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Segment Reporting | 9 Months Ended
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Sep. 30, 2025
Segment Reporting [Abstract] |
Segment Reporting | Segment Reporting Strategic Education is an educational services company that provides access to high-quality education through campus-based and online post-secondary education offerings, as well as through programs to develop job-ready skills for high-demand markets. Strategic Education’s portfolio of companies is dedicated to closing the skills gap by placing adults on the most direct path between learning and employment. The Company’s organizational structure includes three operating and reportable segments: U.S. Higher Education, Education Technology Services, and Australia/New Zealand. The USHE segment provides flexible and affordable certificate and degree programs to working adults primarily through Capella University and Strayer University, including the Jack Welch Management Institute MBA, which is a unit of Strayer University. USHE also operates non-degree web and mobile application development courses through Hackbright Academy and Devmountain, which are units of Strayer University. The ETS segment primarily develops and maintains relationships with employers to build education benefits programs that provide employees access to affordable and industry-relevant training, certificate, and degree programs. The employer relationships developed by the ETS segment are an important source of student enrollment for Capella University and Strayer University, and a significant portion of the revenue attributed to the ETS segment is driven by the volume of enrollment derived from these employer relationships. ETS also supports employer partners through Workforce Edge, a platform which provides employers a full-service education benefits administration solution, and Sophia Learning, which offers low-cost online general education-level courses recommended by the American Council on Education for credit at other colleges and universities. The ANZ segment is comprised of Torrens University, Think Education, and Media Design School at Strayer (“MDS”) in Australia and New Zealand, which collectively offer certificate and degree programs in business, design, education, hospitality, healthcare, and technology through campuses in Australia, New Zealand, and online. On September 8, 2025, MDS became a wholly owned subsidiary and international additional location of Strayer University included within Strayer’s Middle States Commission on Higher Education accreditation. The New Zealand Qualifications Authority approved the transaction and MDS will continue to operate as a New Zealand private tertiary institution. This change does not affect the Company’s segment reporting. The Company’s Chief Operating Decision Maker (“CODM”) is the Chief Executive Officer. Revenue and operating expenses are generally directly attributable to the segments. Inter-segment revenues are not presented separately, as these amounts are immaterial. The Company’s CODM does not evaluate operating segments using asset information. The Company’s CODM assesses the segments’ performance by using each segment’s income from operations, which includes certain enterprise shared services allocations attributable to each of the segments. The Company’s CODM uses income from operations for each segment in the annual budget and forecasting process. On a monthly basis, the CODM reviews budget-to-actual, latest forecast-to-actual, and year-over-year actual variances when reviewing segment performance and making decisions about the allocation of resources to each segment. A summary of financial information by reportable segment for the three months ended September 30, 2024 is presented in the following table (in thousands):
| U.S. Higher Education |  | Australia/New Zealand |  | Education Technology Services |  | Total
Revenues | $ | 207,709 |  |  | $ | 71,948 |  |  | $ | 26,301 |  |  | $ | 305,958 |
Segment expenses |  |  |  |  |  |  |
Direct segment expenses | 181,663 |  |  | 52,386 |  |  | 14,511 |  |  | 248,560 |
Enterprise shared services allocation | 14,600 |  |  | 4,716 |  |  | 998 |  |  | 20,314 |
Segment income from operations | $ | 11,446 |  |  | $ | 14,846 |  |  | $ | 10,792 |  |  | $ | 37,084 |
Unallocated expenses |  |  |  |  |  |  |
Restructuring costs |  |  |  |  |  |  | (758) |
Consolidated income from operations |  |  |  |  |  |  | $ | 36,326 |
Other income |  |  |  |  |  |  | 2,264 |
Consolidated income before income taxes |  |  |  |  |  |  | $ | 38,590 |
A summary of financial information by reportable segment for the three months ended September 30, 2025 is presented in the following table (in thousands):
| U.S. Higher Education |  | Australia/New Zealand |  | Education Technology Services |  | Total
Revenues | $ | 213,067 |  |  | $ | 68,589 |  |  | $ | 38,293 |  |  | $ | 319,949 |
Segment expenses |  |  |  |  |  |  |
Direct segment expenses | 176,811 |  |  | 50,639 |  |  | 20,873 |  |  | 248,323 |
Enterprise shared services allocation | 13,403 |  |  | 5,465 |  |  | 1,465 |  |  | 20,333 |
Segment income from operations | $ | 22,853 |  |  | $ | 12,485 |  |  | $ | 15,955 |  |  | $ | 51,293 |
Unallocated expenses |  |  |  |  |  |  |
Restructuring costs |  |  |  |  |  |  | (14,251) |
Consolidated income from operations |  |  |  |  |  |  | $ | 37,042 |
Other expense |  |  |  |  |  |  | (273) |
Consolidated income before income taxes |  |  |  |  |  |  | $ | 36,769 |
A summary of financial information by reportable segment for the nine months ended September 30, 2024 is presented in the following table (in thousands):
| U.S. Higher Education |  | Australia/New Zealand |  | Education Technology Services |  | Total
Revenues | $ | 643,558 |  |  | $ | 190,453 |  |  | $ | 74,463 |  |  | $ | 908,474 |
Segment expenses |  |  |  |  |  |  |
Direct segment expenses | 539,346 |  |  | 150,044 |  |  | 40,416 |  |  | 729,806 |
Enterprise shared services allocation | 44,928 |  |  | 13,758 |  |  | 3,133 |  |  | 61,819 |
Segment income from operations | $ | 59,284 |  |  | $ | 26,651 |  |  | $ | 30,914 |  |  | $ | 116,849 |
Unallocated expenses |  |  |  |  |  |  |
Restructuring costs |  |  |  |  |  |  | 2,757 |
Consolidated income from operations |  |  |  |  |  |  | $ | 119,606 |
Other income |  |  |  |  |  |  | 3,935 |
Consolidated income before income taxes |  |  |  |  |  |  | $ | 123,541 |
A summary of financial information by reportable segment for the nine months ended September 30, 2025 is presented in the following table (in thousands):
| U.S. Higher Education |  | Australia/New Zealand |  | Education Technology Services |  | Total
Revenues | $ | 649,710 |  |  | $ | 185,993 |  |  | $ | 109,307 |  |  | $ | 945,010 |
Segment expenses |  |  |  |  |  |  |
Direct segment expenses | 532,189 |  |  | 146,763 |  |  | 59,630 |  |  | 738,582 |
Enterprise shared services allocation | 43,953 |  |  | 16,085 |  |  | 4,846 |  |  | 64,884 |
Segment income from operations | $ | 73,568 |  |  | $ | 23,145 |  |  | $ | 44,831 |  |  | $ | 141,544 |
Unallocated expenses |  |  |  |  |  |  |
Restructuring costs |  |  |  |  |  |  | (18,948) |
Consolidated income from operations |  |  |  |  |  |  | $ | 122,596 |
Other income |  |  |  |  |  |  | 1,623 |
Consolidated income before income taxes |  |  |  |  |  |  | $ | 124,219 |
The following table presents a schedule of significant non-cash items included in segment income from operations by reportable segment for the three and nine months ended September 30, 2024 and 2025 (in thousands):
| For the three months ended September 30, |  | For the nine months ended September 30,
| 2024 |  | 2025 |  | 2024 |  | 2025
Depreciation and amortization |  |  |  |  |  |  |
U.S. Higher Education | $ | 7,981 |  |  | $ | 6,442 |  |  | $ | 23,607 |  |  | $ | 21,692 |
Australia/New Zealand | 1,937 |  |  | 2,394 |  |  | 6,946 |  |  | 7,218 |
Education Technology Services | 888 |  |  | 1,340 |  |  | 2,480 |  |  | 3,693 |
Restructuring costs | — |  |  | 1,786 |  |  | — |  |  | 2,557 |
Consolidated depreciation and amortization | $ | 10,806 |  |  | $ | 11,962 |  |  | $ | 33,033 |  |  | $ | 35,160 |
Stock-based compensation |  |  |  |  |  |  |
U.S. Higher Education | $ | 5,259 |  |  | $ | 4,648 |  |  | $ | 14,278 |  |  | $ | 13,683 |
Australia/New Zealand | 1,061 |  |  | 462 |  |  | 2,871 |  |  | 1,224 |
Education Technology Services | 498 |  |  | 718 |  |  | 1,366 |  |  | 2,100 |
Restructuring costs | 69 |  |  | 40 |  |  | 274 |  |  | 188 |
Consolidated stock-based compensation | $ | 6,887 |  |  | $ | 5,868 |  |  | $ | 18,789 |  |  | $ | 17,195 |

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- Definition The entire disclosure for reporting segments including data and tables. 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