Nuno Fernandes
AMERICAN PUBLIC EDUCATIONAbout Nuno Fernandes
Nuno S. Fernandes has served as President of American Public University System (APUS) since August 2022, leading operations across American Military University and American Public University within APEI’s portfolio . Prior to APUS, he held senior roles at Ilumno (President & CEO, EVP Global Operations & Strategic Alliances, and other leadership posts), and earlier leadership positions at Overseas Leisure Group and Bosch, bringing deep experience in enrollment, operations, and strategic alliances across higher education and services . In 2024, APEI delivered $624.6 million in revenue and Adjusted EBITDA of $72.3 million, exceeding guidance and with PSUs earned at 145.5% on revenue and Adjusted EPS goals, underscoring pay-for-performance alignment for the APUS leader’s compensation framework .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| APUS (APEI) | President | Aug 2022–Present | Lead APUS execution on growth, margin expansion, and compliance priorities (e.g., 90/10 Rule) |
| Ilumno | President & CEO | 2019–2022 | Expanded access to higher education in Latin America; drove operations and strategic alliances |
| Ilumno | EVP Global Operations & Strategic Alliances | 2018–2019 | Built partnerships and operational scale across institutions |
| Ilumno | EVP Strategic Alliances | 2017–2018 | Led partner development and growth initiatives |
| Ilumno | SVP Global Operations | 2016–2017 | Managed enterprise operations to support enrollment and student services |
| Ilumno | Chief Marketing & Operations Officer | 2015–2016 | Integrated marketing and operations for efficiency and growth |
| Ilumno | SVP Marketing, Enrollment & Student Services | 2014–2015 | Directed enrollment and student outcomes strategy |
| Ilumno | SVP Marketing, Enrollment | 2013–2014 | Drove top-of-funnel growth and conversion strategies |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Overseas Leisure Group | Leadership roles | Prior to 2013 | Commercial and operational leadership |
| Bosch | Leadership roles | Prior to 2013 | Product/operations discipline transferable to education ops |
Fixed Compensation
| Component | 2023 | 2024 | Notes |
|---|---|---|---|
| Base Salary ($) | $475,000 | $500,000 | 5.3% increase based on APUS 2023 Adjusted EBITDA performance and market alignment |
| Target Annual Incentive (% of Salary) | 65% | 65% | Threshold 32.5%; Max 130% |
| Actual Annual Incentive ($) | $388,270 | $199,079 | 61.3% of target payout for 2024 |
Performance Compensation
Annual Incentive Plan (AIP) – 2024 Design and Outcomes
| Metric | Weighting | Threshold | Target | Maximum | Actual | Payout % | Notes |
|---|---|---|---|---|---|---|---|
| APEI Adjusted EBITDA | 10% | $52.1M | $65.2M | $78.2M | $70.8M | 143.3% | Gateway metric applies enterprise-wide; APEI above target |
| APUS Adjusted EBITDA | 20% | $73.2M | $91.5M | $109.8M | $98.2M | 136.4% | Above target; Committee excludes certain unbudgeted costs for AIP calc |
| APUS Revenue | 20% | $286.4M | $318.2M | $350.0M | $317.0M | 98.2% | Near target performance |
| Strategic Goal (APUS 90/10 Rule) | 50% | Not disclosed | Not disclosed | Not disclosed | 0% | 0% | Compliance achieved but below payout level; targets proprietary |
| Total AIP Payout | — | — | — | — | — | 61.3% | Resulting cash payout $199,079 |
Key design changes in 2024: shift to Adjusted EBITDA and revenue, equalized earnings/growth weighting, higher performance thresholds, and standardized max payout at 200% to tighten pay-performance alignment .
Long-Term Incentives (granted 1/31/2024)
| Instrument | Grant Value | RSUs (#) | PSUs (#, target) | Vesting | Performance Metrics |
|---|---|---|---|---|---|
| RSUs and PSUs | $370,300 | 17,500 | 17,500 | 3 equal annual tranches starting 1/31/2025 | PSUs: 50% revenue, 50% Adjusted EPS |
2024 PSU performance and earnout:
| Metric | Threshold | Target | Maximum | Actual 2024 | % of Target Earned |
|---|---|---|---|---|---|
| Revenue | 90% ($572.4M) | 100% ($636.0M) | 110% ($699.6M) | $624.6M | 91% |
| Adjusted EPS | 85% ($0.67) | 100% ($0.79) | 115% ($0.91) | $1.00 | 200% |
| Total PSU Earnout | — | — | — | — | 145.5% of target; 25,463 PSUs earned subject to time-vesting |
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial Ownership | 51,720 shares; <1% of outstanding (18,036,421) |
| Stock Ownership Guidelines | 2x base salary for executives other than CEO/CFO; compliance assessed annually using 60-day average price; execs in compliance as of 12/31/2024 |
| Hedging/Pledging | Prohibited for directors/officers; no margin accounts or pledging allowed |
| Clawback | Incentive compensation recoupment policy covering restatements and misconduct; compliant with SEC rules |
Outstanding equity and vesting schedule:
| Category | Quantity | Vest/Status | Reference |
|---|---|---|---|
| Unvested stock/units (total) | 69,834 units; $1,506,316 market value at $21.57 (12/31/2024) | Various tranches through 2027 | |
| 2024 Tranche (PSU/RSU) | 8,488 PSUs; 5,834 RSUs | Vest 1/31/2025 | |
| 2026 Tranche (PSU/RSU) | 8,488 PSUs; 5,833 RSUs | Vest 1/31/2026 | |
| 2027 Tranche (PSU/RSU) | 8,488 PSUs; 5,833 RSUs | Vest 1/31/2027 | |
| 2023 Tranche (PSU/RSU) | 4,193 PSUs; 5,164 RSUs | Vest 2/07/2025; 2/07/2026 | |
| 2022 RSU | 8,157 RSUs | Vest 8/29/2025 | |
| Stock Options (APUS award) | 15,037 exercisable; 7,519 unexercisable; strike $10.66 | Remaining vest 8/29/2025; expiration 8/29/2032 | |
| In-the-money indicator | At $21.57 (12/31/2024), options were in-the-money; strike $10.66 vs price $21.57 |
Insider selling pressure indicators:
- Multiple vesting events in early calendar years (Jan/Feb), with meaningful tranches through 2027 could drive periodic sell-to-cover activity for taxes and liquidity .
