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Finance and Operating Leases | 9 Months Ended
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Mar. 31, 2025
Finance and Operating Leases |
Finance and Operating Leases | 5. Finance and Operating Leases ​ Finance Leases ​ The Company is a lessee under finance leases for student computers and peripherals under agreements with Banc of America Leasing & Capital, LLC (“BALC”) and CSI Leasing, Inc. (“CSI Leasing”). As of March 31, 2025 and June 30, 2024, the finance lease liability was $96.8 million and $55.6 million, respectively, with lease interest rates ranging from 3.95% to 6.72%. As of March 31, 2025 and June 30, 2024, the balance of the associated right-of-use assets was $78.3 million and $39.8 million, respectively. The right-of-use asset is recorded within property and equipment, net on the condensed consolidated balance sheets. Lease amortization expense associated with the Company’s finance leases is recorded within instructional costs and services on the condensed consolidated statements of operations. ​ The Company entered into agreements with BALC and CSI Leasing in April 2020 and August 2022, respectively, to provide financing for its student computers and peripherals. Individual leases with BALC include 36-month payment terms, fixed rates ranging from 3.95% to 6.72%, and a $1 purchase option at the end of each lease term. The Company has pledged the assets financed to secure the outstanding leases. Individual leases under the agreement with CSI Leasing include 36-month payment terms, but do not include a stated interest rate. The Company uses its incremental borrowing rate as the implied interest rate and the total lease payments to calculate its lease liability. ​ The following is a summary, as of March 31, 2025 and June 30, 2024, respectively, of the present value of the net minimum lease payments under the Company’s finance leases: ​
​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | March 31, 2025 |  | June 30, 2024
​ |  | (in thousands)
2025 | ​ | $ | 12,666 | ​ | $ | 31,655
2026 | ​ | ​ | 45,454 | ​ | ​ | 19,880
2027 | ​ | ​ | 33,265 | ​ | ​ | 7,691
2028 | ​ | ​ | 11,542 | ​ | ​ | 82
Total minimum payments | ​ | ​ | 102,927 | ​ | ​ | 59,308
Less: imputed interest | ​ | ​ | (6,153) | ​ | ​ | (3,710)
Finance lease liability | ​ | ​ | 96,774 | ​ | ​ | 55,598
Less: current portion of finance lease liability | ​ | ​ | (44,011) | ​ | ​ | (29,146)
Long-term finance lease liability | ​ | $ | 52,763 | ​ | $ | 26,452
​ Operating Leases ​ The Company is a lessee under operating leases for various facilities to support the Company’s operations. As of March 31, 2025 and June 30, 2024, the operating lease liability was $49.1 million and $57.9 million, respectively. As of March 31, 2025 and June 30, 2024, the balance of the associated right-of-use assets was $46.0 million and $54.5 million, respectively. Lease expense associated with the Company’s operating leases is recorded within both instructional costs and services and selling, general, and administrative expenses on the condensed consolidated statements of operations. ​ Individual operating leases range in terms of 1 to 9 years and expire on various dates through fiscal year 2034 and the minimum lease payments are discounted using the Company’s incremental borrowing rate. ​ The following is a summary as of March 31, 2025 and June 30, 2024, respectively, of the present value of the minimum lease payments under the Company’s operating leases: ​
​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | ​ | ​ | ​ | ​ | ​
​ |  | March 31, 2025 |  | June 30, 2024
​ | ​ | (in thousands)
2025 | ​ | $ | 3,558 | ​ | $ | 14,263
2026 | ​ | ​ | 12,508 | ​ | ​ | 12,361
2027 | ​ | ​ | 8,881 | ​ | ​ | 8,705
2028 | ​ | ​ | 7,894 | ​ | ​ | 7,713
2029 | ​ | ​ | 7,711 | ​ | ​ | 7,599
Thereafter | ​ | ​ | 12,552 | ​ | ​ | 12,381
