Q3 2025 Lincoln Educational Services Corp Earnings Call
Good day and thank you for standing by. Welcome to the third quarter 2025, Lincoln Educational Services earnings conference. Call at this time, all participants are in a listen-only mode. After the speaker's presentation, they'll be a question and answer session to ask a question during the session. You'll need to press star 1. 1 on your telephone, you will then hear an automated message. Advising your hand is raised to withdraw your question. Please press star 1 1 again, please. Be advised. Today's conference is being recorded. I will now attend the conference over your speaker today.
Michael Polio, you may begin.
Thank you. Kevin. Good morning, everyone. Before the market opened today, Lincoln Educational Services issued US release reporting Financial results of third, quarter ended September 30th 2025, as well as recent corporate developments. The release is available on the investor relations portion of the company's corporate website at www.link.com
And Tech.edu joining us today or on the call are Scott Shaw, President and CEO, and Brian Meyers, Chief Financial Officer. Today's call is being recorded and is being broadcast live on the company's website. A replay of the call will be archived on the company's website.
Statements made by Lincoln's management on today's call regarding the company's business that are not historical facts may be forward-looking statements as the term is identified in the context of the Securities laws.
The words "may," "will," "expect," "believe," "anticipated," "plan," and "estimate"—and "continue," as well as similar expressions—are intended to identify. If I were to look at statements...
Or look at statements should not be read as a guarantee of future performance.
The company cautions you that these statements reflect certain expectations about the company's performance or events and are subject to a number of uncertainties, risks, and other influences.
Many of which are beyond the company's control and may influence the accuracy of the statement and projection upon which the segmented statements are based.
Factors that may affect the company's results include, but are not limited to the risks and uncertainty is discussed in the risk, factor section of the annual report on form 10K and the quarterly report on form 10 Q filed with the Securities and Exchange Commission.
Oh, look of statements are based on an information available at the time. Those statements are made and Management's. Good faith, belief, as of the time with respect to future events. All if I look at statements are qualified in their entirety about the cautionary. Statement, Lincoln only takes no obligation to publicly revise, or update any further. Look of statements, whether a result of new information,
Future events or otherwise, after the date thereof 1, other housekeeping, uh, housekeeping matter. During the Q&A portion of the call today, we would ask questions to limit themselves to 2, ask any additional questions in advance. We thank you for your cooperation. Now, I'd like to turn the call over to Scott off, president, CEO of Lincoln, Educational Services, Scott please, go ahead. Thank you, Michael. And good morning everyone. Thank you for joining us today. For our review of another exceptional quarter of operating in financial performance for Lincoln Tech, our third quarter students, start growth of 6% exceeded our internal forecast and marked the 12th consecutive quarter. We grew students starts over the prior Year's period. We also continue to realize double digit growth rates in total student population, total revenue and Consolidated adjusted ibida over the prior year periods. While also recording the third consecutive quarter of declining, year-over-year, bad debt levels. We generated 12 cents a
Cher net income while continuing to invest in our highly successful and expanding growth strategies. Once again, we are increasing our guidance for full-year financial results. Brian will provide the details on the guidance.
Lincoln has earned the well-deserved reputation for setting the standard of Excellence in helping American corporations and organizations in their constant search for employees. Trained and skilled trades. Such as HVAC installation, repair residential and Commercial Real Estate. Electrical systems is installation and Repair automotive and diesel systems maintenance and repair welding and nursing and other health care professions.
Accelerated due to the nation's increased interest in skilled trade careers and through our successful development of Greenfield campuses, as well as the expansion of successful programs to existing campuses.
Since the beginning of 2024, we have opened new campuses in East Point, Georgia, and Houston, Texas, while relocating outdated and space-constrained campuses in Nashville and Philadelphia to new and expanded state-of-the-art facilities.
As we reported during our second quarter, call East Point start rate after 18 months of operation achieved a level. We plan to achieve after 3 years of operation
Due to this exceptional growth. We have secured an additional 15,000 square feet of space. Immediately adjacent to our current facility to meet the increasing demand.
