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New words:
advocate, basic, broker, capacity, card, Carolina, case, classified, conduct, cooperate, cooperating, count, counting, coupon, covenant, curricula, delist, delisting, diligence, disciplinary, disputed, Division, documentation, earliest, effort, employee, enable, enforcement, enumerated, environment, evidence, exit, expressed, external, failing, faith, found, Franchise, good, guarantee, harm, heightened, improperly, inadequately, intent, irreparable, landlord, longest, maximum, mediation, monitoring, Montana, multiple, narrative, North, occurrence, Ombudsperson, Oregon, organizational, OTC, OTCQB, oversee, oversight, Pink, prepay, president, processor, proctoring, prohibition, protection, prove, provision, provost, question, quoted, receded, redeemed, registrar, repaid, repay, repayment, reputation, research, safety, section, sharp, show, Spring, step, structure, struggle, team, visit, willingly
Removed:
accrual, apply, approve, audited, compensating, confer, customary, generated, ground, incorporated, irrevocable, issuer, posted, power, preparing, reference, reflected, released, unregistered, voting
Financial report summary
?Competition
RLI • Hallmark Financial Services • Strategic Education • Zovio • Grand Canyon Education • Medifirst SolutionsRisks
- As a result of the disclosure of the recent AZ BON probation and related matters, we are subject to a class action lawsuit and are or may become subject other litigation which could expose us to significant costs and cause business and reputational harm.
- Because there is strong competition in the postsecondary education market, especially in the online education market and as a result of COVID-19, our cost of acquiring students may increase and our results of operations may be materially and adversely affected.
- COVID-19 has materially and adversely affected our business.
- If we are unable to successfully execute our growth strategy of opening new nursing campuses, our results of operations and future growth could be materially and adversely affected.
- In the event that we are unable to update and expand the content of existing programs and develop new programs and specializations on a timely basis and in a cost-effective manner, our results of operations may be harmed.
- Because we are an online provider of education, we are substantially dependent on continued growth and acceptance of online education and, if the recognition by students and employers of the value of online education does not continue to grow, our ability to grow our business could be adversely impacted.
- Because our future growth and profitability will depend in large part upon the effectiveness of our marketing and advertising efforts, if those efforts are unsuccessful we may not be profitable in the future.
- Because of the Russian invasion of Ukraine, the effect on the capital markets and the economy is uncertain, and we may have to deal with a recessionary economy and economic uncertainty including possible adverse effects upon our business.
- If our assumptions with respect to our long-term accounts receivable prove to be inaccurate, we may be required to take a charge to our Allowance for Doubtful accounts and incur a material non-cash charge to earnings.
- We experienced a reduction in enrollments year-over-year, and if we are unable to change the trend in future periods, our results of operations and prospects, and your investment in us, could be materially adversely impacted.
- Although our management has successfully implemented a monthly payment business model, it may not be successful long-term.
- If we are unable to develop awareness among, and attract and retain, high quality learners to our schools, our ability to generate significant revenue or achieve profitability will be significantly impaired.
- Because we rely on third parties to provide certain services in running our operations, if any of these parties fail to provide the agreed services at an acceptable level, it could limit our ability to provide services and/or cause student dissatisfaction, either of which could adversely affect our business.
- Because we rely on third-party administration and hosting of learning management system software for our online classroom, if that third-party were to cease to do business or alter its business practices and services, it could have an adverse impact on our ability to operate.
- If we experience system disruptions to our online computer networks, it could impact our ability to generate revenue and damage our reputation, limiting our ability to attract and retain students.
- If we lose the services of key personnel, it could adversely affect our business.
- If we are unable to attract and retain our faculty, administrators, management and skilled personnel, we may not be able to support our operations.
- If we or our service providers are unable to update the technology that we rely upon to offer online education, our future growth may be impaired.
- If we experience any interruption to our technology infrastructure, it could prevent students from accessing their courses, could have a material adverse effect on our ability to attract and retain students and could require us to incur additional expenses to correct or mitigate the interruption.
- Because the CAN-SPAM Act imposes certain obligations on the senders of commercial emails, it could adversely impact our ability to market Aspen University’s and USU’s educational services, and otherwise increase the costs of our business.
- If our data or our users’ content is hacked, including through privacy and data security breaches, our business could be damaged, and we could be subject to liability.
- Our business could be harmed by any significant disruption of service on our websites.
- If we incur liability for the unauthorized duplication or distribution of class materials posted online during our class discussions, it may affect our future operating results and financial condition.
- Because the personal information that we or our vendors collect may be vulnerable to breach, theft or loss, any of these factors could adversely affect our reputation and operations.
