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Summary of Significant Accounting Policies | 12 Months Ended
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Jun. 30, 2026
Summary of Significant Accounting Policies |
Summary of Significant Accounting Policies | 3. Summary of Significant Accounting Policies Recent Accounting Pronouncements ​ Accounting Standards Adopted ​ In December 2023, the Financial Accounting Standards Board (“FASB”) issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”). ASU 2023-09 is intended to enhance the transparency and decision usefulness of income tax disclosures. The amendments in ASU 2023-09 address investor requests for enhanced income tax information primarily through changes to the rate reconciliation and income taxes paid information. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024, and for interim periods for fiscal years beginning after December 15, 2025. The Company adopted this guidance prospectively, as permitted by ASU 2023-09, in the fourth quarter of 2026. The adoption is reflected in Note 5, “Income Taxes.” ​ Accounting Standards Not Yet Adopted ​ In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40) ("ASU 2024-03"). This update provides investors with enhanced detail regarding components of expenses presented in the income statement, aiming to improve transparency and enable precise understanding of a company’s cost structure. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. The Company will review the extent of new disclosures necessary in the coming quarters, prior to implementation during fiscal year 2028. Other than additional disclosure, the Company does not expect a change to its consolidated financial statements. ​ In July 2025, the FASB issued ASU 2025-05, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets (“ASU 2025-05”). The update provides an optional practical expedient for public companies to estimate expected credit losses on current accounts receivable and contract assets arising from ASC 606 transactions by assuming that conditions at the balance sheet date remain unchanged over the assets’ remaining lives. ASU 2025-05 is effective for fiscal years beginning after December 15, 2025 (including interim periods), with early adoption permitted. The Company is assessing the impact of the ASU and whether to elect the practical expedient upon adoption in fiscal year 2027. ​ In September 2025, the FASB issued ASU 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software (“ASU 2025-06”). ASU 2025-06 is intended to modernize and clarify the accounting for internal-use software, including updates to capitalization guidance that removes references to project stages and replaces them with the concept of a probable-to-complete recognition threshold. ASU 2025-06 is effective for fiscal years beginning after December 15, 2027, and early adoption is permitted as of the beginning of an annual period. The Company is currently evaluating the impact of this ASU on its consolidated financial statements. ​ Segment Reporting Stride, Inc. operates in one operating and reportable business segment as a technology company providing an educational platform to deliver proprietary and third-party curriculum, software systems and educational services designed to facilitate individualized learning for students and adults. The Company’s primary revenue source is derived from educational products and services provided through its General Education and Career Learning lines of revenue. Operating as a cohesive technology company, the Company offers its products and services across the United States via an integrated online platform, using a centralized management approach for all educational and support functions. The Chief Executive Officer (“CEO”) serves as the Chief Operating Decision Maker (“CODM”). The CODM evaluates the Company’s performance based on consolidated net income. This measure aligns with Stride’s consolidated financial statements and serves as the basis for resource allocation and performance assessment. The measure of segment assets is reported on the balance sheet as total consolidated assets. The CODM monitors profitability and strategic growth initiatives on a consolidated basis without disaggregating profit or loss into separate operating segments. The Company determined there are no significant segment expenses that require a separate disclosure. The consolidated net income is used to assess overall company performance, benchmark against industry standards, and identify profitability trends, which guides resource allocation and investment in expansion and technology upgrades. The CODM also evaluates company performance using operating income. Operating income provides the CODM with a focused view of the company’s profitability excluding the effects of financing activities, tax strategies, and other non-operating items. This measure enables the CODM to assess operational efficiency, monitor performance trends, and evaluate the effectiveness of strategies aimed at revenue generation and cost management. Use of Estimates The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions affecting the reported amounts of assets and liabilities and contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, the Company evaluates its estimates and assumptions, including those related to the allowance for credit losses, inventory reserves, amortization periods, the allocation of the purchase price to the fair value of net assets and liabilities acquired in business combinations, fair values used in asset impairment evaluations, valuation of long-lived assets, accrual for incurred but not reported (“IBNR”) claims, contingencies, income taxes, fair value of contingent consideration, and stock-based compensation expense. The Company bases its estimates on historical experience and various assumptions that it believes are reasonable under the circumstances. The results of the analysis form the basis for making assumptions about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results could differ from those estimates. Revenue Recognition ​ Revenue is recognized when control of the promised goods or services is transferred to the Company’s customers in an amount that reflects the consideration it expects to be entitled to in exchange for those goods or services using the following steps: ​
| ● | identify the contract, or contracts, with a customer;
| ● | identify the performance obligations in the contract;
| ● | determine the transaction price;
| ● | allocate the transaction price to the performance obligations in the contract; and
| ● | recognize revenue when, or as, the Company satisfies a performance obligation.
​ Revenues related to the products and services that the Company provides to students in kindergarten through twelfth grade or adult learners are considered to be General Education or Career Learning based on the school or adult program in which the student is enrolled. General Education products and services are focused on core subjects, including math, English, science and history, for kindergarten through twelfth grade students to help build a common foundation of knowledge. Career Learning products and services are focused on developing skills to enter and succeed in careers in high-growth, in-demand industries—including information technology, healthcare and general business, for students in middle school through high school and adult learners. ​ The majority of the Company’s contracts are with the following types of customers: ​
| ● | a virtual or blended school whereby the amount of revenue is primarily determined by funding the school receives;
| ● | a school or individual who licenses certain curriculum on a subscription or course-by-course basis; or
| ● | an enterprise that contracts with the Company to provide online job training.