Meanwhile, at Nashville starts an existing programs at the new campus, exceeded our expectations, the expanded Compass enabled, the addition of electrical and HVAC programs, which also added to the momentum. In Levittown, Pennsylvania, we completed the transfer of our Automotive program from Philadelphia and have started. Our first class as an HVAC welding and electrical. Finally we began our first classes in our new Houston, Texas campus during the third quarter and their response also is exceeding our pre-opening expectations
East Point, Nashville Levittown, in Houston are generating, stronger, and faster returns than we anticipated, when we made these Investments. This, this both increases, uh, conviction in our Greenfield and expansion strategy is accelerating our growth allowing us to fund our ambitious growth plans from operating cash flow. Supplemented with our credit facility for seasonal needs,
New campus development has driven about half of our recent start growth and the implementation of our Innovative Lincoln Tempo hybrid, teaching platform, increasing returns, from marketing efforts and the expansion. Or addition of programs have generated good solid organic growth at existing campuses. As a result. We are realizing increasing levels of instructional efficiencies space efficiencies and organizational productivity through Linkedin. 10.0 and other initiatives. Brian will provide more details on the progress. We are making by leveraging our operating expenses to generate cash flow that is funding our expanded growth objectives in the few minutes.
As the overall National growth in new job creation slows interest in skilled trade training as an alternative to the traditional 4-year college, education continues to expand, the federal government's actions, impacting student loans have further fueled, this interest and our team is executing our updated growth strategies for the benefit of our students. Corporate Partners instructors and shareholders.
Last week, we announced plans to plans to expand Lincoln's presence in Texas, by developing, a new state-of-the-art campus in rowlet, Texas, our Northern suburb of Dallas. This new campus, our 24th Nationwide is located near major interstate highways 635 and 30 and will complement our highly successful. Lincoln Tech campus in Grand Prairie, Texas, which is, uh, west of Dallas, the new 88,000 square foot campus will have a capacity for over 1600 students and will offer Automotive welding electrical and HVAC training when it opens in the beginning of 2017,
We have found that by having 2 strategic loaded, located campuses in growing Metropolitan markets, we are able to leverage resources and enhance our ability to serve students instructors and corporate Partners in Atlanta. Our 2 campuses located in Marietta and East Point have both benefited from marketing and other corporate resources resulting in higher than expected starts at both campuses.
We are hoping to generate similar leveraging opportunities in the Dallas market when the Rowlett campus opens.
Similarly, our new campus under development and takes Bill Long Island is progressing towards opening in late 2026 and will be our second campus in the metropolitan New York City area, where where we have successfully operated, our Queen's campus for over 20 years.
With each new campus, our objective is due 25 to 30 million in annualized, revenue, and 7 to 10 million. In Evita for the fourth year of operation. If not sooner,
in addition to new campus development program expansion, or replication existing campus, sorry. In addition to new campus development, program expansion, or replication at existing campuses is contributing to Lincoln's growth. We added or expanded 6 programs at existing campuses during 2024 and are well, on the way to add 5 more this year. In total, these 11 programs are a key contributor to our Stark growth.
Providing graduates with secure, rewarding career opportunities with advancement potential this year. Many potential partners have extended decision-making timelines, largely due to ongoing economic uncertainty. However, during the third quarter, we did expand our innovative training program with CMC Corporation under which we are training their employees at their facilities, rather than at Lincoln campuses. We signed our original 5-year agreement with the company in 2023 and believe our extended partnership with CMC illustrates the contribution we are making to closing their workforce skills gap.
Another key growth initiative at Lincoln involves our health care programs. Our new leadership for this segment is hard at work developing changes to our instructional model and improving operating effectiveness and efficiency. One area of focus is to expand our offerings beyond the current LPN certificate so that students can earn RN degrees. Such a development would substantially increase our addressable market in the nursing field.
Meanwhile, last quarter, we talked about our efforts to regain enrollment status at our paramis nursing program. We have now exceeded the graduation Benchmark at this program for the past 12 months and have received approval from the state of State Board of Nursing to begin re-enrolling students starting in January of 2026. This is great news. And is a testament to our ability to deliver quality nursing training, uh, across, uh, New Jersey, New Jersey. Like most of the nation faces a
Severe shortage of nurses at all levels and we look forward to doing our part to lessen, the shortage and bring greater and better, nursing care to the state.
We also introduce you to our high school share program during our last call and have made some substantial progress with this Initiative. For instance, at our Mahwah, New Jersey campus, the number of students enrolled through High School share has doubled from last year more and more school districts in New Jersey as well as other states, where Lincoln operates have inquired about implementing a share program at their schools. Under this program, students attend linking classes during their Junior and Senior year and then continue After High School to gain their certificate in less time, which accelerates their entry into rewarding careers.
With school districts under constant budgetary challenges our initiative, enables the continuation of skilled trades training within the high school while building our enrollment, we are quite excited about the potential for this initiative. It along with additional investments in our high school, Outreach programs lead us to be optimistic, about our opportunities, to enroll more high school students graduating in the spring and summer of 2026.
