LRN

Find your next quality investment with Simply Wall St's easy and powerful screener, trusted by over 7 million individual investors worldwide. Stride (LRN) has investors’ attention after reporting better than expected earnings and revenue, extending its share repurchase authorization, and confirming Robert E. Knowling Jr. as CEO with a focus on operational scalability. See our latest analysis for Stride. Stride’s latest earnings, acquisition plans, and extended buyback run alongside a 1-day share price return of 6.46% and a year to date share price return of 29.5%, even though the 1-year total shareholder return declined 46.73%. Longer term total shareholder returns over 3 and 5 years remain firmly positive. If you are reassessing Stride after these results, it can help to widen your search and see how other education and tech enabled businesses are priced by checking a screener of 20 top founder-led companies After Stride’s sharp rebound and sizeable discount to both analyst targets and some intrinsic value estimates, the key issue now is whether the market is being too cautious on the risks or simply realistic about what comes next. The most followed narrative on Stride compares a fair value of $113.50 with the last close at $83.67, which points to a sizable valuation gap that depends on steady earnings growth and margins rather than aggressive forecasts. Read the complete narrative. Want to see what is included in that margin story and valuation gap? The narrative focuses on measured revenue growth, firmer profitability, and a future earnings multiple that is lower than many peers. Curious how those elements combine into that $113.50 fair value. Result: Fair Value of $113.50 (UNDERVALUED) Have a read of the narrative in full and understand what's behind the forecasts. However, Stride’s narrative still hinges on sensitive points, including political funding exposure and the risk that contract losses or enrollment caps will limit how much demand actually converts to revenue. Find out about the key risks to this Stride narrative. With sentiment on Stride mixed after these results, it makes sense to move quickly and test the story against your own expectations. To see what investors see in the company’s upside case, review the 4 key rewards If Stride has sharpened your focus, now is a good time to scan for other opportunities that fit your style before the next move catches you off guard. Target companies that balance quality and valuation by checking a screener of 51 high quality undervalued stocks. Prioritise capital preservation and steadier profiles by reviewing a list of 88 resilient stocks with low risk scores. Spot earlier stage opportunities with room to grow by using a curated set of screener containing 18 high quality undiscovered gems. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include LRN. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

Stride’s second quarter was marked by a positive market response, with results surpassing Wall Street’s expectations for both revenue and non-GAAP earnings. Management attributed this outperformance to disciplined cost management, operational improvements, and the continued impact of recent technology investments. CEO Robert Knowling Jr., newly appointed following a board-led leadership change, emphasized Stride’s focus on strengthening its educational offerings and improving student outcomes as key reasons for resilience in the face of modest top-line contraction. Is now the time to buy LRN? Find out in our full research report (it’s free). Revenue: $636.1 million vs analyst estimates of $627.3 million (2.7% year-on-year decline, 1.4% beat) Adjusted EPS: $2.12 vs analyst estimates of $1.91 (10.8% beat) Adjusted EBITDA: $149.8 million vs analyst estimates of $145.7 million (23.6% margin, 2.9% beat) Operating Margin: 16.6%, up from 8.7% in the same quarter last year Market Capitalization: $3.30 billion While we enjoy listening to the management’s commentary, our favorite part of earnings calls is the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention. Jeffrey Silber (BMO Capital Markets) asked about the non-renewal of the Lone Star Online Academy contract, specifically citing concerns over student outcomes. CFO Donna Blackman acknowledged performance issues and said, “Bob is really focused on student outcomes,” emphasizing continued investment to prevent similar contract losses. Jeffrey Silber (BMO Capital Markets) inquired whether investors should expect enrollment, revenue, and earnings growth in the coming year. Blackman replied that while the funding environment is favorable and conversion rates are improving, it is too early in the enrollment cycle to provide specific figures. Alexander Paris (Barrington Research) questioned the ability to match last year’s in-year enrollment growth given a lower starting enrollment base. Blackman responded that year-over-year comparisons will be tough, and while things are trending positively, she avoided committing to specific growth numbers and cautioned against expecting a repeat of last year’s enrollment dynamics. Alexander Paris (Barrington Research) followed up on whether in-year enrollment growth would resume after being paused last year. Blackman noted that in-year enrollment growth is expected to return, but not at the same curtailed level as last year, allowing for more flexibility in the coming cycle. Alexander Paris (Barrington Research) asked if the CEO transition was related to disappointing enrollment expectations. CEO Robert Knowling Jr. clarified that the change was made to “move to the next level of growth and development,” not as a reaction to enrollment trends. In the next few quarters, our analysts will be monitoring (1) the pace of student enrollment and conversion during peak season, (2) early indicators of improved student outcomes and contract retention, especially in large states like Texas, and (3) measurable progress in technology platform adoption and operational efficiencies. Capital allocation decisions and responses to evolving state funding will also be key focus areas. Stride currently trades at $81.05, in line with $80.45 just before the earnings. In the wake of this quarter, is it a buy or sell? See for yourself in our full research report (it’s free for active Edge members). ONE MORE THING: Top 5 Growth Stocks. The biggest stock winners almost always had one thing in common before they ran. Revenue growing like crazy. Meta. CrowdStrike. Broadcom. Our AI flagged all three. They returned 315%, 314%, and 455%, respectively. Find out which 5 stocks it’s flagging this month — FREE. Get Our Top 5 Growth Stocks for Free HERE. Stocks that have made our list include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Tecnoglass (+1,552% between June 2020 and June 2025). Find your next big winner with StockStory today.

