What changed in this filing

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Item 2. Management’s Discussion and Analysis

2026-07-30 compared with 2026-04-30 · 111 added, 54 removed, 124 unchanged (57% of the section changed)

47 unchanged sentences

In addition, we have provided certain services to a university partner to assist them in expanding their online graduate programs.

As of March 31, 2026, GCE provides education services to 20 university partners across the United States.

As of June 30, 2026, GCE provides education services to 20 university partners across the United States.

We plan to continue to add additional university partners and to introduce additional programs with both our existing partners and with new partners.

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Our critical accounting policies are disclosed in the 2025 Form 10-K for the fiscal year ended December 31, 2025.

During the three months ended March 31, 2026, there were no significant changes in our critical accounting policies.

During the six months ended June 30, 2026, there were no significant changes in our critical accounting policies.

Results of Operations

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Three Months Ended

Six Months Ended

Costs and expenses

3 unchanged sentences

General and administrative

Three Months Ended March 31, 2026 Compared to Three Months Ended March 31, 2025

Three Months Ended June 30, 2026 Compared to Three Months Ended June 30, 2025

Service revenue .

Our service revenue for the three months ended March 31, 2026 was $308.8 million, an increase of $19.5 million, or 6.7%, as compared to service revenue of $289.3 million for the three months ended March 31, 2025.

The increase year over year in service revenue was primarily due to an increase in university partner enrollments of 7.1% to 136,884 at March 31, 2026 as compared to 127,779 at March 31, 2025.

GCU enrollments increased to 132,354 at March 31, 2026, an increase of 6.9% over enrollments at March 31, 2025.

University partner enrollments at our off-campus classroom and laboratory sites were 5,961, an increase of 18.6% over enrollments at March 31, 2025, which includes 1,431 and 1,021 GCU students at March 31, 2026 and 2025, respectively.

Our service revenue for the three months ended June 30, 2026 was $264.0 million, an increase of $16.5 million, or 6.7%, as compared to service revenue of $247.5 million for the three months ended June 30, 2025.

The increase year over year in service revenue was primarily due to an increase in university partner enrollments of 7.6% to 126,231 at June 30, 2026 as compared to 117,283 at June 30, 2025.

GCU enrollments increased to 121,921 at June 30, 2026, an increase of 7.5% over enrollments at June 30, 2025.

University partner enrollments at our off-campus classroom and laboratory sites were 5,829, an increase of 16.8% over enrollments at June 30, 2025, which includes 1,519 and 1,142 GCU students at June 30, 2026 and 2025, respectively.

Excluding sites that have been closed or are in teach out, total enrollments at our off-campus classroom and laboratory sites increased 18.5% between years.

Revenue per student decreased slightly between years primarily due to contract modifications with some of our university partners in which our revenue share percentage was reduced in exchange for us no longer reimbursing these partners for certain faculty costs which had the effect of reducing revenue per student and a slight decline year over year in revenue per student for online students due to the continued mix shift to students that have a slightly lower net tuition rate and a slight decline year over year in ground students which generate a higher revenue per student than online students.

These decreases were partially offset by an additional day of revenue for the ground campus due to the start date shifting one day of revenue from the second quarter to the first quarter in 2026 which had a $1.0 million impact and the service revenue per student for accelerated Bachelor of Science in Nursing (“ABSN”) students at off-campus classroom and laboratory sites generating a significantly higher revenue per student than we earn under our agreement with GCU, as these agreements generally provide us with a higher revenue share percentage, the partners have higher tuition rates than GCU and the majority of our partners’ students take more credits on average per semester.

We opened five new sites in the year ended December 31, 2025 closed two sites in which we stopped recruiting new students in 2024 and merged two sites that were located in the same market bringing the total number of these sites to 47 at December 31, 2025, which has also positively impacted the enrollment growth.

We plan to open one to two additional sites in the second half of 2026 while mutually agreeing with one partner to stop the recruiting of new students and begin teach outs at its three sites during the first quarter of 2026.

Enrollments for GCU ground students were 21,948 at March 31, 2026, down slightly from 22,330 at March 31, 2025.