In addition to these initiatives, we are also exploring expansion efforts through corporate development activities including Acquisitions and joint ventures recently. Several startups targeting skilled trades have contacted Lincoln to explore ways. We could facilitate their their strategy through our capabilities. These discussions are in the early stage and require little, if any
Of our development resources but do illustrate the expanded interest in increasing skilled trades training in America to address the continuing skills Gap.
While there is a decided focus on growth at Lincoln. We continue to make investments in people and processes to ensure that we deliver an exceptional learning experience for our students. We want to be the best and we want the best for our students to achieve this goal. We are constantly evaluating new software, curriculum, and training AIDS. In addition, we want our instructors to have industry recognized credentials that ensure, they have the most up-to-date knowledge in their field. So our students have an edge on their competition.
With technology Ever Changing. We are constantly in pursuit of what will help our students master the skills. They desire to become the technician's, welders and healthcare providers that will lead the next generation of skilled Hands-On professionals.
We Believe 1 way to measure the effectiveness of our investments in people and processes is our graduation rate as well as the employment of our graduates in their field of training. Despite our growth in students, both metrics, remain, strong, and we are constantly evaluating wage to build on this success rate.
Company and our shareholders are new in 2027. Milestones will be achieved organically through our existing operations and new campuses developed internally. As I've discussed before, our country's existing severe skills gap will likely get worse before it gets better. We believe there are many significant underserved markets in America where employers and employees will benefit from our innovative and proven approach to skilled trades training.
Despite all this positive news and solid execution, it appears that the market still does not understand who we are, and what we can become, furthermore, While others in our sector have had their businesses negatively impacted by internal execution, challenges, and from the external environment, we at Lincoln Tech have not constant, uh, Khan Khan consequently. I want to bring additional Clarity to our story.
First, while the government shutdown has been the longest in history, our students have continued to receive timely disbursements of federal aid used to finance their education. At our schools, the U.S. Department of Education reminded the higher education community of the minimal impact on students at the beginning of the shutdown, and our businesses have not been affected. Second, we continue to see strong interest in our programs, and the current environment for us has not lessened.
Third, the decline in our Healthcare segment is not meaningful, nor is it a concern. We have been rationalizing our program offerings for the past several years to focus resources on our most in-demand programs to meet market demand, as well as to ensure that we have the industry-leading curriculums and training experiences that will set our students apart and give them an edge in the employment market. Within our reported Healthcare segment, there are not healthcare programs such as culinary and IT, as well as small Allied Health programs such as patient care tech and dental assisting.
We are selectively exiting these non-core programs and will continue to do so. When we see better opportunities in the classroom space, our focus currently is on our Licensed Practical Nursing and Medical Assisting programs. During this quarter, these grew by 2%, and this is without LPN starts at our Paramus campus, which will restart in a few months. As we have mentioned in the past, we are continuing to work on plans to offer Registered Nursing programs in the not-so-distant future.
Forth.
Growth initiatives are meeting and exceeding our expectations and guidance. We are replicating our most successful programs wherever there is demand, and we have space, and we are opening new campuses that research tells us are underserved. In simple terms, we are constantly looking to double down on our success. Our minimum expectations for all these investments are to achieve a threshold 20% higher.
My irr on a fully burdened basis, including all direct costs needed to open and operate these facilities. I am very proud to say that to date. We've exceeded this threshold.
Fifth. We've been investing in our team to ensure that we have the talent to not only deliver on what we've announced to date, but also to enable us to capitalize on new opportunities as they arise 1. Clear example of this is our significant refocus on growing, our high school student population. Our recent High School results, along with the increase Outreach by numerous high schools around the country who are asking for ways for us to help with vocational training are clear indicators that the stigma of Career Technical Training is lessening students, parents, and even high school guidance. Counselors are more interested in the trades than ever before to tap into this opportunity over the past 7 months. We've have hired new talent and our reinvigorating, our high school recruiting strategy and we are already seeing good results.
As many of you know, I've been with Lincoln Tech for nearly 25 years and I believe that our organization has never been stronger in order to have as much growth opportunity as we have today. Moreover, we have Khan consistently proven to ourselves that we can capture opportunities. We have achieved what we have set out to achieve, and continue to find new opportunities, recent survey results show that our employees have never been more engaged and satisfied. We are all working for the common, good of our students. So that they
They can graduate launch their careers and find satisfaction and pride as obstacles arise and they always do. We find Solutions our business is strong in our company's vibrant.
