LAUREATE EDUCATION, INC. 10-Q

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations Forward-Looking Statements This Quarterly Report on Form 10-Q (this Form 10-Q) contains “forward‑looking statements” within the meaning of the federal securities laws, which involve risks and uncertainties. You can identify forward‑looking statements because they contain words such as “believes,” “expects,” “may,” “will,” “should,” “seeks,” “approximately,” “intends,” “plans,” “estimates” or “anticipates” or similar expressions that concern our strategy, plans or intentions. All statements we make relating to estimated and projected earnings, costs, expenditures, cash flows, growth rates and financial results, and all statements we make relating to our current growth strategy and other future plans, strategies or transactions that may be identified, explored or implemented and any litigation or dispute resulting from any completed transaction are forward-looking statements. In addition, we, through our senior management, from time to time make forward‑looking public statements concerning our expected future operations and performance and other developments. All of these forward‑looking statements are subject to risks and uncertainties that may change at any time, including with respect to our current growth strategy and the impact of any completed divestiture or separation transaction on our remaining businesses. Accordingly, our actual results may differ materially from those we expected. We derive most of our forward‑looking statements from our operating budgets and forecasts, which are based upon many detailed assumptions. While we believe that our assumptions are reasonable, we caution that it is very difficult to predict the impact of known factors, and, of course, it is impossible for us to anticipate all factors that could affect our actual results. Important factors that could cause actual results to differ materially from our expectations, including, without limitation, in conjunction with the forward-looking statements and risk factors included in this Form 10-Q, are disclosed in “Item 1—Business,” and “Item 1A—Risk Factors” of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024 (the 2024 Form 10-K). Some of the factors that we believe could affect our results include: • the risks associated with operating our portfolio of degree-granting higher education institutions in Mexico and Peru, including complex business, political, legal, regulatory, tax and economic risks; • our ability to maintain and, subsequently, increase tuition rates and student enrollments in our institutions; • our ability to effectively manage the growth of our business and increase our operating leverage; • the risks associated with maintaining the value of our brands and our reputation; • the effect of existing international and U.S. laws and regulations governing our business or changes to those laws and regulations or in their application to our business; • changes in the political, economic and business climate in the markets in which we operate; • risks of downturns in general economic conditions and in the educational services and education technology industries that could, among other things, impair our goodwill and intangible assets; • possible increased competition from other educational service providers; • market acceptance of new service offerings by us or our competitors and our ability to predict and respond to changes in the markets for our educational services; • the effect of greater than anticipated tax liabilities; • the effect on our business and results of operations from fluctuations in the value of foreign currencies; • risks associated with the incorporation of new technologies (including artificial intelligence) into our programs and processes; • the fluctuations in revenues due to seasonality; • the risks associated with disruptions to our computer networks and other cybersecurity incidents, including misappropriation of personal or proprietary information; • the risks associated with protests, strikes or natural or other disasters; • our ability to attract and retain key personnel; • the risks and uncertainties associated with an epidemic, pandemic or other public health emergency including, but not limited to, effects on student enrollment, tuition pricing, and collections in future periods; • our ability to maintain proper and effective internal controls necessary to produce accurate financial statements on a timely basis; • the risks associated with indebtedness and disruptions to credit and equity markets; 21 • our focus on a specific public benefit purpose and producing a positive effect for society may negatively influence our financial performance; and • the future trading prices of our common stock and the impact of any securities analysts’ reports on these prices. We caution you that the foregoing list of important factors may not contain all of the material factors that are important to you. In addition, in light of these risks and uncertainties, the matters referred to in the forward-looking statements contained in this Form 10-Q may not in fact occur. We undertake no obligation to publicly update or revise any forward-looking statement as a result of new information, future events or otherwise, except as otherwise required by law. Introduction This Management’s Discussion and Analysis of Financial Condition and Results of Operations (the MD&A) is provided to assist readers of the financial statements in understanding the results of operations, financial condition and cash flows of Laureate Education, Inc. This MD&A should be read in conjunction with the consolidated financial statements and related notes included elsewhere in this Form 10-Q. The consolidated financial statements included elsewhere in this Form 10-Q are presented in U.S. dollars (USD) rounded to the nearest thousand, with the amounts in MD&A rounded to the nearest tenth of a million. Therefore, discrepancies in the tables between totals and the sums of the amounts listed may occur due to such rounding. Our MD&A is presented in the following sections: • Overview; • Results of Operations; • Liquidity and Capital Resources; • Critical Accounting Policies and Estimates; and • Recently Adopted Accounting Standards. Overview Our Business We operate a portfolio of degree-granting higher education institutions in Mexico and Peru. Collectively, we have approximately 511,400 students enrolled at five institutions in these two countries. We believe that the higher education markets in Mexico and Peru present an attractive long-term opportunity, primarily because of the large and growing imbalance between the supply and