Total minimum payments | ​ | ​ | 53,104 | ​ | ​ | 63,022
Less: imputed interest | ​ | ​ | (4,008) | ​ | ​ | (5,082)
Operating lease liability | ​ | ​ | 49,096 | ​ | ​ | 57,940
Less: current portion of operating lease liability | ​ | ​ | (12,306) | ​ | ​ | (12,748)
Long-term operating lease liability | ​ | $ | 36,790 | ​ | $ | 45,192
​ ​ The Company is subleasing one of its facilities through December 2025. Sublease income is recorded as an offset to the related lease expense within both instructional costs and services and selling, general, and administrative expenses on the condensed consolidated statements of operations. The following is a summary as of March 31, 2025 and June 30, 2024, respectively, of the expected sublease income: ​
​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | ​ | ​ | ​ | ​ | ​
​ |  | March 31, 2025 |  | June 30, 2024
​ | ​ | (in thousands)
2025 | ​ | $ | 70 | ​ | $ | 455
2026 | ​ | ​ | 139 | ​ | ​ | 139
Total sublease income | ​ | $ | 209 | ​ | $ | 594
​ The following is a summary of the Company’s lease cost, weighted-average remaining lease term, weighted-average discount rate and certain other cash flows as it relates to its operating and finance leases for the three and nine months ended March 31, 2025 and 2024: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended March 31, | ​ | Nine Months Ended March 31, | ​
​ | ​ | 2025 |  | 2024 | ​ | 2025 |  | 2024 | ​
​ | ​ | (in thousands) | ​
Lease cost | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Finance lease cost: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Amortization of right-of-use assets | ​ | $ | 10,556 | ​ | $ | 7,775 | ​ | $ | 27,033 | ​ | $ | 23,760 | ​
Interest on lease liabilities | ​ | ​ | 1,225 | ​ | ​ | 887 | ​ | ​ | 3,105 | ​ | ​ | 1,870 | ​
Instructional costs and services: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Operating lease cost | ​ | ​ | 2,269 | ​ | ​ | 2,363 | ​ | ​ | 6,913 | ​ | ​ | 7,284 | ​
Short-term lease cost | ​ | ​ | 12 | ​ | ​ | 10 | ​ | ​ | 38 | ​ | ​ | 42 | ​
Sublease income | ​ | ​ | (66) | ​ | ​ | (66) | ​ | ​ | (197) | ​ | ​ | (263) | ​
Selling, general, and administrative expenses: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Operating lease cost | ​ | ​ | 984 | ​ | ​ | 1,146 | ​ | ​ | 3,097 | ​ | ​ | 4,891 | ​
Short-term lease cost | ​ | ​ | 23 | ​ | ​ | 16 | ​ | ​ | 70 | ​ | ​ | 128 | ​
Sublease income | ​ | ​ | — | ​ | ​ | (123) | ​ | ​ | (149) | ​ | ​ | (368) | ​
Total lease cost | ​ | $ | 15,003 | ​ | $ | 12,008 | ​ | $ | 39,910 | ​ | $ | 37,344 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Other information | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Cash paid for amounts included in the measurement of lease liabilities | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Operating cash flows from operating leases | ​ | $ | (3,146) | ​ | $ | (3,108) | ​ | $ | (9,583) | ​ | $ | (11,695) | ​
Financing cash flows from finance leases | ​ | ​ | (13,243) | ​ | ​ | (9,721) | ​ | ​ | (29,957) | ​ | ​ | (32,212) | ​
Right-of-use assets obtained in exchange for new finance lease liabilities | ​ | ​ | 15,628 | ​ | ​ | 6,220 | ​ | ​ | 67,567 | ​ | ​ | 32,497 | ​
Right-of-use assets obtained in exchange for new operating lease liabilities | ​ | ​ | 457 | ​ | ​ | 180 | ​ | ​ | 739 | ​ | ​ | 805 | ​
Weighted-average remaining lease term - finance leases | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | 2.21 | yrs. | ​ | 2.09 | yrs.
Weighted-average remaining lease term - operating leases | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | 5.24 | yrs. | ​ | 5.80 | yrs.
Weighted-average discount rate - finance leases | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | 5.51 | % | ​ | 5.45 | %
Weighted-average discount rate - operating leases | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | 2.94 | % | ​ | 2.93 | %
​

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