December 16th. Additionally, we'll be hosting an investor analyst day at our new Nashville. Campus on March 19th, 2026 to showcase the site and review, our long-term growth plan and operating objectives. I urge you to contact Michael Bolivia. If you would like to attend finally, with Veterans Day being observed tomorrow, I want to extend our appreciation to our military members, and their families for their valued service and sacrifice to our country.
Now, I'll turn the call over to Brian Meyers so he can review some of our recent financial highlights and guidance Brian.
Thanks, Scott, and good morning, everyone.
Lincoln delivered, another strong quarter with several key metrics once again, exceeding, our internal forecast,
We see momentum in enrolling, growth combined with improved operating efficiencies, where the primary drivers of this performance. These results reflect the strength of our model and our continued focus on operational execution.
Before I get into the quarter's financial results, a couple reminders about our year-over-year comparisons. First, the financial comparison to my remarks excludes the transitional segment, which consists of our former Summerland, Las Vegas campus that we sold in late 2024. Second, as noted on last quarter's earnings call, our reported Q2 starts include an adjustment for the 2,764 students that started on July 1st to align with the prior year class start time.
For this course comparison, we have excluded, those thoughts to M, maintain consistency with the prior year.
With those points in mind. Let's turn to the quarters financial highlights.
Revenue for the quarter was 141.4 million and increase of 25.4% the strong performance, reflects the continued momentum, and student starts here to date.
According to student starts starts with the quarter where approximately 6,400 representing a 6% growth.
We had originally expected sought to be relatively flat given the strong 22.5% growth in last year's third quarter.
Achieving a 6% growth over such a high comparative base undisclosed. The persistent demand, we are seeing for our programs.
That performance was mainly in skilled trades, which experienced better-than-anticipated starts, particularly in our new programs and replications.
Revenue pursuing an increase by 4.8% reflecting, both tuition increases and the timing of booking tool Revenue.
Average student population, grew by nearly 20% and ending population increase by about 17% as we closed the quarter, with over 2500 more students than the prior year ending population climbed to about 18,200 compared to this 15,600 in the prior year.
breaking down the composition of this quarter stock growth, transportation and skilled trade programs delivered, in 11.8, increase in starts to remove by continued, strong demand as well as successful program, additions and expansions
Excluding the program launches in 2024 and 2025. We still achieve a robust, 7.9% growth.
As anticipated, healthcare and other professional programs experienced a 13.7% decline in stocks.
Approximately half of this decline resulted from the discontinuation of the smaller programs, which we have determined are no longer part of our core program offering.
We continue to refine our program. Offerings to align with areas of strongest student interest and employer demand.
As we sunset smaller programs, we will strengthen our core offerings while improving our profitability, particularly in our Licensed Practical Nurse and Medical Assistant programs.
In addition, as Scott mentioned, we are pursuing the Greek granting approval to over to offer registered nurse programs.
also as noted, we will commence new enrollments on our LPN program, at our paramis campus, beginning in January 2026,
Total expenses were $135.1 million compared to $106.3 million in the prior year. The increase was in line with our internal expectations and was primarily driven by direct costs associated with the larger student population, as well as ongoing investment in our growth initiatives.
From a profitability standpoint, our adjusted EBITDA grew by 65.1%, reaching $16.9 million, up from $10.2 million last year, which includes the transitional segment.
Include efficiencies from our Lincoln 10.0 hybrid teaching model which has contributed to lower instructional costs as as a percentage of Revenue and improved space utilization.
In addition, we are seeing improvement in bad debt, and expenses, which have declined as a percentage of revenue. For three consecutive quarters,
Net income for the quarter was $3.8 million compared to $4 million, including transitional adjustments. Net income was $6.3 million or $0.20 per diluted share compared to $4.1 million or $0.13 per diluted share, representing an increase of $2.2 million or 54.9%.
Looking at our balance sheet, we ended the quarter with $65.5 million in total liquidity. This quarter, we generated $23.9 million in cash from operations on a year-to-date basis. Cash flow from operations totals $15.8 million, as reflected on our cash flow statement.
Due to our seasonality, most of our incoming cash is generated in the second half of the year with the highest level. Typically, in Q4 we finished the quarter with 8 million in outstanding borrowing,
And a 13.5 million in cash on hand based on historical Trends and an outlook for a strong fourth quarter, cash flow, we are forecasting the end of the year without any debt outstanding and a higher, net cash balance.
