Q3 2026 (three and nine months ended September 30, 2026)
Filed Nov 9, 2026Q3 2026 student starts rose 14.2%, revenue rose 12.6% and adjusted EBITDA rose 30.8%; full-year revenue guidance raised
Starts, average and ending population, revenue, operating income, net income, adjusted EBITDA and operating cash flow all grew in the quarter and the nine months, and the company raised full-year revenue guidance. Offsets to note: program-level starts in Transportation and Skilled Trades fell on an unadjusted basis, the adjusted EBITDA definition changed for 2026, and nine-month operating cash flow includes large receivables and payables movements.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Student starts, Q3 2026 (total)other | 7,362 | – | 14.2% |
| Student starts, Q3 2026 (total, as reported 2025 unadjusted)other | 7,362 | – | (20.1)% |
| Student starts, Q3 2026, Transportation and Skilled Trades (yoy vs 2025 adjusted)other | 6,120 | – | 16.5% |
| Student starts, Q3 2026, Healthcare and Other Professions (yoy vs 2025 adjusted)other | 1,242 | – | 4.2% |
| Average student population, Q3 2026 (total, yoy vs 2025 adjusted)other | 18,584 | – | 10.9% |
| End of period student population, Q3 2026other | 20,325 | – | 11.4% |
| Revenue, Q3 2026GAAP | $159.2M | – | 12.6% |
| Educational services and facilities expense, Q3 2026GAAP | $67.12M | – | 17.2% |
| Selling, general and administrative expense, Q3 2026GAAP | $84.34M | – | 8.4% |
| Gain on sale of assets, Q3 2026 (as printed in thousands)GAAP | 19K | – | – |
| Total costs and expenses, Q3 2026GAAP | $151.5M | – | – |
| Operating income, Q3 2026GAAP | $7.70M | – | 22.5% |
| Campus Operations operating income, Q3 2026GAAP | $24.84M | – | 6.8% |
| Corporate operating income (loss), Q3 2026GAAP | −$17.15M | – | (1.0)% |
| Interest expense, Q3 2026GAAP | −$1.11M | – | – |
| Income before income taxes, Q3 2026GAAP | $6.59M | – | – |
| Provision for income taxes, Q3 2026GAAP | $1.87M | – | – |
| Net income, Q3 2026GAAP | $4.7M | – | 24.1% |
| Diluted net income per common share, Q3 2026GAAP | $0.15 | – | – |
| Basic net income per common share, Q3 2026GAAP | $0.15 | – | – |
| Adjusted EBITDA, Q3 2026non-GAAP | $17.4 million ($17,370 thousand) | – | 30.8% |
| Net cash provided by operating activities, Q3 2026GAAP | $34.9M | – | improved $11.0 million |
| Revenue, nine months 2026GAAP | $445.7 million ($445,695 thousand) | – | 18.7% |
| Educational services and facilities expense, nine months 2026GAAP | $185.1M | – | 22.2% |
| Selling, general and administrative expense, nine months 2026GAAP | $243.1M | – | 14.8% |
| Total costs and expenses, nine months 2026GAAP | $428.3M | – | – |
| Operating income, nine months 2026GAAP | $17.41M | – | 38.5% |
| Campus Operations operating income, nine months 2026GAAP | $74.14M | – | 15.4% |
| Corporate operating loss, nine months 2026GAAP | −$56.73M | – | (9.8)% |
| Interest expense, nine months 2026GAAP | −$3.01M | – | – |
| Income before income taxes, nine months 2026GAAP | $14.45M | – | – |
| Provision for income taxes, nine months 2026GAAP | $3.43M | – | – |
| Net income, nine months 2026GAAP | $11.02M | – | – |
| Diluted net income per common share, nine months 2026GAAP | $0.35 | – | – |
| Adjusted EBITDA, nine months 2026non-GAAP | $45.6 million ($45,569 thousand) | – | 49.0% |
| Net cash provided by operating activities, nine months 2026GAAP | $61.5 million ($61,515 thousand) | – | – |
| Capital expenditures, nine months 2026GAAP | −$67.37M | – | – |
| Student starts, nine months 2026 (yoy vs 2025 adjusted)other | 18,840 | – | 11.0% |
| Average student population, nine months 2026 (yoy vs 2025 adjusted)other | 18,404 | – | 14.4% |
Full year 2026 outlook
- Revenue$600.0 million - $605.0 million
- NoteAdjusted EBITDA (non-GAAP): $76.0 million - $80.0 million; includes approximately $10.0 million in losses related to new campus openings and strategic growth initiatives
- NoteNet income: $23.0 million - $26.0 million
- NoteDiluted EPS: $0.74 - $0.83
- NoteCapital expenditures: $95.0 million - $100.0 million