The number of ground students has historically declined between the Fall and Spring semesters due to graduations significantly exceeding Spring new enrollments.

GCU online enrollments were 110,406 at March 31, 2026, up from 101,443 at March 31, 2025, an increase of 8.8% between years.

Revenue per student decreased slightly between years primarily due to contract modifications with one of our university partners in which our revenue share percentage was reduced in exchange for us no longer reimbursing this partner for certain faculty costs which had the effect of reducing revenue per student and a slight decline year over year in revenue per student for online students due to the continued mix shift to students that have a slightly lower net tuition rate and a slight decline year over year in Spring semester ground traditional students which generate a higher revenue per student than online students.

In addition there was one less day of revenue for the ground campus due to the start date shifting one day of revenue from the second quarter to the first quarter in 2026 which had a $1.0 million impact.

These decreases were partially offset by the service revenue per student for accelerated Bachelor of Science in Nursing (“ABSN”) students at off-campus classroom and laboratory sites generating a significantly higher revenue per student than we earn under our agreement with GCU, as these agreements generally provide us with a higher revenue share percentage, the partners have higher tuition rates than GCU and the majority of our partners’ students take more credits on average per semester.

We opened one new site in the six months ended June 30, 2026 and closed one site in which we stopped recruiting new students in 2025, thus the total number of sites remains at 47 at June 30, 2026.

We plan to open one additional site in the Fall of 2026.

Enrollments for GCU ground students were 8,910 at June 30, 2026, up 3.9% from 8,579 at June 30, 2025.

GCU ground enrollment declines between March 31 and June 30 of each year as ground traditional enrollment at GCU at June 30 of each year only includes traditional-aged students taking summer school classes, which is a small percentage of GCU’s traditional-aged student body.

The Spring semester for GCU’s traditional-aged student body ends near the end of April each year.

GCU online enrollments were 113,011 at June 30, 2026, up from 104,856 at June 30, 2025, an increase of 7.8% between years.

Technology and academic services .

Our technology and academic services expenses for the three months ended March 31, 2026 were $45.0 million, an increase of $3.3 million, or 8.1%, as compared to technology and academic

services expenses of $41.7 million for the three months ended March 31, 2025.

Our technology and academic services expenses for the three months ended June 30, 2026 were $45.6 million, an increase of $2.5 million, or 5.8%, as compared to technology and academic services expenses of $43.1 million for the three months ended June 30, 2025.

This increase was primarily due to increases in employee compensation and related expenses, including share-based compensation and benefit costs, in

other technology and academic costs, and in occupancy and depreciation costs of $0.9 million, $0.8 million and $0.8 million, respectively.

The increase in employee compensation and related expenses is primarily due to increased headcount to support our 20 university partners and their increased enrollment growth, tenure-based salary adjustments and a significant year-over-year increase in benefit costs.

The increases in other technology and academic costs and occupancy and depreciation were primarily due to the costs associated with the increased enrollment growth at our off-campus classroom and laboratory sites to support our 20 university partners as well as an increase in technology costs and curriculum cost reimbursements to our university partners.

Our technology and academic services expenses as a percentage of revenue decreased by 0.1% to 17.3% for the three months ended June 30, 2026, from 17.4% for the three months ended June 30, 2025.

This decrease was primarily due to our ability to leverage our technology and academic service expenses across an increasing revenue base offset by the increased technology costs and curriculum cost reimbursements.

We anticipate that technology and academic services expenses will increase in the future as we open more off-site classroom and laboratory sites and technology costs continue to grow, partially offset by a decrease in curriculum cost reimbursements due to the Amended Master Services Agreement, and these costs as a percentage of revenue could increase in the future.

Counseling services and support .

Our counseling services and support expenses for the three months ended June 30, 2026 were $88.1 million, an increase of $5.1 million, or 6.1%, as compared to counseling services and support expenses of $83.0 million for the three months ended June 30, 2025.

This increase was primarily attributable to increases in employee compensation and related expenses including share-based compensation and benefits and in occupancy and depreciation costs of $4.7 million and $0.6 million, respectively, partially offset by a decrease in other counseling services and support expenses of $0.2 million.

