Zovio (ZVOI) 10-Q 27 Oct 21 2021 Q3 Quarterly report Financial data

Cover

Cover - shares	9 Months Ended
	Sep. 30, 2021	Oct. 21, 2021
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2021
Document Transition Report	false
Entity File Number	001-34272
Entity Registrant Name	ZOVIO INC
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	59-3551629
Entity Address, Address Line One	1811 E. Northrop Blvd,
Entity Address, City or Town	Chandler
Entity Address, State or Province	AZ
Entity Address, Postal Zip Code	85286
City Area Code	858
Local Phone Number	668-2586
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Title of 12(b) Security	Common Stock, par value $0.01 per share
Trading Symbol	ZVO
Security Exchange Name	NASDAQ
Entity Common Stock, Shares Outstanding		33,459,695
Entity Central Index Key	0001305323
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2021
Document Fiscal Period Focus	Q3
Amendment Flag	false

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Sep. 30, 2021	Dec. 31, 2020
Current assets:
Cash and cash equivalents	$ 31,608	$ 35,462
Restricted cash	9,808	20,035
Investments	1,322	1,515
Accounts receivable, net of allowance for credit losses of $1.8 million and $1.2 million at September 30, 2021 and December 31, 2020, respectively	8,539	7,204
Prepaid expenses and other current assets	15,564	12,617
Total current assets	66,841	76,833
Property and equipment, net	27,711	30,575
Operating lease assets	29,909	20,114
Goodwill and intangibles, net	29,998	31,785
Other long-term assets	3,316	1,999
Total assets	157,775	161,306
Current liabilities:
Accounts payable and accrued liabilities	57,878	62,693
Deferred revenue and student deposits	13,083	8,090
Total current liabilities	70,961	70,783
Rent liability	35,373	24,125
Other long-term liabilities	8,577	7,181
Total liabilities	114,911	102,089
Commitments and contingencies (see Note 15)
Preferred stock, $0.01 par value:
Preferred stock issued	0	0
Common stock, $0.01 par value:
Common stock issued	675	668
Additional paid-in capital	171,315	179,489
Retained earnings	307,574	326,319
Treasury stock	(436,700)	(447,259)
Total stockholders' equity	42,864	59,217
Total liabilities and stockholders' equity	$ 157,775	$ 161,306

Condensed Consolidated Balanc_2

Condensed Consolidated Balance Sheets - Parenthetical - USD ($) $ in Thousands	Sep. 30, 2021	Dec. 31, 2020
Statement of Financial Position [Abstract]
Less allowance for credit losses	$ 1,833	$ 1,216
Preferred Stock, Par or Stated Value Per Share	$ 0.01	$ 0.01
Preferred Stock, Shares Authorized	20,000,000	20,000,000
Preferred Stock, Shares Issued	0	0
Preferred Stock, Shares Outstanding	0	0
Common Stock, Par or Stated Value Per Share	$ 0.01	$ 0.01
Common Stock, Shares Authorized		300,000,000
Common Stock, Shares, Issued	67,155,000	66,454,000
Common Stock, Shares, Outstanding	33,446,000	32,267,000
Treasury Stock, Shares	33,709,000	34,187,000

Condensed Consolidated Statemen

Condensed Consolidated Statements of Income (Loss) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Revenue and other revenue	$ 62,226	$ 102,166	$ 208,271	$ 303,978
Costs and expenses:
TechnologyAndAcademicServices	16,498	19,084	53,698	54,821
CounselingServicesAndSupport	20,438	24,670	68,936	71,529
Marketing Expense	21,068	23,274	68,628	70,017
General and administrative	9,013	11,437	33,285	36,405
UniversityRelatedExpenses	0	22,863	0	72,332
Restructuring and impairment expense	300	184	2,641	3,430
Total costs and expenses	67,317	101,512	227,188	308,534
Operating income (loss)	(5,091)	654	(18,917)	(4,556)
Other income (loss), net	(69)	39	90	(62)
Income (loss) before income taxes	(5,160)	693	(18,827)	(4,618)
Income tax expense (benefit)	59	(428)	(82)	(12,906)
Net income (loss)	$ (5,219)	$ 1,121	$ (18,745)	$ 8,288
Income (loss) per share:
Earnings Per Share, Basic (in dollars per share)	$ (0.16)	$ 0.03	$ (0.56)	$ 0.26
Earnings Per Share, Diluted (in dollars per share)	$ (0.16)	$ 0.03	$ (0.56)	$ 0.26
Weighted average number of common shares outstanding used in computing income (loss) per share:
Basic (in shares)	33,427	32,646	33,182	31,711
Diluted (in shares)	33,427	34,015	33,182	32,342
Revenue, Product and Service Benchmark
Revenue and other revenue	$ 59,808	$ 5,131	$ 200,585	$ 14,258
University-related revenue
Revenue and other revenue	0	97,035	0	289,720
Transition Service Agreement
Revenue and other revenue	$ 2,418	$ 0	$ 7,686	$ 0