​ Funding-based Contracts ​ The Company provides an integrated package of systems, services, products, and professional expertise that is administered together to support a virtual or blended public school. Contracts generally span multiple years with performance obligations being isolated to annual periods which generally coincide with the fiscal year. Customers of these programs can obtain administrative support, information technology, academic support services, online curriculum, learning systems platforms and instructional services under the terms of a negotiated service agreement. The schools receive funding on a per student basis from the state in which the public school or school district is located. Shipments of materials for schools that occur in the fourth fiscal quarter and the upcoming school year are recorded in deferred revenue. ​ The Company generates revenues under contracts with virtual and blended public schools and includes the following components, where required: ​
| ● | providing each of a school’s students with access to the Company’s online school and lessons;
| ● | offline learning kits, which include books and materials to supplement the online lessons;
| ● | the use of a personal computer and associated reclamation services;
| ● | internet access and technology support services;
| ● | instruction by a state-certified teacher; and
| ● | management and technology services necessary to support a virtual or blended school. In certain contracts, revenues are determined directly by per enrollment funding.
​ To determine the ratable amount of revenue to recognize in a fiscal quarter, the Company estimates the total expected funds each school will receive in a particular school year. Total funds for a school are primarily a function of the number of students enrolled in the school and established per enrollment funding levels, which are generally published on an annual basis by the state or school district. The Company reviews its estimates of funding periodically, and updates as necessary, by adjusting its year-to-date earned revenues to be proportional to the total expected revenues to be earned during the fiscal year. Actual school funding may vary from these estimates and the impact of these differences could impact the Company’s results of operations. Since the end of the school year coincides with the end of the fiscal year, annual revenues are generally based on actual school funding and actual costs incurred (including costs for the Company’s services to the schools plus other costs the schools may incur). The Company’s reported results are subject to annual school district financial audits, which incorporate enrollment counts, funding and other routine financial audit considerations. The results of these audits are incorporated into the Company’s monthly funding estimates. Historically, aggregate funding estimates have differed from actual reimbursements, generally in the range of 2% of annual revenue or less, which may vary from year to year. For the years ended June 30, 2025, 2024 and 2023, the Company’s aggregate funding estimates differed from actual reimbursements impacting total reported revenue by approximately 0.8%, 1.8%, and 2.8%, respectively. Each state and/or school district has variations in the school funding formulas and methodologies that it uses to estimate funding for revenue recognition at its respective schools. As the Company estimates funding for each school, it takes into account the state definition for count dates on which reported enrollment numbers will be used for per pupil funding. The parameters the Company considers in estimating funding for revenue recognition purposes include school district count definitions, withdrawal rates, new registrations, average daily attendance, special needs enrollment, academic progress, historical completion, student location, funding caps and other state specified categorical program funding. Under the contracts where the Company provides products and services to schools, the Company is responsible for substantially all of the expenses incurred by the school and has generally agreed to absorb any operating losses of the schools in a given school year. These school operating losses represent the excess of costs incurred over revenues earned by the virtual or blended public school (the school’s expected funding), as reflected in its respective financial statements, including Company charges to the schools. To the extent a school does not receive sufficient funding for each student enrolled in the school, the school would still incur costs associated with serving the unfunded enrollment. If losses due to unfunded enrollments result in a net operating loss for the year that loss is reflected as a reduction in the revenues and net receivables that the Company collects from the school. A school net operating loss in one year does not necessarily mean the Company anticipates losing money on the entire contract with the school. However, a school’s net operating loss may reduce the Company’s ability to collect its management fees in full and revenues recognized are constrained to reflect the expected cash collections from such schools. The Company records the school’s estimated net operating loss against revenues based upon the percentage of actual revenues in the period to total estimated revenues for the fiscal year. Actual school net operating losses may vary from these estimates or revisions, and the impact of these differences could have a material impact on results of operations. For the years ended June 30, 2026, 2025 and 2024, the Company’s revenues included an adjustment for net school operating losses at the schools of $17.2 million, $14.5 million, and $17.0 million, respectively. Because the Company has agreed to absorb any operating losses of the schools, the Company records the expenses incurred by the school as both revenue and expense in the consolidated statements of operations. For the years ended June 30, 2026, 2025 and 2024, the Company recognized revenue associated with these schools of $683.6 million, $662.6 million and $576.4 million, respectively. ​ Subscription-based Contracts ​ The Company provides certain online curriculum and services to schools and school districts under subscription agreements. Revenues from the licensing of curriculum under subscription arrangements are recognized on a ratable basis over the subscription period. Revenues from professional consulting, training and