Image source: The Motley Fool. Tuesday, Aug. 4, 2026, at 5 p.m. ET Chief Executive Officer - Robert E. Knowling Jr. Chief Financial Officer - Donna Blackman Manager of Investor Relations - Eliza Henson Operator: Hello, everyone. Thank you for joining us and welcome to the Stride Fourth Quarter Fiscal Year 20 Earnings Call. After today's prepared remarks, we will host a question-and-answer session. To withdraw your question, press 1 again. I will now hand the conference over to Eliza Henson, Manager of Investor Relations. Eliza? Please go ahead. Eliza Henson: Thank you, and good afternoon. Welcome to Stride's fourth quarter and year end earnings call for fiscal year 26. With me on today's call are Bob Knowling, Chief Executive Officer and Donna Blackman, chief financial officer. As a reminder, today's conference call and webcast are accompanied by a presentation that can be found on the Stride Investor Relations website. Please be advised that today's discussion of our financial results may include certain non GAAP financial measures. A reconciliation of these measures is provided in the earnings release issued this afternoon can also be found on our Investor Relations website. In addition to historical information, this call will also involve forward looking statements. The company's actual results could differ materially from any forward looking statements due to several important factors as described in the company's earnings release and latest SEC filings, including our most recent annual report on Form 10-K subsequent filings. These statements are made on the basis of our views and assumptions regarding future events and business performance at the time we make them and the company assumes no obligation to update any forward looking statements. Following our prepared remarks, we will answer questions you may have. Now I will turn the call over to Bob. Robert E. Knowling Jr.: Thanks, Eliza, and good afternoon, everyone. Before we discuss our results, I would like to address the leadership transition that we announced last Thursday. The board executed this leadership change after careful evaluation and deliberation and, ultimately, the board determined that for Stride to reach its full potential, a new leader was needed to take the reins. Having made that decision, the board enacted our succession plan to appoint me as the new CEO. We collectively believe that it was best to do this immediately so that I could hit the ground running. I appreciate the board's confidence in making me Stride's CEO. A strong consideration was putting in place a leader with strong tech and education experience and a track record of building strong teams. Those qualities align with my background. I have been an independent member of the Stride board. Since 2018. On the education front, I served as the inaugural CEO of the New York City Leadership Academy. Which was a nationally recognized nonprofit organization committed to improving outcome for students, particularly the most vulnerable students through high quality educational leadership. I was a founding member of the organization, which was crafted under mayor Michael Bloomberg, and chancellor Joel Klein. It was during my tenure there that I grew to truly understand the importance of driving student outcomes. I believe this is the ultimate measure of educational success. Investments in curriculum, technology, and support services, must translate into meaningful academic achievement. Educators institutions, and policymakers expect this from stride and this will be 1 of my top priorities. On the tech side, I spent the early part of my career in the Bell system at Ameritech and US West. As executive vice president of operations and technology at US West, ICE oversaw every technical function in the company. Subsequently, I became CEO at COVAD Communications, which I took public. And have served as CEO of Cemdesk Technologies and Telwares as well. I have also served on the board at a variety of Fortune 500 companies, bringing a lens of delivering long term shareholder value through board oversight. I have been a leader on every board on which I have served, whether as chairman of the board or a committee chair. Given my experience on Stride's board, I have a strong understanding of our business. I have gotten an appreciation for our mission. And our people who deliver on that mission every day. So if you were to summarize my experience in a few words, I have a proven track record as an operator, I am known for building strong teams, and I get quite deep in the details as that is my comfort zone. Second, I have a strong blend of tech and education experience. And then third, I bring a shareholder driven mindset from my board experiences. There is a lot to continue to build on here at Stride. And I am incredibly excited by the opportunity ahead of us. Stride is a market leader with several competitive advantages. We have a significant and scaled base of students across more than 30 geographies. And the management team is committed to growing the business deeper where we already have students, as well as planting flags in new geographies. The management team has exhibited disciplined fiscal management, and as a result, we have a balance sheet that enables us to make prudent investments in the growth of our company. An example of this is the extension of our share repurchase authorization until 10/31/2027. Once our trading window opens at the end of October, I intend to actively consider opportunistic stock repurchases as part of our capital allocation strategy. Stride has a tremendous amount of talent throughout the organization. From the management team all the way to our frontline. that is why I am eager to roll up my sleeves alongside this group. And I do recognize there is room for improvement. While we have strong foundational elements, we also have many students that we could still be serving. To grow our market share, in large part, we must improve student outcomes. This includes better leveraging our suite of products and services, such as our live and AI tutoring platforms, and our tallow career and digital curriculum platforms. We have done a nice job over the years of adding capabilities, but I believe that there is even more we can do to extend our suite of products and help students to reach their goals. Improving our go to market has huge potential. As we execute our strategy, I am confident that we will better meet the needs of our students which will in turn create more value for our shareholders. Let me now pivot to talk about our performance. As you have heard the team talk about in the past, Stride has made significant investments in our technology platforms to improve the long term scalability of the business. We have improved the customer experience We have strengthened our operational foundation. And we have positioned the business for future growth. As a result of the steps we have taken to date, we have delivered 4.2% enrollment growth and 4.7% revenue growth. Turning briefly to the previously announced decision by Roscoe Independent School District to not renew their contract for our Lone Star Online Academy. While we are disappointed by the district's decision, Texas remains an important state for us. And our commitment to serving families across the state remains unchanged. We continue to operate multiple schools in, and we are actively placing Roscoe Independent School District impacted families in our other programs. As we look towards the upcoming school year, it is still early in the enrollment season. Families will continue to make enrollment decisions throughout the fall and increasingly throughout the school year. And with that caveat, we are encouraged by the indications we are seeing so far. Applications are tracking slightly behind this time last year. But we are seeing improved conversion metrics and re registration activity continues to track slightly ahead of last year. While I am just getting started in the CEO role, it is clear to me that there is much to be excited about. I have relocated to Virginia. and I am full steam ahead. I believe we can build upon what this leadership team has accomplished and reach even greater heights. Thank you for your attention. And I will now turn the call over to Donna. Donna Blackman: Thank you, Bob, and good afternoon. As Bob discussed, FY 26 was a year of meaningful progress for Stride. We continue to see strong demand for our programs made progress on a number of strategic priorities, and delivered solid financial results. While the year was not without challenges, we believe the progress we made positions us well for the future. I want to thank our employees, school partners, and our students and families for their continued commitment throughout the year. Now I would like to provide some detail on our fiscal 26 financial results. For the full year, revenue was $2.518 billion, an increase of 4.7% over fiscal 25. Adjusted operating income was $498.4 million up nearly 7%. Adjusted EBITDA totaled $617.6 million, up 8.2% from last year. And adjusted earnings per share were $8.33. Overall, these results reflect another year of resilient demand and disciplined financial management. Looking more closely at our business, revenue from our career learning, middle