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Apollo Group Inc. (NASDAQ:APOL), owner of the University of Phoenix and a bellwether for the U.S. ‘for-profit’ education industry, reported third quarter results that beat market expectations, with the company improving its full-year guidance. However, the company’s shares lost some gains due to falling student sign-ups and the inability of the company to specify when it could return to growth.
Earnings Report: Apollo Earnings Cheat Sheet: Strong Report Yields Rising Shares.
“While we are refraining from providing a specific year-over-year change estimate, our objective is to return to new enrollment growth at some point in 2013,” Apollo Chief Financial Officer Brian Swartz said on the conference call.
Profit in the third quarter dropped to $134.4 million ($1.13 per share) compared to $213.3 million ($1.51 a share) last year, while revenue fell by 9 percent to $1.13 billion. Earnings excluding items were $1.20 per share. Analysts expected revenues of $1.12 billion and earnings of $1.20 a share. Student sign-ups declined 8 percent during the quarter.
Apollo improved revenue guidance for the full year to $4.2 billion to $4.3 billion and said operating income could range from $700 million to $740 million.
The company has been affected by declining student enrollments after admission standards were made stricter to comply with tough rules issued after it was revealed that students were burdened with high debt in a scenario of low graduation rates.
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