support services are deferred and recognized ratably over the service period. ​ In addition, the Company contracts with individual customers who have access for one to two years to company-provided online curriculum and generally prepay for services to be received. Adult learners enroll in courses that provide specialized training in a specific industry. Each of these contracts is considered to be one performance obligation. The Company recognizes these revenues ratably over the maximum term of the customer contract based on the defined contract price. ​ Enterprise Contracts ​ The Company provides online job training over a specified contract period to enterprises. Each of these contracts is considered to be one performance obligation. The Company recognizes these revenues based on the number of students trained during the term of the contract based on the defined contract price. ​ Disaggregated Revenues ​ The revenue recognition related to the types of contracts discussed above can span both of the Company’s lines of revenue as shown below. For example, a funding-based contract may include both General Education and Career Learning students. In total, there is one performance obligation and revenue is recognized over the fiscal year. The revenue is then disaggregated between General Education and Career Learning based on the Company’s estimated full-year enrollment totals of each category. During the years ended June 30, 2026, 2025 and 2024, approximately 96%, 95%, and 93%, respectively, of the Company’s General Education revenues, and 100%, 100% and 100%, respectively, of the Company’s Middle – High School Career Learning revenues, were from funding-based contracts. ​ The following table presents the Company’s revenues disaggregated based on its two lines of revenue for the years ended June 30, 2026, 2025 and 2024: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Years Ended June 30,
​ | ​ | 2026 | ​ ​ ​ | 2025 | ​ ​ ​ | 2024
​ | ​ | (In thousands)
General Education | ​ | $ | 1,417,785 | ​ | $ | 1,448,676 | ​ | $ | 1,289,193
Career Learning | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Middle - High School | ​ | ​ | 1,043,726 | ​ | ​ | 876,287 | ​ | ​ | 651,191
Adult | ​ | ​ | 56,570 | ​ | ​ | 80,354 | ​ | ​ | 99,685
Total Career Learning | ​ | ​ | 1,100,296 | ​ | ​ | 956,641 | ​ | ​ | 750,876
Total Revenues | ​ | $ | 2,518,081 | ​ | $ | 2,405,317 | ​ | $ | 2,040,069
​ Concentration of Customers ​ During each of the years ended June 30, 2026, 2025 and 2024, the Company had no contracts that represented greater than 10% of total revenues. ​ Contract Balances ​ The timing of revenue recognition, invoicing, and cash collection results in accounts receivable, unbilled receivables (a contract asset) and deferred revenue (a contract liability) in the consolidated balance sheets. Accounts receivable are recorded when there is an executed customer contract and the customer is billed. An allowance is recorded to reflect expected losses at the time the receivable is recorded. The collectability of outstanding receivables is evaluated regularly by the Company to determine if additional allowances are needed. Unbilled receivables are created when revenue is earned prior to the customer being billed. Deferred revenue is recorded when customers are billed or cash is collected in advance of services being provided. ​ The opening and closing balances of the Company’s accounts receivable, unbilled receivables and deferred revenue are as follows: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | June 30,
​ | ​ | 2026 | ​ ​ ​ | 2025 | ​ ​ ​ | 2024
​ | ​ | (In thousands)
Accounts receivable | ​ | $ | 664,788 | ​ | $ | 559,646 | ​ | $ | 472,754
Unbilled receivables (included in accounts receivable) | ​ | ​ | 24,351 | ​ | ​ | 19,902 | ​ | ​ | 19,499
Deferred revenue | ​ | ​ | 20,553 | ​ | ​ | 26,995 | ​ | ​ | 35,742
Deferred revenue, long-term (included in other long-term liabilities) | ​ | ​ | 58 | ​ | ​ | 327 | ​ | ​ | 1,097
​ The difference between the opening and closing balance of the accounts receivable and unbilled receivables relates to the timing of the Company’s billing in relation to month end and its contracts. The difference between the opening and closing balance of the deferred revenue relates to the timing difference between billings to customers and the term of the contract, as well as changes in the estimates of variable consideration. Typically, each of these balances is at its highest during the first quarter of the fiscal year and lowest at the end of the fiscal year. The amount of revenue recognized during the years ended June 30, 2026, 2025 and 2024, that was included in the previous July 1st deferred revenue balance was $25.8 million, $32.0 million, and $74.4 million, respectively. During the years ended June 30, 2026, 2025 and 2024, the Company recorded revenues of $18.4 million, $35.9 million and $51.0 million, respectively, related to performance obligations satisfied in prior periods. ​ Performance Obligations ​ A performance obligation is a promise in a contract to transfer a distinct good or service to the customer, and is the unit of account. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. For the majority of its contracts, the Company’s performance obligations are satisfied over time, as the Company delivers, and the customer receives the services, over the service period of the contract. The Company’s payment terms are generally net 30 or net 45, but can vary depending on the customer or when the school receives its funding from the state. ​ The Company has elected, as a practical expedient, not to report the value of unsatisfied performance obligations for contracts with customers that have an expected duration of one year or less. The amount of unsatisfied performance obligations for contracts with customers which extend beyond one year as of June 30, 2026 was $0.1 million. ​ Significant Judgments ​ The Company determined that the majority of its contracts with customers contain one performance obligation. The Company markets the products and services as an integrated package building off its curriculum offerings. It does not market distinct products or services to be sold independently from the curriculum offering. The Company provides the significant service of integrating the goods and services into the operation of the school and education of its students, for which the customer has contracted. ​ The Company has determined that the time elapsed method is the