demand for affordable, quality higher education in those markets. We believe that the combination of the projected growth in the middle class, limited government resources dedicated to higher education, and a clear value proposition demonstrated by the higher earnings potential afforded by higher education, creates substantial opportunities for high-quality private institutions to meet this growing and unmet demand. By offering high-quality, outcome-focused education, we believe that we enable students to prosper and thrive in the dynamic and evolving knowledge economy. We have two reportable segments as described below. We group our institutions by geography in Mexico and Peru for reporting purposes. Our Segments Our segments generate revenues by providing an education that emphasizes profession-oriented fields of study with undergraduate and graduate degrees in a wide range of disciplines. Our educational offerings utilize campus-based, online and hybrid (a combination of online and in-classroom) courses and programs to deliver their curriculum. The Mexico and Peru markets are characterized by what we believe is a significant imbalance between supply and demand. The demand for higher education is large and growing and is fueled by several demographic and economic factors, including a growing middle class, global growth in services and technology-related industries and recognition of the significant personal and economic benefits gained by graduates of higher education institutions. The target demographics are primarily 18- to 24-year-olds in the countries in which we compete. We compete with other private higher education institutions on the basis of price, educational quality, reputation and location. We believe that we compare favorably with competitors because of our focus on quality, professional-oriented curriculum and the competitive advantages provided by our in-country networks. There are a number of private and public institutions in both of the countries in which we operate, and it is difficult to predict how the markets will evolve and how many competitors there will be in the future. We expect competition to increase as the Mexican and Peruvian markets mature. Essentially all of our revenues were generated from private pay sources as there are no material government-sponsored loan programs in Mexico or Peru. Specifics related to both of our reportable segments are discussed below: 22 • Private education providers in Mexico constitute approximately 39% of the total higher-education market. The private sector plays a meaningful role in higher education, bridging supply and demand imbalances created by a lack of capacity at public universities. Laureate owns two nationally licensed institutions and is present throughout the country with a footprint of over 30 campuses. • In Peru, private universities are increasingly providing the capacity to meet growing demand and constitute approximately 76% of the total higher-education market. Laureate owns three institutions in Peru, with a footprint of 20 campuses. Corporate is a non-operating business unit whose purpose is to support operations. Its departments are responsible for establishing operational policies and internal control standards, implementing strategic initiatives, and monitoring compliance with policies and controls throughout our operations. Our Corporate segment provides financial, human resource, information technology, insurance, legal, and tax compliance services. The Corporate segment also contains the eliminations of inter-segment revenues and expenses. The following information for our reportable segments is presented as of September 30, 2025: Institutions Enrollment 2025 YTD Revenues ($ in millions) (1) % Contribution to 2025 YTD Revenues Mexico 2 277,000 $ 601.5 52 % Peru 3 234,400 558.9 48 % Total (1) 5 511,400 $ 1,160.5 100 % (1) Amounts related to Corporate were immaterial and are not separately presented. Challenges Our operations are outside of the United States and are subject to complex business, economic, legal, regulatory, political, tax and foreign currency risks, which may be difficult to adequately address. As a result, we face risks that are inherent in international operations, including: fluctuations in exchange rates, possible currency devaluations, inflation and hyper-inflation; price controls and foreign currency exchange restrictions; potential economic and political instability in both countries in which we operate; expropriation of assets by local governments; key political elections and changes in government policies; subsequent changes to laws and regulatory regimes; multiple and possibly overlapping and conflicting tax laws; and compliance with a wide variety of foreign laws. See “Item 1A—Risk Factors—Risks Relating to Our Business—We operate a portfolio of degree-granting higher education institutions in Mexico and Peru and are subject to complex business, economic, legal, political, tax and foreign currency risks, which risks may be difficult to adequately address,” in our 2024 Form 10-K. We plan to grow our operations organically by: 1) adding new programs and course offerings; 2) expanding target student demographics; and 3) increasing capacity at existing and new campus locations. Our success in growing our business will depend on the ability to anticipate and effectively manage these and other risks related to operating in various countries. Regulatory Environment and Other Matters Our business is subject to varying laws and regulations based on the requirements of local jurisdictions. These laws and regulations are subject to updates and changes. We cannot predict the form of the rules that ultimately may be adopted in the future or what effects they might have on our business, financial condition, results of operations and cash flows. We will continue to develop and implement necessary changes that enable us to comply with such laws and regulations. See “Item 1A—Risk Factors—Risks Relating to Our Business—Our institutions are subject to uncertain and varying laws and regulations, and any changes to these laws or regulations or their application to us may materially adversely affect our business, financial condition and results of operations,” and “Item 1—Business—Industry Regulation” in our 2024 Form 10-K for a detailed discussion of our different regulatory environments. Key Business Metric Enrollment Enrollment is our lead revenue indicator and represents our most important non-financial metric. We define “enrollment” as the number of students registered in a course on the last day of the enrollment reporting period. New enrollments provide an indication of future revenue trends. Total