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UT

UNIVERSAL TECHNICAL INSTITUTE INC (UTI)·Q2 2025 Earnings Summary

Executive Summary

  • Strong Q2: Revenue $207.45M (+12.6% YoY), diluted EPS $0.21 (+50% YoY vs $0.14), and Adjusted EBITDA $28.90M (+27.8% YoY); average full-time active students +10.3% and new starts +21.4% .
  • Broad-based execution: UTI revenue +8.8% YoY to $134.23M; Concorde +20.3% to $73.22M; segment Adjusted EBITDA $28.0M and $10.9M, respectively .
  • Guidance raised across all metrics: FY25 revenue to $825–$835M (from $810–$820M), EPS to $1.00–$1.08, Adjusted EBITDA to $124–$128M, starts to 29,000–30,000, and Adjusted FCF to $62–$68M .
  • Estimate beats: Q2 revenue beat S&P consensus ($207.45M vs $196.63M*), EPS beat ($0.21 vs $0.122*), and EBITDA outperformed consensus ($24.99M* actual vs $22.09M* est; S&P EBITDA) driven by enrollment momentum and deliberate spend pacing . Values retrieved from S&P Global.

What Went Well and What Went Wrong

What Went Well

  • Enrollment momentum: New starts +21.4% (6,650) and average full-time active students +10.3% (24,604), exceeding internal expectations; Concorde conversion rates strong on higher marketing ROI .
    • “We executed with discipline… both revenue and adjusted EBITDA significantly outperformed forecast.” — CFO Bruce Schuman .
  • Segment outperformance: Concorde revenue +20.3% YoY to $73.22M and Adjusted EBITDA doubled to $10.9M on marketing and admissions investments; UTI revenue +8.8% to $134.23M and Adjusted EBITDA $28.0M .
  • Guidance raise: FY25 guidance increased across all key metrics reflecting stronger student trends and execution .
    • “We are raising our fiscal 2025 guidance ranges across all key metrics.” — CFO .

What Went Wrong

  • Margin seasonality/investment: EBITDA margin compressed sequentially (see table) as quarterly seasonality and growth investments weighed; management reiterated margins will be lower in Q2/Q3 and recover in Q4 .
  • Capacity constraints at Concorde: Management flagged that sustaining high-teens growth could be harder as clinical program capacity tightens and comps toughen in 2H .
  • Near-term OpEx trajectory: Management expects elevated OpEx and CapEx tied to Phase II (campus/program builds), with EBITDA growth slower in FY26–FY27 before re-accelerating in FY28–FY29 .

Financial Results

Quarterly actuals (oldest → newest)

MetricQ4 2024Q1 2025Q2 2025
Revenue ($M)$196.36 $201.43 $207.45
Diluted EPS ($)$0.34 $0.40 $0.21
Adjusted EBITDA ($M)$37.31 $35.51 $28.90

Margins (oldest → newest)

MetricQ4 2024Q1 2025Q2 2025
EBITDA Margin %17.23%*17.63%*12.05%*
EBIT Margin %13.28%*13.66%*8.12%*
Values retrieved from S&P Global.

Q2 2025 actual vs S&P Global consensus

MetricActualConsensusSurprise
Revenue ($M)$207.45 $196.63*+$10.82M / +5.5% (beat)
Diluted EPS ($)$0.21 $0.1217*+$0.088 (beat)
EBITDA ($M, S&P def.)$24.99*$22.09*+$2.90M (beat)
Values retrieved from S&P Global.

Segment breakdown (Q2)

MetricQ2 2024Q2 2025YoY
UTI Revenue ($M)$123.32 $134.23 +8.8%
Concorde Revenue ($M)$60.85 $73.22 +20.3%
UTI Adjusted EBITDA ($M)$24.36 $27.98 +14.9%
Concorde Adjusted EBITDA ($M)$5.42 $10.92 +101.6%

KPIs (Q2)

KPIQ2 2024Q2 2025YoY
Total New Starts5,480 6,650 +21.4%
Avg FT Active Students22,316 24,604 +10.3%
End-of-Period FT Active Students22,077 24,851 +12.6%
UTI New Starts2,840 3,591 +26.4%
Concorde New Starts2,640 3,059 +15.9%

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
New student startsFY 202528,500–29,500 29,000–30,000 Raised
Revenue ($M)FY 2025810–820 825–835 Raised
Net Income ($M)FY 202554–58 56–60 Raised
Diluted EPS ($)FY 20250.96–1.04 1.00–1.08 Raised
Adjusted EBITDA ($M)FY 2025122–126 124–128 Raised
Adjusted FCF ($M)FY 202560–65 62–68 Raised

