $5 million, allowing for continued investment and shareholder returns. The company is experiencing robust growth in fully online programs, particularly among working adults, which is a strategic focus area. Laureate Education Inc (NASDAQ:LAUR) has a strong market position in Mexico and Peru, with all four institutions rated five-star by QS Stars in employability, inclusiveness, online learning, and social impact.

Negative Points

The timing of the academic calendar in Peru led to a shift of $26 million in Revenue and $23 million in Adjusted EBITDA from the first quarter to the second half of the year, affecting quarterly comparability. The company faces potential macroeconomic uncertainties, including trade tensions and foreign exchange volatility, particularly in Mexico. Laureate Education Inc (NASDAQ:LAUR) reported a first-quarter Net Loss of $20 million, resulting in a Loss Per Share of $0.13. There is a one-time expected Revenue loss of approximately $8 million in 2025 due to campus consolidations in Mexico. Despite strong local currency growth, reported Revenues in 2025 are expected to be flat to slightly up versus 2024 due to foreign exchange impacts.

Story Continues

Q & A Highlights

Q: Are you seeing any hesitancy from potential students given the current economic environment, particularly in Mexico for the upcoming fall intake period? A: (Eilif Serck-Hanssen, President, CEO) We have just completed our secondary intake, which is largely for working adults who are less dependent on household income. We saw robust demand during this intake. We expect the primary intake in the third quarter to mirror last year's intake, which was 4% to 5%. It's too early to give specific guidance, but we are assuming a similar economic environment as last year.

Q: Can you clarify the impact of the timing shift in the intake cycle between 2024 and 2025? A: (Richard Buskirk, CFO) The shift occurred in Peru, where the academic calendar started two weeks later. This delay affected the reported numbers, but normalized for the academic calendar change, new enrollments were up 7%, with 8% in Mexico and 6% in Peru. There are no other normalizations beyond this timing shift.

Q: Why did you decide to use the past FX rate rather than the current rate for guidance? A: (Richard Buskirk, CFO) We maintained a 20.50 peso to dollar rate from February due to significant FX volatility. Although the peso has recently strengthened, we chose to stick with the previous rate as a prudent measure given the market's volatility.

Q: Can you provide more details on the growth and development of fully digital courses in the first intake cycle? A: (Eilif Serck-Hanssen, President, CEO) Fully online courses are growing at a robust double-digit rate, faster than face-to-face programs. We have about 100,000 students, or 20% of our student population, enrolled in digital learning. We are leaders in both Mexico and Peru in digital education, with strong momentum in both markets.

Q: What are your plans for capital allocation, given the recent stock repurchase? A: (Eilif Serck-Hanssen, President, CEO) We are committed to returning all excess cash to shareholders after supporting business growth through CapEx. We plan to convert 50% of our EBITDA into free cash flow, which will be returned to shareholders. We are halfway through a $100 million stock repurchase program and will discuss further actions with our Board once it is completed.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

This article first appeared on GuruFocus.

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