most appropriate measure of progress towards the satisfaction of the performance obligation. Generally, the Company delivers the integrated products and services package over the course of the Company’s fiscal year. This package includes enrollment, marketing, teacher training, etc. in addition to the core curriculum and instruction. All of these activities are necessary and contribute to the overall education of its students, which occurs evenly throughout the year. Accordingly, the Company recognizes revenue on a straight-line basis. ​ The Company determined that the expected value method is the most appropriate method to account for variable consideration and the Company’s forecasting method is an estimation process that uses probability to determine expected funding. On a monthly basis, the Company estimates the total funds each school will receive in a particular school year and the amount of full-year school revenues and operating expenses to determine the amount of revenue the Company will recognize. Enrollment and state funding rates are key inputs to this estimate. The estimates are adjusted monthly, and a cumulative catch-up adjustment is recorded to revenue as necessary to reflect the total revenues earned to date to be proportional to the total revenues to be earned in the fiscal year. The Company builds in known constraints (i.e., enrollment, funding, net operating losses, etc.) into the estimate of the variable consideration to record the most probable amount. ​ Sales Taxes Sales tax collected from customers is excluded from revenues. Collected but unremitted sales tax is included as part of accrued liabilities in the consolidated balance sheets. Revenues do not include sales tax as the Company considers itself a pass-through conduit for collecting and remitting sales tax. ​ Shipping and Handling Costs Shipping and handling costs are expensed when incurred and are classified as instructional costs and services in the consolidated statements of operations. Shipping and handling charges invoiced to a customer are included in revenues. Research and Development Costs All research and development costs, including patent application costs, are expensed as incurred. Research and development costs totaled $22.0 million, $16.6 million and $16.7 million for the years ended June 30, 2026, 2025 and 2024, respectively, and are included within selling, general and administrative expenses in the consolidated statements of operations. Cash, Cash Equivalents and Restricted Cash Cash and cash equivalents generally consist of cash on hand and cash held in money market and demand deposit accounts. The Company considers all highly liquid investments with maturities of three months or less when purchased to be cash equivalents. The Company periodically has cash balances which exceed federally insured limits. Investments in Marketable Securities The Company’s marketable securities generally consist of bonds and other securities which are classified as held-to-maturity. The securities with maturities between three months and one year are classified as short-term and are included in marketable securities on the consolidated balance sheets. The securities with maturities greater than one year are classified as long-term and are included in deposits and other assets on the consolidated balance sheets. Held-to-maturity securities are recorded at their amortized cost. The Company recorded interest income of $30.4 million, $31.6 million and $25.6 million for the years ended June 30, 2026, 2025 and 2024, respectively. This activity is recorded within other income (expense) within the consolidated statements of operations. The Company reviews the held-to-maturity debt securities for declines in fair value below the amortized cost basis under the credit loss model of Accounting Standards Codification (“ASC”) Topic 326, Financial Instruments – Credit Losses (“ASC 326”). Any decline in fair value related to a credit loss is recognized in the consolidated statements of operations, with the amount of the loss limited to the difference between fair value and amortized cost. As of June 30, 2026 and 2025, the allowance for credit losses recognized related to held-to-maturity debt securities was $0.2 million and zero, respectively. As of June 30, 2026, the Company’s marketable securities consisted of investments in corporate bonds, U.S. Treasury notes and commercial paper. The short-term and long-term portions were $203.6 million and $76.2 million, respectively. The maturities of the Company’s long-term marketable debt securities range from one to two years. The following table summarizes the amortized cost, net carrying amount, and fair value disaggregated by class of instrument (in thousands). ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | Allowance for | ​ | ​ | Net Carrying | ​ | ​ | Gross Unrealized | ​ | ​ | ​
​ | ​ | Amortized Cost | ​ | ​ | Credit Losses | ​ | ​ | Amount | ​ | ​ | Gains (Losses) | ​ | ​ | Fair Value
Corporate Bonds | $ | 112,160 | ​ | $ | (160) | ​ | $ | 112,000 | ​ | $ | (269) | ​ | $ | 111,731
U.S. Treasury Notes | ​ | 141,689 | ​ | ​ | (50) | ​ | ​ | 141,639 | ​ | ​ | (259) | ​ | ​ | 141,380
Commercial Paper | ​ | 25,956 | ​ | ​ | (12) | ​ | ​ | 25,944 | ​ | ​ | - | ​ | ​ | 25,944
Total | $ | 279,805 | ​ | $ | (222) | ​ | $ | 279,583 | ​ | $ | (528) | ​ | $ | 279,055
​ As of June 30, 2025, the Company’s marketable securities consisted of investments in corporate bonds, U.S. Treasury notes, and commercial paper. The short-term and long-term portions were $202.8 million and $26.1 million, respectively. The maturities of the Company’s long-term marketable debt securities range from one to two years. The following table summarizes the amortized cost, net carrying amount, and fair value disaggregated by class of instrument (in thousands). ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | Allowance for | ​ | ​ | Net Carrying | ​ | ​ | Gross Unrealized | ​ | ​ | ​
​ | ​ | Amortized Cost | ​ | ​ | Credit Losses | ​ | ​ | Amount | ​ | ​ | Gains (Losses) | ​ | ​ | Fair Value
Corporate Bonds | $ | 48,837 | ​ | $ | - | ​ | $ | 48,837 | ​ | $ | 97 | ​ | $ | 48,934
U.S. Treasury Notes | ​ | 35,816 | ​ | ​ | - | ​ | ​ | 35,816 | ​ | ​ | 27 | ​ | ​ | 35,843
Commercial Paper | ​ | 144,257 | ​ | ​ | - | ​ | ​ | 144,257 | ​ | ​ | (6) | ​ | ​ | 144,251
Total | $ | 228,910 | ​ | $ | - | ​ | $ | 228,910 | ​ | $ | 118 | ​ | $ | 229,028