Condensed Consolidated Statem_2

Condensed Consolidated Statement of Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands	Total	Common Stock	Additional Paid-in Capital	Retained Earnings	Treasury Stock
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Adoption of accounting standards	$ 98,938	$ 660	$ 192,413	$ 375,180	$ (469,315)
Balance (in shares) at Dec. 31, 2019		65,695
Balance at Dec. 31, 2019	98,938	$ 660	192,413	375,180	(469,315)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation	4,138		4,138
Stock issued under stock incentive plan, net of shares held for taxes (in shares)		338
Stock issued under stock incentive plan, net of shares held for taxes	(202)	$ 3	(205)
Net income (loss)	2,020			2,020
Balance (in shares) at Mar. 31, 2020		66,033
Balance at Mar. 31, 2020	104,985	$ 663	196,346	377,291	(469,315)
Balance (in shares) at Dec. 31, 2019		65,695
Balance at Dec. 31, 2019	98,938	$ 660	192,413	375,180	(469,315)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	8,288
Balance (in shares) at Sep. 30, 2020		66,349
Balance at Sep. 30, 2020	114,254	$ 667	177,287	383,559	(447,259)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Adoption of accounting standards	104,985	$ 663	196,346	377,291	(469,315)
Balance (in shares) at Mar. 31, 2020		66,033
Balance at Mar. 31, 2020	104,985	$ 663	196,346	377,291	(469,315)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation	802		802
Stock issued under employee stock purchase plan	112	1	111
Stock issued for acquisition	0	$ 0	(22,162)		22,162
Stock repurchase	(106)				(106)
Stock issued under employee stock purchase plan (in shares)		57
Stock issued under stock incentive plan, net of shares held for taxes (in shares)		236
Stock issued under stock incentive plan, net of shares held for taxes	(180)	$ 2	(182)
Business Combination, Consideration Transferred, Equity Interests Issued and Issuable	1,245		1,245
Net income (loss)	5,147			5,147
Balance (in shares) at Jun. 30, 2020		66,326
Balance at Jun. 30, 2020	112,005	$ 666	176,160	382,438	(447,259)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Adoption of accounting standards	112,005	$ 666	176,160	382,438	(447,259)
Stock-based compensation	1,146		1,146
Stock issued under stock incentive plan, net of shares held for taxes (in shares)		23
Stock issued under stock incentive plan, net of shares held for taxes	(18)	$ 1	(19)
Net income (loss)	1,121			1,121
Balance (in shares) at Sep. 30, 2020		66,349
Balance at Sep. 30, 2020	114,254	$ 667	177,287	383,559	(447,259)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Adoption of accounting standards	114,254	667	177,287	383,559	(447,259)
Adoption of accounting standards	59,217	$ 668	179,489	326,319	(447,259)
Balance (in shares) at Dec. 31, 2020		66,454
Balance at Dec. 31, 2020	59,217	$ 668	179,489	326,319	(447,259)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation	2,382		2,382
Stock issued under stock incentive plan, net of shares held for taxes (in shares)		563
Stock issued under stock incentive plan, net of shares held for taxes	(1,078)	$ 5	(1,083)
Contingent consideration	(122)		(122)
Adjustments to Additional Paid in Capital, Other			(10,559)		10,559
Net income (loss)	(9,493)			(9,493)
Balance (in shares) at Mar. 31, 2021		67,017
Balance at Mar. 31, 2021	50,906	$ 673	170,107	316,826	(436,700)
Balance (in shares) at Dec. 31, 2020		66,454
Balance at Dec. 31, 2020	59,217	$ 668	179,489	326,319	(447,259)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	(18,745)
Balance (in shares) at Sep. 30, 2021		67,155
Balance at Sep. 30, 2021	42,864	$ 675	171,315	307,574	(436,700)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Adoption of accounting standards	50,906	$ 673	170,107	316,826	(436,700)
Balance (in shares) at Mar. 31, 2021		67,017
Balance at Mar. 31, 2021	50,906	$ 673	170,107	316,826	(436,700)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation	247		247
Stock issued under employee stock purchase plan	76	$ 0	76
Stock issued under employee stock purchase plan (in shares)		31
Stock issued under stock incentive plan, net of shares held for taxes (in shares)		79
Stock issued under stock incentive plan, net of shares held for taxes	(88)	$ 1	(89)
Net income (loss)	(4,033)			(4,033)
Balance (in shares) at Jun. 30, 2021		67,127
Balance at Jun. 30, 2021	47,108	$ 674	170,341	312,793	(436,700)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Adoption of accounting standards	47,108	$ 674	170,341	312,793	(436,700)
Stock-based compensation	990		990
Stock issued under stock incentive plan, net of shares held for taxes (in shares)		28
Stock issued under stock incentive plan, net of shares held for taxes	(15)	$ 1	(16)
Net income (loss)	(5,219)			(5,219)
Balance (in shares) at Sep. 30, 2021		67,155
Balance at Sep. 30, 2021	42,864	$ 675	171,315	307,574	(436,700)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Adoption of accounting standards	$ 42,864	$ 675	$ 171,315	$ 307,574	$ (436,700)

Condensed Consolidated Statem_3

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020
Cash flows from operating activities:
Net income (loss)	$ (18,745)	$ 8,288
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Provision for bad debts	1,002	9,845
Depreciation and amortization	6,297	8,749
Deferred income taxes	0	6
Stock-based compensation	3,619	6,086
Noncash lease expense	6,539	8,546
Net loss (gain) on marketable securities	(144)	47
Loss (gain) on disposal or impairment of fixed assets	71	38
Changes in operating assets and liabilities:
Accounts receivable	(2,335)	(14,513)
Prepaid expenses and other current assets	(2,948)	219
Other long-term assets	(1,318)	(821)
Accounts payable and accrued liabilities	(2,369)	(12)
Deferred revenue and student deposits	4,992	4,269
Operating lease liabilities	(7,527)	(8,173)
Other liabilities	1,275	(2,468)
Net cash provided by (used in) operating activities	(11,591)	20,106
Cash flows from investing activities:
Capital expenditures	(1,155)	(2,587)
Purchases of investments	(740)	(702)
Capitalized costs for intangible assets	(565)	(199)
Sale of investments	1,076	1,818
Net cash used in investing activities	(1,384)	(1,670)
Cash flows from financing activities:
Proceeds from the issuance of stock under employee stock purchase plan	76	112
Borrowings from long-term liabilities	0	2,682
Tax withholdings on issuance of stock awards	(1,182)	(400)
Payments for Repurchase of Common Stock	0	(106)
Net cash provided by (used in) financing activities	(1,106)	2,288
Net increase (decrease) in cash, cash equivalents and restricted cash	(14,081)	20,724
Cash, cash equivalents and restricted cash at beginning of period	55,497	92,537
Cash, cash equivalents and restricted cash at end of period	41,416	113,261
Reconciliation of cash, cash equivalents, and restricted cash:
Cash and cash equivalents	31,608	86,628
Restricted cash	9,808	26,633
Total cash, cash equivalents and restricted cash	41,416	113,261
Supplemental disclosure of non-cash transactions:
Purchase of equipment included in accounts payable and accrued liabilities	65	36
Issuance of common stock for vested restricted stock units	3,861	1,388
Debt extinguishment	3,095	0
Issuance of notes payable	$ 2,809	$ 0

Restatement of Previously Issue

Restatement of Previously Issued Financial Statement Statement - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Reclassification [Line Items]
TechnologyAndAcademicServices	$ 16,498	$ 19,084	$ 53,698	$ 54,821
CounselingServicesAndSupport	20,438	24,670	68,936	71,529
Marketing Expense	21,068	23,274	68,628	70,017
Technology and academic services		0		0
Counseling services and support		0		0
General and administrative	9,013	11,437	33,285	36,405
UniversityRelatedExpenses	0	22,863	0	72,332
Restructuring and impairment expense	300	184	2,641	3,430
Total costs and expenses	$ 67,317	101,512	$ 227,188	308,534
Previously Reported
Reclassification [Line Items]
TechnologyAndAcademicServices		0		0
CounselingServicesAndSupport		0		0
Marketing Expense		0		0
Technology and academic services		44,929		136,184
Counseling services and support		41,620		122,155
General and administrative		14,779		46,765
UniversityRelatedExpenses		0		0
Restructuring and impairment expense		184		3,430
Total costs and expenses		$ 101,512		$ 308,534

