Laureate Education Reaffirms 2026 Outlook, Adds $150 Million to Buyback

Laureate Education said third-quarter 2026 revenue and Adjusted EBITDA exceeded its guidance, supported by favorable foreign-exchange movements and the timing of expenses. The higher-education operator reaffirmed its full-year outlook and added $150 million to its share-repurchase authorization as enrollment increased across its Mexico and Peru businesses.

Revenue for the quarter ended September 30 rose 21% year over year to $485.1 million, or 14% on a constant-currency basis. Adjusted EBITDA increased 55% to $146.8 million, with the margin expanding 657 basis points to 30.3%.

The reported growth rates were affected by changes in the academic calendar that shifted revenue and earnings between quarters. Excluding a $29 million calendar-timing benefit, third-quarter revenue grew 6% in constant currency. Adjusted EBITDA rose 14% on the same basis after excluding a $26 million timing impact, while the adjusted margin increased 211 basis points.

Net income attributable to Laureate climbed to $101.2 million from $34.5 million a year earlier. Diluted earnings per share were $0.73, compared with $0.23. The quarter included a roughly $25 million discrete tax benefit related to the resolution of a legacy tax contingency. Adjusted net income, which excludes discrete tax items and certain other items, was $71.7 million, or $0.52 per diluted share, up from $38.5 million, or $0.26 per share.

Enrollment growth supports both markets

Total enrollment increased 6% to about 540,000, including growth of 6% in Mexico and 5% in Peru. New enrollment rose 7% on a reported basis to approximately 140,000. On a timing-adjusted intake-cycle basis, new enrollment increased 8% overall, including growth of 8% in Mexico and 9% in Peru.

Mexico generated quarterly revenue of $256.5 million, up 32% as reported and 22% in constant currency. Adjusted EBITDA more than doubled to $62.1 million, representing constant-currency growth of 123%. After adjusting for academic-calendar timing, revenue and Adjusted EBITDA grew 6% and 12%, respectively, in constant currency.

Mexico’s new enrollment increased 9% to about 101,000, while total enrollment reached approximately 293,000, up 6%. Laureate attributed the intake performance to campus-based programs and the launch of a new campus in Puebla. Improved retention also contributed to total enrollment growth.

Peru reported revenue of $228.6 million, an increase of 11% as reported and 7% in constant currency. Adjusted EBITDA rose 20% to $94 million, or 15% in constant currency, and the segment’s margin expanded 306 basis points to 41.1%. New enrollment totaled about 39,000, up 3%, while total enrollment increased 5% to approximately 247,000. The timing-adjusted intake result showed 9% growth, supported by the expansion of fully online programs for working adults.

For the first nine months of 2026, Laureate’s revenue increased 18% to $1.37 billion and Adjusted EBITDA rose 26% to $395.1 million. On a timing-adjusted constant-currency basis, revenue grew 7% and Adjusted EBITDA increased 9%. Net income reached $216.7 million, compared with $112.3 million in the prior-year period.

Operating cash flow for the nine months rose to $324.6 million from $272.8 million. Free cash flow increased to $263.6 million from $236.9 million despite higher capital expenditures.

Full-year outlook reaffirmed

Laureate continues to expect full-year 2026 revenue of $1.92 billion to $1.93 billion, representing reported growth of about 13% and constant-currency growth of 6% to 7%. Adjusted EBITDA is projected at $593 million to $599 million, up 14% to 15% as reported and 8% to 9% in constant currency.

The company expects about 50 basis points of Adjusted EBITDA margin expansion at the midpoint of its guidance, reflecting margin optimization and operating leverage from revenue growth. Adjusted EPS is forecast at $2.04 to $2.10, an increase of 19% to 22% from 2025, based on approximately 139 million diluted weighted-average shares. Adjusted EBITDA-to-unlevered-free-cash-flow conversion is expected to be approximately 50%.

For the fourth quarter, Laureate forecast revenue of $546 million to $556 million and Adjusted EBITDA of $198 million to $204 million. On a constant-currency basis and after adjusting the prior-year comparison for calendar timing, the ranges imply revenue growth of 6% to 8% and Adjusted EBITDA growth of 6% to 9%.

The outlook uses actual exchange rates through October and assumes rates of 18.60 Mexican pesos and 3.45 Peruvian soles per U.S. dollar for November and December. Actual results may therefore vary with currency movements. Academic-calendar changes are also expected to reduce fourth-quarter revenue by about $20 million and Adjusted EBITDA by about $17 million, offsetting timing benefits recorded earlier in the year.

At September 30, Laureate had $204 million of gross debt, $190 million of cash and cash equivalents, and net debt of $14 million. It repurchased $256 million of shares during the first nine months, totaling 7.4 million shares, and had 136 million shares outstanding at quarter-end. The additional $150 million authorization expands its capacity for further buybacks but does not specify their timing.

Laureate did not provide projected GAAP net income or reconciliations of its forward-looking non-GAAP measures because it said it could not estimate the required variables and adjustments without unreasonable effort.