​ In addition to bonds and other held-to-maturity securities, the Company’s marketable securities also include investments in publicly held equity securities. The publicly held equity securities have readily determinable fair values, are included in deposits and other assets on the consolidated balance sheets, and are measured at fair value with changes recognized in other income (expense) within the consolidated statement of operations. As of June 30, 2026 and 2025, the Company’s investments in publicly held equity securities were $42.3 million and $19.9 million, respectively. For the years ended June 30, 2026, 2025 and 2024, the Company recorded a net unrealized (losses) gains of ($24.0) million, $1.0 million, and zero, respectively, related to changes in the fair value of the underlying securities of its publicly held equity securities. Allowance for Credit Losses The Company maintains an allowance for credit losses primarily for estimated losses resulting from the inability or failure of individual customers to make required payments. The Company maintains an allowance under ASC 326 based on historical losses, changes in payment history, customer-specific information, current economic conditions, and reasonable and supportable forecasts of future economic conditions. The allowance under ASC 326 is updated as additional losses are incurred or information becomes available related to the customer or economic conditions. ​ The Company’s allowance for credit losses increased from $31.1 million as of June 30, 2025 to $31.3 million as of June 30, 2026. The increase of $0.2 million is due primarily to a $16.4 million current year provision, less $16.2 million in adjustments and amounts written off. The Company’s allowance for credit losses decreased from $31.3 million as of June 30, 2024 to $31.1 million as of June 30, 2025. The decrease of $0.2 million is due primarily to a $15.3 million current year provision, less $15.5 million in amounts written off. ​ The Company writes off accounts receivable based on the age of the receivable and the facts and circumstances surrounding the customer and reasons for non-payment. Actual write-offs might differ from the recorded allowance. Inventories Inventories consist primarily of textbooks and curriculum materials, a majority of which are supplied to virtual and blended public schools, and utilized directly by students. Inventories represent items that are purchased and held for sale and are recorded at the lower of cost (first-in, first-out method) or net realizable value. The Company classifies its inventory as current or long-term based on the holding period. As of June 30, 2026 and 2025, $14.7 million and $13.6 million, respectively, of inventory, net of reserves, was deemed long-term and included in deposits and other assets on the consolidated balance sheets. The provision for excess and obsolete inventory is established based upon the evaluation of the quantity on hand relative to demand. The excess and obsolete inventory reserve was $9.4 million and $6.8 million at June 30, 2026 and 2025, respectively. Other Current Assets Other current assets primarily include textbooks, curriculum materials and other supplies which are expected to be returned upon the completion of the school year. Materials not returned are expensed as part of instructional costs and services. Capitalized Software-as-a-Service Costs The Company capitalizes Software-as-a-Service (“SaaS”) license and implementation costs incurred in cloud computing contracts that are service contracts if they meet certain requirements. Those requirements are similar to the requirements for capitalizing costs incurred to develop internal-use software. Capitalization of SaaS costs ceases once the project is substantially complete and the software is ready for its intended purpose. Amortization is computed using the straight-line method over the term of the associated hosting contract, usually between three and five years. The Company classifies its SaaS implementation costs as current or long-term based on the terms of the associated hosting contract. SaaS implementation costs deemed short-term are included in prepaid expenses, and those deemed long-term are included in deposits and other assets, on the consolidated balance sheets. Impairment is recognized when it is no longer probable that the SaaS project will be completed and placed in service. As of June 30, 2026 and 2025, the Company recorded $18.0 million and $17.5 million, respectively, of costs related to SaaS implementation within prepaid expenses in the consolidated balance sheets. As of June 30, 2026 and 2025, the Company recorded $28.1 million and $43.3 million, respectively, of costs related to SaaS implementation within deposits and other assets in the consolidated balance sheets. ​ During the years ended June 30, 2026, 2025 and 2024, the Company amortized $13.8 million, $3.4 million, and zero, respectively, of SaaS implementation costs to instructional costs and services. SaaS implementation costs amortized to selling, general and administrative expenses were $17.3 million, $16.0 million, and $15.8 million, during the years ended June 30, 2026, 2025 and 2024, respectively. There were no material impairments of SaaS implementation costs for the years ended June 30, 2026, 2025 and 2024. ​ Property and Equipment Property and equipment are stated at cost less accumulated depreciation and amortization. Depreciation and amortization expense is calculated using the straight-line method over the estimated useful life of the asset (or the lesser of the term of the lease and the estimated useful life of the asset under the finance lease). Amortization of assets capitalized under finance lease arrangements is included in depreciation expense. Leasehold improvements are amortized over the lesser of the lease term or the estimated useful life of the asset. The determination of the lease term is discussed below under “Leases.” Property and equipment are depreciated over the following useful lives: ​
​ | ​ | ​
​ | ​ ​ ​ | Useful Life
Computer hardware | ​ | 3 - 5 years
Computer software | ​ | 3 - 5 years
Financed computers and printers | ​ | 3 years
Web site development | ​ | 3 - 5 years
Office equipment | ​ | 3 years
Furniture and fixtures | ​ | 5 - 7 years
Leasehold improvements | ​ | Shorter of useful life or term of the lease