Nature of Business

Nature of Business	9 Months Ended
	Sep. 30, 2021
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Nature of Business	Nature of Business Zovio Inc (the “Company”) is a Delaware corporation, and is an education technology services company that partners with higher education institutions and employers to deliver innovative, personalized solutions to help learners and leaders achieve their aspirations. In April 2019, the Company acquired both Fullstack Academy, Inc. (“Fullstack”) and TutorMe.com, Inc. (“TutorMe”), each of which became wholly-owned subsidiaries of the Company at that time. Fullstack is an innovative web development school offering immersive technology bootcamps, and TutorMe is an online education platform that provides 24/7 on-demand tutoring and online courses. On December 1, 2020, the Company and AU LLC finalized a definitive Asset Purchase and Sale Agreement (the “Purchase Agreement”), by and among the Company, AU LLC, the Arizona Board of Regents, a body corporate, for and on behalf of the University of Arizona (the “University of Arizona”), and the University of Arizona Global Campus, a newly formed Arizona nonprofit corporation (“Global Campus”). Upon the closing of the Purchase Agreement (the “Sale Transaction”), the Company and Ashford University (the “University”) transferred to Global Campus the tangible and intangible academic and related operations and assets comprising the University to Global Campus. Following the closing of the Sale Transaction, Global Campus owns and operates the University in affiliation with the University of Arizona and with a focus on expanding access to education for non-traditional adult learners, and the Company provides services to Global Campus under a long-term Strategic Services Agreement (the “Services Agreement”). The services that the Company provides to Global Campus under the Services Agreement include recruiting, admissions, marketing, student finance, financial aid processing, and financial aid advising, program advising, student retention advising, support services for academics, information technology and institutional support. The majority of the Company's cash comes from the Services Agreement with Global Campus. The service fees in the Services Agreement are subject to certain minimum residual liability adjustments, including performance-based adjustments, minimum profit level adjustments, and excess direct cost adjustments. These adjustments are all variable in nature in that they depend upon the Company’s performance during each service period, and to a certain extent the performance and forecast of Global Campus.

Summary of Significant Accounti

Summary of Significant Accounting Policies	9 Months Ended
	Sep. 30, 2021
Accounting Policies [Abstract]
Summary of Significant Accounting Policies	Summary of Significant Accounting Policies Principles of Consolidation The condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. Intercompany transactions have been eliminated in consolidation. Unaudited Interim Financial Information The condensed consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the U.S. (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, these financial statements do not include all of the information and footnotes required by GAAP for complete annual financial statements and should be read in conjunction with the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020, which was filed with the Securities and Exchange Commission (“SEC”) on February 24, 2021. In the opinion of management, the condensed consolidated financial statements include all adjustments, consisting of normal recurring adjustments, considered necessary to present a fair statement of the Company’s condensed consolidated financial position, results of operations and cash flows as of and for the periods presented. Operating results for any interim period are not necessarily indicative of the results that may be expected for the full year. The year-end condensed consolidated balance sheet data was derived from audited consolidated financial statements but does not include all disclosures required by GAAP for complete annual consolidated financial statements. Use of Estimates The preparation of the condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts in the condensed consolidated financial statements. Actual results could differ from those estimates. Notes Payable The fair value of the Company’s outstanding notes payable was estimated using the net present value of the payments, discounted at an interest rate consistent with market interest rates. The Company, through Fullstack, had previously entered into a contract whereby its counterparty advanced funds to the Company for certain program development costs, which the Company was obligated to repay out of future revenues from the developed program. The Company originally recognized these advances as a debt obligation. During the first half of 2021, the notes payable contract was amended and the amount was revalued. As such, included within the other income (loss), net, on the condensed consolidated statements of income (loss) for the nine months ended September 30, 2021, is an offset of interest expense in the amount of $3.1 million, as well as a loss on extinguishment of debt of $2.8 million, the net impact of which is immaterial. Revenue and Other Revenue Revenues are recognized when control of the promised goods or services are transferred, in an amount that reflects the consideration the Company expects to be entitled in exchange for those goods or services. Determining whether a valid customer contract exists includes an assessment of whether amounts due under the contract are collectible. The Company performs this assessment at the beginning of every contract and subsequently thereafter if new information indicates there has been a significant change in facts and circumstances. On December 1, 2020, the Company entered into the Services Agreement with Global Campus whereby the Company will provide certain educational technology and support services, which has an initial term of just over fifteen years, subject to renewal options and certain early termination provisions. The amounts earned from the Services Agreement are within the scope of ASC 606, Revenue from Contracts with Customers (“ASC 606”), and are denoted as revenue on the condensed consolidated statements of income (loss). On December 1, 2020, the Company also entered into a transition services agreement with Global Campus whereby the Company will provide certain temporary transition services (the “Transition Services Agreement”), which has a term of three years. The amounts earned from the Transition Services Agreement are denoted as other revenue on the condensed consolidated statements of income (loss). The Services Agreement has a single performance obligation, as the promises to provide the identified services are not distinct within the context of these agreements. The single performance obligation constitutes a series of distinct services as the customer benefits as services are provided. Service revenue is recognized over time using the input method. The input method provides a faithful depiction of the performance toward complete satisfaction of the performance obligation and can be tied to the direct cost incurred. The service fees received over the term of the agreement are variable in nature in that they are dependent upon the number of students attending the university and revenues generated from those students during the service period. The service fees are subject to certain adjustments, including performance-based adjustments, minimum profit level adjustments, and excess direct cost adjustments. These adjustments are all variable in nature in that they depend upon the Company’s performance during each service period. Such adjustments are presented as minimum residual liability within accounts payable and accrued liabilities. For additional information, see Note 8, “Other Significant Balance Sheet Accounts - Accounts Payable and Accrued Liabilities.” The Company allocates variable consideration to the distinct increments of service to which it relates, as the variability is directly related to the Company’s effort to satisfy the distinct increments of service provided. This is consistent with the allocation objective in ASC 606. The Company meets the criteria in the standard and exercises the practical expedient to not disclose the aggregate amount of the transaction price allocated to the single performance obligation that is unsatisfied as of the end of the reporting period. The Company does not disclose the value of unsatisfied performance obligations because the variable consideration is allocated entirely to a wholly unsatisfied promise to transfer a service that forms part of a single performance obligation. The Company, through Fullstack, offers both full-time and part-time technology bootcamps. The tuition fees for these programs are recognized as revenue as the services are provided to the student, which occurs over the applicable period of instruction. For most Fullstack programs, tuition is collected prior to the start of the cohort; however, for certain programs students can defer payment until completion of the program and for these students an accounts receivable balance is recorded. The Company, through TutorMe, provides online on-demand tutoring services through hourly and access license contracts. Revenue for these contracts are recognized based on hours used or ratably over the contract period depending on the type of contract. For most TutorMe contracts, cash is collected at or near the onset of the contract. The collected cash is recognized as deferred revenue until recognized into revenue. Technology and Academic Services Technology and academic services costs consist primarily of costs related to ongoing maintenance of educational infrastructure, including online course delivery and management, student records, assessment, customer relations management and other internal administrative systems. These costs were previously components of instructional costs and services, as well as general and administrative. This also includes costs to provide support for curriculum and new program development, support for faculty training and development and technical support. This expense category includes salaries, benefits and share-based compensation, information technology costs, curriculum and new program development costs (which are expensed as incurred) and other costs associated with these support services. This category also includes an allocation of depreciation, amortization, human resources, rent, and occupancy costs attributable to the provision of these services. Counseling Services and Support Counseling services and support costs consist primarily of costs including team-based counseling and other support to prospective and current students as well as financial aid processing. These costs were previously components of instructional costs and services, admissions advisory and marketing, as well as general and administrative. This expense category includes salaries, benefits and share-based compensation, and other costs such as dues, fees and subscriptions and travel costs. This category also includes an allocation of depreciation, amortization, human resources, rent, and occupancy costs attributable to the provision of these services. Marketing and Communication Marketing and communication costs consist primarily of lead acquisition, digital communication strategies, brand identity advertising, media planning and strategy, video, data science and analysis, marketing to potential students and other promotional and communication services. These costs were previously components of admissions advisory and marketing, as well as some general and administrative. This expense category includes salaries, benefits and share-based compensation for marketing and communication personnel, brand advertising, marketing leads and other promotional and communication expenses. This category also includes an allocation of depreciation, amortization, human resources, rent, and occupancy costs attributable to the provision of these services. Advertising costs are expensed as incurred. General and Administrative General and administrative costs consist primarily of compensation and benefit costs, including related stock-based compensation, for employees engaged in corporate management, finance, compliance, and other corporate functions. This category also includes an allocation of depreciation, amortization, human resources, rent, and occupancy costs attributable to the provision of these services. University-Related Expenses University-related expenses represent those costs that were transferred to Global Campus in the Sale Transaction and that are no longer incurred by the Company. These costs were previously primarily components of instructional costs and services, with some costs from admissions advisory and marketing and some general and administrative, including instructor fees and other employee costs, student related bad debt expense, license fees for licenses transferred to Global Campus and other costs. Comprehensive Income (Loss) The Company has no components of other comprehensive income (loss), and therefore, comprehensive income (loss) equals net income (loss). Recent Accounting Pronouncements In December 2019, the Financial Accounting Standards Board (“FASB”) issued ASU 2019-12 , Income Taxes (Topic 740) Simplifying the Accounting for Income Taxes (“ASU 2019-12”), which removes certain exceptions to the general principles in Topic 740. The amendments in this update also improve consistent application of and simplify GAAP for other areas of Topic 740 by clarifying and amending existing guidance. For public business entities, the amendments in this standard are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. The Company applied the new standard, including all applicable updates, effective January 1, 2021. The adoption of ASU 2019-12 did not have a material impact on the Company’s condensed consolidated financial statements.