Now turning to capital expenditures, we continue to execute on our key expansion projects. The total capital expenditures were approximately $21.7 million for the quarter and $68.1 million for the first nine months of the year, as reflected in the cash flow statements.
The majority of our quarterly spend was tied to our growth initiatives, including two recent campus relocations and the buildout of our new Houston campus, which opened during Q3.
As Scott mentioned, we are excited to announce our fourth. Greenville campus in Raleigh Texas, the bill that is expected to take approximately 1 year with an anticipated opening. In the first quarter of 2027, we view the expansion as an important step in our growth strategy and are encouraged by the by the strong performance of our prior Greenfield campuses.
While new campuses require a meaningful offer on investment and take approximately two years before they become operational, there are exceptional growth drivers for Lincoln. These investments are expected to generate internal rates of return exceeding our 20% threshold.
Our East Point campus. Now, in its second year of operations, well on its way to delivering returns significantly Above This threshold.
Looking ahead to the remainder of 2025, based on our performance and momentum across our core growth drivers, we are raising our full-year guidance across all metrics. We now expect Revenue ranging from $505 million to $510 million, adjusted EBITDA in the range of $65 million to $67 million, net income ranging from $17 million to $19 million, and student stocks growth of 15% to 16%. Capital expenditures remain unchanged at $75 million to $80 million.
As a reminder, our guidance excludes stock-based compensation, one-time non-cash pension termination expense expected in Q4 pre-opening, and net operating losses from new and relocated campuses and programs. For more detailed guidance, please refer to our earnings release, which was filed earlier today.
Beginning in 2026, we will no longer address our ibid off for pre-opening course, and that that operating losses from new campuses and program, expansions as we currently do going forward adjusting, but I will reflect only the air back of non-cash, stock-based compensation, and other non-recurring items.
In our discussions of operating expenses, we will continue to call out the losses incurred from campuses that have not yet commenced operations to provide investors with a clear understanding of the profitability of our current operations and future periods.
While we will provide formal 2026 guidance during our fourth quarter earnings call in February, we can communicate today that based on our current growth.
Improving profitability and current investment plans, we expect our 2026 adjusted.
Under the revised methodology to exceed our 202,255 of 65 to 67 million, which excludes approximately $10 million of our backs for new campuses and program expansions.
Targets based on our current performance Trends and strategic initiatives. We are projecting to achieve more than 600 million in revenue and over 90 million adjusted ebit out by 2027. Without the benefit from adding back approximately, 10 million of expenses, for new campuses and program, expansions that were included in our original term in our original long-term plan.
In closing, as our nation observes Veterans Day, I also want to extend our sincere gratitude to all members of our Lincoln community—students, instructors, and alumni—who have served or are serving in the Armed Forces.
And with that, I'll turn the call back over to the operator for your questions. Operator, thank you. Ladies and gentlemen, if you have a question or a comment at this time, please press *1, 1 on your telephone. If your question has been answered, or you wish to remove yourself from the queue, please press *1 and 1. Again, we'll pause for a moment while we compile our Q&A roster.
And we also ask that you limit yourself to 1 question and 1 follow-up. Feel free to jump back in the queue with any further questions. 1 moment.
Our first question comes from Alex Paris with Bington Research. Your line is open.
Hi guys. Uh congratulations on the beat and race great, great job. Um I wanted to uh
Thank you. Uh I I just wanted to uh ask a couple more clarifying questions on 2026. Uh, actually Brian's final comments and his prepared comments. Um,
So we we, uh, this year in 2025 the adjusted ebit, dog, guidance of 66 to 68 million. Uh, sorry, 65 to 67 million that includes the impact or the addback of roughly 10 million in uh, pre-opening costs and so on.
Correct and you're talking about in 2025? Yes. Yeah in 2025. So uh uh uh and then you said regarding 2026 um
Uh, it sort of sounded like your forecasting may be another $10 million of pre-opening costs. Yeah, correct. And even without those add backs, we'll be able to exceed the $90 million that we originally had in our plan with the add back to that $10 million.
Annual exceed the 65 to 67 million that you're going to do in 2025 based on guidance.
Correct. Correct. Correct, great. Uh, what about? Here's my follow-up question. What about capex for 2026? Um, I think you said, uh,
70 to 80 million this year. I assume my notes are here somewhere. Um, yeah.
We we, we haven't put that yet. Uh, anything out yet for a 2026 we'll announce that in February. Um, it'll probably be similar and maybe slightly down from this year.
Okay, great. Thanks, Brian. I'll get back in the queue.
Great. Thank you.
1 moment for our next question.
