Feb. 2 at 4:12 PM
It took close to three months, but
$LRN finally delivered the proof point the market kept doubting.
Q2 results were strong. Revenue up 7.5% y/y, with Career Learning once again doing the heavy lifting. Middle- and high-school career programs grew revenue nearly 30%, and enrollments followed. It is higher value, more durable, and less exposed to the noise that hits general K-12 funding.
Margins held up better than feared. Operating leverage showed up despite inflation and investment spending. Management also reinforced capital allocation discipline with a
$500M buyback authorization, signaling confidence in cash flow durability.
The stock jumped hard after earnings, then cooled off. The thesis was never about one quarter. It was about scale, mix, and execution. On that front, LRN did exactly what I expected.
I updated my model after the call.
https://www.beatingthetide.com/p/trump-fed-pick-selloff-micron-lrn-mu-stride