Revenue Recognition

Revenue Recognition	9 Months Ended
	Sep. 30, 2021
Revenue Recognition [Abstract]
Revenue Recognition	Revenue, Other Revenue and Deferred Revenue The following table presents the Company’s net revenue disaggregated based on the revenue source (in thousands): Three Months Ended Nine Months Ended 2021 2020 2021 2020 Strategic services revenue $ 52,702 $ — $ 179,318 $ — Transition services income 2,418 — 7,685 — Tuition revenue, net 7,012 93,183 20,967 277,533 Digital materials revenue, net — 5,809 — 17,415 Technology fee revenue, net — 2,628 — 7,628 Other revenue, net (1) 94 546 301 1,402 Total revenue, net $ 62,226 $ 102,166 $ 208,271 $ 303,978 (1) Primarily consists of revenues generated from various services and other miscellaneous fees. The following table presents the Company’s net revenue disaggregated based on the timing of revenue recognition (in thousands): Three Months Ended Nine Months Ended 2021 2020 2021 2020 Over time, over period of instruction $ 62,159 $ 82,659 $ 208,062 $ 244,872 Over time, full tuition grant (1) — 13,948 — 42,792 Point in time (2) 67 5,559 209 16,314 Total revenue, net $ 62,226 $ 102,166 $ 208,271 $ 303,978 (1) Represents revenue generated from the FTG program. (2) Represents revenue generated from digital textbooks and other miscellaneous fees. The Company operates under two reportable segments and has no foreign operations or assets located outside of the United States. For additional information on segmentation, see Note 16, “Segment Information.” Deferred Revenue and Student Deposits Current deferred revenue and student deposits consisted of the following (in thousands): As of As of Deferred revenue, current $ 12,126 $ 7,477 Student deposits 957 613 Total current deferred revenue and student deposits $ 13,083 $ 8,090 Below are the opening and closing balances of current deferred revenue from the Company’s contracts with customers (in thousands): 2021 2020 Current deferred revenue opening balance, January 1 $ 7,477 $ 23,356 Current deferred revenue closing balance, September 30 12,126 29,413 Increase (decrease) $ 4,649 $ 6,057 For further information on receivables, refer to Note 7, “Accounts Receivable, Net” within the condensed consolidated financial statements. Deferred revenue consists of cash payments that are received or due in advance of the Company’s performance. As of September 30, 2021 the deferred revenue balance relates entirely to the Zovio Growth segment. For the majority of the Company’s customers, payment for services is due prior to services being provided and is included in current deferred revenue. However, there are contracts which include deferred revenue that is deemed to be long-term. For additional information, refer to Note 8, “Other Significant Balance Sheet Accounts - Other Long-Term Liabilities” within the condensed consolidated financial statements. The difference between the opening and closing balances of deferred revenue primarily results from the timing difference between the Company’s performance and the customer’s payment. For the nine months ended September 30, 2021, the Company recognized $6.4 million of revenue that was included in the deferred revenue balance as of January 1, 2021. For the nine months ended September 30, 2020, the Company recognized $23.3 million of revenue that was included in the deferred revenue balance as of January 1, 2020. Amounts reported in the closing balance of deferred revenue are expected to be recognized as revenue within the next 12 months.