Our next question comes from Luke Horton with Northland Capital markets. Your line is open.
Yeah, hey guys, congrats again on the nice quarter.
Hey, um, just wondering if we could get a sense. What kind of drove this strong performance? I mean, kind of a little bit from campus level or from program mixed perspective. Um, just looking at the updated guide for 2025 starts, I mean, this implies nearly a 30% starts growth in 4q. Um, so a little bit for the quarter kind of what drove the bead and then and then the expectation in 4 q of that strong starts. Um, right from a campus level or program mixed perspective,
Right? So, so at the low end of the range, you know, we would, uh, that's actually a 15% stock growth for Q4, and at the high end of the range. It'll, it'll be about a, uh, a 20% stock growth for Q4. So not exactly 30%. But, you know, with that being said, we are forecasting, robust, stock growth for Q4.
Which is what we got it to before. Just based off of the trends we're seeing is we are seeing strong interest overall and as well as the performance of our new campuses and programs.
Okay, and then you guys did mention kind of building out some more square footage at East Point. Um could we get a sense of kind of student capacity? This adds is this a meaningful expansion here or just
Kind of, kind of right sizes the space.
Oh sure. So we're we're probably adding 1. Oh frankly about a 500 student capacity with this addition. Okay.
Well you said in the near future I guess, could you just walk us through the timeline of this or from a regulatory perspective? What needs to be done here and then would that give you a accreditation to offer these across all campuses? Or is it a state-by-state accreditation?
Yes, it's a good question. So it is a, it's a long process. And it is state-by-state uh, today where we have our LPN program, we're not degree granting. And in order to offer an RN, we have to become degree. Granted. So, we have applications in to become degree granting in. Excuse me, New Jersey, New York, uh, Connecticut. Um, and so that process could take anywhere from 12 months to, to frankly, uh, 48 months. So, depending on the state where obviously pushing to make it as quickly as happen as quickly as possible. But we know that our LPN students, a large percentage of them are going on to become RNs as well as naturally the RN uh uh, career itself is the largest in the health care sector and in these states and particularly New Jersey is 1 of the highest that has a low, a greater shortfall of nurses to population. So we feel really good about the opportunity. It's the process of getting
Through the regulatory hurdles to get there. But we're also looking in certain other states where we have degree granting already, but don't have an LPN program. We're, we're evaluating put in, uh, putting an RN program there, but there's been nothing decided as of yet.
Okay, got it. Awesome. Well, thanks for the color there. And congrats again on a nice quarter, guys.
Great, thanks. Appreciate it.
1 moment for our next question.
Our next question comes from Eric Martin news with Lakes Street Capital markets. Your line is open.
The 2027 new guide. Uh, I just wanted to make sure I'm apples to apples with the old guide. I think the $550 million excluded Atlanta, Houston, and then the, uh, program expansions at Levittown and Nashville. Can you clarify that?
Go ahead Brian. Yeah. So no it always included the uh um it it it didn't include you the same because when we first put that out you used to know what was in uh announced yet. It really only included for new campuses, the East Point. So it included revenue from East Point. Now, the ski exceeding, the 600 million that includes everything announced as of today.
For Revenue.
Okay. So that would be assuming Hicksville and and rowlet are online. They would contribute towards that 600, okay.
Alright just roll coming online first quarter of 27 correct.
Okay.
All right. And then the the decline in the Hop starts, you you uh,
Clarify that that was tied to the the promise and we're going to get the green light for Paramus in 2026.
And then the massaging culinary. It's kind of we're, we're choosing not to pursue those at what point did we get back to, um, kind of organic positive growth and and were we, uh, positive X, the paramis and the the massaging culinary here in Q3
Yes. So as I, as I mentioned, the 2 core programs of represent more than 80% of the students in healthcare are our LPN and medical, assisting and those 2 Programs grew at 2%, uh, in the third quarter, I would anticipate, excuse me.
I would anticipate that next year we should be, uh, positive again, especially with the opening of nursing at our Paramus campus. So in 2026, those two programs should continue to grow.
Got it. Thanks for taking my questions.
No problem. Thanks. One moment for our next question.
Our next question comes from rash armor with Texas Capitol, your line is open.
Hi. Uh, thank you for taking my questions. Congratulations on solid results again. This is where some of the other players in the education space are talking about.
So it seems like on the on the healthcare um starts. There's a lot of noise that programs that are going on that programs that are coming back in and I know that. So what what starts and what kind of growth do you expect out of you? Just said about 2%
um,
Here, um, Arena, and now you're left with LP and...
can you talk about?
