Executive Summary

Q3 FY2025 delivered record growth: revenue $18.58M (+50.7% YoY) and diluted EPS $0.21, driven by a 49.8% increase in ending enrollment to 3,245 and 70.7% growth in new student starts, including the CCMCC acquisition .
Results materially beat Wall Street consensus: revenue $18.58M vs $16.14M, EBITDA $3.80M vs $2.81M, and EPS $0.21 vs $0.15; strength came from nursing and imaging cohorts added mid-quarter, per management commentary . Estimates marked with an asterisk are from S&P Global.
No formal guidance was issued; management emphasized typical seasonality (Q1 and Q3 strongest) and indicated Q4 should reflect general seasonality, with some starts pulled forward into Q3 .
Near-term stock reaction catalysts: visible demand momentum (new student starts and enrollment), continued program expansion (EMT rollout across campuses), and active M&A pipeline discussions, with nursing and imaging identified as upside drivers .

What Went Well and What Went Wrong

What Went Well
- “Record” quarter with broad-based demand: revenue +50.7% YoY to $18.6M and adjusted EBITDA +60% to $3.9M; ending enrollment +49.8% to 3,245 students, new starts +70.7% to 1,227 .
- Upside drivers explicitly called out: “nursing and imaging” contributed meaningfully; added two nursing classes (~53 students) and an imaging cohort (20 students) .
- Balance sheet capacity for growth: cash $17.33M and working capital $21.95M as of March 31, enabling branching and accretive acquisitions .
What Went Wrong
- Elevated operating costs to support growth: educational services expense +54.6% YoY (to $10.1M) and G&A +39.5% YoY (to $4.6M), driven by instructional staffing, rent/externship fees, marketing, professional fees, and bad debt .
- Seasonality and timing effects: management indicated quarter-to-quarter timing of starts pulled some Q4 starts into Q3, implying less robust Q4 vs prior-year Q4 despite strong underlying demand .
- Non-GAAP reliance: adj. EBITDA excludes stock-based compensation; while helpful analytically, investors should monitor underlying cost trends and non-cash comp over time .

Financial Results

Metric	Q1 FY2025 (Sep 30, 2024)	Q2 FY2025 (Dec 31, 2024)	Q3 FY2025 (Mar 31, 2025)
Revenue ($USD Millions)	$14.000	$13.635	$18.578
Net Income ($USD Millions)	$2.101	$1.399	$2.817
Diluted EPS ($)	$0.21	$0.10	$0.21
Operating Income ($USD Millions)	n/a	$1.658	$3.666
EBITDA ($USD Millions)	n/a	$2.114 (FY table)	$3.796
Adjusted EBITDA ($USD Millions)	n/a	$2.384 (FY table)	$3.903
EBITDA Margin (%)	n/a	15.5% (2.114/13.635)	20.4% (3.796/18.578)

Notes: EBITDA/Adj. EBITDA for Q2 are shown in the FY press release reconciliation; Q3 margins calculated from cited revenue and EBITDA.

Vs Estimates (Q3 FY2025):

Metric	Consensus (Q3 FY2025)	Actual (Q3 FY2025)	Surprise
Revenue ($USD Millions)	$16.139*	$18.578	+$2.439M (~+15.1%)
EBITDA ($USD Millions)	$2.813*	$3.796	+$0.983M (~+35.0%)
Diluted EPS ($)	$0.15*	$0.21	+$0.06 (~+40.0%)

Values with asterisk (*) retrieved from S&P Global.

KPIs and Enrollment:

KPI	Q1 FY2025	Q2 FY2025	Q3 FY2025
Ending Student Population (students)	2,539	2,768	3,245
New Student Starts (quarter)	+23.3% YoY (abs not disclosed)	347 (vs 337)	1,227 (vs 719)
CCMCC Students Added	n/a	389	468

Segment breakdown: Company reports a single operating focus in career-focused healthcare education; no segment revenue breakdown disclosed in Q3 materials .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Revenue	FY2025/Q4	None issued	None issued; management reiterated typical seasonality and timing effects	Maintained (no formal guidance)
EBITDA/Margins	FY2025/Q4	None issued	None issued; costs elevated to support growth	Maintained (no formal guidance)
OpEx	FY2025/Q4	None issued	Continued investments in instructional staffing, marketing, rent/externship	Maintained (no formal guidance)
Programs/Starts	FY2025/Q4	None issued	Q4 to reflect general seasonality; some starts pulled into Q3	Maintained (qualitative)

Management did not provide numeric guidance ranges in Q3 FY2025.

Earnings Call Themes & Trends

Topic	Previous Mentions (Q1 FY2025 and Q2 FY2025)	Current Period (Q3 FY2025)	Trend
Demand & Enrollment	Q1: Revenue +35.1% YoY; student population 2,539 . Q2: Surpassed 3,000 enrolled (as of Jan 31); student pop 2,768 .	Record quarter; ending enrollment 3,245; starts +70.7% .	Strengthening
Program Expansion (Allied Health)	Ongoing investments in RN program; CCMCC acquisition closed 12/18 .	Nursing and imaging cohorts expanded; EMT rollout underway across HDMC campuses pending county approvals .	Expanding
Seasonality & Timing	Q2: Seasonal softness; limited starts growth (+3%) .	Q3 benefited from starts timing; Q4 expected to reflect general seasonality .	Neutral (timing shift)
M&A Pipeline	CCMCC integrated; exploring targets .	“Talking to a few” targets; no specifics disclosed .	Active discussions
Regulatory/Title IV & Accreditation	Compliance emphasized; RN program investments .	Continued compliance and strong placement (NCLEX 83% pass, placement ~75–76%) in transcript narrative .	Stable/Positive
Technology/Hybrid	Hybrid learning and simulation technology referenced .	Continued emphasis on hybrid models to scale efficiently .	Ongoing execution

Management Commentary

CEO framing: “Surpassing 3,000 enrolled students and achieving more than 50% revenue growth reflect the success of our strategic focus and the growing demand for career-focused education.” .
Upside drivers: “Our top programs remained strong… We added two nursing classes (~53 enrollments) and an imaging cohort (20), leading to the fantastic quarter.” .
Strategic priorities: “Driving enrollment growth, expanding program offerings, optimizing operational efficiency and pursuing branching and accretive acquisitions.” .
Seasonality clarification: “Q3 is impacted by starts timing… some starts that would typically show up in Q4 showed up in Q3 this year… Q4 similar seasonality, probably a little less than Q4 of last year.” .

Q&A Highlights

What drove the beat: Nursing and imaging were the largest contributors, with incremental cohorts added mid-quarter .
Seasonality/guidance color: Management stressed typical seasonality and the timing of starts between quarters; no quantitative guidance ranges provided .
EMT program rollout: Approved at HDMC sites; launched in Temecula; weekend 12-week program; expanding post county approvals to additional campuses .
M&A: Active pipeline discussions beyond initial conversations; no specifics disclosed yet .

Estimates Context

Q3 FY2025 beats vs Street: revenue $18.58M vs $16.14M*, EBITDA $3.80M vs $2.81M*, EPS $0.21 vs $0.15*; materially above across all three metrics .
Estimate breadth: Two estimates each for revenue and EPS in Q3, indicating emerging coverage for a smaller-cap education company.*
Implications: Given the magnitude of beat and explicit upside drivers in nursing/imaging, estimates for subsequent quarters should reflect stronger throughput and cohort additions, while moderating for seasonality.