The increases in employee compensation including share-based compensation and benefits were primarily due to increased headcount to support our university partners, and their planned increases in enrollment, tenure-based salary adjustments and a significant year over year increase in benefit costs.

The increase in occupancy and depreciation is primarily related to the increased headcount and continued enhancements to technology infrastructure and internal-use software development for employees that service students.

The decrease in other counseling services and support expenses is primarily the result of lower travel costs to service our 20 university partners.

Our counseling services and support expenses as a percentage of revenue decreased 0.1% to 33.4% for the three months ended June 30, 2026, from 33.5% for the three months ended June 30, 2025 primarily due to our ability to leverage our counseling services and support expenses across an increasing revenue base offset by the increased costs described above.

We anticipate that counseling services and support expense will increase in the future as we continue to invest to meet our partners’ needs and these costs as a percentage of revenue could increase in the future.

Marketing and communication .

Our marketing and communication expenses for the three months ended June 30, 2026 were $60.0 million, an increase of $4.0 million, or 7.0%, as compared to marketing and communication expenses of $56.0 million for the three months ended June 30, 2025.

This increase was primarily attributable to the increased spend to market our university partners’ programs and due to the marketing of new locations which resulted in increased advertising of $3.6 million, increased employee compensation, including share-based compensation and benefits of $0.2 million, increased occupancy and depreciation expense of $0.1 million and increased other communication expenses of $0.1 million.

Our marketing and communication expenses as a percentage of revenue increased by 0.1% to 22.7% for the three months ended June 30, 2026, from 22.6% for the three months ended June 30, 2025.

We anticipate that marketing and communication expenses will increase in the future as we continue to invest to meet our partners’ needs and these costs as a percentage of revenue could increase in the future.

General and administrative .

Our general and administrative expenses for the three months ended June 30, 2026 were $10.1 million, a decrease of $1.3 million, or 11.4%, as compared to general and administrative expenses of $11.4 million for the three months ended June 30, 2025.

This decrease was primarily attributable to a decrease in professional fees, in other administrative expenses and in occupancy and depreciation expenses of $0.9 million, $0.4 million and $0.2 million, respectively.

These decreases were partially offset by increases in employee compensation, including share-based compensation and benefit costs of $0.2 million.

The decrease in professional fees was primarily due to lower legal costs between years.

Our general and administrative expenses as a percentage of revenue decreased by 0.8% to 3.8% for the three months ended June 30, 2026, from 4.6% for the three months ended June 30, 2025, primarily due to the decreased legal fees and our ability to leverage our general and administrative expenses across an increasing revenue base.

General and administrative expenses could increase in the future and these costs as a percentage of revenue could increase in the future.

Amortization of intangible assets .

Amortization of intangible assets for the three months ended June 30, 2026 and 2025 were $2.1 million for both periods.

As a result of the Orbis Education acquisition in 2019, certain identifiable intangible assets were created (primarily customer relationships) that will be amortized over their expected lives.

Investment interest and other .

Investment interest and other for the three months ended June 30, 2026 was $2.7 million, a decrease of $0.5 million, as compared to $3.2 million for the three months ended June 30, 2025 due to slightly lower returns and lower investment balances.

Income tax expense .

Income tax expense for the three months ended June 30, 2026 was $15.0 million, an increase of $1.5 million, or 11.4%, as compared to income tax expense of $13.5 million for the three months ended June 30, 2025.

The increase in income tax expense is due to the increase in income before taxes and a higher effective tax rate.

Our effective tax rate was 24.7% during the three months ended June 30, 2026 compared to 24.5% during the three months ended June 30, 2025.

The effective tax rate increased year over year due to changes in state income taxes.

Our net income for the three months ended June 30, 2026 was $45.9 million, an increase of $4.4 million, or 10.4% as compared to $41.5 million for the three months ended June 30, 2025, due to the factors discussed above.

Six Months Ended June 30, 2026 Compared to Six Months Ended June 30, 2025

Service revenue .