Just ongoing.
In the next couple of years, what should we expect from the healthcare and nursing segment?
Sure. So again, let's just put this all in perspective today, the healthcare and other segment is 20% of our population. So the bulk of what we're doing is all in the automotive and skilled trades. And those are the programs today that we're replicating. Uh, as we said in the call the, the core programs in healthcare LPN and Ma are still growing. And we would anticipate that to continue into the future. We are going to complement that in the future with our end. But again, we're it's too early in the game to say, where things are going, all all I can share with you is that all of our guidance and all the information that we're sharing incorporates, all these changes that are taking place and the overall message is that our business is is very, very robust and our growth rates will be uh, will will reflect that.
I don't know if that helps you.
Yeah, got it. Thanks. Thanks. Got it. And then just following on, I know Brian had touched on the guidance for fiscal 2026. So the way I read it is, um,
You're talking about the EBA guidance; the "apples to apples" would be 6,567 this year, which would have been 7,577 at least.
Correct, thanks. Alright. Are you saying anything about starts for next year? Revenue growth, do you see anything um, in the Horizon on the horizon that would disrupt the current starts growth?
Uh, for transportation or Healthcare.
No, I mean, as I think we, we've said in our remarks things are, you know, frankly, uh, very robust have been very steady and, uh, we're seeing just strong conversions and strong interest both. Uh, also, as we said from the adult market and the high school market and I'll just highlight that the high school Market is seeing increased interest and that that's an exciting opportunity for us and we're going to capitalize on that more. So in 2026 given Investments, we're making today, and then, that'll even grow, even more, I believe into 2027.
Got it. Great. And then just lastly, on the regulatory horizon, is there anything that, um, any sort of developments that we should be able to look out for? I mean, anything happening in the negotiated rulemaking that we should be on the watch out for?
Sure, there's nothing that, uh, I am aware of that affects Lincoln Tech, uh, that that's out there. Obviously, we have to stay on top of it because things change in this environment very quickly. But as of right now, Raj, I don't see anything that's going to derail us from what our plans are and where we're going as a company.
Got it. Um, great! Thank you so much, um, for taking my questions. And again, congratulations on the Beacon Race.
Thanks, we appreciate that.
again, ladies and gentlemen, if you have a question or a comment at this time, please press star 1, 1 on your telephone,
1 moment for our next question.
Our next question comes from Steve Franco with Rosin, Black Security. Your line is open.
Good afternoon. Thank you.
What did you learn from East Point that maybe you're going to change as you open this new campus in Texas? Are there anything that you take away from the early days of East Point that says, 'Well, maybe we could do these things to get it even faster started?''
What the model is and when to stop it and how to get, uh, the excitement within the market up before our campuses open up. I mean, uh, East Point was a market where we all already had a presence with our campus, in Marietta Houston's, a market where, you know, our name isn't as well known. So we're spending a little bit more to make it well known, but we're starting to see similar results as in the East Point. So things are going well and and we we constantly learn as we open up new programs and replicate in each market.
Great. And then from a 30,000 foot view, have you seen any material decline in interest for you know Legacy auto diesel programs? Um or does that continue to be a healthy portion of the skilled trade mix?
We're still seeing Positive Growth, but I I certainly the skilled trades are growing faster at this point. You know, things fluctuate. Uh, obviously if you look at our, our numbers overall, or I would say we've replicated the skilled trades, the most simply because it's the most cost-effective for us to do that. So we have more skilled trades programs today than we have Auto programs. But we are still seeing as I've mentioned, our organic growth has been frankly, very strong uh due to improvements in the Lincoln 10.0 and and due to increased marketing efforts to get the word out. And frankly, the receptivity that's out there.
so, skilled trades are definitely growing more for Lincoln than Auto but we're seeing positive growth in, in frankly, all segments,
Great. Thank you, Scott.
1 moment for our next question.
Our next question comes from Griffin boss with B rally Securities. Your line is open.
Hi. Good morning. Uh, thanks for taking my questions. Um, so I'll just start off. Um, you can, you know, you sort of back out an average tuition per student um that that came in very strong in the quarter. I think Brian mentioned something about, um, structurally higher tuition, but curious if you could expand on that is is this higher you know, average tuition per student um, just pricing or is it also program mixed?