enrollment is a function of continuing student enrollments, new student enrollments and enrollments from acquisitions, offset by graduations, attrition and enrollment decreases due to dispositions. Attrition is 23 defined as a student leaving the institution before completion of the program. To minimize attrition, we have implemented programs that involve assisting students in remedial education, mentoring, counseling and student financing. Each of our institutions has an enrollment cycle that varies by geographic region and academic program. Each institution has a “Primary Intake” period during the academic year in which the majority of the enrollment occurs. Each institution also has a smaller “Secondary Intake” period. Our Peruvian institutions have their Primary Intake during the first calendar quarter and a Secondary Intake during the third calendar quarter. Institutions in our Mexico segment have their Primary Intake during the third calendar quarter and a Secondary Intake during the first calendar quarter. Our institutions in Peru are generally out of session in January, February and July, while institutions in Mexico are generally out of session in May through July. Revenues are recognized when classes are in session. Principal Components of Income Statement Revenues The majority of our revenue is derived from tuition and educational services. The amount of tuition generated in a given period depends on the price per credit hour and the total credit hours or price per program taken by the enrolled student population. The price per credit hour varies by program, by market and by degree level. Additionally, varying levels of discounts and scholarships are offered depending on market-specific dynamics and individual achievements of our students. Revenues are recognized net of scholarships and other discounts, refunds and waivers. In addition to tuition revenues, we generate other revenues from student fees and other education-related activities. These other revenues are less material to our overall financial results and have a tendency to trend with tuition revenues. The main drivers of changes in revenues between periods are student enrollment and price. We continually monitor market conditions and carefully adjust our tuition rates to meet local demand levels. We proactively seek the best price and content combinations to remain competitive in all the markets in which we operate. Direct Costs Our direct costs include labor and operating costs associated with the delivery of services to our students, including the cost of wages, payroll taxes and benefits, depreciation and amortization, rent, utilities, bad debt expenses, and marketing and promotional costs to grow future enrollments. In general, a significant portion of our direct costs tend to be variable in nature and trend with enrollment, and management continues to monitor and improve the efficiency of instructional delivery. General and Administrative Expenses Our general and administrative expenses primarily consist of costs associated with corporate departments, including executive management, finance, legal, business development and other departments that do not provide direct operational services. Factors Affecting Comparability Foreign Exchange While the USD is our reporting currency, our institutions are located in Mexico and Peru and operate in other functional currencies, namely the Mexican peso and Peruvian nuevo sol. We monitor the impact of foreign currency movements and the correlation between the local currency and the USD. Our revenues and expenses are generally denominated in local currency. The principal foreign exchange exposure is the risk related to the translation of revenues and expenses incurred in each country from the local currency into USD. See “Item 1A—Risk Factors—Risks Relating to Our Business—Our reported revenues and earnings may be negatively affected by the strengthening of the U.S. dollar and currency exchange rates” in our 2024 Form 10‑K. In order to provide a framework for assessing how our business performed excluding the effects of foreign currency fluctuations, we present organic constant currency in our segment results, which is calculated using the change from prior-year average foreign exchange rates to current-year average foreign exchange rates, as applied to local-currency operating results for the current year, and excludes the impact of acquisitions and divestitures. 24 Seasonality Our institutions have a summer break during which classes are generally not in session and minimal revenues are recognized. In addition to the timing of summer breaks, holidays such as Easter also have an impact on our academic calendar. Operating expenses, however, do not fully correlate to the enrollment and revenue cycles, as the institutions continue to incur expenses during summer breaks. Given the geographic diversity of our institutions and differences in timing of summer breaks, our second and fourth quarters are stronger revenue quarters as the majority of our institutions are in session for most of these respective quarters. Our first and third fiscal quarters are weaker revenue quarters because our institutions have summer breaks for some portion of one of these two quarters. However, our primary enrollment intakes occur during the first and third quarters. Due to this seasonality, revenues and profits in any one quarter are not necessarily indicative of results in subsequent quarters and may not be correlated to new enrollment in any one quarter. Additionally, seasonality may be affected due to other events that could change the academic calendar at our institutions. See “Item 1A—Risk Factors—Risks Relating to Our Business—We experience seasonal fluctuations in our results of operations” in our 2024 Form 10-K. Income Tax Expense Our consolidated income tax provision is derived based on the combined impact of federal, state and foreign income taxes. Also, discrete items can arise in the course of our operations that can further affect the Company’s effective tax rate for the period. Our tax rate fluctuates from period to period due to changes in the mix of earnings between our tax-paying entities and our loss-making entities for which it is not ‘ more likely than not ’ that a tax benefit will be realized on the loss. See “Item 1A—Risk Factors—Risks Relating to Our Business—We may have exposure to greater-than-anticipated tax liabilities” in our 2024 Form 10-K. Results of Operations The following discussion of the results of our operations is organized as follows: • Summary Comparison of Consolidated Results; • Non-GAAP Financial Measure; and • Segment Results. 