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Income Taxes | 12 Months Ended
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Jun. 30, 2026
Income Taxes |
Income Taxes | 5. Income Taxes The provision for income taxes is based on earnings reported in the consolidated financial statements. A deferred income tax asset or liability is determined by applying currently enacted tax laws and rates to the expected reversal of the cumulative temporary differences between the carrying value of assets and liabilities for financial statement and income tax purposes. Deferred income tax expense or benefit is measured by the change in the deferred income tax asset or liability during the year. Deferred tax assets and liabilities result primarily from temporary differences in book versus tax basis accounting. Deferred tax assets and liabilities consist of the following: ​
​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | June 30,
​ | ​ ​ ​ | 2026 | ​ ​ ​ | 2025
​ | ​ | (In thousands)
Deferred tax assets | ​ | ​ | ​ | ​ | ​ | ​
Net operating loss carryforward | ​ | $ | 13,524 | ​ | $ | 13,888
Reserves | ​ |  | 10,545 | ​ |  | 9,154
Accrued expenses | ​ |  | 11,916 | ​ |  | 15,441
Stock compensation expense | ​ |  | 7,320 | ​ |  | 6,881
Other assets | ​ |  | 2,170 | ​ |  | 3,308
Convertible debt | ​ |  | 9,085 | ​ |  | 4,059
Deferred revenue | ​ |  | 122 | ​ |  | 260
Capitalized software and website development costs | ​ | ​ | — | ​ | ​ | 4,680
Lease liability | ​ | ​ | 2,659 | ​ | ​ | 11,136
Total deferred tax assets | ​ |  | 57,341 | ​ |  | 68,807
Deferred tax liabilities | ​ | ​ | ​ | ​ | ​ | ​
Capitalized curriculum development | ​ |  | (9,758) | ​ |  | (10,071)
Capitalized software and website development costs | ​ |  | (24,023) | ​ |  | —
Property and equipment | ​ |  | (18,259) | ​ |  | (11,460)
Right-of-use assets | ​ | ​ | (1,755) | ​ | ​ | (3,832)
Returned materials | ​ |  | (2,220) | ​ |  | (2,722)
Purchased intangibles | ​ | ​ | (6,943) | ​ | ​ | (6,717)
Total deferred tax liabilities | ​ |  | (62,958) | ​ |  | (34,802)
Net deferred tax (liability) asset before valuation allowance | ​ |  | (5,617) | ​ |  | 34,005
Valuation allowance | ​ |  | (7,416) | ​ |  | (7,628)
Net deferred tax (liability) asset | ​ | $ | (13,033) | ​ | $ | 26,377
Reported as: | ​ | ​ | ​ | ​ | ​ | ​
Long-term deferred tax (liability) asset | ​ | $ | (13,033) | ​ | $ | 26,377
​ The Company maintained a valuation allowance on net noncurrent deferred tax assets of $7.4 million and $7.6 million as of June 30, 2026 and 2025, respectively, predominantly related to foreign and state income tax net operating losses ("NOL"). At June 30, 2026, the Company had approximately $24.5 million of available federal NOL carryforwards solely related to the acquisition of Galvanize in January 2020. The available federal NOL carryforwards were generated after 2017 and have an indefinite carryforward period due to the Tax Cuts and Jobs Act (the “Tax Act”). Section 382 of the Internal Revenue Code limits the utilization of NOL carryforwards following a change of control. The Company has performed an analysis of the Section 382 ownership changes and have determined that it will be able to fully utilize its available NOLs subject to the Section 382 limitation. At June 30, 2026, the Company had tax effected state NOL carryforwards of $1.0 million, net of valuation allowances, and will expire on various dates. The components of the income before income taxes for the years ended June 30, 2026, 2025 and 2024 were as follows: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Years Ended June 30,
​ | ​ ​ ​ | 2026 | ​ ​ ​ | 2025 | ​ ​ ​ | 2024
​ | ​ | (In thousands)
Domestic | ​ | $ | 435,108 | ​ | $ | 374,932 | ​ | $ | 262,802
Foreign | ​ |  | 5,850 | ​ |  | 6,016 | ​ |  | 5,863
Total income before income taxes | ​ | $ | 440,958 | ​ | $ | 380,948 | ​ | $ | 268,665
​ The components of the income tax expense (benefit) for the years ended June 30, 2026, 2025 and 2024 were as follows: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Years Ended June 30,
​ | ​ | 2026 | ​ | 2025 | ​ | 2024
​ | ​ | (In thousands)
Current: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Federal | ​ | $ | 47,321 | ​ | $ | 91,696 | ​ | $ | 52,678
State | ​ |  | 14,213 | ​ |  | 17,921 | ​ |  | 7,660
Foreign | ​ |  | 1,238 | ​ |  | 1,173 | ​ |  | 1,254
Total current | ​ |  | 62,772 | ​ |  | 110,790 | ​ |  | 61,592
Deferred: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Federal | ​ |  | 38,372 | ​ |  | (16,047) | ​ |  | (667)
State | ​ |  | 1,621 | ​ |  | (1,736) | ​ |  | 3,557
Total deferred | ​ |  | 39,993 | ​ |  | (17,783) | ​ |  | 2,890
Total income tax expense | ​ | $ | 102,765 | ​ | $ | 93,007 | ​ | $ | 64,482
​ Following the adoption of ASU 2023-09, the provision for income taxes can be reconciled to the income tax that would result from applying the statutory rate to the net income before income taxes as follows: ​
​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Year Ended June 30, 2026 | ​