Restructuring and Impairment Ex

Restructuring and Impairment Expense	9 Months Ended
	Sep. 30, 2021
Restructuring and Related Activities [Abstract]
Restructuring, Impairment, and Other Activities Disclosure	Restructuring and Impairment Expense During the three months ended September 30, 2021 and 2020, the Company recognized $0.3 million and $0.2 million, respectively, of restructuring and impairment expense. During the nine months ended September 30, 2021 and 2020, the Company recognized $2.6 million and $3.4 million, respectively, of restructuring and impairment expense. The components of these expenses are further described below. The Company had previously vacated or consolidated properties and subsequently reassessed its non-cancelable leases obligation. Additionally, the Company had previously relocated its headquarters from California to Arizona. As a result, during the three and nine months ended September 30, 2020, the Company recognized relocation and lease reassessment expenses of $0.3 million and $0.5 million, respectively. No such expense was recorded for either the three or nine months ended September 30, 2021, respectively. In May and July 2021, the Company implemented restructuring plans to reduce operating expenses, implement cost reductions and conserve cash resources. During the three months ended September 30, 2021, the Company recognized severance costs of $0.3 million, all of which related to the University Partners segment. These restructuring charges consist of one-time termination benefits for employee severance, benefits and related costs, all of which are expected to result in cash expenditures and substantially all of which will be paid out over the next 12 months. For the three months ended September 30, 2020, the Company reversed $0.1 million of restructuring and impairment expense relating to severance costs for wages and benefits for a prior restructuring plan. During the nine months ended September 30, 2021 and 2020, the Company recognized severance costs of $2.6 million and $2.9 million, respectively. The following table summarizes the amounts recorded in the restructuring and impairment expense line item on the Company’s condensed consolidated statements of income (loss) for each of the periods presented (in thousands): Three Months Ended Nine Months Ended 2021 2020 2021 2020 Severance costs $ 300 $ (70) $ 2,641 $ 2,902 Lease exit and other costs — 254 — 528 Total restructuring and impairment expense $ 300 $ 184 $ 2,641 $ 3,430 The following table summarizes the changes in the Company's restructuring and impairment liability by type during the nine months ended September 30, 2021 (in thousands): Student Transfer Costs Severance Costs Lease Exit and Other Costs Total Balance at December 31, 2020 $ 1,282 $ 742 $ 1,974 $ 3,998 Restructuring and impairment expense — 2,641 — 2,641 Payments and adjustments — (2,493) (1,115) (3,608) Balance at September 30, 2021 $ 1,282 $ 890 $ 859 $ 3,031 The restructuring liability amounts are recorded within either the (i) accounts payable and accrued liabilities account or (ii) lease liability account on the condensed consolidated balance sheets.

Fair Value Measurements

Fair Value Measurements	9 Months Ended
	Sep. 30, 2021
Fair Value Disclosures [Abstract]
Fair Value Measurements	Fair Value Measurements The following tables summarize the fair value information as of September 30, 2021 and December 31, 2020, respectively (in thousands): As of September 30, 2021 Level 1 Level 2 Level 3 Total Mutual funds $ 1,322 $ — $ — $ 1,322 As of December 31, 2020 Level 1 Level 2 Level 3 Total Mutual funds $ 1,515 $ — $ — $ 1,515 The mutual funds in the tables above, represent the deferred compensation asset balances, which are considered to be trading securities. The Company’s deferred compensation asset balances are recorded in the investments line item on the Company’s condensed consolidated balance sheets, and are classified as Level 1 securities. There were no transfers between any level categories for investments during the periods presented. There were no differences between amortized cost and fair value of investments as of September 30, 2021 or December 31, 2020, and no reclassifications out of accumulated other comprehensive income during either the nine months ended September 30, 2021 or 2020.

Accounts Receivable, Net

Accounts Receivable, Net	9 Months Ended
	Sep. 30, 2021
Receivables [Abstract]
Accounts Receivable, Net	Accounts Receivable, Net Accounts receivable, net, consisted of the following (in thousands): As of As of Accounts receivable $ 10,372 $ 8,420 Less allowance for credit losses 1,833 1,216 Accounts receivable, net $ 8,539 $ 7,204 The following table presents the changes in the allowance for credit losses for the nine months ended September 30, 2021 (in thousands): Beginning Charged to Write-offs Recoveries of amounts Ending Non-FTG related allowance $ 1,216 $ 1,002 $ (385) $ — $ 1,833 Total allowance for credit losses $ 1,216 $ 1,002 $ (385) $ — $ 1,833 The following table presents the changes in the allowance for credit losses for the nine months ended September 30, 2020 (in thousands): Beginning Charged to Write-offs Recoveries of amounts Ending FTG-related allowance $ 1,749 $ 1,524 $ (1,872) $ 337 $ 1,738 Non-FTG related allowance 11,963 8,321 (14,124) 4,518 10,678 Total allowance for credit losses $ 13,712 $ 9,845 $ (15,996) $ 4,855 $ 12,416