Our service revenue for the six months ended June 30, 2026 was $572.8 million, an increase of $36.0 million, or 6.7%, as compared to service revenue of $536.8 million for the six months ended June 30, 2025.

The increase year over year in service revenue was primarily due to an increase in university partner enrollments of 7.6% to 126,231 at June 30, 2026 as compared to 117,283 at June 30, 2025.

GCU enrollments increased to 121,921 at June 30, 2026, an increase of 7.5% over enrollments at June 30, 2025.

Excluding sites that have been closed or are in teach out, total enrollments at our off-campus classroom and laboratory sites increased 18.5% between years.

These decreases were partially offset by the service revenue per student for ABSN students at off-campus classroom and laboratory sites generating a significantly higher revenue per student than we earn under our agreement with GCU, as these agreements generally provide us with a higher revenue share percentage, the partners have higher tuition rates than GCU and the majority of our partners’ students take more credits on average per semester.

We opened one new site in the six months ended June 30, 2026 and closed one site in which we stopped recruiting new students in 2025, thus the total number of sites remains at 47 at June 30, 2026.

We plan to open one additional site in the Fall of 2026.

Enrollments for GCU ground students were 8,910 at June 30, 2026, up 3.9% from 8,579 at June 30, 2025.

The Spring semester for GCU’s traditional-aged student body ends near the end of April each year.

GCU online enrollments were 113,011 at June 30, 2026, up from 104,856 at June 30, 2025, an increase of 7.8% between years.

Technology and academic services .

Our technology and academic services expenses for the six months ended June 30, 2026 were $90.7 million, an increase of $5.9 million, or 6.9%, as compared to technology and academic services expenses of $84.8 million for the six months ended June 30, 2025.

This increase was primarily due to increases in other technology and academic costs, in employee compensation and related expenses, including share-based compensation and benefit costs and in occupancy and depreciation costs of $2.4 million, $2.2 million and $1.3 million, respectively.

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Our technology and academic services expenses as a percentage of revenue increased by 0.2% to 14.6% for the three months ended March 31, 2026, from 14.4% for the three months ended March 31, 2025.

This increase was primarily due to the increased technology costs and curriculum cost reimbursements, partially offset by our ability to leverage our technology and academic service expenses across an increasing revenue base.

We anticipate that technology and academic services expenses will increase in the future as we open more off-site classroom and laboratory sites and the growing technology costs and curriculum cost reimbursements and these costs as a percentage of revenue could increase in the future.

Our technology and academic services expenses as

a percentage of revenue stayed flat at 15.8% for the six months ended June 30, 2026 and 2025.

The increases in technology costs and curriculum cost reimbursements were offset by our ability to leverage our technology and academic service expenses across an increasing revenue base.

Counseling services and support .

Our counseling services and support expenses for the three months ended March 31, 2026 were $91.9 million, an increase of $5.1 million, or 5.8%, as compared to counseling services and support expenses of $86.8 million for the three months ended March 31, 2025.

Our counseling services and support expenses for the six months ended June 30, 2026 were $179.9 million, an increase of $10.1 million, or 5.9%, as compared to counseling services and support expenses of $169.8 million for the six months ended June 30, 2025.

This increase was primarily attributable to increases in employee compensation and related expenses including share-based compensation and benefits and in occupancy and depreciation costs of $9.4 million and $1.2 million, respectively, partially offset by a decrease in other counseling services and support expenses of $0.5 million.

The increase in occupancy and depreciation is primarily related to higher depreciation expense associated with our continued enhancements to technology infrastructure and internal-use software development.

The decrease in other counseling services and support expenses is primarily the result of lower travel costs to service our 20 university partners.

Our counseling services and support expenses as a percentage of revenue decreased 0.2% to 29.8% for the three months ended March 31, 2026, from 30.0% for the three months ended March 31, 2025 primarily due to our ability to leverage our counseling services and support expenses across an increasing revenue base.

Our counseling services and support expenses as a percentage of revenue decreased 0.2% to 31.4% for the six months ended June 30, 2026, from 31.6% for the six months ended June 30, 2025 primarily due to our ability to leverage our counseling services and support expenses across an increasing revenue base partially offset by the increased costs discussed above.