It's a good question for the quarter. We got the benefit of timing of books and tools. I think I might have mentioned that in my prayer remarks, you know? Also you know when you uh when we give out tools we earn the revenue when it was given out, but we also have the expense. So that big start that happened in July 1st. We did have a pickup in Revenue there but it also we have an off offsetting expense on that as well. So that we benefited from that uh, for the Q3 as well. But but just to be clear, we raised tuition uh, let 3% or less it varies by program and that happens just once a year. So usually at the beginning of the year, so the changes that Brian's mentioning are either could be somewhat program, mixed or as he said we got the benefit of
All these starts, and so students start. We booked a lot of the books and tools revenue at that point, so that can distort it slightly.
Right. Because overall it was about 4%. So as Scott was saying about, you know, I would say, 2 to 3% is tuition increases, we do benefit from a little bit of our program mix with, you know, with slightly higher with our starts. Uh, but then some of it was due to the, uh, the booking tool Revenue.
Got it. That's a great color. Thank you so much and then just, uh, lost on for me. Um, you can you remind us what maybe the average ramp up period is for new campuses? Obviously, you talked a lot about revenue and EBA expectations, um, but you mentioned, you know, this new rowlet campus all will have 1,600 student capacity. Um, what's the, you know, how long does it take you to fill those seats when you open up a compass? Do you expect to have, you know, the a certain amount of capacity uh initially that that maybe increases over time. How how do you think about that?
Sure. So I mean, just looking at East Point as an example. Uh, obviously a very strong performer for us when the within the first 18 months, it has about 700 to 800 students. We would anticipate that our other campuses will perform similarly in the first 18 to 24 months. Um, when we say that has about 1600 student capacity to get our return on investment that we're looking for, we we, we don't need that many frankly, we're basing that off of closer to it.
Say 850 to maybe a thousand students. So um I hope that helps you
Yeah, absolutely. Thank you, Scott. Thank you, Brian, for taking my questions. I appreciate it.
No problem. Thanks, 1 moment for our next question.
Next question, comes from Alex Paris with bington research, your line is open.
Previous, uh, you, in light of Veterans Day tomorrow, you mentioned military. Uh, just curious, what is Lincoln's overall military exposure as a percent of total enrollment? And what is the character of that military enrollment? Is it, uh, military tuition assistance for active duty, or is it, uh, Veterans Administration, GI Bill?
Yeah, it's a good question. Well as as you uh as a reminder, we started as a military uh training organization by our founder to train vets from World War II. And unfortunately we're down to only about 5 to 6% of our students today are military and part of that is because when we moved to the Lincoln 10.0 model, you're not allowed to provide housing benefits to our military, through the GI Bill. If it's a diploma hybrid program, unless you have a degree program, so our initiative to get degrees in a number of states, where we don't have degrees will enable us to start re-enrolling veterans in that area. So it is, they're all using their, their GI benefits. So these are people that have left the military and, uh, we would anticipate as we get. As I said, degree granting particularly in the states of New Jersey and New York that will start seeing frankly, a growth again, in our uh, veteran population.
Okay, so to be clear, it it's it's veterans. And that's what I thought you don't do. Material amount of active duty. Yeah.
Correct. And the veteran and GI Bill funds are flowing in. It had been an issue for another one of your competitors, American Public.
Yeah, that is correct. That's why I tried to say in my remarks mean, for us, for Lincoln, for what we do, who we serve the shutdown, and the changes that are taking place in Washington, have not negatively impacted our business and that's why we're able to get the strong results that we've been achieving today, and how that's why I believe that will continue to achieve these strong results going forward.
Excellent. Keep up the good work. That's all I had.
Thanks Alex. Appreciate it.
And I'm not showing any further questions at this time. I'd like to turn the call back over to uh Scott Shaw for any closing remarks.
Great. Thank you, Operator, and thank you all for joining us today as we reviewed our continued progress, growth, and increased financial guidance for the full year. As more and more high school graduates and adults seek a time-efficient, cost-effective path to develop skills that can serve them a lifetime, interest in our programs continues to grow. With our student enrollment growth, new campus development, and increasing levels of operating efficiencies, we believe we have numerous opportunities to generate increasing levels of shareholder returns over several years.
Our success is only made possible by the commitment and dedication of our faculty and staff to our students and their success. We will continue to share with the world that middle school careers, like the ones we offer, lead to rewarding, productive, and fulfilling careers that our nation desperately needs. I'd like to thank our shareholders for their support and our entire team for their dedication to achieving our goals. I hope to see you during my time on the road, visiting shareholders, employers, and politicians as I share the link and text story. Thank you all again and have a great day. Bye-bye.
Ladies and gentlemen, that's includes today's presentation. We thank you for your participation. You may now disconnect and have a wonderful day.