- If we fail to comply with laws and regulations relating to privacy, data protection, information security, advertising and consumer protection, government access requests, or, if new laws in one or more of these areas are enacted, it could result in proceedings, actions, or penalties against us and could adversely affect our business, financial condition, and results of operations.
- If we are unable to protect our intellectual property, our business could be harmed.
- If we are subject to intellectual property infringement claims, it could cause us to incur significant expenses and pay substantial damages.
- If there is new tax treatment of companies engaged in Internet commerce, this may adversely affect the commercial use of our marketing services and our financial results.
- Our business is subject to the risks of earthquakes, hurricanes, tornadoes, fires, power outages, floods and other catastrophic events, any of which may adversely affect our business and results of operations.
- If our goodwill and intangible assets on our consolidated balance sheet arising from the USU acquisition become impaired, it would require us to record a material charge to earnings in accordance with generally accepted accounting principles.
- If we fail to comply with the extensive regulatory requirements for our business, we could face penalties and significant restrictions on our operations, including loss of access to Title IV Program funds.
- If we do not maintain authorization in Arizona, Florida, Texas, Tennessee, Georgia and California and future states where we plan to have campuses, our operations would be curtailed, and we would not be able to grant degrees.
- Our failure to comply with regulations of various states could have a material adverse effect on our enrollments, revenues, and results of operations.
- If the DOE determines that borrowers of federal student loans who attended our institutions have a defense to repayment of their federal student loans, our institution’s repayment liability to the DOE could have a material adverse effect on our enrollments, revenues and results of operations.
- If we fail to maintain our institutional accreditations, we would lose our ability to participate in the tuition assistance programs of the U.S. Armed Forces and also to participate in Title IV Programs.
- Because we participate in Title IV Programs, our failure to comply with the complex regulations associated with Title IV Programs would have a significant adverse effect on our operations and prospects for growth.
- We must regularly reestablish our eligibility and certification to participate in the Title IV Programs, and there are no assurances that the DOE will recertify us to participate in the Title IV Programs.
- Because the DOE may conduct compliance reviews of us, we may be subject to adverse actions and future litigation which could affect our ability to offer Title IV student loans.
- If the percentage of our revenues derived from Title IV Programs is too high, we could lose our ability to participate in Title IV Programs.
- If our competitors are subject to further regulatory claims and adverse publicity, it may affect our industry and reduce our future enrollment.
- Due to new regulations or congressional action or reduction in funding for Title IV Programs, our future enrollment may be reduced and costs of compliance increased.
- Because we are subject to sanctions if we fail to calculate correctly and return timely Title IV Program funds for students who stop participating before completing their educational program, our future operating results may be adversely affected.
- If we fail to demonstrate “financial responsibility,” Aspen University and USU may lose their eligibility to participate in Title IV Programs or be required to post a letter of credit in order to maintain eligibility to participate in Title IV Programs.
- If we fail to demonstrate “administrative capability,” we may lose eligibility to participate in Title IV Programs.
- Because we rely on third parties to assist us in administering our participation in Title IV Programs, their failure to comply with applicable regulations could cause one or both of our schools to lose their eligibility to participate in Title IV Programs.
- If we pay impermissible commissions, bonuses or other incentive payments to individuals involved in recruiting, admissions or financial aid activities, we will be subject to sanctions.
- If their student loan default rates are too high, our schools may lose eligibility to participate in Title IV Programs.
- If either institutional accrediting agency loses recognition by the U.S. Secretary of Education or we fail to maintain institutional accreditation for Aspen University and USU, we may lose our ability to participate in Title IV Programs.
- If we fail to comply with the DOE’s substantial misrepresentation rules, it could result in sanctions against our schools.
- If we fail to comply with the DOE’s credit hour requirements, it could result in sanctions against our schools.
- The U.S. Congress continues to examine the for-profit postsecondary education sector which could result in legislation or additional DOE rulemaking that may limit or condition Title IV Program participation of proprietary schools in a manner that may materially and adversely affect our business.
- Due to factors beyond our control, our stock price may be volatile.
Management Discussion
- AU and USU combined revenue decreased 18% in Q3 Fiscal 2023 compared to Q3 Fiscal 2022.The AU revenue decline year-over-year reflects lower post-licensure enrollments attributed to lower marketing spend initiated in late Q1 Fiscal 2023 and the stoppage of enrollments at our pre-licensure campuses. The active student body at AU decreased from 10,736 at January 31, 2022 to 7,232 at January 31, 2023. This AU revenue decrease was offset by the USU revenue increase due primarily to USU's MSN-FNP program, the USU post-licensure degree program with the highest concentration of students and the highest LTV.