and high school programs $1.04 billion, an increase of 19% from last year. Full year career learning enrollments totaled 110 thousand up 14%. General Education revenue totaled $1.42 billion, decreasing 2% from fiscal 2025. Enrollments in general education totaled 134 thousand down 2.5% for the year. Taken together, we served approximately 244 thousand students during the year. Just over 4% more than last year. Reflecting sustained demand for the educational choices we provide. Total revenue per enrollment across both lines of revenue was $9.91 thousand compared to $9.68 thousand last year. FY 2026 revenue per enrollment continued to reflect differences in state funding, program mix, and enrollment timing. Looking ahead to f y 2027, most of our partner states have now finalized their educational budgets. While funding decisions vary across states, the overall funding environment remains supportive. As with any year, revenue per enrollment may be impacted by state mix and yield. And while it is still early in the enrollment season, given the current environment, we expect full year FY 2027 revenue per enrollment to be relatively flat to up slightly versus fiscal 2026. As always, revenue per enrollment may continue to fluctuate modestly based on state and program mix as well as enrollment yield throughout the year. Now turning to profitability. Gross margin for the year was 37.8% down 140 basis points. As we mentioned previously, our investments affected our near term margins, but they also strengthened the business and positioned us well for the years ahead. While many of the onetime implementation costs associated with these initiatives are now behind us. We will continue to incur some ongoing expenses associated with the new platforms as we focus on realizing the long term operational benefits and we will continue to invest in our strategic priorities. Selling, general, and administrative expenses totaled $499.8 million, down 4.7% from last year. Stock based compensation for the year was $40.3 million. And our effective tax rate for FY 2026 was 23.3%. Now turning to our balance sheet. Capital expenditures for the year were $78.8 million. Free cash flow, which we define as cash from operations, less capital expenditures, totaled $355 million. down $17.8 million from last year. We finished the year with cash, cash equivalents, and marketable securities of approximately $1.034 billion. During fiscal 2026, we continued executing against our share repurchase authorization purchasing approximately $189 million of our common stock. These repurchases reflect our confidence in the long term value of the business while maintaining the financial flexibility to continue investing in our strategic priorities. We ended the year with approximately $311 million remaining under the current repurchase authorization which now extends to October 31, 2027. Even as we continue executing against our share repurchase authorization, our capital allocation priorities remain unchanged. We will continue to invest first in opportunities that support organic growth, evaluate strategic acquisitions that strengthen our business, and return excess capital to shareholders when we believe it creates long term value. Our balance sheet gives us the flexibility to pursue each of these priorities, while maintaining a strong financial position. Now before I wrap up, let me offer a few thoughts on FY 27. As Bob mentioned, we are encouraged by what we are seeing early in the enrollment cycle. At the same time, I remind investors that the first quarter count date enrollment growth will face a more difficult comparison than it has for the last couple of years. Because we moderated in-year enrollment growth during FY 26, we will not have the same carryover benefit entering this school year. As a result, even with healthy demand and solid execution, year over year count date growth may appear more modest than what we have seen over the past few years. Keeping that in mind, for FY 27, seasonality should remain generally consistent with prior-year CapEx and SG&A as a percent of revenue are anticipated to be relatively flat. We expect gross margins will be flattish to last year, and we expect to see somewhat of an uptick in both stock based compensation and tax rate from this year. As we typically do, we will provide formal enrollment and financial guidance when we report our first quarter results in October. It is still early in the enrollment season, and with August and September being our busiest month, there is still a lot of work ahead of us, and we remain confident in our ability to execute. FY 2026 an important year for Stride. We believe the foundation we have built positions us well for the coming year. And we believe we are on track to achieve our fiscal 2028 financial targets. Thank you for your time today. Now I will turn the call back over to the operator for your questions. Operator? Operator: We will now begin the question and answer session. Please limit yourself to 1 question and 1 follow-up. You would like to ask a question, please press *1 to raise your hand. Withdraw your question, press *1 again. We ask that you pick up your handset when asking a to allow for optimum sound quality. If you are muted locally, please remember to unmute your device. Please standby while we compile the Q&A roster. Your first question is from the line of Jeffrey Silber with BMO Capital Markets. Jeffrey, your line is open. Please go ahead. Jeff Silber: Thank you so much. Wanted to start with the Lone Star Online Academy. I think this is the first opportunity you have had to discuss this publicly. Can you give us a little bit more color what happened? I know the outcomes there were a little bit subpar. Is that the reason that Roscoe decided not to renew? And if that is the case, how do you make sure that things like this do not happen at other schools? Donna Blackman: So, you know, Jeffrey, as we have talked about previously, we were in conversation with Roscoe about renewing the contract. And as you have indicated, we certainly had some performance issues with that school. And I think the district decided not to renew the contract. And as you also know that in any given year, we could have schools that do not decide to renew their contract. To get to the second part of your question about how do you ensure that this does not happen in the future. We will never be able to ensure that we will have contracts leave us. We will be part of the business. We have contracts that leave us. We have contract, and we sign on new contracts. But what I can say is Bob is really focused on student outcomes. And we are continuing to invest in our student outcomes And so that will help us to enable us to ensure that we deliver to our students the outcomes that they have come to expect. Jeff Silber: Okay. I appreciate that. I know you are not providing guidance for 2027. You mentioned a few times it is still early in the year, But based on what you know now, at least directionally, should we see enrollment revenue and earnings growth in fiscal 27? Donna Blackman: So you know, Jeffrey, I am not going to get ahead of myself. We did that a little bit last year. Here's what Here's what I will say. The funding environment looks favorable. And I said that in my in my prepared remarks. While our application volumes are strong, they are trailing slightly behind last year, but still strong. What I am encouraged by is the fact that our conversion rates are higher as well as our reregistration rates are higher. And so other than saying those things, I do not want to get too far ahead of, say, what fiscal 2027 numbers will look like. But, hopefully, those data points are helpful for you. I just do not want to get ahead of ourselves because we are so early in the enrollment season. And, you know, August and September is a really busy time for us, and our team is working really hard to make sure that we enroll as many students as possible and have them have the best experience as possible. Jeff Silber: Okay. I understand that. I will get back in the queue. Thanks so much. Operator: Your next question is from the line of Alexander Paris with Barrington Research. Alexander, your line is open. Please go ahead. Alexander Paris: Thank you. I appreciate the opportunity to ask a question or 2. First, just to follow on the previous question by Jeffrey. Last year, from Q4 to Q1. You brought on 12.4 thousand students. To get us to where we were. This year, and you alluded to it in your prepared remarks, you are starting with fewer students because you held down in-year enrollments. And if you added the same number of students, 12.4 thousand from Q4 to Q1 this year, you would be pretty flat, down 0.4%. On a year over year basis as of the count date. Are you expecting some growth in the fall? I know you do not wanna commit to a number or what have you. If you are able to do 12.4 thousand last year, can you do 12.4 thousand this year? I guess is what I am asking. Donna Blackman: Yeah. Look, I think the important thing to note is where we are ending the year. Right? So because we are ending the year lower than what we began the year, and then the past few years, that was not the case. Right? We ended the year with enrollments higher than we began the