​ The Company makes an estimate of unreturned student computers and printers based on an analysis of recent trends of returns. The Company recorded accelerated depreciation of $5.4 million, $4.3 million and $4.0 million for the years ended June 30, 2026, 2025 and 2024, respectively, related to unreturned student computers and printers. The Company fully expenses computer peripheral equipment (e.g., keyboards, mouses) upon purchase as recovery has been determined to be uneconomical. These expenses totaled $4.4 million, $3.8 million and $4.0 million for the years ended June 30, 2026, 2025 and 2024, respectively, and are recorded as instructional costs and services. Capitalized Software Costs The Company develops software for internal use. Software development costs incurred during the application development stage are capitalized. The Company amortizes these costs over the estimated useful life of the software, which is generally three years. Capitalized software development costs are stated at cost less accumulated amortization. Capitalized software additions totaled $61.6 million, $36.4 million and $40.7 million for the years ended June 30, 2026, 2025 and 2024, respectively. There were no material write-downs of capitalized software projects for the years ended June 30, 2026, 2025 and 2024. Capitalized Curriculum Development Costs The Company internally develops curriculum, which is primarily provided as online content and accessed via the Internet. The Company also creates textbooks and other materials that are complementary to online content. ​ The Company capitalizes curriculum development costs incurred during the application development stage, as well as the design and deployment phases of the project. As a result, a significant portion of the Company’s courseware development costs qualify for capitalization due to the concentration of its development efforts on the content of the courseware. Capitalization ends when a course is available for general release to its customers, at which time amortization of the capitalized costs begins. The period of time over which these development costs are amortized is generally five years. Total capitalized curriculum development additions were $16.7 million, $21.8 million and $18.7 million for the years ended June 30, 2026, 2025 and 2024, respectively. These amounts are recorded on the consolidated balance sheets, net of amortization charges. There were no material write-downs of capitalized curriculum development costs for the years ended June 30, 2026, 2025 and 2024. Leases ​ The Company’s principal leasing activities include computers and peripherals, classified as finance leases, and facilities, classified as operating leases. ​ Leases are classified as operating leases unless they meet any of the criteria below to be classified as a finance lease:
| ● | the lease transfers ownership of the asset at the end of the lease;
| ● | the lease grants an option to purchase the asset which the lessee is expected to exercise;
| ● | the lease term reflects a major part of the asset’s economic life;
| ● | the present value of the lease payments equals or exceeds the fair value of the asset; or
| ● | the asset is specialized with no alternative use to the lessor at the end of the term.
​ Finance Leases ​ The Company enters into agreements to finance the purchase of computers and peripherals. Individual leases typically include 3-year payment terms. The Company pledges the assets financed to secure the outstanding leases. ​ Operating Leases ​ The Company enters into agreements for facilities that serve as offices for its headquarters and school operations. Lease terms vary between 1 and 7 years. Certain leases include renewal options, usually based upon current market rates, as well as termination rights. The Company performs an evaluation of each lease to determine if the lease payments included in the renewal option should be included in the initial measurement of the lease liability. Discount Rate ​ The present value of the lease payments is calculated using either the rate implicit in the lease, or the lessee’s incremental borrowing rate, over the lease term. For the majority of the Company’s finance and operating leases, the stated rate is not defined within the lease terms. Therefore, the Company uses its incremental borrowing rate as the discount rate. The incremental borrowing rate is defined as the rate of interest that a lessee would have to pay to borrow on a collateralized basis over a similar term for an amount equal to the lease payments in a similar economic environment and is calculated using comparative credit ratings. ​ Policy Elections ​ Short-term Leases ​ The Company has elected as an ongoing accounting policy election not to record a right-of-use asset or lease liability on its short-term facility leases of 12 months or less, and will expense its lease payments on a straight-line basis over the lease term. The accounting policy election is made by class of underlying asset to which the right of use relates. The Company has elected to apply the accounting policy election only to operating leases. Goodwill and Intangible Assets The Company records as goodwill the excess of the purchase price over the fair value of the identifiable net assets acquired. Finite-lived intangible assets acquired in business combinations subject to amortization are recorded at their fair value. Finite-lived intangible assets include trade names, acquired customers and distributors, developed technology, and non-compete agreements. Such intangible assets are amortized on a straight-line basis over their estimated useful lives. Amortization expense for the years ended June 30, 2026, 2025 and 2024 was $7.4 million, $9.9 million and $12.9 million, respectively, and is included within selling, general, and administrative expenses in the consolidated statements of operations. Future amortization of intangible assets is expected to be $5.9 million, $4.1 million, $0.3 million, $0.2 million and $0.1 million in the fiscal years ending June 30, 2027 through June 30, 2031, respectively, and $0.1 million thereafter. The Company reviews its finite-lived intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be fully recoverable. If the total of the expected undiscounted future cash flows is less than the carrying amount of the asset, a loss is recognized for the difference between fair value and the carrying value of the asset. As part of the Company’s review of its long-lived assets for impairment (discussed in more detail in Note 3, “Summary of Significant Accounting Policies – Impairment of Long-Lived Assets”) during the year ended June 30, 2025, the Company recorded