​ | ​ | Amount | ​ | Percent | ​
​ | ​ | (In thousands)
U.S. Federal Statutory Tax Rate | ​ | $ | 92,601 | ​ | 21.0 | %
State and Local Income Tax Effects, net of federal tax benefit (a) |  | ​ | 14,705 | ​ | 3.3 | ​
Foreign Tax Effects |  | ​ | (18) | ​ | - | ​
Tax Credits | ​ | ​ | ​ | ​ | ​ | ​
Research and development tax credits |  | ​ | (2,866) | ​ | (0.7) | ​
Changes in Valuation Allowance |  | ​ | 31 | ​ | - | ​
Nontaxable or Nondeductible Items |  | ​ | ​ | ​ | ​ | ​
Stock-based compensation |  | ​ | (20,007) | ​ | (4.5) | ​
Non-deductible compensation |  | ​ | 17,329 | ​ | 3.9 | ​
Other |  | ​ | 85 | ​ | - | ​
Changes in Unrecognized Tax Benefits |  | ​ | 583 | ​ | 0.2 | ​
Other Adjustments |  | ​ | 322 | ​ | 0.1 | ​
Effective Tax Rate | ​ | $ | 102,765 | ​ | 23.3 | %
(a) State taxes in California, Texas, and Virginia made up the majority (greater than 50 percent) of the tax effect in this category. ​ Prior to the adoption of ASU 2023-09, the provision for income taxes can be reconciled to the income tax that would result from applying the statutory rate to the net income before income taxes as follows: ​
​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Years Ended June 30, | ​
​ | ​ ​ ​ | 2025 | ​ ​ ​ | 2024 | ​ ​ ​
U.S. federal tax at statutory rates | ​ | 21.0 | % | 21.0 | %
Lobbying |  | - | ​ | 0.1 | ​
Non-deductible compensation | ​ | 2.7 | ​ | 0.8 | ​
State taxes, net of federal benefit |  | 3.4 | ​ | 3.2 | ​
Research and development tax credits |  | (1.2) | ​ | (1.5) | ​
Effects of foreign operations |  | - | ​ | 0.1 | ​
Reserve for unrecognized tax benefits |  | 0.4 | ​ | 0.5 | ​
Noncontrolling interests |  | - | ​ | - | ​
Other |  | (0.2) | ​ | 0.1 | ​
Stock-based compensation | ​ | (1.7) | ​ | (0.3) | ​
Provision for income taxes |  | 24.4 | % | 24.0 | %
​ The decrease in the effective income tax rate for the year ended June 30, 2026, as compared to the effective tax rate for the year ended June 30, 2025, was primarily due to stock-based compensation. As of June 30, 2026 and 2025, the balance of income taxes payable was $27.5 million and $52.6 million, respectively. Income taxes payable is recorded within accrued liabilities on the consolidated balance sheets. Tax Uncertainties The Company follows the provisions of ASC 740, Income Taxes (“ASC 740”) which applies to all tax positions related to income taxes. ASC 740 provides a comprehensive model for how a company should recognize, measure, present and disclose in its financial statements uncertain tax positions that the Company has taken or expects to take on a tax return. ASC 740 clarifies accounting for income taxes by prescribing a minimum probability threshold that a tax position must meet before a financial statement benefit is recognized. If the probability for sustaining a tax position is greater than 50%, then the tax position is warranted and recognition should be at the highest amount which would be expected to be realized upon ultimate settlement related to unrecognized tax benefits. The Company recognizes interest and penalties, if any, related to unrecognized tax benefits in income tax expense. As of June 30, 2026, 2025 and 2024, the Company had $0.7 million, $0.5 million and $0.4 million in accrued interest and penalties, respectively. The unrecognized tax benefits for the years ended June 30, 2026, 2025 and 2024 were as follows: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Years Ended June 30,
​ | ​ | 2026 | ​ | 2025 | ​ | 2024
​ | ​ | (In thousands)
Balance at beginning of the year | ​ | $ | 5,514 | ​ | $ | 4,286 | ​ | $ | 3,156
Additions for prior year tax positions | ​ |  | 277 | ​ |  | 486 | ​ |  | 591
Additions for current year tax positions | ​ |  | 1,236 | ​ |  | 1,635 | ​ |  | 1,205
Reductions for prior year tax positions | ​ | ​ | (1,047) | ​ | ​ | (893) | ​ | ​ | (666)
Balance at end of the year | ​ | $ | 5,980 | ​ | $ | 5,514 | ​ | $ | 4,286
​ If recognized, all of the $6.0 million balance of unrecognized tax benefits as of June 30, 2026 would affect the effective tax rate. The Company does not anticipate a significant increase or decrease in unrecognized tax benefits in the next twelve months. The Company remains subject to audit by the Internal Revenue Service for federal tax purposes for tax years after June 30, 2022. Certain state and foreign tax jurisdictions are also either currently under audit or remain open under the statute of limitations for the tax years after June 30, 2021. Income Taxes Paid Disclosed below is a summary of income taxes paid by jurisdiction pursuant to the disclosure requirements of ASU 2023-09 for the year ended June 30, 2026:
​ | ​ | ​
​ | Year Ended June 30, 2026
​ | Amount
​ | (In thousands)
Federal | $ | 67,201
State and Local | ​ | 19,963
Foreign | ​ | 859
​ | $ | 88,023
​ Income taxes paid (net of refunds) exceed 5 percent of total income taxes paid (net of refunds) in the following jurisdictions: ​
​ | ​ | ​
State | ​ | ​
California | $ | 6,475
​

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