year. So the starting point was much easier for us to be able to grow. So the comparison from account based perspective will certainly be the comparison will be a tough comparison. Because of that. And I know you want me to give you an enrollment number and I am probably not going to give you an enrollment number that is going to make you happy. Last year was sort of a 1-time thing. I have had conversations with investors to say we are not going to do that again. But I do think it is important for you to know where we are where we are seeing things in terms of the conversion rates. We are seeing things in terms of rereg. And where we are seeing things from in terms of for next year in terms of application volumes. And so while things are pointing in the right direction, August and September is when we are really, really busy. Parents are making decisions about the upcoming school year, even as late as August and September. And so I do not wanna get ahead of ourselves for full fiscal 2027. But the other thing I will point out to you is that you know, we cut off our enrollments last year earlier than usual. And so while it is still early to say what that will look like for FY 27, what I can say is I would not expect for us to cut off our in-year enrollment into the same capacity that we did on last year. And so I hope that information is helpful for you. Alexander Paris: Is. So just a clarifying question on that last comment. Would you would you expect in-year enrollment this year, like we saw in the 3 years prior to fiscal 26? Regardless of where you start? Donna Blackman: Yeah, yeah. So I would -- look, based on where I sit today, I would expect us to have in-year enrollment growth. In 2025, from Q2 to Q3, we have pretty significant in-year enrollment growth. And so I do not know what -- if I were to commit that we are going to have that in-year enrollment growth consistent in fiscal 2027. But what I will say is that we are not going to have all the windows closed to the same extent that we had them closed in fiscal 2026. Alexander Paris: Gotcha. And then the last 1 still related is, obviously investors were concerned by what seemed like the sudden CEO succession announcement last week, Thursday. A lot of investors voted with their feet, you know, with the sell off in the shares 15-18%. Thinking that this had something to do with a disappointing fall enrollment season. Was that part of the decision, or is it more Bob, like you said earlier, changing horses for the next phase of accelerated growth? Robert E. Knowling Jr.: Thanks for the question. It is the latter. There was no consideration about any forward thinking, forward looking performance but a need and a desire to move to the next level of growth and development of this enterprise. And as you probably all know, leadership transitions are tough, but the decision was made, and we made it to be an immediate in effect so that I would really have a chance at the end of the fiscal year to hit the ground running relative to fiscal 2027. Okay. Alexander Paris: Because it sounds like all the comments I appreciate that. It sounds like all the comments are the fall term expectations are not too different. From the Q3 call or the Q2 call. Donna Blackman: I think it is fair. Alexander Paris: K. Great. Thanks for answering my questions. Operator: There are no further questions at this time. This concludes today's call. Thank you for attending. You may now disconnect. Before you buy stock in Stride, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Stride wasn’t one of them. The 10 stocks that made the cut are built for long-term growth and could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $411,427!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,335,252!* That performance is why people listen. With a track record of beating the S&P 500 by 4x, Stock Advisor offers a distinct advantage. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built for the long haul. See the 10 stocks » *Stock Advisor returns as of August 11, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has positions in and recommends Stride. The Motley Fool has a disclosure policy. Stride (LRN) Q4 2026 Earnings Call Transcript was originally published by The Motley Fool

This article first appeared on GuruFocus. Revenue: Full-year revenue was $2.518 billion, an increase of 4.7% over fiscal 2025. Adjusted Operating Income: Totaled $498.4 million, up nearly 7% year-over-year. Adjusted EBITDA: Reached $617.6 million, up 8.2% from the prior year. Adjusted Earnings Per Share: Reported at $8.33 for the full year. Career Learning Revenue: Revenue from middle and high school programs was $1.04 billion, an increase of 19% from last year. Career Learning Enrollments: Totaled 109.7 thousand, up 14% year-over-year. General Education Revenue: Totaled $1.42 billion, a decrease of 2% from fiscal 2025. General Education Enrollments: Totaled 134.2 thousand, down 2.5% for the year. Total Enrollments: Served approximately 243.9 thousand students during the year, just over 4% more than last year. Revenue Per Enrollment: Total revenue per enrollment across both lines of revenue was $9,914, compared to $9,677 last year. Gross Margin: Gross margin for the year was 37.8%, down 140 basis points. Selling, General and Administrative Expenses: Totaled $499.8 million, down 4.7% from last year. Stock-Based Compensation: Amounted to $40.3 million for the year. Effective Tax Rate: Came in at 23.3% for fiscal 2026. Capital Expenditures: Totaled $78.8 million for the year. Free Cash Flow: Totaled $355 million, down $17.8 million from last year. Cash and Marketable Securities: Ended the year with approximately $1.034 billion. Share Repurchases: Purchased approximately $189 million of common stock during fiscal 2026. Warning! GuruFocus has detected 6 Warning Signs with GRUSF. Is LRN fairly valued? Test your thesis with our free DCF calculator. Release Date: August 04, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Stride Inc (NYSE:LRN) delivered solid financial results for fiscal year 2026, with revenue up 4.7% to $2.518 billion and adjusted operating income up nearly 7% to $498.4 million. The company saw strong growth in its career learning segment, with revenue up 19% and enrollments up 14% to 109.7 thousand, highlighting successful strategic focus. Stride Inc (NYSE:LRN) maintains a strong balance sheet with approximately $1.034 billion in cash and marketable securities, providing flexibility for investments and capital returns. The company extended its share repurchase authorization to October 31, 2027, with $311 million remaining, and the new CEO intends to actively consider opportunistic buybacks. Early indicators for fiscal year 2027 are encouraging, with improved conversion metrics and re-registration activity tracking slightly ahead of last year, despite a tough comparison. The new CEO, Bob Noling, brings a strong blend of technology and education experience, with a focus on improving student outcomes and leveraging the company's platform suite for growth. Stride Inc (NYSE:LRN) experienced a leadership transition, with the Board determining a new leader was needed, which caused a significant sell-off in shares (15-18%) due to investor uncertainty. The company lost a key contract as the Roscoe Independent School District decided not to renew its agreement for the Lone Star Online Academy, impacting Texas operations. General education revenue decreased 2% and enrollments fell 2.5% in fiscal year 2026, indicating weakness in a core segment of the business. Gross margins declined by 140 basis points to 37.8% due to investments in new platforms, with some ongoing expenses expected to continue impacting near-term profitability. Applications for the upcoming school year are tracking slightly behind last year, and the first quarter count date enrollment growth will face a more difficult comparison, potentially leading to more modest growth. Free cash flow decreased by $17.8 million to $355 million, reflecting higher capital expenditures and investment costs. Q: Can you provide more color on the Lone Star Online Academy contract loss with Roscoe Independent School District? Was it due to subpar outcomes, and how will you prevent this at other schools? A: Donna Blackman (CFO): We were in conversations with Roscoe about renewing, but the district decided not to renew, partly due to performance issues at that school. It's normal for some contracts to leave us each year, but we are investing heavily in student outcomes, which is a key focus for our new CEO, Bob Noling, to ensure we deliver the results students expect. Q: Given the leadership transition, was the CEO succession announcement related to a disappointing fall enrollment season? A: Robert Knowling (CEO): No, it was not related to any forward-looking performance concerns. The Board decided a new leader was needed to take the company to the next level of growth and development. We made the change immediately so I could hit the ground running for fiscal 2027. Q: Can you provide direction on enrollment, revenue, and earnings growth for fiscal 2027? A: Donna Blackman (CFO): I won't get ahead of myself with formal guidance, but the funding environment looks favorable. While application volumes are slightly behind