- NoteStudent starts growth: 10% - 12%; the company said it is refining start growth guidance within the range set after the first quarter
- NoteCompany states it is raising full-year 2026 revenue guidance, narrowing student start guidance, and reiterating adjusted EBITDA, net income, diluted EPS and capital expenditure guidance
- NoteReconciliation to guidance midpoint (management projections, in thousands): net income $24,500; interest expense, net $4,000; provision for taxes $10,300; depreciation and amortization $33,000; EBITDA $71,800; stock-based compensation $6,200; adjusted EBITDA $78,000
Capital returns
- Repurchased 871,135 shares of common stock for approximately $21.0 million during the third quarter
- Nine-month cash flow statement shows repurchases of common stock of $(19,298) thousand
- Board approved a $30 million increase in the existing share repurchase authorization, to $70 million in total, with more than $37 million remaining available
- Net share settlement for equity-based compensation of $(6,700) thousand in the nine months 2026 (cash flow statement)
- November 2026 amendment to the revolving credit facility provides, among other items, greater flexibility for daily borrowing and repayment and enhanced share repurchase flexibility
What drove it
- Company states Q3 revenue increase of $17.8 million, or 12.6%, was primarily due to a 10.9% increase in average student population
- Company states Q3 educational services and facilities expense increased $9.8 million, or 17.2%, including a $3.1 million increase in costs related to the new campuses in Houston, Hicksville, Rowlett and Suitland, and that the increase was primarily driven by a larger student population, increased laptop pricing and higher depreciation expense from capital investments
- Company states Q3 SG&A increased $6.5 million, or 8.4%, driven by higher student population and costs related to new campuses
- Company states nine-month revenue increase of $70.3 million, or 18.7%, was primarily due to a 14.4% increase in average student population
- Company states nine-month SG&A increase of $31.4 million, or 14.8%, was primarily driven by a larger student population, higher sales and marketing expense, and costs related to new campuses and other growth initiatives
- Company states Corporate and Other expenses of $17.1 million in Q3 2026 compared with $17.0 million in the prior year period, and that the nine-month increase to $56.7 million from $51.7 million was primarily driven by higher salaries and benefits
- Company states that in Q3 it saw an improvement in lead conversion rate to starts to its historic levels
- Company states it realized operating efficiencies in many of its operations during the period
- Company states Hicksville, New York, the second campus in the state, is expected to begin its first class in November 2026
- Company states the Melrose Park, Illinois campus property, previously leased, was acquired for $18.8 million
Concerns
- Program mix on an unadjusted basis: Transportation and Skilled Trades Q3 starts of 6,120 compare with 7,705 in Q3 2025 as printed, a decline of (20.6)%; Healthcare and Other Professions starts fell (17.4)% on the same basis. The company's comparison excludes 2,764 starts moved into July 1, 2025
- Healthcare and Other Professions average population grew 2.2% in Q3 and fell (1.1)% in the nine months on the unadjusted basis, while Transportation and Skilled Trades average population grew 17.1% in Q3
- Adjusted EBITDA guidance includes approximately $10.0 million in losses related to new campus openings and strategic growth initiatives
- The company states that beginning in fiscal 2026 it no longer excludes pre-opening costs or net operating losses from new campuses and program expansions from adjusted EBITDA, and that prior periods have been recast; Q3 2025 adjusted EBITDA is therefore shown on the recast basis
- Accounts payable increased to $44,127 thousand from $27,023 thousand at December 31, 2025, and accounts receivable change in the nine-month cash flow statement is $(50,658) thousand, while provision for credit losses is $47,062 thousand
