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LAUREATE EDUCATION, INC. (LAUR)·Q1 2025 Earnings Summary

Executive Summary

  • Q1 2025 revenue was $236.2M, down 14% year over year but ahead of Wall Street consensus ($223.7M); EPS was $(0.13) vs $(0.19) consensus, and Adjusted EBITDA was $5.4M vs $(5.0)M consensus, with management noting revenue and EBITDA were ahead of their guidance . Values retrieved from S&P Global.*
  • The quarter was impacted by academic calendar timing, with ~$26M of revenue and ~$23M of EBITDA shifted out of Q1 into the second half; management tightened FY25 guidance and raised midpoints (+$10M revenue, +$5M EBITDA) .
  • Enrollment intake was strong on a timing-adjusted basis: new enrollments +7% and total +6%; Mexico new +8% (secondary intake) and Peru new +6% (primary intake) .
  • Capital return remains a key theme: $42M repurchased in Q1; $56M authorization remaining; net debt ~$5M with $109.8M cash and $114.6M gross debt .

What Went Well and What Went Wrong

  • What Went Well

    • Timing-adjusted growth: New enrollments +7% and total enrollments +6%, with Mexico new +8% and Peru new +6%; CFO emphasized the normalization was purely due to a ~2-week later start in Peru .
    • Guidance tightened with higher midpoints: FY25 revenue to $1.560–$1.575B and Adjusted EBITDA to $473–$480M; management expects margin expansion (~150 bps) and ~50% EBITDA-to-unlevered FCF conversion .
    • Strong balance sheet and shareholder returns: $42M Q1 buybacks; $56M remaining; cash $109.8M, gross debt $114.6M; management reiterated commitment to return excess cash .

  • What Went Wrong

    • Reported revenue and profitability pressured by academic calendar: Q1 revenue down 14% YoY to $236.2M; Adjusted EBITDA down to $5.4M; ~$26M revenue and ~$23M EBITDA shifted to 2H .
    • FX headwinds: Weaker Mexican peso expected to pressure USD-reported results in FY25; company maintained MXN 20.50 in guidance amid volatility .
    • Peru seasonal and fixed-cost drag: Seasonally out-of-session quarter with limited revenue recognition and fixed costs; Peru Adjusted EBITDA (Q1) was $(38.8)M vs $(20.7)M .

Financial Results

  • Quarterly performance
MetricQ3 2024Q4 2024Q1 2025
Revenue ($USD Millions)$368.6 $423.4 $236.2
Net Income ($USD Millions)$85.3 $93.6 $(19.6)
Diluted EPS ($USD)$0.56 $0.62 $(0.13)
Adjusted EBITDA ($USD Millions)$91.4 $141.1 $5.4
  • Margins
MetricQ3 2024Q4 2024Q1 2025
EBITDA Margin %24.05%*33.15%*1.22%*
EBIT Margin %19.54%*29.34%*−5.59%*
Net Income Margin %23.18%*22.11%*−8.26%*

Values retrieved from S&P Global.*

  • Q1 2025 vs prior year and estimates
MetricQ1 2024Q1 2025 ActualYoY ChangeWall Street ConsensusSurprise
Revenue ($USD Millions)$275.4 $236.2 −14% $223.7*+$12.5M / +5.6%*
EPS ($USD)$(0.07) $(0.13) −$0.06 $(0.19)*+$0.06*
Adjusted EBITDA ($USD Millions)$30.6 $5.4 −$25.2 $(5.0)*+$10.4M*

Values retrieved from S&P Global.*

  • Segment breakdown (Q1)
SegmentRevenue Q1 2024 ($M)Revenue Q1 2025 ($M)Reported YoYOrganic CC YoYAdj. EBITDA Q1 2024 ($M)Adj. EBITDA Q1 2025 ($M)Reported YoYOrganic CC YoY
Mexico$214.1 $189.3 −12% +6% $59.9 $53.0 −12% +7%
Peru$61.2 $46.9 −23% −25% $(20.7) $(38.8) −87% −86%
Corporate & Elims—$0.1 nm nm $(8.6) $(8.8) −2% −2%
Total$275.4 $236.2 −14% −1% $30.6 $5.4 −82% −45%
  • KPIs
KPIMexicoPeruTotal
New Enrollments YTD 1Q 202544,200 (+8%) 49,800 (−9%; +6% timing-adjusted) 94,000 (−2%; +7% timing-adjusted)
Total Enrollments as of 3/31/2025250,200 (+7%) 226,800 (flat; +5% timing-adjusted) 477,000 (+4%; +6% timing-adjusted)

Guidance Changes

MetricPeriodPrevious Guidance (Feb 20, 2025)Current Guidance (May 1, 2025)Change
Total EnrollmentsFY 2025489K–495K 491K–495K Raised low end; midpoint +1K
Revenue ($USD Billions)FY 2025$1.545–$1.570 $1.560–$1.575 Midpoint +$10M (operational) and +$5M (FX)
Adjusted EBITDA ($USD Millions)FY 2025$467–$477 $473–$480 Midpoint +$5M
Q2 Revenue ($USD Millions)Q2 2025—$499–$504 New quarterly outlook
Q2 Adjusted EBITDA ($USD Millions)Q2 2025—$191–$194 New quarterly outlook
Campus consolidation impact (Revenue)FY 2025—~$8M one-time headwind (Mexico) New disclosure

Notes: FX headwind on USD-reported results persists due to MXN weakness; constant-currency growth expected 6–7% revenue and 11–13% EBITDA; adjusted EBITDA margin accretion ~150 bps at mid-point .