Other Significant Balance Sheet

Other Significant Balance Sheet Accounts	9 Months Ended
	Sep. 30, 2021
Balance Sheet Related Disclosures [Abstract]
Other Significant Balance Sheet Accounts	Other Significant Balance Sheet Accounts Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consisted of the following (in thousands): As of As of Prepaid expenses $ 3,106 $ 3,027 Prepaid licenses 2,257 1,371 Prepaid income taxes — 48 Income tax receivable — 1,644 Prepaid insurance 3,044 1,127 Insurance recoverable 476 404 Other current assets (1) 6,681 4,996 Total prepaid expenses and other current assets $ 15,564 $ 12,617 (1) Other current assets includes a net asset adjustment due from Global Campus related to the Sale Transaction, which is currently in mediation. Property and Equipment, Net Property and equipment, net, consisted of the following (in thousands): As of As of Furniture and office equipment $ 23,974 $ 36,146 Software 5,502 7,512 Leasehold improvements 15,901 16,325 Vehicles 22 22 Total property and equipment 45,399 60,005 Less accumulated depreciation and amortization (17,688) (29,430) Total property and equipment, net $ 27,711 $ 30,575 For the three months ended September 30, 2021 and 2020, depreciation and amortization expense related to property and equipment was $1.4 million and $1.5 million, respectively. For the nine months ended September 30, 2021 and 2020, depreciation and amortization expense related to property and equipment was $3.9 million and $4.7 million, respectively. Goodwill and Intangibles, Net Goodwill and intangibles, net, consisted of the following (in thousands): September 30, 2021 Definite-lived intangible assets: Gross Carrying Amount Accumulated Amortization Net Carrying Amount Capitalized curriculum costs $ 13,932 $ (12,760) $ 1,172 Purchased intangible assets 14,185 (8,535) 5,650 Total definite-lived intangible assets $ 28,117 $ (21,295) $ 6,822 Goodwill 23,176 Total goodwill and intangibles, net $ 29,998 December 31, 2020 Definite-lived intangible assets: Gross Carrying Amount Accumulated Amortization Net Carrying Amount Capitalized curriculum costs $ 13,745 $ (12,644) $ 1,101 Purchased intangible assets 14,185 (6,677) 7,508 Total definite-lived intangible assets $ 27,930 $ (19,321) $ 8,609 Goodwill 23,176 Total goodwill and intangibles, net $ 31,785 For the three months ended September 30, 2021 and 2020, amortization expense was $0.7 million and $1.3 million, respectively. For the nine months ended September 30, 2021 and 2020, amortization expense was $2.4 million and $4.0 million, respectively. The following table summarizes the estimated remaining amortization expense as of each fiscal year ended below (in thousands): Year Ended December 31, Remainder of 2021 $ 658 2022 2,533 2023 2,380 2024 791 2025 122 Thereafter 338 Total future amortization expense $ 6,822 Accounts Payable and Accrued Liabilities Accounts payable and accrued liabilities consisted of the following (in thousands): As of As of Accounts payable $ 9,129 $ 11,246 Accrued salaries and wages 7,305 6,149 Accrued bonus 2,521 11,428 Accrued vacation 3,084 3,369 Accrued litigation and fees 8,041 8,341 Minimum residual liability 7,422 1,216 Accrued expenses 14,494 12,473 Current leases payable 4,405 6,934 Accrued insurance liability 1,424 1,537 Accrued income taxes payable 53 — Total accounts payable and accrued liabilities $ 57,878 $ 62,693 Other Long-Term Liabilities Other long-term liabilities consisted of the following (in thousands): As of As of Uncertain tax positions $ 28 $ 28 Notes payable 2,885 2,981 Deferred revenue 942 — Other long-term liabilities 4,722 4,172 Total other long-term liabilities $ 8,577 $ 7,181

Credit Facilities

Credit Facilities	9 Months Ended
	Sep. 30, 2021
Debt Disclosure [Abstract]
Credit Facilities	Credit Facilities The Company has issued letters of credit that are collateralized with cash, in the aggregate amount of $9.8 million as of September 30, 2021. The letters of credit relate primarily to the Company's leased facilities and insurance requirements. The collateralized cash is held in restricted cash on the Company's condensed consolidated balance sheets. The Company is required to provide surety bonds in certain states in which it does business. As a result, the Company had previously entered into a surety bond facility with an insurance company to provide such bonds when required. Although there are no remaining bonds on the Company’s behalf under this facility as of September 30, 2021, the Company still holds certain liability associated with any required collateral.

Lease Obligations

Lease Obligations	9 Months Ended
	Sep. 30, 2021
Leases [Abstract]
Lease Obligations	Lease Obligations Operating Leases The Company leases various office and classroom facilities with terms that expire at various dates through 2033. These facilities are used for academic operations, corporate functions, enrollment services and student support services. The Company does not have any leases other than its office facilities and classrooms. All of the leases were classified as operating leases for the period ended September 30, 2021, and the Company does not have any finance leases. All of the leases, other than those that may qualify for the short-term scope exception of 12 months or less, are recorded on the Company’s condensed consolidated balance sheets. The Company obtained additional right-of-use assets of $14.6 million in exchange for lease obligations related to new classroom and office leases during the period ended September 30, 2021. The Company has agreements to sublease certain portions of its office facilities, with two active subleases as of September 30, 2021. The Company’s subleases do not include any options to extend or for early termination and do not contain any residual value guarantees or restrictive covenants. All of the subleases were classified as operating leases for the period ended September 30, 2021. The Company is subleasing office space of approximately 21,000 square feet in Denver, Colorado with a remaining commitment to lease of 17 months and net lease payments of $0.9 million. The Company is also subleasing approximately 24,000 square feet of office space in San Diego, California with a remaining commitment to lease of 3 months and net lease payments of $0.3 million. Sublease income for the nine months ended September 30, 2021 and 2020 was $1.9 million and $1.4 million, respectively.

Income Per Share

Income Per Share	9 Months Ended
	Sep. 30, 2021
Earnings Per Share [Abstract]
Income Per Share	Income (Loss) Per Share Basic income (loss) per share is calculated by dividing net income (loss) available to common stockholders for the period by the weighted average number of common shares outstanding for the period. Diluted income (loss) per share is calculated by dividing net income (loss) available to common stockholders for the period by the sum of (i) the weighted average number of common shares outstanding for the period, plus (ii) potentially dilutive securities outstanding during the period, if the effect is dilutive. Potentially dilutive securities for the periods presented include stock options, unvested restricted stock units (“RSUs”) and unvested performance stock units (“PSUs”). The following table sets forth the computation of basic and diluted income (loss) per share for the periods indicated (in thousands, except per share data): Three Months Ended Nine Months Ended 2021 2020 2021 2020 Numerator: Net income (loss) $ (5,219) $ 1,121 $ (18,745) $ 8,288 Denominator: Weighted average number of common shares outstanding 33,427 32,646 33,182 31,711 Effect of dilutive options and stock units — 1,369 — 631 Diluted weighted average number of common shares outstanding 33,427 34,015 33,182 32,342 Income (loss) per share: Basic $ (0.16) $ 0.03 $ (0.56) $ 0.26 Diluted $ (0.16) $ 0.03 $ (0.56) $ 0.26 The following table sets forth the number of stock options and stock units excluded from the computation of diluted income (loss) per share for the periods indicated below because their effect was anti-dilutive (in thousands): Three Months Ended Nine Months Ended 2021 2020 2021 2020 Stock options 1,279 1,525 1,391 1,654 Stock units 972 — 1,170 577