last year, they remain strong. I'm encouraged by higher conversion rates and re-registration rates. August and September are our busiest months, so we'll provide formal guidance in October. Q: Last year you added 12,400 students from Q4 to Q1. Can you do the same this year to achieve count date growth? A: Donna Blackman (CFO): The comparison will be tough because we ended FY26 with lower enrollment than we began, unlike prior years. We won't have the same carryover benefit. However, we cut off in-year enrollments earlier than usual last year, and I would not expect us to do that to the same extent in FY27, which should support in-year growth. Q: Should we expect in-year enrollment growth in fiscal 2027, similar to the years prior to fiscal 2026? A: Donna Blackman (CFO): Based on where we sit today, yes, I would expect in-year enrollment growth. We won't have all the enrollment windows closed to the same extent as we did in 2026, which should allow for more flexibility in adding students throughout the year. Q: What are your initial priorities as the new CEO, and how will you leverage your background to drive growth? A: Robert Knowling (CEO): My top priority is improving student outcomes, which is the ultimate measure of educational success. I bring a strong blend of tech and education experience, and I plan to better leverage our platforms like live and AI tutoring, Tallo, and digital curriculum. I also see huge potential in improving our go-to-market strategy to grow market share. Q: Can you elaborate on the fiscal 2026 financial results and the outlook for margins and profitability in FY27? A: Donna Blackman (CFO): FY26 revenue was $2.518 billion, up 4.7%, with adjusted EBITDA of $617.6 million, up 8.2%. For FY27, we expect gross margins to be flattish to last year, with CapEx and SG&A as a percentage of revenue relatively flat. We anticipate an uptick in stock-based compensation and tax rate, but we remain on track to achieve our FY2028 financial targets. Q: How is the company approaching capital allocation, particularly regarding share repurchases? A: Robert Knowling (CEO) & Donna Blackman (CFO): We extended our share repurchase authorization to October 31, 2027, with approximately $311 million remaining. Bob intends to actively consider opportunistic stock repurchases once the trading window opens. Our priorities remain investing in organic growth, evaluating strategic acquisitions, and returning excess capital to shareholders. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. The Board appointed Bob Knowling as CEO to accelerate the company's next phase of growth, emphasizing his background in technology, education, and shareholder value creation. Management attributed the 4.7% revenue growth and 4.2% enrollment growth to long-term scalability investments and improved customer experiences. A strategic pivot is underway to prioritize student academic outcomes as the primary measure of success, which management believes will drive market share expansion. The company is actively managing the non-renewal of the Lone Star Online Academy contract by transitioning impacted Texas families to its other existing programs in the state. Operational discipline led to a 4.7% reduction in SG&A expenses, supporting an 8.2% increase in adjusted EBITDA despite near-term margin pressure from platform investments. Management is leveraging a strong balance sheet to extend share repurchase authorizations, signaling confidence in the company's long-term valuation. FY 2027 enrollment growth comparisons will be challenging because the company moderated in-year enrollment during FY 2026, removing the typical 'carryover' benefit. Revenue per enrollment for FY 2027 is expected to be relatively flat to up slightly, supported by a generally favorable state educational funding environment. Management expects to resume more normalized in-year enrollment growth patterns in FY 2027 compared to the restricted enrollment windows utilized in FY 2026. The company remains committed to its FY 2028 financial targets, supported by investments in AI tutoring, digital curriculum, and career platforms. Capital allocation will prioritize organic growth and strategic acquisitions, with opportunistic stock repurchases considered once the trading window opens in late October. The loss of the Lone Star Online Academy contract reflects performance issues at that specific school, highlighting the risk of district non-renewals. Gross margin declined 140 basis points due to ongoing expenses from new platform implementations and strategic growth investments. Application volumes are currently tracking slightly behind the previous year, though this is partially offset by higher conversion and re-registration rates. Stock-based compensation and effective tax rates are both anticipated to tick upward in the coming fiscal year. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management acknowledged performance issues led to the Lone Star non-renewal and stated that while some churn is inherent to the business, the focus on student outcomes is the primary mitigation strategy. The new CEO emphasized that academic achievement is the ultimate measure of success and will be a top priority to ensure contract stability. Donna Blackman declined to provide specific numbers but noted that higher conversion and re-registration rates are encouraging signs despite lower starting enrollment levels. The company expects a 'tough comparison' for count-date growth but anticipates a more open enrollment window throughout the year compared to FY 2026. CEO Bob Knowling clarified the change was not driven by forward-looking performance concerns or disappointing fall enrollment data. The transition was described as a strategic decision by the Board to 'change horses' for a new phase of accelerated growth and operational detail-focus.

Interested in Stride, Inc.? Here are five stocks we like better. Fiscal 2026 revenue rose 4.7% to $2.518 billion, while adjusted operating income increased nearly 7% to $498.4 million and adjusted EBITDA grew 8.2% to $617.6 million. Career Learning drove growth, with revenue up 19% and enrollment up 14%, offsetting declines in General Education. Bob Knowling became CEO following a board-led leadership change, which he said was intended to position Stride for long-term growth rather than reflect near-term performance concerns. Strategic priorities include improving student outcomes, expanding existing markets and entering new geographies. Stride gave no formal fiscal 2027 guidance, citing mixed early enrollment indicators: applications are slightly behind last year, but conversion and re-registration trends have improved. The company also plans to consider opportunistic share repurchases and expects margins to remain roughly in line with fiscal 2026. 4 Stocks That Crushed Analyst Estimates by More Than Double Stride (NYSE:LRN) reported fiscal 2026 revenue growth of 4.7% and higher adjusted profitability, while outlining an executive transition and describing early enrollment indicators for the coming school year. Bob Knowling, who was appointed chief executive officer following a board-led leadership change announced last week, said the transition was intended to position the education company for its next stage of growth rather than reflect expectations for near-term performance. → SpaceX’s First Earnings Report Could Decide Whether Shorts or Bulls Have Control 2 Stocks That Crushed Short Sellers With Impressive Gains “Ultimately, the board determined that for Stride to reach its full potential, a new leader was needed to take the reins,” Knowling said. He added during the question-and-answer session that there was “no consideration” of forward-looking performance in the decision and that the change was made immediately to enable him to begin the fiscal 2027 year in the role. For the fiscal year ended 2026, Stride generated revenue of $2.518 billion, up 4.7% from fiscal 2025. Adjusted operating income increased nearly 7% to $498.4 million, while adjusted EBITDA rose 8.2% to $617.6 million. Adjusted earnings per share were $8.33. → 3 Drone Stocks That Should Soar After the Summer Slump Chegg Chokes on AI Attempt, CEO Talks it Up as He Passes Torch The company served about 243,900 students during the year, an increase of just over 4% from the prior year. Revenue per enrollment across its business was $9,914, compared with $9,677 a year earlier. Career Learning was the company’s primary growth driver. Revenue from middle- and high-school Career Learning programs rose 19% to $1.04 billion, while full-year enrollments increased 14% to 109,700. → Why Rare Earth Processing Could Be the Real 2027 Opportunity General Education revenue declined 2% to $1.42 billion, and enrollments in that business fell 2.5% to 134,200. Chief Financial Officer Donna Blackman said revenue per enrollment continued to be influenced by differences in state funding, program mix and enrollment timing. Gross margin was 37.8%, down 140 basis points from the prior year. Selling, general and administrative expense fell 4.7% to $499.8 million. Capital expenditures totaled $78.8 million. Free cash flow was $355 million, down $17.8 million year over year. Cash equivalents and marketable securities totaled approximately $1.034 billion