Slide 1: Q2 FY2022 Earnings Presentation
Q2 FY2022 Earnings Presentation January 25, 2022
Slide 2: Safe Harbor
Safe Harbor This press release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. We have tried, whenever possible, to identify these forward-looking statements using words such as “anticipates,” “believes,” “estimates,” “continues
Slide 3: Lifelong learning platform in a $100B+ addressable market
Career Advancement (Corp. Training & Upskilling) $100B+ addressable Market in U.S. Leveraging over 20 years of experience with over 2 Job Placement & Recruitment million students supported, and a scalable education services platform, Stride provides Early Career online and blended lifelong & Immersi
Slide 4: Compelling long-term investment thesis
Compelling long-term investment thesis Growing in $100B+ addressable market in U.S. 01 02 03 04 05 Leading education Sustainable Career Learning Experienced, Financial services platform core business growth diverse leadership track record With scale, expertise & Secular shift toward Leveraging Deep
Slide 5: Second Quarter Highlights
Second Quarter Highlights Q2 FY22 Performance 1. Continued Strength in Enrollments and Revenue Per Enrollment • Revenue of $409.5M Q2 revenue and profitability above guidance ranges • (+9% y-o-y) • Adj. Operating Income* of $60.7M 2. Raising Full Year Guidance for Revenue and Profitability • (+21%
Slide 6: Strong year-over-year growth in key financial metrics
Strong year-over-year growth in key financial metrics Revenue ($M) Adjusted Operating Income* ($M) 70 65 61 60 55 • Continued execution of 60 405 50 50 growth strategy into 40 37 Career Learning 34 30 22 23 • Demonstrated demand 20 16 for virtual school options 10 5 0 • Improving margins (10) (20) (
Slide 7: Career & Adult Learning Continue to Drive Growth
Career & Adult Learning Continue to Drive Growth Career Learning Quarter Ended December 31, 2021 • Enrollment growth of 38% 2021 2020 Change Revenue ($M) Adult Learning General Education 313.2 314.0 ↓ 0.3% • Continued growth Career Learning • Y-O-Y comparison Middle – High School 75.3 51.3 ↑ 47% imp
Slide 8: Raising Full Year Revenue and Profitability Guidance
Raising Full Year Revenue and Profitability Guidance Q3 FY2022 FY2022 Guidance reflects continued strong demand for virtual Low High Low High education Revenue ($M) 405 415 1,620 1,640 • FY22 Revenue: +6% Y-O-Y Adjusted Operating Income ($M)* 60 65 175 185 Mid-point of Guidance Capital Expenditures
Slide 9: Long-term General Education Growth Drivers
Long-term General Education Growth Drivers Total Enrollment(1) (K) FY21 FY25 QE 9/30 Actuals Expectations 7% CAGR 165 148 Revenue $1.28B $1.25B - $1.4B 112 114 111 Enrollments(1) 164.6K 170 – 180K FY2018 FY2019 FY2020 FY2021 FY2022 Per Pupil Funding ($K) Programs(2) 77 + 8 – 10 YE 6/30 3.0% CAGR 8.0
Slide 10: Long-term Career Learning Growth Drivers
Long-term Career Learning Growth Drivers Total Enrollment(1) (K) FY21 FY25 QE 9/30 Actuals Expectations 42 126% CAGR 31 Revenue $256.6M $650M - $800M 14 Adult Learning 7 Revenue $55.8M $140M - $150M 2 FY2018 FY2019 FY2020 FY2021 FY2022 Career Prep Enrollments(1) 30.8K 80 – 85K Per Pupil Funding ($K)
Slide 11: FY25 Financial Outlook
FY25 Financial Outlook Strategic priorities supporting outlook Support improving learner outcomes while delivering strong growth and sustainable long-term value creation Enrollment growth in K-12 and Adult programs FY22 FY25 Financial Guidance(1) Outlook Expand capacity in existing and new programs
Slide 12: 2022 Promising Practices: CRE – Stronger Together
2022 Promising Practices: CRE – Stronger Together Open to all teachers, administrators, counselors, board members, and parents Hosted internally for Stride staff for the past 10 years with over 6,000 in attendance last year – now open to everyone Designed by Stride educators and leaders, offer
Slide 13: Liquidity & Low Debt Support Organic & Inorganic Growth
Liquidity & Low Debt Support Organic & Inorganic Growth Expect increasing cash balance through rest of Select balance sheet and other information year. As of December 31, 2021 ($M) Accounts receivable Cash and Cash Equivalents $257.0 balance reflects seasonality and timing of Accounts Receivable, Ne
Slide 14: Disciplined capital allocation
Disciplined capital allocation Prioritizing free cash flow sustainability, educational platform development, and synergistic M&A • Invest in academic quality & student / customer experience to support Organic growth outcomes & retention • Implement innovative products across portfolio • Leverage pla
Slide 15: Appendix
Appendix
Slide 16: Reconciliation
ADJ. OPERATING INCOME AND ADJUSTED EBITDA TO GAAP FINANCIALS Reconciliation Three Months Ended Six Months Ended December 31, December 31, 2021 2020 2021 2020 (In thousands) Income from operations $ 56,915 $ 38,452 $ 49,938 $ 50,516 Stock-based compensation expense 602 9,074 8,888 17,967 Amortization
Slide 17: Reconciliation
ADJ. OPERATING INCOME (FY2020 & FY2021) Reconciliation FY2020 FY2021 Three Months Ended Three Months Ended Sept. 30, Dec. 31, Mar. 31, Jun. 30, Sept. 30, Dec. 31, Mar. 31, Jun. 30, (in millions) 2019 2019 2020 2020 2020 2020 2021 2021 Income (loss) from operations $ (19.4) $ 30.3 $ 14.5 $ 7.0 $ 12.1
Slide 18: Reconciliation
GUIDANCE Reconciliation Three Months Ended Year Ended March 31, 2022 June 30, 2022 Low High Low High (In millions) Income from operations $ 50.7 $ 54.7 $ 142.0 $ 150.0 Stock-based compensation expense 6.0 7.0 20.0 22.0 Amortization of intangible assets 3.3 3.3 13.0 13.0 Adjusted operating income $ 6