Marketing and communication .

Our marketing and communication expenses for the three months ended March 31, 2026 were $64.0 million, an increase of $3.7 million, or 6.1%, as compared to marketing and communication expenses of $60.3 million for the three months ended March 31, 2025.

This increase was primarily attributable to the increased cost to market our university partners’ programs and to the marketing of new locations which resulted in increased advertising of $3.1 million, increased employee compensation, including share-based compensation and benefits of $0.4 million, increased occupancy and depreciation expense of $0.1 million and increased other communication expenses of $0.1 million.

Our marketing and communication expenses as a percentage of revenue decreased by 0.2% to 20.7% for the three months ended March 31, 2026, from 20.9% for the three months ended March 31 2025, primarily due to our ability to leverage our marketing and communication expenses across an increasing revenue base.

Our marketing and communication expenses for the six months ended June 30, 2026 were $124.0 million, an increase of $7.6 million, or 6.5%, as compared to marketing and communication expenses of $116.4 million for the six months ended June 30, 2025.

This increase was primarily attributable to the increased spend to market our university partners’ programs and the marketing of new locations which resulted in increased advertising of $6.7 million, increased employee compensation, including share-based compensation and benefits of $0.6 million, increased other communication expenses of $0.2 million and increased occupancy and depreciation expense of $0.1 million.

Our marketing and communication expenses as a percentage of revenue decreased by 0.1% to 21.6% for the six months ended June 30, 2026, from 21.7% for the six months ended June 30, 2025.

General and administrative .

Our general and administrative expenses for the three months ended March 31, 2026 were $10.3 million, a decrease of $0.1 million, as compared to general and administrative expenses of $10.4 million for the three months ended March 31, 2025.

This decrease was primarily attributable to a decrease in professional fees and in occupancy and depreciation expenses of $0.3 million and $0.1 million, respectively.

These decreases were partially offset by increases in employee compensation, including share-based compensation and benefit costs and in other administrative expenses of $0.2 million and $0.1 million, respectively.

Our general and administrative expenses for the six months ended June 30, 2026 were $20.4 million, a decrease of $1.4 million, or 6.2%, as compared to general and administrative expenses of $21.8 million for the six months ended June 30, 2025.

This decrease was primarily attributable to a decrease in professional fees, in occupancy and depreciation expenses and in other administrative expenses of $1.3 million, $0.3 million and $0.2 million, respectively.

These decreases were partially offset by increases in employee compensation, including share-based compensation and benefit costs of $0.4 million.

The decrease in professional fees was primarily due to lower legal costs between years.

Our general and administrative expenses as a percentage of revenue decreased by 0.3% to 3.3% for the three months ended March 31, 2026, from 3.6% for the three months ended March 31, 2025, primarily due to our ability to leverage our general and administrative expenses across an increasing revenue base.

We anticipate that general and administrative expenses will increase in the future and these costs as a percentage of revenue could increase in the future.

Our general and administrative expenses as a percentage of revenue decreased by 0.5% to 3.6% for the six months ended June 30, 2026, from 4.1% for the six months ended June 30, 2025, primarily due lower legal expenses and due to our ability to leverage our general and administrative expenses across an increasing revenue base.

General and administrative expenses could increase in the future and these costs as a percentage of revenue could increase in the future.

Amortization of intangible assets .

Amortization of intangible assets for the three months ended March 31, 2026 and 2025 were $2.1 million for both periods.

Amortization of intangible assets for the six months ended June 30, 2026 and 2025 were $4.2 million for both periods.

As a result of the Orbis Education acquisition in 2019, certain identifiable intangible assets were created (primarily customer relationships) that will be amortized over their expected lives.

Investment interest and other .

Investment interest and other for the three months ended March 31, 2026 was $3.0 million, a decrease of $0.4 million, as compared to $3.4 million for the three months ended March 31, 2025 due to slightly lower returns and lower investment balances.

Investment interest and other for the six months ended June 30, 2026 was $5.7 million, a decrease of $0.9 million, as compared to $6.6 million for the six months ended June 30, 2025 due to slightly lower returns and lower investment balances.

