Greg Parrish's questions to Stride Inc (LRN) leadership • Q4 2025
Question
Greg Parrish of Morgan Stanley questioned the sustainability of Stride's long-term framework for operating income to grow at twice the rate of revenue, especially after recent outperformance. He also asked for more color on the strong Q4 funding and the broader FY26 funding outlook amid federal and state budget uncertainty.
Answer
CEO James Rhyu acknowledged that achieving operating income growth at twice the rate of revenue becomes mathematically harder at scale and noted that gross margin expansion is expected to slow. CFO Donna Blackman added that Q4 revenue per enrollment was strong due to state mix and some favorable growth and completion funding. Both executives described the overall FY26 funding environment as positive, with no material negative impact anticipated from the federal level.