an aggregate impairment loss of $32.2 million, of which $32.0 million related to trade names and $0.2 million related to developed technology. The $32.2 million is recorded under impairment of long-lived assets within the consolidated statements of operations. The Company has one reporting unit. The process for testing goodwill and intangible assets with indefinite lives for impairment is performed annually, as well as when an event triggering impairment may have occurred. Companies are also allowed to qualitatively assess goodwill impairment through a screening process which would permit companies to forgo the quantitative impairment test as part of their annual goodwill impairment process. The Company performs its annual assessment on May 31st, which is then updated for any changes in condition as of June 30th. ​ During the years ended June 30, 2026, 2025 and 2024, there were no events or changes in circumstances that would indicate that the carrying amount of the goodwill was impaired. ​ The following table represents the balance of the Company’s goodwill for the years ended June 30, 2026, 2025 and 2024: ​
​ | ​ | ​ | ​
($ in millions) | ​ ​ ​ | Amount
Goodwill | ​ | ​ | ​
Balance as of June 30, 2024 | ​ | $ | 246.7
​ | ​ | ​ | ​
Balance as of June 30, 2025 | ​ | $ | 246.7
​ | ​ | ​ | —
Balance as of June 30, 2026 | ​ | $ | 246.7
​ The following table represents the balance of the Company’s intangible assets as of June 30, 2026 and 2025: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | June 30, 2026 | ​ | June 30, 2025
($ in millions) | ​ ​ ​ | Gross Carrying Amount | ​ ​ ​ | Accumulated Amortization and Impairment | ​ ​ ​ | Net Carrying Value | ​ ​ ​ | Gross Carrying Amount | ​ ​ ​ | Accumulated Amortization and Impairment | ​ ​ ​ | Net Carrying Value
Trade names | ​ ​ ​ | $ | 70.6 | ​ ​ ​ | $ | (63.8) | ​ ​ ​ | $ | 6.8 | ​ | $ | 70.6 | ​ | $ | (60.4) | ​ | $ | 10.2
Customer and distributor relationships | ​ | ​ | 37.1 | ​ | ​ | (35.8) | ​ | ​ | 1.3 | ​ | ​ | 37.1 | ​ | ​ | (33.7) | ​ | ​ | 3.4
Developed technology | ​ | ​ | 21.7 | ​ | ​ | (19.1) | ​ | ​ | 2.6 | ​ | ​ | 21.7 | ​ | ​ | (17.3) | ​ | ​ | 4.4
Other | ​ | ​ | 1.4 | ​ | ​ | (1.2) | ​ | ​ | 0.2 | ​ | ​ | 1.4 | ​ | ​ | (1.2) | ​ | ​ | 0.2
Total | ​ | $ | 130.8 | ​ | $ | (119.9) | ​ | $ | 10.9 | ​ | $ | 130.8 | ​ | $ | (112.6) | ​ | $ | 18.2
​ Impairment of Long-Lived Assets Long-lived assets include property, equipment, right-of-use assets, capitalized curriculum and software developed or obtained for internal use. Management reviews the Company’s recorded long-lived assets for impairment annually or whenever events or changes in circumstances indicate that the carrying amount of an asset may not be fully recoverable. The Company determines the extent to which an asset may be impaired based upon its expectation of the asset’s future usability as well as reasonable assurance that the future cash flows associated with the asset will be in excess of its carrying amount. If the total of the expected undiscounted future cash flows is less than the carrying amount of the asset, a loss is recognized for the difference between fair value and the carrying value of the asset. ​ During the year ended June 30, 2025, the Company reviewed an asset group unrelated to its core operations, comprised entirely of Galvanize, a wholly-owned subsidiary, for impairment and determined that the carrying value exceeded its fair value. This review was prompted by changes in the expected use of certain long-lived assets as the Company decided to exit specific leased facilities. The fair value of the asset group was determined using a discounted cash flow methodology based on expected future cash flows. The Company recorded an impairment loss of $59.5 million, which is separately disclosed in the consolidated statements of operations under impairment of long-lived assets and included in income from operations. This loss comprises $32.2 million associated with intangible assets and $27.3 million related to operating lease right-of-use assets. ​ During the years ended June 30, 2026 and 2024, there were no events or changes in circumstances that may indicate that the carrying amount of the long-lived assets may not be recoverable. Income Taxes Deferred tax assets and liabilities are computed based on the difference between the financial reporting and income tax bases of assets and liabilities using the enacted marginal tax rate. The net deferred tax asset is reduced by a valuation allowance if, based on the weight of available evidence, it is more likely than not that some portion or all of the net deferred tax asset will not be realized. Stock-Based Compensation The Company estimates the fair value of share-based awards on the date of grant. The fair value of restricted stock awards is based on the closing price of the Company’s common stock on the date of grant. Certain restricted stock awards with a market-based performance component are valued using a Monte Carlo simulation model that considers a variety of factors, including, but not limited to, the Company’s common stock price, risk-free rate, and expected stock price volatility over the expected life of awards. The Company recognizes forfeitures of share-based awards as they occur in the period of forfeiture. Advertising and Marketing Costs Advertising and marketing costs consist primarily of internet advertising and online marketing, and are expensed when incurred. Advertising costs totaled $92.1 million, $103.6 million and $96.5 million for the years ended June 30, 2026, 2025 and 2024, respectively, and are included within selling, general, and administrative expenses in the consolidated statements of operations. Fair Value Measurements Fair value is the price that would be received to sell an asset or paid to transfer a liability, in the principal or most advantageous market for the asset or liability, in an orderly transaction between market participants at the measurement date. Measurements are described in a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ​ The three levels of inputs used to measure fair value are: ​
| Level 1: | Inputs based on quoted market prices for identical assets or liabilities in active markets at the measurement date;
​
| Level 2: | Observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data; and
​
| Level 3: | Inputs reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. The inputs are unobservable in the market and significant to the instrument’s valuation.