Income tax expense .

Income tax expense for the three months ended March 31, 2026 was $23.1 million, an increase of $3.3 million, or 16.9%, as compared to income tax expense of $19.8 million for the three months ended March 31, 2025.

Income tax expense for the six months ended June 30, 2026 was $38.1 million, an increase of $4.8 million, or 14.7%, as compared to income tax expense of $33.3 million for the six months ended June 30, 2025.

The increase in income tax expense is due to the increase in income before taxes and a higher effective tax rate.

Our effective tax rate was 23.5% during the three months ended March 31, 2026 compared to 21.6% during the three months ended March 31, 2025.

The effective tax rate increased year over year due to changes in state income taxes and a decrease in excess tax benefits of $1.4 million as compared to $2.7 million in the three months ended March 31, 2026 and 2025, respectively.

Our effective tax rate was 23.9% during the six months ended June 30, 2026 compared to 22.7% during the six months ended June 30, 2025.

The effective tax rate increased year over year due to changes in state income taxes and a decrease in excess tax benefits to $1.4 million in the six months ended June 30, 2026 due to the decline in our stock price as compared to $2.7 million in the six months ended June 30, 2025.

The inclusion of excess tax benefits and deficiencies as a component of our income tax expense increases the volatility within our provision for income taxes as the amount of excess tax benefits or deficiencies from share-based compensation awards are dependent on our stock price at the date the restricted stock awards vest.

Our restricted stock awards vest in March each year so any benefit or expense will primarily impact the first quarter each year.

Our net income for the three months ended March 31, 2026 was $75.3 million, an increase of $3.7 million, or 5.2% as compared to $71.6 million for the three months ended March 31, 2025, due to the factors discussed above.

Our net income for the six months ended June 30, 2026 was $121.2 million, an increase of $8.0 million, or 7.1% as compared to $113.2 million for the six months ended June 30, 2025, due to the factors discussed above.

Our net revenue and operating results normally fluctuate as a result of seasonal variations in our business, principally due to changes in our university partners’ enrollment.

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Liquidity and Capital Resources

As of March 31,

As of June 30,

As of December 31,

1 unchanged sentence

Cash, cash equivalents and investments

Our liquidity position, as measured by cash and cash equivalents and investments decreased by $48.4 million between December 31, 2025 and March 31, 2026, which was largely attributable to cash expended for share repurchases and capital expenditures exceeding our cash provided by operations during the three months ended March 31, 2026.

Our liquidity position, as measured by cash and cash equivalents and investments decreased by $25.6 million between December 31, 2025 and June 30, 2026, which was largely attributable to cash expended for share repurchases and capital expenditures exceeding our cash provided by operations during the six months ended June 30, 2026.

Based on our current level of operations and anticipated growth, we believe that our cash flow from operations and other sources of liquidity, including cash and cash equivalents and investments, will provide adequate funds for ongoing operations, planned capital expenditures, and working capital requirements for at least the next 12 months.

Cash Flows from Operating Activities

Three Months Ended March 31,

Six Months Ended June 30,

(In thousands)

Net cash provided by operating activities

The increase in cash generated from operating activities between the three months ended March 31, 2025 and the three months ended March 31, 2026 was primarily due to increased income and changes in working capital balances.

Accounts payable increased by $4.0 million between December 31, 2025 and March 31, 2026 compared to the decrease of $2.0 million between December 31, 2024 and March 31, 2025, an increase year over year in cash provided by operating activities of $6.0 million due to timing of vendor payments.

Income tax receivable/payable amounts increased by $19.6 million between December 31, 2025 and March 31, 2026 compared to the increase of $16.0 million between December 31, 2024 and March 31, 2025, a $3.6 million increase year over year in cash provided by operating activities due to the increased taxable income.

Accounts receivable increased $29.0 million between December 31, 2025 and March 31, 2026 compared to the increase of $32.7 million between December 31, 2024 and March 31, 2025, a $3.7 million increase year over year in cash provided by operating activities due to the timing of collections.