25 Summary Comparison of Consolidated Results Comparison of Consolidated Results for the Three Months Ended September 30, 2025 and 2024 % Change Better/(Worse) (in millions) 2025 2024 2025 vs. 2024 Revenues $ 400.2 $ 368.6 9 % Direct costs 316.5 286.0 (11) % General and administrative expenses 12.2 10.6 (15) % Operating income 71.5 72.0 (1) % Interest expense, net of interest income (0.5) (2.6) 81 % Other non-operating (expense) income (2.2) 15.4 (114) % Income from continuing operations before income taxes 68.8 84.9 (19) % Income tax (expense) benefit (34.5) 0.5 nm Income from continuing operations 34.4 85.3 (60) % Income from discontinued operations, net of tax — — nm Net income 34.4 85.3 (60) % Net loss attributable to noncontrolling interests 0.1 0.1 — % Net income attributable to Laureate Education, Inc. $ 34.5 $ 85.5 (60) % nm - percentage changes not meaningful Comparison of Consolidated Results for the Three Months Ended September 30, 2025 to the Three Months Ended September 30, 2024 Revenues increased by $31.6 million to $400.2 million for the three months ended September 30, 2025 (the 2025 fiscal quarter) from $368.6 million for the three months ended September 30, 2024 (the 2024 fiscal quarter). This increase in revenues was attributable to higher average total organic enrollment at our institutions during the 2025 fiscal quarter, which increased revenues by $22.0 million compared to the 2024 fiscal quarter. In addition, the effect of a net change in foreign currency exchange rates increased revenues by $15.8 million, mainly due to the strengthening of the Mexican peso against the USD compared to the 2024 fiscal quarter. These increases in revenues were partially offset by the effect of changes in tuition rates and enrollments in programs at varying price points (product mix), pricing and timing, which decreased revenues by $6.2 million, including an unfavorable impact of approximately $7 million from intra-year academic calendar timing in Peru, compared to the 2024 fiscal quarter. Direct costs and general and administrative expenses combined increased by $32.1 million to $328.7 million for the 2025 fiscal quarter from $296.6 million for the 2024 fiscal quarter. This increase was primarily driven by the effect of operational changes, which increased costs by $21.1 million, primarily due to the result of higher enrollment at our institutions. In addition, the effect of a net change in foreign currency exchange rates increased costs by $10.4 million, mainly due to the strengthening of the Mexican peso against the USD compared to the 2024 fiscal quarter. Other Corporate expenses accounted for an increase in costs of $0.6 million for the 2025 fiscal quarter compared to the 2024 fiscal quarter. Operating income decreased by $0.5 million to $71.5 million for the 2025 fiscal quarter from $72.0 million for the 2024 fiscal quarter. This decrease was primarily driven by lower operating income at our Peru segment, combined with higher operating expenses at Corporate. This decrease was partially offset by higher operating income at our Mexico segment during the 2025 fiscal quarter compared to the 2024 fiscal quarter. Other non-operating (expense) income changed by $17.6 million to an expense of $(2.2) million for the 2025 fiscal quarter from income of $15.4 million for the 2024 fiscal quarter. This change was primarily attributable to foreign currency exchange loss during the 2025 fiscal quarter compared to a gain during the 2024 fiscal quarter for a change of $16.8 million, mainly related to intercompany loan arrangements. Other income accounted for the remaining change of $0.8 million. Income tax (expense) benefit changed by $35.0 million to an expense of $(34.5) million for the 2025 fiscal quarter from a benefit of $0.5 million for the 2024 fiscal quarter. This change was primarily attributable to a discrete tax benefit of approximately $37.9 million that was recorded during the 2024 fiscal quarter related to an entity restructuring. 26 Comparison of Consolidated Results for the Nine Months Ended September 30, 2025 and 2024 % Change Better/(Worse) (in millions) 2025 2024 2025 vs. 2024 Revenues $ 1,160.5 $ 1,143.2 2 % Direct costs 872.3 858.9 (2) % General and administrative expenses 36.7 34.6 (6) % Operating income 251.6 249.8 1 % Interest expense, net of interest income (3.1) (8.5) 64 % Other non-operating (expense) income (30.2) 33.8 (189) % Income from continuing operations before income taxes 218.4 275.0 (21) % Income tax expense (106.3) (72.5) (47) % Income from continuing operations 112.0 202.5 (45) % Income from discontinued operations, net of tax 0.2 0.3 (33) % Net income 112.3 202.8 (45) % Net loss attributable to noncontrolling interests (2.2) — nm Net income attributable to Laureate Education, Inc. $ 110.1 $ 202.8 (46) % nm - percentage changes not meaningful Comparison of Consolidated Results for the Nine Months Ended September 30, 2025 to the Nine Months Ended September 30, 2024 Revenues increased by $17.3 million to $1,160.5 million for the nine months ended September 30, 2025 (the 2025 fiscal period) from $1,143.2 million for the nine months ended September 30, 2024 (the 2024 fiscal period). This increase in revenues was attributable to the effect of higher average total organic enrollment at our institutions, which increased revenues by $67.1 million compared to the 2024 fiscal period. This increase in revenue was partially offset by a net change in foreign currency exchange rates, which decreased revenues by $46.0 million, mainly due to the weakening of the Mexican peso against the USD compared to the 2024 fiscal period. In addition, these increases in revenues were partially offset by the effect of changes in product mix, pricing and timing which decreased revenues by $3.8 million compared to the 2024 fiscal period, which included a decrease in revenue for Peru of approximately $25 million from intra-year academic calendar timing attributable to later semester start dates as compared to the 2024 fiscal period. Direct costs and general and administrative expenses combined increased by $15.5 million to $909.0 million for the 2025 fiscal period from $893.5 million for the 2024 fiscal period. This increase was driven by the effect of operational changes, which increased direct costs by $53.9 million compared to the 2024 fiscal period, primarily due to the result of higher enrollment at our institutions. This increase was partially offset by the effect of a net change in foreign currency exchange rates, which decreased direct costs by $37.7 million, mainly due to the weakening of the Mexican peso against the USD compared to the 2024 fiscal period. Corporate accounted for the remaining difference of $0.7 million. Operating income increased by $1.8 million to $251.6 million for the 2025 fiscal period from $249.8 million for the 2024 fiscal period. This change was primarily driven by higher operating income in our Mexico segment, partially offset by lower operating income in our Peru segment, combined with higher operating expenses at Corporate during the 2025 fiscal period compared to the 2024 fiscal period. Other non-operating (expense) income changed by $64.0 million to an expense of $(30.2) million for the 2025 fiscal period from income of $33.8 million for the 2024 fiscal period. This change was attributable to: (1) a loss on foreign currency exchange during the 2025 fiscal period compared to a gain during the 2024 fiscal period for a change of $67.5 million, mainly related to intercompany loan arrangements; (2) the year-over-year effect of a $3.1 million loss related to the release of accumulated foreign currency translation balances upon the liquidation of certain subsidiaries during the 2024 fiscal period; and (3) an increase in other income of $0.4 million for the 2025 fiscal period. 27 Income tax expense increased by $33.8 million to $106.3 million for the 2025 fiscal period from $72.5 million for the 2024 fiscal period. This increase was primarily attributable to a discrete tax benefit of approximately $37.9 million that was recorded during the 2024 fiscal period related to an entity restructuring. Non-GAAP Financial Measure We define Adjusted EBITDA as net income (loss), before (income) loss from discontinued operations, net of tax, equity in net (income) loss of affiliates, net of tax, income tax expense (benefit), (gain) loss on disposal of subsidiaries, net, foreign currency exchange (gain) loss, net, other (income) expense, net, interest expense, interest income, and loss on debt extinguishment, plus depreciation and amortization, share-based compensation expense and loss on impairment of assets. Adjusted EBITDA is used in addition to and in conjunction with results presented in accordance with GAAP and should not be relied upon to the exclusion of GAAP financial measures. Adjusted EBITDA is a key measure used by our management and Board of Directors to understand and evaluate our core operating performance and trends, to prepare and approve our annual budget and to develop short- and long-term operational plans. In particular, the exclusion of certain expenses in calculating Adjusted EBITDA can provide a useful measure for period-to-period comparisons of our core business. Additionally, Adjusted EBITDA is a key financial measure used by the compensation committee of our Board of Directors and our Chief Executive Officer in connection with the payment of incentive compensation to our executive officers and other members of our management team. Accordingly, we believe that Adjusted EBITDA provides useful information to investors and others in understanding and evaluating our operating results in the same manner as our management and Board of Directors. The following table presents Adjusted EBITDA and reconciles Net income to Adjusted EBITDA for the three months ended September 30, 2025 and 2024: % Change Better/(Worse) (in millions) 2025 2024 2025 vs. 2024 Net income $ 34.4 $ 85.3 (60) % Plus: Income from discontinued operations, net of tax — — nm Income from continuing operations 34.4 85.3 (60) % Plus: Income tax expense (benefit) 34.5 (0.5) nm Income from continuing operations before income taxes 68.8 84.9 (19) % Plus: Foreign currency exchange loss (gain), net 2.3 (14.5) (116) % Other income, net (0.2) (0.9) (78) % Interest expense 2.6 5.0 48 % Interest income (2.1) (2.4) (13) % Operating income 71.5 72.0 (1) % Plus: Depreciation and amortization 19.6 16.6 (18) % EBITDA 91.1 88.6 3 % Plus: Share-based compensation expense (a) 3.8 2.8 (36) % Adjusted EBITDA $ 94.8 $ 91.4 4 % nm - percentage changes not meaningful (a) Represents non-cash, share-based compensation expense pursuant to the provisions of ASC 718, “Stock Compensation.” 28 Comparison of Depreciation and Amortization for the Three Months Ended September 30, 2025 and 2024 Depreciation and amortization increased by $3.0 million to $19.6 million for the 2025 fiscal quarter from $16.6 million for the 2024 fiscal quarter, which was primarily attributable to equipment purchases and campus improvements in Mexico that resulted in a higher depreciable asset base compared to the 2024 fiscal quarter. The following table presents Adjusted EBITDA and reconciles Net income to Adjusted EBITDA for the nine months ended September 30, 2025 and 2024: % Change Better/(Worse) (in millions) 2025 2024 2025 vs. 2024 Net income $ 112.3 $ 202.8 (45) % Plus: Income from discontinued operations, net of tax (0.2) (0.3) (33) % Income from continuing operations 112.0 202.5 (45) % Plus: Income tax expense 106.3 72.5 (47) % Income from continuing operations before income taxes 218.4 275.0 (21) % Plus: Loss on disposal of subsidiaries, net — 3.1 100 % Foreign currency exchange loss (gain), net 31.1 (36.4) (185) % Other income, net (1.0) (0.5) 100 % Interest expense 8.1 14.8 45 % Interest income (5.0) (6.3) (21) % Operating income 251.6 249.8 1 % Plus: Depreciation and amortization 53.3 52.1 (2) % EBITDA 304.9 301.9 1 % Plus: Share-based compensation expense (a) 9.7 7.1 (37) % Adjusted EBITDA $ 314.7 $ 308.9 2 % nm - percentage changes not meaningful (a) Represents non-cash, share-based compensation expense pursuant to the provisions of ASC 718, “Stock Compensation.” Comparison of Share-based Compensation Expense for the Nine Months Ended September 30, 2025 and 2024 Share-based compensation expense increased by $2.6 million to $9.7 million for the 2025 fiscal period from $7.1 million for the 2024 fiscal period, which was primarily driven by executive retention awards of restricted stock units that were granted in May 2024 and January 2025. 