at year-end. Blackman said margins were affected by investments in technology platforms and strategic initiatives. While many one-time implementation costs are now behind the company, she said Stride expects to continue incurring some ongoing expenses tied to the new platforms and to continue investing in strategic priorities. Stride repurchased approximately $189 million of common stock during fiscal 2026 and ended the year with about $311 million remaining under its share repurchase authorization. The authorization has been extended through Oct. 31, 2027. Knowling said he intends to “actively consider opportunistic stock repurchases” when the company’s trading window opens at the end of October. Blackman said the company’s capital allocation priorities remain investing in organic growth, evaluating strategic acquisitions and returning excess capital to shareholders when doing so can create long-term value. The company did not provide formal fiscal 2027 enrollment or financial guidance, saying it will do so when it reports first-quarter results in October. Blackman said most partner states have finalized education budgets and that the overall funding environment remains supportive. Stride expects fiscal 2027 revenue per enrollment to be relatively flat to modestly higher than fiscal 2026, though Blackman said state and program mix, along with enrollment yield, could affect results. Early enrollment indicators were mixed. Knowling said applications are tracking slightly behind the same period last year, but conversion metrics have improved and re-registration activity is slightly ahead of the prior year. Blackman cautioned that first-quarter count-date enrollment growth will face a tougher comparison because the company moderated in-year enrollment growth during fiscal 2026, reducing the carryover benefit entering the new school year. Blackman added that the company does expect in-year enrollment growth in fiscal 2027, although she did not commit to the level of growth seen in earlier periods. She said Stride does not expect to close enrollment windows to the same extent as it did in fiscal 2026. The company also addressed Roscoe Independent School District’s decision not to renew its contract for Lone Star Online Academy in Texas. Blackman said the school had performance issues and that Roscoe elected not to renew. She noted that contracts can leave the business in any given year, while new contracts are also added. Knowling said Texas remains an important state for Stride, which continues to operate multiple schools there and is placing families affected by the Roscoe decision into other programs. Knowling said improving student outcomes will be a top priority, describing it as the “ultimate measure of educational success.” He said the company sees an opportunity to better use products and services including live and artificial intelligence tutoring, the Tallo career platform and digital curriculum offerings. He also identified go-to-market improvements, deeper expansion in existing geographies and entry into new geographies as potential growth opportunities. “To grow our market share, in large part, we must improve student outcomes,” Knowling said. For fiscal 2027, Blackman said Stride expects capital expenditures and SG&A as a percentage of revenue to be relatively flat, gross margins to be roughly in line with fiscal 2026, and both stock-based compensation and the tax rate to increase somewhat. She said the company believes it remains on track to achieve its fiscal 2028 financial targets. Stride, Inc (NYSE:LRN) is a technology-driven education company that designs and delivers online learning solutions for students and adult learners. Through long-term partnerships with state-authorized public school districts, Stride operates virtual academies that serve K-12 students across the United States. The company's blended-learning model combines digital curriculum, live teaching support and data analytics to personalize instruction and monitor student progress. In addition to its K-12 offerings, Stride provides a portfolio of career and workforce readiness programs under its Stride Career Prep division. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Stride Q4 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

RESTON, Va., Aug. 04, 2026 (GLOBE NEWSWIRE) -- Stride, Inc. (NYSE: LRN), one of the nation’s most successful technology-based education companies, today announced its results for the fourth quarter and full fiscal year ended June 30, 2026. “I am pleased to lead Stride as we position the Company for its next chapter of growth,” said Robert Knowling, Stride Chief Executive Officer. “Building on Stride’s strong foundation, we will continue to prioritize investments in curriculum, technology and support services to improve student outcomes and drive growth and value creation. I look forward to working alongside our talented team and leveraging our full breadth of capabilities to reach Stride's full potential.” Fiscal 2026 Highlights Compared to 2025 Revenue of $2,518.1 million, compared with $2,405.3 million Income from operations of $450.8 million, compared with $360.1 million Net income of $338.2 million, compared with $287.9 million Diluted net income per share of $7.14, compared with $5.95 Adjusted operating income of $498.4 million, compared with $466.2 million (1) Adjusted EBITDA of $617.6 million, compared with $571.0 million (1) Adjusted earnings per share of $8.33, compared with $8.10 (1) Repurchased approximately $188.7 million of common stock under the Company’s share repurchase authorization Share repurchase authorization extended through October 31, 2027 Fiscal 2026 Summary Financial Metrics (1) To supplement our financial statements presented in accordance with U.S. generally accepted accounting principles (GAAP), we also present non-GAAP financial measures including adjusted operating income (loss), EBITDA, adjusted EBITDA, and adjusted earnings per share. Management believes that these additional measures provide useful information to investors relating to our financial performance. A reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measures is provided below. Fourth Quarter Fiscal 2026 Highlights Compared to 2025 Revenue of $636.1 million, compared with $653.6 million Income from operations of $105.9 million, compared with $56.9 million Net income of $81.4 million, compared with $51.3 million Diluted net income per share of $1.75, compared with $1.03 Adjusted operating income of $117.8 million, compared with $130.6 million (1) Adjusted EBITDA of $149.8 million, compared with $158.4 million (1) Adjusted earnings per share of $2.12, compared with $2.29 (1) Repurchased approximately $100 million of common stock under the Company’s share repurchase authorization Fourth Quarter Fiscal 2026 Summary Financial Metrics Revenue Data Enrollment and Revenue Per Enrollment Data Full year enrollments averaged 243.9K, up 4.2% compared to 234.0K enrollments in fiscal year 2025. Of the total enrollments, 109.7K were Career Learning enrollments, up 13.9% compared to 96.3K Career Learning enrollments in fiscal 2025. Fourth quarter enrollments averaged 234.2K, down (0.5)% compared to 235.3K enrollments in the fourth quarter of fiscal year 2025. Of the total average enrollments, 106.4K were Career Learning enrollments, up 9.7% compared to 97.0K Career Learning enrollments in the fourth quarter of fiscal 2025. Enrollments only include those students in full service public or private programs where Stride provides a combination of curriculum, technology, and instructional and support services, inclusive of administrative support and may include enrollments for which Stride receives no public funding or revenue. Stride does not report enrollments for our Adult Learning business. Revenue per enrollment for the full fiscal year 2026 was $9,914, up 2.4% compared to $9,677 in fiscal year 2025. General Education revenue per enrollment was $10,243, up 1.6%, and Career Learning revenue per enrollment was $9,512, up 4.5%, compared to fiscal year 2025. If the mix of enrollments changes, our revenues will be impacted to the extent the average revenues per enrollments are significantly different. Revenue per enrollment for the fourth quarter was $2,620, down (0.4)% compared to $2,630 in the fourth quarter of fiscal year 2025. General Education revenue per enrollment was $2,710, down (1.0)% compared to the fourth quarter of fiscal year 2025, and Career Learning revenue per enrollment was $2,511, up 1.3%, compared to the fourth quarter of fiscal year 2025. Cash Flow and Capital Allocation As of June 30, 2026, the Company’s cash and cash equivalents and marketable securities totaled $1,034.1 million, compared with $1,011.4 million reported at June 30, 2025. Capital expenditures for the fiscal year ended June 30, 2026 were $78.8 million, compared to $60.0 million in fiscal year 2025, and were comprised of $0.6 million of property and equipment, $61.6 million of capitalized software development and $16.6 million of capitalized curriculum development. During fiscal year 2026, the Company repurchased approximately 2.3 million shares of its common stock for an aggregate purchase price of approximately $188.7 million under its previously announced share repurchase