​ The carrying values reflected in the consolidated balance sheets for cash and cash equivalents, receivables, and short-term obligations approximate their fair values, as they are largely short-term in nature. As of June 30, 2026, the estimated fair value of the long-term debt was $747.6 million. The Company estimated the fair value based on the quoted market prices in an inactive market (Level 2). The long-term debt, comprised of the Company’s convertible senior notes due 2027, is recorded at face value less the unamortized debt issuance costs on its consolidated balance sheet, and is discussed in more detail in Note 7, “Debt.” As of June 30, 2026, the estimated fair value of the Company’s held-to-maturity marketable securities based on the quoted market prices in an inactive market (Level 2) was $266.2 million. As of June 30, 2026, the estimated fair value of the Company’s held-to-maturity marketable securities based on quoted prices in an active market (Level 1) was $12.9 million. As of June 30, 2026, the fair value of the Company’s publicly held equity securities was $42.3 million. The fair value was determined using quoted prices in an active market (Level 1). The held-to-maturity marketable securities and publicly held equity securities are discussed in more detail in Note 3, “Summary of Significant Accounting Policies - Investments in Marketable Securities.” ​ There was no activity related to the Company’s fair value measurements categorized as Level 3 in the valuation hierarchy, valued on a recurring basis, for the years ended June 30, 2026, 2025 and 2024. ​ Net Income (Loss) Per Common Share Basic net income (loss) per common share is calculated by dividing net income (loss) by the weighted-average number of common shares outstanding during the reporting period. The weighted average number of shares of common stock outstanding includes vested restricted stock awards. Diluted net income (loss) per share (“EPS”) reflects the potential dilution that could occur assuming vesting of all dilutive unvested restricted stock awards. The dilutive effect of restricted stock awards is determined using the treasury stock method. Under the treasury stock method, the proceeds received from the vesting of restricted stock awards, the amount of compensation cost for future service not yet recognized by the Company and the amount of tax benefits that would be recorded as income tax expense when the stock options become deductible for income tax purposes are all assumed to be used to repurchase shares of the Company’s common stock. Restricted stock awards are not included in the computation of diluted net income (loss) per share when they are anti-dilutive. Common stock outstanding reflected in the Company’s consolidated balance sheets includes restricted stock awards outstanding. The dilutive effect of the Company’s convertible debt is determined using the if-converted method when the Company’s stock is trading above the conversion price. However, based on the structure of the instrument and how it is settled upon conversion, it would produce a similar result as the previously applied treasury stock method. The dilutive effect of the Company’s employee stock purchase plan shares is also determined by the treasury stock method. Under the treasury stock method, the total expected employee payroll contributions and unrecognized compensation cost are assumed to be used to repurchase shares of the Company’s common stock. The following schedule presents the calculation of basic and diluted net income (loss) per share: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | Years Ended June 30,
​ | ​ | ​ | ​ | 2026 | ​ | 2025 | ​ | 2024
​ | ​ | ​ | ​ | (In thousands except share and per share data)
Basic net income per share computation: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Net income attributable to common stockholders | ​ | ​ | ​ | $ | 338,192 | ​ | $ | 287,941 | ​ | $ | 204,183
Weighted average common shares — basic | ​ | ​ | ​ | ​ | 42,717,156 | ​ | ​ | 43,041,274 | ​ | ​ | 42,626,588
Basic net income per share | ​ | ​ | ​ | $ | 7.92 | ​ | $ | 6.69 | ​ | $ | 4.79
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Diluted net income per share computation: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Net income attributable to common stockholders | ​ | ​ | ​ | $ | 338,192 | ​ | $ | 287,941 | ​ | $ | 204,183
Share computation: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Weighted average common shares — basic | ​ | ​ | ​ | ​ | 42,717,156 | ​ | ​ | 43,041,274 | ​ | ​ | 42,626,588
Effect of dilutive restricted stock, convertible debt, and the employee stock purchase plan | ​ | ​ | ​ | ​ | 4,615,699 | ​ | ​ | 5,372,443 | ​ | ​ | 908,853
Weighted average common shares — diluted | ​ | ​ | ​ | ​ | 47,332,855 | ​ | ​ | 48,413,717 | ​ | ​ | 43,535,441
Diluted net income per share | ​ | ​ | ​ | $ | 7.14 | ​ | $ | 5.95 | ​ | $ | 4.69
​ For the years ended June 30, 2026, 2025 and 2024, shares issuable in connection with restricted stock, convertible debt, and the 2025 Employee Stock Purchase Plan (the “2025 ESPP”) of 2,778,431, 2,400,621 and 7,658 respectively, were excluded from the diluted income per common share calculation because the effect would have been anti-dilutive. In connection with the issuance of the 1.125% Convertible Senior Notes due 2027 (“Notes”), the Company entered into capped call transactions (the “Capped Call Transactions”) as described further in Note 7, “Debt.” The Capped Call Transactions are intended to reduce the potential dilution to the Company’s common stock upon conversion of the Notes and/or to offset any cash payments the Company may be required to make in excess of the principal amount of the Notes. Reclassification Certain previous year amounts have been reclassified to conform with current year presentation, as related to the balance sheets.

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