Phoenix Education Partners H1 Profit Drops 58% to $26.2M as Labor Costs Surge

Phoenix Education Partners, Inc., an education services provider, reported net income of $26.2 million for the six months ending February 28, 2026, down 58% from $62.5 million in the prior-year period. Revenue for the half climbed 1.3% to $484.5 million from $478.1 million. Read more earnings reports.

Operating income fell 50% to $39.6 million from $79.3 million a year earlier, as labor and related expenses jumped 20% to $246.1 million from $204.7 million. The company reported diluted earnings per share of $0.68, down from $1.66 in the first half of fiscal 2025.

For the three months ending February 28, 2026, net income totaled $10.8 million compared with $16.1 million in the same quarter last year. Quarterly revenue edged down slightly to $222.5 million from $223.4 million. Operating income for the quarter came in at $14.0 million versus $19.7 million a year earlier.

Labor expenses for the December-to-February quarter rose to $112.8 million from $103.1 million, outpacing the flat revenue trend. The company's tax expense for the six-month period totaled $16.4 million, down from $21.9 million in the prior year.

Cash and cash equivalents stood at $194.6 million as of February 28, 2026, up from $136.5 million at the end of August 2025. Total assets rose to $546.4 million from $493.6 million over the same period. Stockholders' equity increased to $291.1 million from $246.8 million.

Operating cash flow surged to $80.0 million for the six months, more than triple the $22.1 million generated in the first half of fiscal 2025. The company used $9.0 million in investing activities and $12.6 million in financing activities during the period.

Accounts receivable fell to $35.0 million as of February 28 from $59.0 million six months earlier. Current liabilities declined to $157.7 million from $162.0 million, while accounts payable rose to $30.5 million from $25.7 million.

The company had 35.8 million shares outstanding as of February 28, 2026. Total liabilities stood at $252.8 million, down marginally from $253.5 million at the end of August 2025.