2u (TWOU) Tops Q2 EPS by 5c, Revenues Beat

2u (NASDAQ: TWOU) reported Q2 EPS of ($0.34), $0.05 better than the analyst estimate of ($0.39). Revenue for the quarter came in at $182.7 million versus the consensus estimate of $174.56 million.

Results for Second Quarter 2020 Compared to Second Quarter 2019

• Revenue increased 35% to $182.7 million
• Graduate Program Segment revenue increased 14% to $115.7 million
• Alternative Credential Segment revenue increased 97% to $67.0 million, including $36.6 million in revenue from Trilogy, acquired in May 2019
• Net loss increased $38.2 million to $66.2 million, or $1.03 per share

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

• Adjusted net loss was $21.8 million, or $0.34 per share, compared to adjusted net loss of $25.8 million, or $0.43 per share
• Adjusted EBITDA loss was $2.1 million, compared to a loss of $15.0 million

"In these complex and challenging times, the importance of 2U's mission and the value we deliver for our partners and their students has never been more clear," Co-Founder and CEO Christopher "Chip" Paucek said. "As universities accelerate their digital transformations and more students affirmatively choose to pursue an education online, we believe our strong relationships with leading universities and the unmatched scale and quality of our portfolio of offerings position us well for future growth."

"We are driving significant improvement in key profitability and cash flow metrics while maintaining quality, enhancing operational efficiency, and executing on growth opportunities," said Chief Financial Officer Paul Lalljie. "We delivered a significant improvement in free cash flow in the second quarter and expect to achieve EBITDA profitability next quarter and for the full year. We also increased our financial flexibility with our recent convertible senior notes offering and revolving line of credit."

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

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