Stock-Based Compensation

Stock-Based Compensation	9 Months Ended
	Sep. 30, 2021
Share-based Payment Arrangement [Abstract]
Stock-Based Compensation	Stock-Based Compensation The Company recorded $1.0 million and $1.1 million of stock-based compensation expense for the three months ended September 30, 2021 and 2020, respectively. The related income tax benefit was $0.2 million and $0.3 million for the three months ended September 30, 2021 and 2020, respectively. The Company recorded $3.6 million and $6.1 million of stock-based compensation expense for the nine months ended September 30, 2021 and 2020, respectively. The related income tax benefit was $0.9 million and $1.5 million for the nine months ended September 30, 2021 and 2020, respectively. During the nine months ended September 30, 2021, the Company granted 1.1 million RSUs at a weighted average grant date fair value of $3.31 and 1.0 million RSUs vested. During the nine months ended September 30, 2020, the Company granted 1.4 million RSUs at a grant date fair value of $2.22, and 0.8 million RSUs vested. During the nine months ended September 30, 2021, the Company granted 0.9 million performance-based PSUs at a weighted average grant date fair value of 2.72, and no performance-based or market-based PSUs vested. During the nine months ended September 30, 2020, 1.1 million market-based PSUs were granted at a weighted average grant date fair value of 2.18 and no performance-based or market-based PSUs vested. During each of the nine months ended September 30, 2021, and September 30, 2020, the Company did not grant any stock options and no stock options were exercised. As of September 30, 2021, unrecognized compensation cost was $5.4 million related to unvested stock options, RSUs and PSUs.

Income Taxes

Income Taxes	9 Months Ended
	Sep. 30, 2021
Income Tax Disclosure [Abstract]
Income Taxes	Income Taxes The Company uses the asset-liability method to account for taxes. Under this method, deferred income tax assets and liabilities result from temporary differences between the tax basis of assets and liabilities and their reported amounts in the condensed consolidated financial statements that will result in income and deductions in future years. The Company recognizes deferred tax assets if realization of such assets is more-likely-than-not. In order to make this determination, the Company evaluates a number of factors including the ability to generate future taxable income from reversing taxable temporary differences, forecasts of financial and taxable income or loss, and the ability to carryback certain operating losses to refund taxes paid in prior years. The cumulative loss incurred over the three-year period ended September 30, 2021 constituted significant negative objective evidence against the Company’s ability to realize a benefit from its federal deferred tax assets. Such objective evidence limited the ability of the Company to consider in its evaluation certain subjective evidence such as the Company’s projections for future growth. On the basis of its evaluation, the Company determined that its deferred tax assets were not more-likely-than-not to be realized and that a valuation allowance against its deferred tax assets should continue to be maintained as of September 30, 2021. The Company’s current effective income tax rate that has been applied to normal, recurring operations for the nine months ended September 30, 2021 was (1.0)%. The Company’s actual effective income tax rate for the nine months ended September 30, 2021, after discrete items, was 0.4%. As of both September 30, 2021, and December 31, 2020, the Company had $19 thousand, respectively, of gross unrecognized tax benefits, of which $15 thousand, respectively, would impact the effective income tax rate if recognized. Although the Company believes the tax accruals provided are reasonable, the final determination of tax returns under review or returns that may be reviewed in the future and any related litigation could result in tax liabilities that materially differ from the Company’s historical income tax provisions and accruals. The Company has analyzed filing positions in all of the federal and state jurisdictions where it is required to file income tax returns, as well as all open tax years in these jurisdictions. The tax years 2001 through 2020 are open to examination by major taxing jurisdictions to which the Company is subject.