Earnings Call Themes & Trends

TopicPrevious Mentions (Q3 2024 and Q4 2024)Current Period (Q1 2025)Trend
Academic calendar timingNot a focus in Q3/Q4 releases~$26M revenue and ~$23M EBITDA shifted out of Q1; Peru started ~2 weeks later New 2025 seasonality shift; offsets expected in 2H
FX (MXN volatility)FY25 outlook cautioned on MXN weakness Maintained MXN 20.50 rate in guidance amid volatility; USD translation remains headwind Continued caution; guide conservatively
Digital/online programsNot detailed in Q3/Q4 releasesFully online growing double digit; ~100k students (~20% of total); faster than face-to-face (3–4x) Structural mix shift to online
Macro backdropPeru recovery aided Q3 2024 performance Mexico: resilient demand; cautious on trade tensions; Peru: ~3% 2025 GDP, favorable rates/inflation Macro constructive but volatile FX
Capital allocationNew $100M buyback announced/completed in 2024 $42M buybacks in Q1; plan to return excess cash; ~50% EBITDA to unlevered FCF conversion Ongoing capital return
Campus consolidations (Mexico)Not emphasized in Q3/Q4 releasesExpect ~$8M revenue loss in 2025; margin optimization continues Near-term headwind; margin tailwind longer-term

Management Commentary

  • CEO (press release): “We are tightening the range on our full-year 2025 guidance, raising the mid-point for both Revenue and Adjusted EBITDA... we remain committed to continuing to return excess capital to shareholders” .
  • CFO (call): “Approximately $26 million of revenue and $23 million in adjusted EBITDA will shift from the first quarter to the second half of the year… revenue for the first quarter was up 10% YoY and adjusted EBITDA increased 132% on an organic constant currency basis, adjusted for timing” .
  • CEO (call, digital): “Fully online courses are growing at a very robust rate… about 100,000 students, or about 20% of our student population, enrolled in fully online digital learning” .

Q&A Highlights

  • Intake timing normalization: Peru’s intake started ~2 weeks later; normalized new enrollments +7% (Mexico +8%, Peru +6%); no other normalization adjustments .
  • FX in guidance: Maintained MXN 20.50 given unusual volatility, despite recent strengthening; typically guide at spot, but not in a typical environment .
  • Digital growth: Fully online growing double-digit in both markets; 3–4x faster than face-to-face; ~100k online students (~20% of total) .
  • Capital return cadence: Plan to return excess cash with ~50% EBITDA-to-unlevered FCF conversion and continue $100M buyback program; Board to reassess upon program completion .
  • Mexico fall intake: Working-adult secondary intake robust; primary intake expectation broadly consistent with prior year (4–5%) given macro backdrop .

Estimates Context

  • Q1 2025 actual vs consensus
MetricConsensusActualSurprise
Revenue ($USD Millions)$223.7*$236.2 +$12.5 (+5.6%)*
EPS ($USD)$(0.19)*$(0.13) +$0.06*
EBITDA ($USD Millions)$(5.0)*$2.9*+$7.9M*

Values retrieved from S&P Global.*

  • FY 2025 consensus vs company guidance
    • FY25 revenue consensus: ~$1.680B vs company guidance $1.560–$1.575B (consensus above guidance midpoint)*
    • FY25 EBITDA consensus: ~$508.5M vs company guidance $473–$480M (consensus above guidance midpoint)*
    • Implication: Consensus likely to adjust down toward company guidance given FX headwinds and campus consolidation impact disclosed . Values retrieved from S&P Global.*

Key Takeaways for Investors

  • Reported headwinds are largely timing/FX: ~$26M revenue and ~$23M EBITDA shifted out of Q1; majority expected to offset in 2H, with seasonality stronger in Q2/Q4 .
  • Guidance credibility improved: Tightened FY25 ranges with higher midpoints; constant-currency growth strong (revenue +6–7%, EBITDA +11–13%) despite FX translation .
  • Mix shift to online supports structural growth: Double-digit online growth and ~20% of students online should enhance scalability and margin over time .
  • Mexico margins continue to optimize: Despite consolidation-related ~$8M revenue hit, management targets consolidated margin accretion (~150 bps) in FY25 .
  • Capital return intact: $42M buybacks in Q1; ~$56M authorization remaining; net debt ~$5M provides flexibility .
  • Near-term trading setup: Q2 guide ($499–$504M revenue; $191–$194M EBITDA) suggests sequential rebound as seasonality normalizes; beats vs consensus in Q1 may support sentiment . Values retrieved from S&P Global.*
  • Medium-term thesis: Secular demand, favorable participation trends in Mexico/Peru, and resilient business model through cycles underpin steady growth; FX volatility remains the primary USD-reported risk .

Appendix: Additional Source Notes

  • Q1 2025 8-K press release and earnings presentation (Exhibits 99.1, 99.2): published May 1, 2025 .
  • Q1 2025 earnings call transcript: May 1, 2025 –.
  • Q4 2024 press release: February 20, 2025 –.
  • Q3 2024 press release: October 31, 2024 –.
  • Q1 2025 earnings date announcement press release: April 8, 2025 .