authorization. As of June 30, 2026, approximately $311.3 million remained available under the current authorization. The Company continues to evaluate share repurchases as part of its disciplined capital allocation strategy. Conference Call The Company will discuss its fourth quarter and full fiscal year 2026 financial results during a conference call scheduled for Tuesday, August 4, 2026 at 5:00 p.m. eastern time (ET). A live webcast of the call will be available at investors.stridelearning.com/events-and-presentations. To participate in the live call, investors and analysts should dial (833) 461-5787 (domestic) or +1 (585) 542-9983 (international) and provide the conference ID number 708 877 615. Please access the website at least 15 minutes prior to the start of the call. A replay of the call will be posted at investors.stridelearning.com/events-and-presentations. About Stride Inc. Stride Inc. (NYSE: LRN) is redefining lifelong learning with innovative, high-quality education solutions. Serving learners in primary, secondary, and postsecondary settings, Stride provides a wide range of services including K-12 education, career learning, professional skills training, and talent development. Stride reaches learners in all 50 states and over 100 countries. Learn more at stridelearning.com. Special Note on Forward-Looking Statements This press release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that involve substantial risks and uncertainties. All statements other than statements of historical facts contained in this press release are forward-looking statements, such as any statements that look to future events and include, among other things, our expectations regarding: mix of enrollment, revenue per enrollment, and future share repurchases. We have tried, whenever possible, to identify these forward-looking statements using words such as “outlook,” “forecasts,” “anticipates,” “trends,” “believes,” “estimates,” “continues,” “likely,” “may,” “opportunity,” “potential,” “projects,” “will,” “will be,” “expects,” “plans,” “intends,” “should,” “would” and similar expressions to identify forward-looking statements, whether in the negative or the affirmative. These statements reflect our current beliefs and are based upon information currently available to us. Accordingly, such forward-looking statements involve known and unknown risks, uncertainties and other factors which could cause our actual results, performance or achievements to differ materially from those expressed in, or implied by, such statements. These risks, uncertainties, factors and contingencies include, but are not limited to: reduction of per pupil funding amounts at the schools we serve; inability to achieve a sufficient level of new enrollments to sustain our business model or to meet financial or operational guidance; limitations of the enrollment data we present, which may not fully capture trends in the performance of our business; failure to enter into new school contracts or renew existing contracts, in part or in their entirety; failure of the schools we serve, our vendors, or us to comply with our contracts, or federal, state and local laws and regulations, resulting in a loss of funding, an obligation to repay funds previously received, contractual remedies, or actions or proceedings against us; governmental investigations that could result in fines, penalties, settlements, or injunctive relief; declines or variations in academic performance outcomes of the students and schools we serve, including due to the evolution of curriculum standards, testing programs and state accountability metrics; harm to our reputation resulting from poor performance or misconduct by operators or us in any school in our industry and/or in any school which we operate; legal and regulatory challenges from opponents of virtual public education or for-profit education companies; potential violation of laws and regulations relating to privacy and data protection, including as such laws and regulations may apply to children’s data; changes in national and local economic and business conditions and other factors, such as natural disasters, pandemics and outbreaks of contagious diseases and other adverse public health developments; discrepancies in interpretation of legislation by regulatory agencies that may lead to payment or funding disputes; termination of our contracts, or a reduction or termination in the scope of services, with schools; failure to develop the Career Learning business; entry of new competitors with superior technologies (including artificial intelligence (“AI”)) and lower prices; unsuccessful integration of mergers, acquisitions and joint ventures; failure to further develop, maintain and enhance our technology, products, services and brands; inadequate recruiting, training and retention of effective teachers and employees; infringement of our intellectual property; disruptions to our Internet-based learning and delivery systems, including, but not limited to, our data storage systems and third-party cloud infrastructure, systems and facilities, including as a result of cybersecurity attacks; misuse or unauthorized disclosure of student and personal data; failure to prevent or mitigate a cybersecurity incident that affects our systems or our data; problems in the implementation of new information technology systems and technology; failure by us or third parties to maintain and support information technology systems, including addressing quality issues and timely delivering new products and enhancements; risks related to the use, implementation and regulation of AI and other emerging technologies, including in the education of children, and their use by third-party vendors; risks related to our stock repurchase program; changes in our effective tax rate and additional liabilities; and other risks and uncertainties associated with our business described in the risk factors discussed in the Company’s Annual Report on Form 10-K for the year ended June 30, 2025 and any subsequently filed Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q or the Company’s other filings with the Securities and Exchange Commission. Forward-looking statements reflect our management’s expectations or predictions of future conditions, events or results based on various assumptions and estimates. They are not guarantees of future performance. Our actual results and financial condition may differ, possibly materially, from the anticipated results and financial condition indicated in these forward-looking statements. Readers are cautioned not to place undue reliance on forward-looking statements in this press release or that we make from time, and to consider carefully the factors discussed above. All information in this press release is as of today’s date, and the Company undertakes no obligation to update any forward-looking statement as a result of new information, future events or otherwise, except where we are expressly required to do so by law. Financial Statements The financial statements set forth below are not the complete set of Stride, Inc.’s financial statements for the three months and year ended June 30, 2026 and are presented below without footnotes. Readers are encouraged to obtain and carefully review Stride Inc.’s Annual Report on Form 10-K for the year ended June 30, 2026, including all financial statements contained therein and the footnotes thereto, filed with the SEC, which may be retrieved from the SEC’s website at www.sec.gov or from Stride Inc.’s Investor Relations website at investors.stridelearning.com. Non-GAAP Financial Measures To supplement our financial statements presented in accordance with GAAP, we have presented adjusted operating income (loss), EBITDA, adjusted EBITDA, and adjusted earnings per share, which are not presented in accordance with GAAP. Adjusted operating income (loss) is defined as income (loss) from operations as adjusted for amortization of intangible assets, stock-based compensation, and other one-time charges or gains. EBITDA is defined as income (loss) from operations as adjusted for depreciation and amortization. Adjusted EBITDA is defined as income (loss) from operations as adjusted for depreciation and amortization, stock-based compensation, and other one-time charges or gains. Adjusted earnings per share (adjusted EPS) is defined as net income (loss) attributable to common stockholders as adjusted for the amortization of intangible assets, stock-based compensation, and other one-time charges or gains net of tax impact divided by the diluted weighted average number of common shares outstanding less the shares expected to be received for the capped call transaction related to Stride’s convertible senior notes. Adjusted operating income (loss), adjusted EBITDA, and adjusted EPS exclude stock-based compensation, which consists of expenses for restricted stock, restricted stock units, and performance stock units. Management believes that the presentation of these non-GAAP financial measures provides useful information to investors relating to our financial performance. Adjusted operating income (loss), adjusted EBITDA and adjusted EPS remove stock-based compensation, which is a non-cash charge that varies based on market volatility and the terms and conditions