29 Segment Results We have two reportable segments: Mexico and Peru. For purposes of the following comparison of results discussion, “ segment direct costs ” represent direct costs incurred by the segment as they are included in Adjusted EBITDA, such that depreciation and amortization expense, loss on impairment of assets and share-based compensation expense have been excluded. Organic enrollment is based on average total enrollment for the period. For a further description of our segments, see Overview. The following tables, derived from our consolidated financial statements included elsewhere in this Form 10-Q, present selected financial information of our segments: (in millions) % Change Better/(Worse) For the three months ended September 30, 2025 2024 2025 vs. 2024 Revenues: Mexico $ 194.8 $ 182.5 7 % Peru 205.3 186.1 10 % Corporate — — nm Consolidated Total Revenues $ 400.2 $ 368.6 9 % Adjusted EBITDA: Mexico $ 25.7 $ 20.0 29 % Peru 78.1 79.8 (2) % Corporate (8.9) (8.3) (7) % Consolidated Total Adjusted EBITDA $ 94.8 $ 91.4 4 % (in millions) % Change Better/(Worse) For the nine months ended September 30, 2025 2024 2025 vs. 2024 Revenues: Mexico $ 601.5 $ 615.2 (2) % Peru 558.9 528.0 6 % Corporate 0.1 0.1 — % Consolidated Total Revenues $ 1,160.5 $ 1,143.2 2 % Adjusted EBITDA: Mexico $ 136.1 $ 128.1 6 % Peru 206.5 209.4 (1) % Corporate (27.9) (28.6) 2 % Consolidated Total Adjusted EBITDA $ 314.7 $ 308.9 2 % nm - percentage changes not meaningful 30 Mexico Financial Overview Comparison of Mexico Results for the Three Months Ended September 30, 2025 to the Three Months Ended September 30, 2024 (in millions) Revenues Direct Costs Adjusted EBITDA September 30, 2024 $ 182.5 $ 162.5 $ 20.0 Organic enrollment (1) 9.3 Product mix, pricing and timing (1) 0.1 Organic constant currency 9.4 4.5 4.9 Foreign exchange 2.9 2.1 0.8 September 30, 2025 $ 194.8 $ 169.1 $ 25.7 (1) Organic enrollment and product mix, pricing and timing are not separable for the calculation of direct costs and therefore are combined and defined as Organic constant currency for the calculation of Adjusted EBITDA. Revenues increased by $12.3 million, a 7% increase from the 2024 fiscal quarter. • On an organic constant currency basis, revenue increased by 5% compared to the 2024 fiscal quarter. • Revenues from our Mexico segment represented 49% of our consolidated total revenues for the 2025 fiscal quarter compared to 50% for the 2024 fiscal quarter. Adjusted EBITDA increased by $5.7 million, a 29% increase from the 2024 fiscal quarter, mainly driven by revenue growth. • On an organic constant currency basis, Adjusted EBITDA increased by 25% compared to the 2024 fiscal quarter. Comparison of Mexico Results for the Nine Months Ended September 30, 2025 to the Nine Months Ended September 30, 2024 (in millions) Revenues Direct Costs Adjusted EBITDA September 30, 2024 $ 615.2 $ 487.1 $ 128.1 Organic enrollment (1) 39.2 Product mix, pricing and timing (1) 13.0 Organic constant currency 52.2 25.3 26.9 Foreign exchange (65.9) (47.0) (18.9) September 30, 2025 $ 601.5 $ 465.4 $ 136.1 (1) Organic enrollment and product mix, pricing and timing are not separable for the calculation of direct costs and therefore are combined and defined as Organic constant currency for the calculation of Adjusted EBITDA. 31 Revenues decreased by $13.7 million, a 2% decrease from the 2024 fiscal period. • Revenue for the 2025 fiscal period was unfavorably affected by the weakening of the Mexican peso against the USD compared to the 2024 fiscal period. • On an organic constant currency basis, revenue increased by 8% compared to the 2024 fiscal period. • Revenues from our Mexico segment represented 52% of our consolidated total revenues for the 2025 fiscal period, compared to 54% for the 2024 fiscal period. Adjusted EBITDA increased by $8.0 million, a 6% increase from the 2024 fiscal period, driven by revenue growth, partially offset by the weakening of the Mexican peso against the USD. • On an organic constant currency basis, Adjusted EBITDA increased by 21% compared to the 2024 fiscal period. Peru Financial Overview Comparison of Peru Results for the Three Months Ended September 30, 2025 to the Three Months Ended September 30, 2024 (in millions) Revenues Direct Costs Adjusted EBITDA September 30, 2024 $ 186.1 $ 106.3 $ 79.8 Organic enrollment (1) 12.7 Product mix, pricing and timing (1) (6.4) Organic constant currency 6.3 13.2 (6.9) Foreign exchange 12.9 7.7 5.2 September 30, 2025 $ 205.3 $ 127.2 $ 78.1 (1) Organic enrollment and product mix, pricing and timing are not separable for the calculation of direct costs and therefore are combined and defined as Organic constant currency for the calculation of Adjusted EBITDA. Revenues increased by $19.2 million, a 10% increase from the 2024 fiscal quarter. • On an organic constant currency basis, revenues increased by 3% compared to the 2024 fiscal quarter. • Revenue for the 2025 fiscal quarter was unfavorably affected by approximately $7 million of intra-year academic calendar timing compared to the 2024 fiscal quarter. • Revenues from our Peru segment represented 51% of our consolidated total revenues for the 2025 fiscal quarter, compared to 50% for the 2024 fiscal quarter. Adjusted EBITDA decreased by $1.7 million, a 2% decrease from the 2024 fiscal quarter. • On an organic constant currency basis, Adjusted EBITDA decreased by 9% compared to the 2024 fiscal quarter and was unfavorably affected by intra-year academic calendar timing. 32 Comparison of Peru Results for the Nine Months Ended September 30, 2025 to the Nine Months Ended September 30, 2024 (in millions) Revenues Direct Costs Adjusted EBITDA September 30, 2024 $ 528.0 $ 318.6 $ 209.4 Organic enrollment (1) 27.9 Product mix, pricing and timing (1) (16.9) Organic constant currency 11.0 22.0 (11.0) Foreign exchange 19.9 11.8 8.1 September 30, 2025 $ 558.9 $ 352.4 $ 206.5 (1) Organic enrollment and product mix, pricing and timing are not separable for the calculation of direct costs and therefore are combined and defined as Organic constant currency for the calculation of Adjusted EBITDA. Revenues increased by $30.9 million, a 6% increase from the 2024 fiscal period. • On an organic constant currency basis, revenues increased by 2% and were unfavorably affected by approximately $25 million of intra-year academic calendar timing attributable to later semester start dates in the 2025 fiscal period as compared to the 2024 fiscal period. • Revenues from our Peru segment represented 48% of our consolidated total revenues for the 2025 fiscal period compared to 46% for the 2024 fiscal period. Adjusted EBITDA decreased by $2.9 million, a 1% decrease from the 2024 fiscal period. • On an organic constant currency basis, Adjusted EBITDA decreased by 5% compared to the 2024 fiscal period and was unfavorably affected by intra-year academic calendar timing. Corporate Corporate revenues primarily represent miscellaneous other revenues, net of the elimination of intersegment revenues. Comparison of Corporate Results for the Three Months Ended September 30, 2025 to the Three Months Ended September 30, 2024 % Change Better/(Worse) (in millions) 2025 2024 2025 vs. 2024 Revenues $ — $ — nm Expenses 8.9 8.3 (7) % Adjusted EBITDA $ (8.9) $ (8.3) (7) % nm - percentage changes not meaningful Comparison of Corporate Results for the Nine Months Ended September 30, 2025 to the Nine Months Ended September 30, 2024 % Change Better/(Worse) (in millions) 2025 2024 2025 vs. 2024 Revenues $ 0.1 $ 0.1 — % Expenses 28.0 28.7 2 % Adjusted EBITDA $ (27.9) $ (28.6) 2 % 33 Liquidity and Capital Resources Liquidity Sources We anticipate that cash flow from operations and available cash will be sufficient to meet our current operating requirements and manage our liquidity needs for at least the next 12 months from the date of issuance of this report. Our primary source of cash is revenue from tuition charged to students in connection with our various education program offerings. Essentially all of our revenues are generated from private pay sources as there are no material government-sponsored loan programs in Mexico or Peru. We anticipate generating sufficient cash flow from operations in both countries in which we operate to satisfy the working capital and financing needs of our organic growth plans for each country. If our educational institutions within one country were unable to maintain sufficient liquidity, we would consider using internal cash resources or reasonable short-term working capital facilities to accommodate any short- to medium-term shortfalls. As of September 30, 2025, our secondary source of liquidity was cash and cash equivalents of $241.0 million. Our cash accounts are maintained with high-quality financial institutions. The Company also maintains a revolving credit facility under its credit agreement (the Amended Credit Agreement) that provides for borrowings of up to $155.0 million of revolving credit loans maturing September 2028 (the Revolving Credit Facility). The credit available to be borrowed under the Amended Credit Agreement, whether as revolving loans or term loans, if any, are referred to herein collectively as the “Senior Secured Credit Facility.” In accordance with the terms of the Amended Credit Agreement, any proceeds drawn on the Revolving Credit Facility may be used for general corporate purposes. As of September 30, 2025, the Company had no outstanding balance borrowed under the Revolving Credit Facility. If certain conditions are satisfied, the Amended Credit Agreement also provides for an incremental revolving and term loan facilities, at the request of the Company and subject to lender approval, not to exceed (i) the greater of (a) $172.5 million and (b) 50% of the Company’s Consolidated EBITDA, plus (ii) additional amounts so long as both immediately before and after giving effect to such incremental facilities the Company’s Consolidated Senior Secured Debt to Consolidated EBITDA ratio, as defined in the Amended Credit Agreement, on a pro forma basis, does not exceed 2.25x, plus (iii) the aggregate amounts of any voluntary repayments of term loans, if any, and aggregate amount of voluntary repayments of revolving credit facilities that are accompanied by a corresponding termination or reduction of revolving credit commitments. Liquidity Restrictions Our liquidity is affected by restricted cash balances, which totaled $5.5 million as of September 30, 2025 and $6.5 million as of December 31, 2024. Restricted cash mainly consists of cash equivalents held as assets for a supplemental employment retention agreement for a former executive. Indefinite Reinvestment of Historical Foreign Earnings We earn a significant portion of our income from subsidiaries located in countries outside the United States. As of September 30, 2025, $161.2 million of our total $241.0 million of cash and cash equivalents were held by foreign subsidiaries. As of December 31, 2024, $80.1 million of our total $91.4 million of cash and cash equivalents were held by foreign subsidiaries. As part of our business strategies, we have determined that the undistributed historical earnings of our foreign operations for which we have not already recorded taxes will be deemed indefinitely reinvested outside of the United States. Liquidity Requirements Our liquidity requirements include: funding for debt service (including finance leases); operating lease obligations; payments of deferred compensation; working capital; operating expenses; capital expenditures; stock repurchases; business development activities; and payments of other third-party obligations. Debt As of September 30, 2025, our debt obligations consisted of lines of credit and short-term borrowing arrangements of subsidiaries and notes payable, which totaled $41.5 million. In addition, our finance lease obligations and sale-leaseback financings were $60.9 million. 34 Covenants The Amended Credit Agreement provides, solely with respect to the revolving credit facility, that the Company shall not permit its Consolidated Senior Secured Debt to Consolidated EBITDA ratio, as defined in the Amended Credit Agreement, to exceed 3 as of the last day of each quarter commencing with the quarter ending December 31, 2019 and thereafter. The Amended Credit Agreement also provides that if less than 25% of the revolving credit facility is utilized as of that date, then such financial covenant shall not apply. As of September 30, 2025, this condition was satisfied and, therefore, we were not subject to the leverage ratio. In addition, indebtedness at some of our locations contain financial maintenance covenants. We were in compliance with those covenants as of September 30, 2025. Leases We conduct a significant portion of our operations from leased facilities, including many of our higher education facilities and other office locations. As of September 30, 2025 and December 31, 2024, the present value of operating lease liabilities was $337.4 million and $327.1 million, respectively. Capital Expenditures Capital expenditures primarily consist of purchases of property and equipment. Our capital expenditure program is a component of our liquidity and capital management strategy. This program includes discretionary spending, which we can adjust in response to economic and other changes in our business environment, to grow our business through the following: (1) capacity expansion at institutions to support enrollment growth; (2) new programs and campuses for institutions in our existing markets; and (3) information technology to increase efficiency and controls. Our non-discretionary spending includes the maintenance of existing facilities. We typically fund our capital expenditures through cash flow from operations and external financing. In the event that we are unable to obtain the necessary funding for capital expenditures, our long-term growth strategy could be significantly affected. We believe that our internal sources of cash and our ability to obtain additional third-party financing, subject to market conditions, will be sufficient to fund our investing activities. Our total capital expenditures, excluding receipts from the sale of