- Options in-the-money at 12/31/2024 price with remaining vest in Aug 2025 may create additional exercise/monetization windows depending on blackout periods .
- Pledging/hedging prohibitions reduce forced-sale and misalignment risk .
Employment Terms
| Term | Fernandes (APUS President) | Citation |
|---|---|---|
| Employment agreement | No individual employment agreement; covered by Executive Severance Plan | |
| Severance (no CIC) | Cash equal to base salary plus pro-rata annual bonus; COBRA premium differential for 12 months (lump sum) subject to release and covenants | |
| Severance (with CIC) | If terminated within 6 months post-CIC or resigns for good reason: 1.5x base salary + target annual bonus; COBRA premium differential for 18 months (lump sum) | |
| Equity on CIC termination | 2017 Plan: full vesting upon termination without cause within one year of a CIC if awards are assumed/continued/substituted | |
| Non-compete / Non-solicit | Required under Executive Severance Plan; generally 12 months post-termination | |
| Clawbacks | Applicable per Company policy | |
| Deferred Compensation | Company match $21,462; aggregate balance $31,242 (2024) |
Compensation Structure vs Performance Metrics
| Element | Weighting/Target | 2024 Outcome | Notes |
|---|---|---|---|
| AIP Financials (Fernandes) | 50% total: 10% APEI Adj. EBITDA; 20% APUS Adj. EBITDA; 20% APUS revenue | Above target on both EBITDA; near target on revenue | Tight linkage to institution and enterprise performance |
| AIP Strategic (Fernandes) | 50%: APUS 90/10 Rule | 0% payout despite compliance (below threshold) | Reinforces compliance rigor and payout calibration |
| LTI (PSUs) | 50% revenue; 50% Adjusted EPS | 145.5% of target earned; subject to 3-year ratable vest | Balanced growth and earnings metrics |
Risk Indicators & Red Flags
- Related party transactions: None reported since beginning of 2024 .
- Hedging/pledging: Prohibited for directors and officers .
- Tax gross-ups: Not provided for CIC; shareholder-friendly practice .
- Say-on-Pay: 92% support in 2024, improved from 2023 .
- Section 16 reporting: No delinquency noted for Fernandes in 2024; two directors had late Form 4s .
Compensation Peer Group (Benchmarking context)
APEI’s compensation peer group for 2024 included TWOU, ATGE, LOPE, LAUR, LINC, PRDO, STRA, LRN, UTI; Willis Towers Watson survey data was primary and peer group used for context; NEO target long-term incentive values were below competitive range in 2024 due to share management and performance considerations .
Investment Implications
- Pay-for-performance alignment: Fernandes’ AIP split places heavy weighting on APUS-specific results and compliance, with PSUs tied to enterprise revenue and Adjusted EPS. His 2024 payout at 61.3% reflects disciplined calibration when strategic thresholds aren’t met, while PSU overachievement (145.5%) tracks enterprise beat on Adjusted EPS with near-target revenue—supportive for retention and execution incentives .
- Insider selling pressure: Layered RSU/PSU vesting across 2025–2027 and in-the-money options at year-end 2024 imply ongoing sell-to-cover cycles, but strict hedging/pledging bans mitigate misalignment and forced sale risks .
- Retention and CIC economics: Executive Severance Plan terms (1.5x base + target bonus on CIC termination for Fernandes) are moderate, with equity acceleration in certain CIC termination scenarios, balancing retention with shareholder protections (no gross-ups, clawbacks) .
- Ownership alignment: Beneficial ownership, unvested equity, and 2x salary ownership guideline compliance indicate meaningful skin-in-the-game, with mandated hold requirements until guideline attainment—supportive of long-term alignment .