Covista Fiscal Q4 2026 Earnings: Walden Drives 9.7% Revenue Growth

Covista (NYSE: CVSA) reported fiscal Q4 2026 revenue of $501.4 million, up 9.7% year over year, while diluted EPS rose to $2.06 from $1.44. Total enrollment increased 8.4% to 99,472 students, led by Walden University, and operating expenses grew more slowly than revenue, supporting higher margins.

Core earnings data

For the quarter ended June 30, 2026, total operating costs and expenses increased approximately 6.8%, below revenue growth of 9.7%. Student services and administrative expense rose about 4.0%, helping operating margin expand by approximately 2.2 percentage points.

Lower share count also amplified per-share growth. Diluted weighted-average shares declined about 7.5% to 34.8 million, contributing to EPS growing faster than net income.

GAAP and adjusted EPS were close in the quarter, at $2.06 and $2.09 respectively, indicating that excluded items had a relatively limited net effect on quarterly per-share results.

Business and segment performance

All three operating segments reported enrollment and revenue growth, but the rates varied considerably. Walden was the largest and fastest-growing segment, while Chamberlain’s recovery remained comparatively modest.

Chamberlain’s enrollment increase was driven by pre-licensure nursing. The university also plans to begin classes at new Cincinnati and Salt Lake City campuses during the first half of fiscal 2027.

Walden’s enrollment growth came from both healthcare and non-healthcare programs. Programs introduced heading into the 2026 academic year had enrolled more than 1,700 students, while total enrollment reached a record for the university.

Medical and Veterinary growth reflected higher enrollment in both areas. Segment operating income increased 12.1% to $16.7 million.

Walden drove most of the incremental revenue and margin expansion

Walden generated $28.6 million of Covista’s $44.3 million consolidated quarterly revenue increase, or approximately 65%. Its operating income rose 35.9% to $59.8 million, and its operating margin expanded to about 28.4% from 24.1%.

That combination of faster revenue growth and higher segment profitability helps explain Covista’s consolidated operating-margin expansion. Chamberlain presented a different picture: although its fiscal-year revenue rose 3.4%, annual operating income declined 6.5% and adjusted EBITDA fell 3.1%. Investors will therefore need to assess whether its renewed enrollment growth and campus expansion translate into improved profitability.

Profitability, cash flow, and balance sheet

Cash generation improved substantially over the full fiscal year. Operating cash flow from continuing operations reached $470.8 million, while calculated free cash flow increased despite higher capital expenditures.

Covista repurchased approximately $238 million of shares and repaid $50 million of Term Loan B debt during fiscal 2026. The company also refinanced outstanding debt and increased its revolving-credit capacity; net leverage stood at 0.5 times at June 30, 2026.

Fiscal 2027 guidance

Covista initiated fiscal 2027 guidance that implies continued growth but at a slower rate than fiscal 2026. Adjusted EPS is still expected to grow faster than revenue, indicating further per-share operating leverage on the company’s non-GAAP basis.

By comparison, fiscal 2026 revenue grew 9.3% and adjusted EPS increased 23.7%. Covista did not provide a forward reconciliation of adjusted EPS to GAAP EPS because future special items cannot be estimated without unreasonable effort.

Management described fiscal 2027 as the first year of its “Purpose at Scale” strategy. The plan is built around converting healthcare workforce demand into profitable growth through enrollment expansion, employer collaborations, additional programs, and new campuses.

Recent insider transactions

Over the latest six-month period in the supplied insider data, company insiders purchased 41,553 shares across three transactions and sold 58,474 shares across eight transactions, resulting in net sales of 16,921 shares. The latest ten reported transactions include eight sales and two purchases; the records alone do not establish the insiders’ motives.

Risks investors should monitor

• Growth is expected to moderate: Fiscal 2027 guidance calls for revenue growth of 5% to 7% and adjusted EPS growth of 8% to 11%, below fiscal 2026 growth rates.
• Results rely heavily on Walden: Walden supplied approximately 65% of the quarter’s incremental revenue and was a major source of margin expansion. Slower enrollment or profit growth at the segment would have an outsized effect on consolidated performance.
• Chamberlain’s profitability has not fully recovered: Chamberlain returned to enrollment growth, but its fiscal-year operating income and adjusted EBITDA declined despite higher revenue.
• Receivables are growing faster than revenue: Accounts and financing receivables increased about 16.0% to $169.6 million, compared with fiscal-year revenue growth of 9.3%. The provision for credit losses also rose to $68.8 million from $63.2 million, making collection and cash-conversion trends important to monitor.

Summary

Covista’s fiscal Q4 2026 results combined enrollment-led revenue growth with expanding operating and adjusted EBITDA margins. Walden was the principal growth engine, while lower weighted-average shares supported faster EPS growth. Fiscal 2027 guidance points to continued revenue and adjusted earnings expansion, but the expected slowdown, Chamberlain’s profitability, and Covista’s reliance on Walden are the main areas to watch.