Earnings Call Themes & Trends

TopicPrevious Mentions (Q1 2025)Current Period (Q2 2025)Trend
Regulatory/DoEExpect reduced burden; focus on outcomes; progress on CFO search Stronger communication with new DoE leadership; no operational disruptions; potential to accelerate growth Improving clarity/engagement
Marketing & Admissions ROIConcorde investments driving starts; turning the dial up Very strong conversion at Concorde; continued investment where ROI is favorable Positive, sustained
Skilled Trades DemandExpanding HVACR, skilled trades across UTI; healthy macro tailwinds Demand outpacing initial estimates in welding/HVAC/electrical; adult/local demand higher Strengthening
Seasonality/MarginsLow DD EBITDA margins in Q2/Q3; upper-teens in Q4 Similar cadence reiterated; deliberate spend pacing Consistent
Expansion Pipeline3 campuses for 2026 (Heartland co-brand, Atlanta UTI, a third TBD) -Confirms 3 campuses (adds San Antonio announcement externally) and multiple 2025 program launches - On track/expanding
Long-term Margin PathEBITDA CAGR ~15% to ~20% margins by FY29 (non-linear) FY26–27 growth to slow with OpEx; re-accelerates into FY28–29 toward ~20% margins Reaffirmed

Management Commentary

  • “We maintained strong operational momentum… both revenue and adjusted EBITDA significantly outperformed forecast.” — CEO Jerome Grant .
  • “Concorde… driven by further investments in marketing and admissions and the effectiveness of those teams.” — CFO Bruce Schuman .
  • “We are raising our fiscal 2025 guidance ranges once again… revenue between $825 million and $835 million… adjusted EBITDA between $124 million and $128 million.” — CEO .
  • On macro and tariffs: “We expect impact, if any, to be minimal… demand for skilled labor… continues to strengthen.” — CEO .
  • On FY26–27 investment phase: “EBITDA growth… will slow… As these initiatives scale, we expect… acceleration into fiscal 2028 and 2029.” — CFO .

Q&A Highlights

  • Starts drivers: Strength in Concorde clinical programs and UTI skilled trades; increased marketing effectiveness; adult/local mix aiding faster starts .
  • Segment cadence: Concorde growth may moderate on capacity/comps; UTI H2 tied to high-school pipeline timing .
  • Investment cadence: About $6M 2H OpEx focused on campus build-outs and early hiring; ~$55M FY25 capex with ~70% for growth investments .
  • Employer demand: Multiple jobs per transportation grad; rising need in welding/electrical/HVAC; data center build-outs cited .
  • Military channel: Recruiters expanded from 16 to 26; more outreach on GI Bill awareness supporting growth .
  • Guidance posture: Management “comfortable and confident” with new ranges; highlights seasonality and mix dynamics .

Estimates Context

  • Q2 2025 S&P consensus: revenue $196.63M*, EPS $0.1217*, EBITDA $22.09M*; actuals beat across metrics (revenue $207.45M, EPS $0.21, S&P EBITDA actual $24.99M*) . Values retrieved from S&P Global.
  • Estimate base: 6 estimates for revenue and EPS in Q2 2025*; stronger-than-expected student trends and disciplined spend contributed to beats . Values retrieved from S&P Global.

Key Takeaways for Investors

  • Broad beat-and-raise quarter with enrollment strength and improved profitability; Concorde outperformance underscores marketing ROI and healthcare demand .
  • Guidance raised across revenue, EPS, Adjusted EBITDA, starts, and Adjusted FCF—key catalyst supporting near-term sentiment .
  • Margins follow seasonal pattern with investments weighing near term; management reaffirmed non-linear path to ~20% EBITDA margins by FY29 .
  • Skilled trades and healthcare tailwinds remain robust; program expansions (HVACR, EEIT) and 2026 campuses (including San Antonio, Atlanta, Heartland Dental) extend runway - .
  • Liquidity solid ($234.7M available: $96.0M cash, $39.7M short-term investments, $99.0M revolver) enabling growth capex and potential M&A .
  • Watch for Concorde clinical capacity and high-school seasonality shaping 2H cadence; management flagged tougher comps for starts in Q3–Q4 .
  • Strategic investments (OpEx/CapEx) to weigh on EBITDA growth in FY26–27 before scale benefits accrue; long-term thesis intact with durable demand and expanding footprint .

Additional Relevant Developments (Q2 period)

  • Crown Equipment collaboration: 30-year partnership highlighted; Crown joins Early Employment Program across 11 campuses, reinforcing employer pipeline .
  • San Antonio skilled trades campus announced (target Spring 2026), offering aviation, welding, HVACR, electrical/electronics; part of North Star Strategy .

Notes:

  • All S&P Global estimate and margin values are marked with an asterisk (*) and are Values retrieved from S&P Global.