- Corporate operating loss widened to $(56,726) thousand in the nine months from $(51,664) thousand, a (9.8)% change on the printed basis
- Cash and cash equivalents declined to $20,627 thousand from $28,519 thousand at December 31, 2025, and the company has $10.0 million outstanding under its revolving credit facility
- Net income guidance of $23.0 million to $26.0 million and diluted EPS guidance of $0.74 to $0.83 were reiterated, while nine-month diluted EPS is $0.35 against guidance range of $0.74 to $0.83 for the full year
What to watch
- Conversion of the 10% to 12% student start growth guidance range, which the company has narrowed within its previous range
- Q4 2026 execution against the raised revenue guidance of $600.0 million to $605.0 million, given nine-month revenue of $445.7 million
- Campus openings in Hicksville (November 2026), Suitland (fourth quarter 2027), Tempe (first quarter 2028) and Rowlett (under construction), and the associated losses included in adjusted EBITDA guidance
- Program-level starts in Transportation and Skilled Trades and Healthcare and Other Professions on the comparable basis
- Accounts receivable, provision for credit losses and accounts payable movements in the operating cash flow
- Use of the expanded $70 million share repurchase authorization, with more than $37 million remaining, and the amended revolving credit facility
- Capital expenditure guidance of $95.0 million to $100.0 million against nine-month capital expenditures of $(67,370) thousand
- Progress toward the long-term 2030 objectives of $850 million in revenue and $150 million of EBITDA, as stated by the company
Balance sheet and cash flow
- Cash and cash equivalents: $20,627 thousand at September 30, 2026, versus $28,519 thousand at December 31, 2025
- Total liquidity (non-GAAP): $135,627 thousand at September 30, 2026, comprised of cash of $20,627 thousand and a credit facility amount of $115,000 thousand; the release states $10.0 million was outstanding under the revolving credit facility
- Long-term debt: $24,752 thousand at September 30, 2026, versus none ('-') at December 31, 2025
- Mortgage loan: proceeds of $15,040 thousand and principal payments of $(20) thousand in the nine months 2026 (cash flow statement)
- Total assets: $517,134 thousand at September 30, 2026, versus $493,164 thousand at December 31, 2025
- Total stockholders' equity: $187,680 thousand at September 30, 2026, versus $199,688 thousand at December 31, 2025
- Total liabilities: $329,454 thousand at September 30, 2026, versus $293,476 thousand at December 31, 2025
- Accounts payable: $44,127 thousand at September 30, 2026, versus $27,023 thousand at December 31, 2025
- Accounts receivable, net: $39,402 thousand at September 30, 2026, versus $36,929 thousand at December 31, 2025; nine-month cash flow shows an accounts receivable change of $(50,658) thousand
- Property, equipment and facilities, net: $219,996 thousand at September 30, 2026, versus $171,603 thousand at December 31, 2025
- Nine-month net cash used in investing activities: $(66,836) thousand; net cash used in financing activities: $(2,571) thousand; net decrease in cash: $(7,892) thousand
- Nine-month provision for credit losses (non-cash add-back in operating cash flow): $47,062 thousand, versus $42,584 thousand in the prior year period
- Company recorded a $24,843 thousand Campus Operations operating income figure alongside Corporate operating loss of $(17,147) thousand in Q3 2026
Analysis
Lincoln reported third-quarter 2026 revenue of $159.2 million, up 12.6% from $141.4 million, with student starts up 14.2% to 7,362 on the company's comparable 2025 base of 6,445 (the reported 2025 figure was 9,209 before the company's adjustment for 2,764 starts moved into the last week of June 2026). Average student population rose 10.9% on the comparable basis and end-of-period population rose 11.4% to 20,325. The company attributes the revenue increase primarily to the population growth. Operating income rose 22.5% to $7,696 thousand, net income rose 24.1% to $4.7 million and diluted EPS was $0.15 against $0.12.