of the awards. EBITDA and adjusted EBITDA remove depreciation and amortization, which can vary depending upon accounting methods and the book value of assets. Adjusted operating income (loss), adjusted EBITDA and adjusted earnings per share remove one-time charges or gains which are not related to core operating activities and are not indicative of our ongoing operating performance. Additionally, adjusted EPS includes the impact from shares expected to be received by the Company to offset potential dilution from the convertible senior notes. EBITDA and adjusted EBITDA provide a measure of corporate performance exclusive of capital structure and the method by which assets were acquired. Management uses these non-GAAP financial measures: as additional measures of operating performance because they assist in comparing the Company’s performance on a consistent basis; and in presentations to the members of the Company’s Board of Directors to enable the Board to review the same measures used by management to compare the Company’s current operating results with corresponding prior periods. Other companies may define these non-GAAP financial measures differently and, as a result, these non-GAAP financial measures may not be directly comparable to similar non-GAAP financial measures used by other companies. Although these non-GAAP financial measures are used to assess the performance of the business, the use of non-GAAP financial measures is limited as they include and/or do not include certain items included and/or not included in the most directly comparable GAAP financial measure. These non-GAAP financial measures should be considered in addition to, and not as a substitute for, revenues, income (loss) from operations, net income (loss) and diluted net income (loss) per share or other related financial information prepared in accordance with GAAP. Adjusted EBITDA is not intended to be a measure of liquidity. You are cautioned not to place undue reliance on these non-GAAP financial measures. Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures are provided below. Fourth Quarter and Full Fiscal Year 2026 Reconciliation of Income from Operations to Adjusted Operating Income Reconciliation of Net Income to EBITDA and Adjusted EBITDA Reconciliation of Net Income Attributable to Common Shareholders and Diluted Net Income Per Share to Adjusted Earnings Per Share

This article first appeared on GuruFocus. Sales Growth: 17.4% increase in H1 2026, excluding currency effects. Organic Growth: 9.8% driven by data centers and energy transition-related offerings. Growth from Acquisitions: Positive scope effect of 6.9% in H1 2026. Exchange Rate Effect: Negative impact of 3.7% in H1 2026. Adjusted Operating Margin: 20.8% in H1 2026. Net Profit: EUR698 million, up 11.2% versus H1 2025. Free Cash Flow: EUR488 million, representing 9% of sales. Data Center Revenue: Organic growth above 30%, accounting for 32% of Legrand's revenue. Acquisitions: 7 acquisitions announced in 2026, with combined annual revenue of around EUR450 million. Warning! GuruFocus has detected 3 Warning Sign with WBO:SOP. Is LGRDY fairly valued? Test your thesis with our free DCF calculator. Release Date: July 29, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Legrand SA (LGRDY) reported a strong sales growth of 17.4% in H1 2026, driven by organic growth and acquisitions. The Data Center business experienced significant organic growth of over 30%, now accounting for 32% of Legrand's revenue. The company raised its full-year 2026 sales growth targets to between 16% and 19%, reflecting confidence in its strategic initiatives. Legrand SA (LGRDY) maintained a strong adjusted operating margin of 20.8% despite inflationary pressures. The company announced seven acquisitions in 2026, focused on energy and digital transition, contributing to its leadership in high-growth markets. Europe sales declined by 2.4% due to a challenging building market, impacting overall regional performance. The exchange rate effect negatively impacted sales by 3.7% in H1 2026. The company's profitability in Europe was affected by higher restructuring costs and fixed SG&A expenses. Legrand SA (LGRDY) faced challenges in managing the hyper growth of its Data Center business, leading to inefficiencies. Free cash flow was slightly lower at EUR488 million, representing 9% of sales, due to higher working capital requirements. Q: Could you provide insights on the Data Center growth in the second half, particularly in the Americas and the Rest of the World? A: In the first half, the Data Center business grew over 30% globally, with stronger growth in North America. For the full year, we expect organic growth between 25% and 30%. The pace is not slowing down, and we have solid orders and ongoing discussions, indicating optimism for the coming months. - Benoit Coquart, CEO Q: Are there any concerns about a potential bubble in the Data Center market, given its significant contribution to your sales? A: We haven't heard much about a bubble in AI-related data centers. There's a strong demand and a race to capacity, with orders extending into 2026 and beyond. The low penetration rate of AI suggests a continued need for computing capacity. While we won't grow 30% forever, we see positive momentum for the next few years. - Benoit Coquart, CEO Q: Can you elaborate on the margin performance in Europe and the Rest of the World, and how should we think about this for the second half? A: In H1, Europe and the Rest of the World saw a decrease in margins due to softer sales. Europe bears central costs and global centers for innovation, impacting profitability when sales are low. For H2, we confirm our margin guidance of 20.5% to 21%, despite inflation and geopolitical uncertainties. - Benoit Coquart, CEO Q: How are you managing pricing in the second half, especially in the context of Data Centers and other segments? A: Our price effect was 2.9% in H1, with an acceleration from Q1 to Q2. We now expect a full-year price effect of around 3%, up from our previous expectation of 2% to 3%. If needed, we can adjust pricing further based on the purchase price environment. - Benoit Coquart, CEO Q: What are your thoughts on the potential for modular prefabricated data centers, and how does this fit with your current strategy? A: Prefabricated solutions are gaining traction as they optimize supply chains and speed up data center openings. We have modular capabilities in the US, Southeast Asia, and Europe, which contribute to our growth. We'll provide more details at our Capital Market Day in Singapore. - Benoit Coquart, CEO For the complete transcript of the earnings call, please refer to the full earnings call transcript.

The market seemed underwhelmed by last week's earnings announcement from Stride, Inc. (NYSE:LRN) despite the healthy numbers. Our analysis suggests that shareholders might be missing some positive underlying factors in the earnings report. AI is about to change healthcare. These 20 stocks are working on everything from early diagnostics to drug discovery. The best part - they are all under $10bn in marketcap - there is still time to get in early. To properly understand Stride's profit results, we need to consider the US$60m expense attributed to unusual items. While deductions due to unusual items are disappointing in the first instance, there is a silver lining. We looked at thousands of listed companies and found that unusual items are very often one-off in nature. And that's hardly a surprise given these line items are considered unusual. Assuming those unusual expenses don't come up again, we'd therefore expect Stride to produce a higher profit next year, all else being equal. That might leave you wondering what analysts are forecasting in terms of future profitability. Luckily, you can click here to see an interactive graph depicting future profitability, based on their estimates. Because unusual items detracted from Stride's earnings over the last year, you could argue that we can expect an improved result in the current quarter. Based on this observation, we consider it likely that Stride's statutory profit actually understates its earnings potential! Better yet, its EPS are growing strongly, which is nice to see. The goal of this article has been to assess how well we can rely on the statutory earnings to reflect the company's potential, but there is plenty more to consider. Obviously, we love to consider the historical data to inform our opinion of a company. But it can be really valuable to consider what other analysts are forecasting. So feel free to check out our free graph representing analyst forecasts. Today we've zoomed in on a single data point to better understand the nature of Stride's profit. But there is always more to discover if you are capable of focussing your mind on minutiae. For example, many people consider a high return on equity as an indication of favorable business economics, while others like to 'follow the money' and search out stocks that insiders are buying. While it might take a little research on your behalf, you may find this free collection of companies boasting high return on equity, or this list of stocks with significant insider holdings to be useful. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.