Other assets increased $1.8 million between December 31, 2025 and March 31, 2026 compared to the increase of $4.4 million between December 31, 2024 and March 31, 2025, a $2.6 million increase year over year in cash provided by operating activities due to timing of payments.

The increase in cash generated from operating activities between the six months ended June 30, 2025 and the six months ended June 30, 2026 was primarily due to increased income and depreciation expense partially offset by net changes in working capital balances.

Income tax receivable/payable amounts increased by $8.7 million between December 31, 2025 and June 30, 2026 compared to the increase of $14.6 million between December 31, 2024 and June 30, 2025, a $5.9 million increase year over year in cash provided by operating activities due to the increased taxable

Accounts receivable increased $50.0 million between December 31, 2025 and June 30, 2026 compared to the increase of $55.2 million between December 31, 2024 and June 30, 2025, a $5.2 million decrease year over year in cash provided by operating activities due to the timing of collections.

Accounts payable decreased by $7.8 million between December 31, 2025 and June 30, 2026 compared to the decrease of $2.6 million between December 31, 2024 and June 30, 2025, a decrease year over year in cash provided by operating activities of $5.2 million due to timing of vendor payments.

We define working capital as the assets and liabilities, other than cash, generated through the Company’s primary operating activities.

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Cash Flows from Investing Activities

Three Months Ended March 31,

Six Months Ended June 30,

(In thousands)

Net cash provided by (used in) investing activities

Investing activities provided $24.1 million of cash in the three months ended March 31, 2026 compared to consuming $169.9 million of cash in the three months ended March 31, 2025.

Investing activities provided $65.6 million of cash in the six months ended June 30, 2026 compared to consuming $198.7 million of cash in the six months ended June 30, 2025.

Cash used in investing activities includes investment activity and the change between years in net investing activities is primarily due to investment activity.

In the three months ended March 31, 2026, the proceeds from the sale of investments, net of purchases of available-for-sale securities were $32.1 million.

In the three months ended March 31, 2025, the purchase of available-for-sale securities, net of proceeds from the sale of investments were $159.9 million.

In the first three months of 2026 and 2025 cash used in investing activities also included capital expenditures totaling $8.1 million and $8.9 million, respectively.

In the six months ended June 30, 2026, the proceeds from the sale of investments, net of purchases of available-for-sale securities were $84.4 million.

In the six months ended June 30, 2025, the purchase of available-for-sale securities, net of proceeds from the sale of investments were $180.7 million.

In the first six months of 2026 and 2025 cash used in investing activities also included capital expenditures totaling $18.9 million and $17.6 million, respectively.

Capital expenditures for both periods primarily consisted of leasehold improvements and equipment for new off-campus classroom and laboratory sites, as well as purchases of computer equipment, internal use software projects and furniture and equipment to support our increasing employee headcount.

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Cash Flows from Financing Activities

Three Months Ended March 31,

Six Months Ended June 30,

(In thousands)

Net cash used in financing activities

Financing activities consumed $127.9 million of cash in the three months ended March 31, 2026 compared to $77.9 million in the three months ended March 31, 2025.

During the three months ended March 31, 2026 and 2025, $120.4 million and $68.4 million, respectively was used to purchase treasury stock in accordance with GCE’s share repurchase program.

Financing activities consumed $203.2 million of cash in the six months ended June 30, 2026 compared to $125.2 million in the six months ended June 30, 2025.

During the six months ended June 30, 2026 and 2025, $195.7 million and $115.7 million, respectively was used to purchase treasury stock in accordance with GCE’s share repurchase program.

In 2026 and 2025, $7.5 million and $9.5 million, respectively, of cash was utilized to purchase common shares withheld in lieu of income taxes resulting from the vesting of restricted share awards.

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The amount and timing of future share repurchases, if any, will be made as market and business conditions warrant.

We repurchased 724,408 shares of common stock in the three months ended March 31, 2026.

At March 31, 2026, there remains $224.0 million available under our share repurchase authorization .

We repurchased 1,195,897 shares of common stock in the six months ended June 30, 2026.

At June 30, 2026, there remains $148.7 million available under our share repurchase authorization .

Off-Balance Sheet Arrangements

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis