Laureate Education Raises Full-Year Guidance as Peru Growth Offsets Mexico Margin Strain
Laureate Education's second-quarter revenue rose 17% to $615.9 million, prompting the for-profit university operator to raise its full-year outlook for the second straight quarter.
Laureate Education (LAUR) reported second-quarter revenue of $615.9 million, up 17% from a year earlier, or 8% in constant currency, as the Latin American higher-education operator reaccelerated from the first quarter's 15% reported and 1% constant-currency growth. Operating income reached $223.4 million, up from $193.3 million a year earlier, a reversal from the first quarter's operating loss of $27.5 million, itself a seasonal trough for a company whose enrollment cycle concentrates activity in the second and fourth quarters.
Diluted earnings per share climbed to $0.98 from $0.65, helped by a falling share count as buybacks continued; diluted weighted-average shares fell to 139.9 million from 146.8 million. A separate tailwind came from currency: the foreign-exchange loss that had dragged on the year-earlier quarter narrowed to $2.0 million from $25.6 million, removing what had been a substantial earnings drag. Net income rose to $137.1 million from $97.4 million, a sharper swing than the FX effects that had pulled full-year 2024 net income down to $283.8 million from $296.4 million.
Enrollment data for the first half of the year showed new enrollments up 10% and total enrollments up 6%, with the divergence between Laureate's two core markets widening. Peru posted new-enrollment growth of 14% and total growth of 8%, extending an outperformance streak that showed 13% new-enrollment growth in the first quarter and for all of 2024, versus 5% in Mexico. Mexico's new enrollments grew a more modest 7% in the first half, and the gap showed up in profitability: Mexico's Adjusted EBITDA rose 2% on a reported basis but fell 11% in constant currency, while Peru's Adjusted EBITDA grew 15% in constant currency over the same period, concentrating margin pressure in the larger of Laureate's two markets.
Adjusted EBITDA for the quarter was $250.6 million, up 17% as reported and 8% in constant currency from $214.5 million, a swing from the first quarter's negative $2.3 million, which was itself weaker than the negative $5.4 million logged in the first quarter of 2024. Part of the deceleration from the fourth quarter's 28% reported revenue growth, which had benefited from roughly $25 million in favorable calendar timing, was due to a roughly $9 million unfavorable timing headwind in the first half of this year.
Laureate raised its full-year 2025 guidance for the second consecutive quarter, projecting enrollment growth of 4% to 5% to 518,000-523,000 students, revenue of $1,920 million to $1,930 million (13% as reported, 6% to 7% in constant currency), Adjusted EBITDA of $593 million to $599 million (14% to 15% as reported), and Adjusted EPS of $2.04 to $2.10, implying growth of 19% to 22%. The first-quarter release had raised only the Adjusted EPS component of guidance, making this the broader of the two upgrades.
The company also disclosed an accounting change, effective in the fourth quarter of 2024, that excludes interest on legacy tax liabilities from Adjusted net income, with prior-year figures restated to match; the interest expense involved was $0.7 million in the quarter, down from $1.8 million a year earlier.
Laureate's board approved a $150 million increase to its share-repurchase authorization alongside the earnings release, the second such increase in four quarters following a similar move in February 2025 tied to fourth-quarter results. The company spent $185.9 million on repurchases in the first half of the year, up from $71.6 million in the same period of 2024, nearly exhausting its prior authorization before the latest increase. That spending, combined with $94.4 million of additional long-term debt taken on since December 31, 2024, pushed the company to a net debt position of $61.5 million as of June 30, a shift from an effectively net-cash position at the end of last year.