2u (TWOU) Tops Q4 EPS by 3c, Revenues Beat; Offers FY21 Revenue Mid-Point Guidance Above Consensus

2u (NASDAQ: TWOU) reported Q4 EPS of ($0.06), $0.03 better than the analyst estimate of ($0.09). Revenue for the quarter came in at $215.3 million versus the consensus estimate of $208.23 million.

Results for Fourth Quarter 2020 Compared to Fourth Quarter 2019

• Revenue increased 32% to $215.3 million
• Degree Program Segment revenue increased 21% to $130.5 million
• Alternative Credential Segment revenue increased 54% to $84.8 million
• Net loss improved $6.9 million to $37.7 million, or $0.52 per share

Non-GAAP Results for Fourth Quarter 2020 Compared to Fourth Quarter 2019

• Adjusted EBITDA improved by $13.8 million to $18.8 million
• Adjusted net loss improved by $7.1 million to $4.0 million, or $0.06 per share

"In the face of the unprecedented challenges 2020 presented for our society and the economy globally, 2U delivered excellent results that I believe are a testament to the underlying strength of our business and the value our shared success model continues to deliver for our partners and students," Co-Founder and Chief Executive Officer, Christopher "Chip" Paucek said. "2U's unmatched scale and the quality, diversity, and breadth of our growing portfolio of degree and non-degree offerings from great nonprofit universities around the world has solidified our position as the digital transformation partner of choice in edtech, and we believe sets us on a clear path forward for strong, profitable growth in 2021 and beyond."

"We executed on our commitment to balance strong revenue growth with margin improvements while driving towards free cash flow and greatly increasing our liquidity and financial flexibility throughout the year," said Chief Financial Officer, Paul Lalljie. "We believe we are well positioned to continue to grow profitably, invest for the future, and drive sustainable value for our shareholders. Our guidance for 2021 reflects confidence in our ability to maintain strong growth while making significant improvements in profitability."

GUIDANCE:

2u sees FY2021 revenue of $910-945 million, versus the consensus of $911.67 million.

Business Outlook for Fiscal Year 2021

The company provided guidance for the full-year 2021 for the following metrics:

• Revenue to range from $910.0 million to $945.0 million, or growth of 17% to 22%
• Net loss to range from $185.0 million to $165.0 million
• Adjusted EBITDA to range from $45.0 million to $65.0 million

For earnings history and earnings-related data on 2u (TWOU) click here.

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