Costs grew more slowly than revenue at the operating income line in the quarter, but the line items show the cost base rising. Educational services and facilities expense rose 17.2% to $67,122 thousand and SG&A rose 8.4% to $84,340 thousand, with the company citing larger population, new campuses, higher laptop pricing and higher depreciation for the first, and population and new campus costs for the second. Campus Operations operating income rose 6.8% to $24,843 thousand, while Corporate operating loss widened slightly to $(17,147) thousand. Interest expense rose to $(1,114) thousand from $(991) thousand.
Nine-month figures show the same pattern at larger scale: revenue of $445.7 million (up 18.7%), operating income of $17,414 thousand (up 38.5%) and net income of $11,018 thousand against $7,298 thousand. Nine-month adjusted EBITDA of $45.6 million rose 49.0%, but this measure now excludes no pre-opening or new campus losses, and the company states prior periods were recast; it also notes the 2026 guidance includes approximately $10.0 million of such losses.
Cash generation improved: nine-month operating cash flow was $61.5 million against $15.8 million, and Q3 operating cash flow was $34.9 million. The nine-month cash flow statement also shows accounts receivable movement of $(50,658) thousand and provision for credit losses of $47,062 thousand, and accounts payable rose to $44,127 thousand from $27,023 thousand at year end. Cash declined to $20,627 thousand from $28,519 thousand, and the company recorded $67,370 thousand of capital expenditures and a $15,040 thousand mortgage loan proceeds line, alongside $19,298 thousand of share repurchases in the nine months.
For the full year, the company is raising revenue guidance to $600.0 million to $605.0 million, narrowing student start growth to 10% to 12%, and reiterating adjusted EBITDA of $76.0 million to $80.0 million, net income of $23.0 million to $26.0 million, diluted EPS of $0.74 to $0.83 and capital expenditures of $95.0 million to $100.0 million. The company also repurchased 871,135 shares for approximately $21.0 million in the quarter and raised its repurchase authorization to $70 million. Figures to examine closely are the Transportation and Skilled Trades starts on the unadjusted basis, the non-comparable adjusted EBITDA definition, and the working capital lines behind operating cash flow.
Management, verbatim
During the third quarter, we generated double-digit growth across all our key metrics, highlighted by our 14.2% increase in student starts
Scott Shaw, President & CEO
Based on our year-to-date performance and current outlook, we are refining our guidance for start growth of 10% to 12% for the full year, within the previous guidance range we established following our first quarter.
Scott Shaw, President & CEO
As we look to the remainder of 2026 and the longer-term future, based on our operational performance through October and current trends, we are raising our full-year revenue guidance.
Scott Shaw, President & CEO
Not in the filing
stated, not guessed- Gross margin: not reported as a figure in the release
- Segment revenue for Campus Operations and Corporate: not printed; only operating income by segment is reported
- Prior-year and prior-quarter figures for Q3 2026 revenue, costs and operating income as separate prior quarter values: no sequential (Q2 2026) figures printed
- Year-over-year percentage change for Q3 and nine-month net income in dollar form ($) on the cash flow basis: not printed
- Year-over-year percentage change for interest expense, income before taxes, provision for income taxes, net income (nine months), diluted and basic EPS (nine months), capital expenditures and operating cash flow (nine months): not printed
- Year-over-year percentage change for Q3 operating cash flow: the release states an $11.0 million improvement, not a percentage
- Quarter-over-quarter (sequential) comparisons: not printed
- Prior-year (Q3 2025) net income and EPS on the recast basis: not restated beyond the figures printed
- Prior-year adjusted EBITDA on the pre-2026 definition: not printed; release states prior periods were recast
- Prior guidance: no previous outlook was provided, so guidance comparison is empty
- Dividends: none printed
- Operating expense and tax rate guidance: not provided
- Stock price reaction and analyst consensus: not in the document
- Individual Campus Operations and Corporate revenue or expense lines in the quarter: not printed
Written by an AI language model from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure is checked against the filing text, and a metric the filing does not print, or whose value, prior period and change do not add up, is dropped from the metrics. The model can still misread a table, in the metrics or in the text, so check a number in the filing before you rely on it. Consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.