subsidiaries and property and equipment, were $36.1 million and $34.6 million during the nine months ended September 30, 2025 and 2024, respectively. The increase in capital expenditures was driven by equipment purchases and campus improvements in Mexico during the 2025 fiscal period, partially offset by the year-over-year effect of the purchase of a parcel of land for a new campus in Peru during the 2024 fiscal period. Share Repurchase Programs On September 13, 2024, the Company announced that its Board of Directors had approved a stock repurchase program to acquire up to $100 million of the Company’s common stock. The Company’s repurchases may be made from time to time on the open market at prevailing market prices, in privately negotiated transactions, in block trades and/or through other legally permissible means, depending on market conditions and in accordance with applicable rules and regulations promulgated under the Exchange Act. Repurchases may also be effected pursuant to a trading plan adopted in accordance with Rule 10b5-1 of the Exchange Act. The Company’s Board of Directors will review the share repurchase program periodically and may authorize adjustment of its terms and size or suspend or discontinue the program. As of September 30, 2025, the approximate dollar value of shares yet to be repurchased under this stock repurchase program was $27.4 million. On October 30, 2025, the Company announced that its Board of Directors had approved a $150.0 million increase to the existing authorization for the Company’s stock repurchase program, increasing the dollar value of shares yet to be repurchased under this stock repurchase program, which has no expiration date, to approximately $177.4 million. The Company intends to fin ance the repurchases with free cash flow, excess cash and liquidity and liquidity on-hand, including available capacity under its Revolving Credit Facility, or a combination thereof. Cash Flows In the consolidated statements of cash flows, the changes in operating assets and liabilities are presented excluding the effects of exchange rate changes and reclassifications, as these effects do not represent operating cash flows. Accordingly, the amounts in the consolidated statements of cash flows do not agree with the changes of the operating assets and liabilities as presented in the consolidated balance sheets. The effects of exchange rate changes on cash are presented separately in the consolidated statements of cash flows. 35 The following table summarizes our cash flows from operating, investing, and financing activities for the nine months ended September 30, 2025 and 2024: (in millions) 2025 2024 Cash provided by (used in): Operating activities $ 272.8 $ 192.0 Investing activities (35.7) (30.5) Financing activities (96.9) (111.7) Effects of exchange rates changes on cash 8.1 (6.2) Change in cash included in current assets held for sale 0.3 0.2 Net change in cash and cash equivalents and restricted cash $ 148.6 $ 43.8 Comparison of Cash Flows for the Nine Months Ended September 30, 2025 to the Nine Months Ended September 30, 2024 Operating Activities Cash provided by operating activities increased by $80.8 million to $272.8 million for the 2025 fiscal period from $192.0 million for the 2024 fiscal period. This increase in operating cash flows was attributable to: (1) the net effect of changes in operating assets and liabilities as well as higher operating income, which increased operating cash by $45.7 million compared to the 2024 fiscal period; (2) lower cash paid for taxes of $29.0 million, from $130.6 million for the 2024 fiscal period to $101.6 million for the 2025 fiscal period, primarily related to taxes paid during the 2024 fiscal period as a result of the distribution of certain intercompany loans; and (3) lower cash paid for interest of $6.1 million, from $13.1 million for the 2024 fiscal period to $7.0 million for the 2025 fiscal period, mostly due to lower average debt balances. Investing Activities Cash used in investing activities increased by $5.2 million to $(35.7) million for the 2025 fiscal period from $(30.5) million for the 2024 fiscal period. This increase in investing cash outflows was primarily attributable to lower year-over-year cash proceeds from the sale of property and equipment of $3.0 million, mainly related to the sale of a parcel of land in the United States during the 2024 fiscal period. Additionally, capital expenditures were higher by $1.5 million during the 2025 fiscal period compared to the 2024 fiscal period. Other items accounted for the remaining difference of $0.7 million. Financing Activities Cash used in financing activities decreased by $14.8 million to $(96.9) million for the 2025 fiscal period from $(111.7) million for the 2024 fiscal period. This decrease in financing cash outflows was primarily attributable to a $28.4 million decrease in common stock repurchases during the 2025 fiscal period compared to the 2024 fiscal period. This change was partially offset by $14.2 million of higher net payments on long-term debt during the 2025 fiscal period compared to the 2024 fiscal period. Other items accounted for the remaining difference of $0.6 million. Critical Accounting Policies and Estimates The preparation of the consolidated financial statements in conformity with GAAP requires our management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and the related disclosure of contingent assets and liabilities. Actual results could differ from these estimates. Our significant accounting policies are discussed in Note 2, Significant Accounting Policies, of the audited consolidated financial statements included in our 2024 Form 10-K. Our critical accounting policies require the most significant judgments and estimates about the effect of matters that are inherently uncertain. As a result, these accounting policies and estimates could materially affect our financial statements and are critical to the understanding of our results of operations and financial condition. For a complete discussion of our critical accounting policies, see the “Critical Accounting Policies and Estimates” section of the MD&A in our 2024 Form 10-K. During the nine months ended September 30, 2025, there were no significant changes to our critical accounting policies. Recently Adopted Accounting Standards None. 36 Item 3. Quantitative and Qualitative Disclosures About Market Risk For information regarding our exposure to certain market risks, see Item 7A, Quantitative and Qualitative Disclosures About Market Risk, in our 2024 Form 10-K. There have been no significant changes in our market risk exposures since our December 31, 2024 fiscal year end.