Strategic Education Books Torrens Impairment After ANZ Reset

The Tip Desk · November 6, 2026 · 2 min read

The company recorded a $134.1 million non-cash charge after reassessing Australia/New Zealand growth, as third-quarter revenue rose 1.6% to $325.1 million.

Strategic Education, Inc. (STRA) reported a third-quarter loss from operations of $87.6 million after recording a $134.1 million non-cash impairment of goodwill and intangibles tied to Torrens University, reversing a year-earlier operating profit of $37.0 million.

The education-technology and university operator said persistent international student immigration constraints led it to reassess near-term growth in Australia and New Zealand. Adjusted income from operations on a constant-currency basis was $50.2 million, compared with $51.3 million a year earlier. Adjusted operating margin on that basis was 15.7%.

Revenue rose 1.6% to $325.1 million from $319.9 million in the year-ago quarter, a slower pace than the 4.9% increase in the second quarter. On a constant-currency basis, revenue rose 0.1% to $320.1 million. The company attributed the reported increase to Education Technology Services, higher U.S. Higher Education revenue per student, and favorable foreign currency. Net loss was $98.3 million, or $4.68 a share, versus net income of $26.6 million, or $1.15 a share, a year earlier. Adjusted diluted earnings on a constant-currency basis were $1.69 a share. Adjusted EBITDA was $71.0 million.

Education Technology Services revenue increased 11.9% to $42.8 million, slower than the 15.4% rise in the second quarter. Sophia Learning average subscribers increased about 22%, and Sophia Learning revenue rose 19.8% to $21.3 million. ETS income from operations was $18.2 million, with a 42.5% operating margin. Workforce Edge had 83 corporate agreements covering about 4.03 million employees.

U.S. Higher Education revenue was essentially unchanged at $213.7 million. Enrollment declined 1.1% to 84,725. Employer-affiliated enrollment was 34.7% of U.S. Higher Education enrollment, up from 32.7% a year earlier. The healthcare portfolio’s total enrollment increased 9% and now comprises 54% of U.S. Higher Education enrollment. Income from operations was $22.0 million, with a 10.3% operating margin. Strayer University launched an Associate of Applied Science in Radiologic Technology for October 2026 enrollment.

Australia/New Zealand enrollment decreased 9.1% to 17,101. Reported revenue was relatively unchanged at $68.6 million; constant-currency revenue decreased 7.2% to $63.6 million. Income from operations was $10.8 million, with a 15.8% operating margin.

At September 30, 2026, the company had cash, cash equivalents, and marketable securities of $138.6 million and no debt outstanding under its revolving credit facility. For the nine months ended September 30, cash provided by operations was $173.5 million and free cash flow was $136.7 million. During the third quarter it repurchased 347,472 shares for $28.5 million. It declared a quarterly cash dividend of $0.60 a share, payable December 7, 2026.