Regulatory

Regulatory	9 Months Ended
	Sep. 30, 2021
Regulatory [Abstract]
Regulatory	Regulatory The Company is subject to extensive regulation by federal and state governmental agencies and accrediting bodies. In particular, the Higher Education Act of 1965, as amended (“Higher Education Act”), and the regulations promulgated thereunder by the U.S. Department of Education (“Department”) subject the Company and its university partners to significant regulatory scrutiny on the basis of numerous standards that institutions of higher education must satisfy in order to participate in the various federal student financial aid programs under Title IV of the Higher Education Act (“Title IV programs”). Department of Education On-Site Program Review of former Ashford University In December 2016, the Department informed the University that it intended to continue the on-site program review, which commenced in January 2017 and initially covered the 2015-2016 and 2016-2017 award years, but may be expanded if the Department deems such expansion appropriate. To date, the Company has not received a draft report from the Department. Department of Education Close Out Audit of University of the Rockies The Company previously recorded an expense of $1.5 million during the fiscal year 2018, in relation to the close out audit of University of the Rockies resulting from its merger with the University in October 2018. The expense was recorded in relation to borrower defense to repayment regulations. On September 26, 2019, the Department sent the University a Final Audit Determination letter for the University of the Rockies. This letter confirmed that with the exception of the borrower defense to repayment regulations, none of the other audit findings resulted in financial liability. The Department also stated that additional liabilities could accrue in the future. On December 19, 2019, the Company filed an administrative appeal with the Department appealing the alleged liability on the basis that the University of Rockies did not close but rather merged with the University. The briefing on the appeal is complete and the Company is awaiting a decision by the administrative law judge. WSCUC Accreditation of former Ashford University Global Campus is regionally accredited by WASC Senior College and University Commission (“WSCUC”). As part of the WSCUC Institutional Review Process, a Reaffirmation of Accreditation Visit was conducted by an evaluation team in April 2019. At its meeting in June 2019, the Commission acted to reaffirm accreditation through Spring 2025. In connection with the Purchase Agreement by and among the Company and the University of Arizona, the Company submitted to WSCUC, on July 1, 2020, a substantive change application for a change in ownership from the University to Global Campus which required review and approval by the Substantive Change Committee and the Structural Change Committee of the Commission. On November 12, 2020, WSCUC approved the change of control application filed to complete the Sale Transaction, subject to certain conditions. These conditions included (i) ensuring that Global Campus is differentiated effectively from the University of Arizona and its affiliates in marketing materials; (ii) providing a report to WSCUC within 90 days of the close of the transaction outlining the actionable steps it will take to address student success including in the form of retention and graduation; (iii) those officers, administrators and related parties who become Global Campus officers or administrators divest themselves of their financial and ownership interest in the Company; and (iv) Global Campus and the Company submit a revised strategic services agreement which incorporates any applicable key performance indicators into that agreement. Additionally, WSCUC notified Global Campus that the provisions of the Notice of Concern issued as part of the reaffirmation of the University in July 2019 remain in effect. Department of Education Regulation On December 1, 2020, the parties to the Purchase Agreement entered into Amendment No. 1 to the Purchase Agreement (“Amendment”) pursuant to which, among other things, the University of Arizona and Global Campus waived the closing condition regarding issuance of a pre-acquisition review notice by the Department of Education. Under the terms of the Purchase Agreement, as amended, the Closing was subject to customary closing conditions for transactions in this sector. The Department is expected to conduct a post-closing review of Global Campus following the Sale Transaction, consistent with the Department’s procedures during which the Department makes a determination on the institution’s request for recertification from the Department following the change of control, including whether to impose or place other conditions or restrictions. To be eligible to participate in Title IV programs, an institution must comply with the Higher Education Act and the regulations thereunder that are administered by the Department. The provisions of the Higher Education Act also include being in compliance with the following: • The 90/10 Rule - A proprietary institution loses eligibility to participate in Title IV programs if the institution derives more than 90% of its revenues from Title IV program funds for two consecutive fiscal years, as calculated in accordance with Department regulations. Any institution that violates the 90/10 rule for two consecutive fiscal years becomes ineligible to participate in Title IV programs for at least two • Cohort Default Rate - For each federal fiscal year, the Department calculates a rate of student defaults over a three-year measuring period for each educational institution, which is known as a “cohort default rate.” An institution may lose eligibility to participate in the Federal Direct Loan Program and the Federal Pell Grant Program if, for each of the three most recent federal fiscal years, 30% or more of its students who became subject to a repayment obligation in that federal fiscal year defaulted on such obligation by the end of the following federal fiscal year. • Financial Responsibility - The Department calculates an institution’s composite score for financial responsibility based on its (i) equity ratio, which measures the institution’s capital resources, ability to borrow and financial viability; (ii) primary reserve ratio, which measures the institution’s ability to support current operations from expendable resources; and (iii) net income ratio, which measures the institution’s ability to operate at a profit. An institution that does not meet the Department’s minimum composite score of 1.5 may demonstrate its financial responsibility by posting a letter of credit in favor of the Department and possibly accepting other conditions on its participation in the Title IV programs. Defense to Repayment On October 28, 2016, the Department published borrower defense to repayment regulations to change processes that assist students in gaining relief under certain provisions of the Direct Loan Program regulations. These defense to repayment regulations allow a borrower to assert a defense to repayment on the basis of a substantial misrepresentation, any other misrepresentation in cases where certain other factors are present, a breach of contract or a favorable nondefault contested judgment against a school for its act or omission relating to the making of the borrower’s loan or the provision of educational services for which the loan was provided. In addition, the financial responsibility standards contained in the new regulations establish the conditions or events that trigger the requirement for an institution to provide the Department with financial protection in the form of a letter of credit or other security against potential institutional liabilities. Triggering conditions or events include, among others, certain state, federal or accrediting agency actions or investigations, and in the case of publicly traded companies, receipt of certain warnings from the SEC or the applicable stock exchange, or the failure to timely file a required annual or quarterly report with the SEC. The new regulations also prohibit schools from requiring that students agree to settle future disputes through arbitration. On March 15, 2019, the Department issued guidance for the implementation of parts of the regulations. The guidance covers an institution’s responsibility in regard to reporting mandatory and discretionary triggers as part of the financial responsibility standards, class action bans and pre-dispute arbitration agreements, submission of arbitral and judicial records, and repayment rates. On August 30, 2019, the Department finalized the regulations derived from the 2017-2018 negotiated rulemaking process and subsequent public comments. This version of the borrower defense regulations applies to all federal student loans made on or after July 1, 2020, and, among other things: grants borrowers the right to assert borrower defense to repayment claims against institutions, regardless of whether the loan is in default or in collection proceedings; allows borrowers to file defense to repayment claims three years from either the student’s date of graduation or withdrawal from the institution; and gives students the ability to allege a specific amount of financial harm and to obtain relief in an amount determined by the Department, which may be greater or lesser than their original claim amount. It also includes financial triggers and other factors for recalculating an institution’s financial responsibility composite score that differ from those in the 2016 regulations. On March 18, 2021, the Department announced it would adopt a streamlined approach for granting full debt relief to borrowers reversing the methodology first announced in December 2019 that allowed for partial student loan cancellation for borrowers. The Department determined that the previous methodology did not result in an appropriate relief determination. In July 2020, the Department notified the Company that they would be initiating a preliminary review of borrower defense applications from borrowers who made claims regarding the University. As part of the initial fact-finding process, the Department will send individual student claims to the University and allow the institution the opportunity to submit a response to the borrower’s allegations. In 2020, the Company received and timely responded to the submitted claims. The Company has responded to everything received and cannot predict the outcome of this the Department's review at this time.

Commitments and Contingencies

Commitments and Contingencies	9 Months Ended
	Sep. 30, 2021
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Commitments and Contingencies Litigation From time to time, the Company is a party to various lawsuits, claims and other legal proceedings that arise in the ordinary course of business. When the Company becomes aware of a claim or potential claim, it assesses the likelihood of any loss or exposure. In accordance with GAAP, the Company records loss contingencies in its financial statements only for matters in which losses are probable and can be reasonably estimated. Where a range of loss can be reasonably estimated, the best estimate within that range should be accrued. If no estimate is better than another, the Company records the minimum estimated liability in the range. If the loss is not probable or the amount of the loss cannot be reasonably estimated, the Company discloses the nature of the specific claim if the likelihood of a potential loss is reasonably possible and the amount involved could be material. The Company continuously assesses the potential liability related to the Company’s pending litigation and revises its estimates when additional information becomes available. Other than the specific liabilities assumed by Global Campus, the Company and AU LLC will generally remain responsible for liabilities of the University relating to periods prior to the closing of the Sale Transaction. Below is a list of material legal proceedings to which the Company or its subsidiaries is a party. California Attorney General Investigation of For-Profit Educational Institutions In January 2013, the Company received from the Attorney General of the State of California (“CA Attorney General”) an Investigative Subpoena relating to the CA Attorney General’s investigation of for-profit educational institutions. Pursuant to the Investigative Subpoena, the CA Attorney General requested documents and detailed information for the time period March 1, 2009 to the date of the Investigative Subpoena. On July 24, 2013, the CA Attorney General filed a petition to enforce certain categories of the Investigative Subpoena related to recorded calls and electronic marketing data. On September 25, 2013, the Company reached an agreement with the CA Attorney General to produce certain categories of the documents requested in the petition and stipulated to continue the hearing on the petition to enforce from October 3, 2013 to January 9, 2014. On January 13, 2014 and June 19, 2014, the Company received additional Investigative Subpoenas from the CA Attorney General, each requesting additional documents and information for the time period March 1, 2009 through each such date. Representatives from the Company met with representatives from the CA Attorney General’s office on several occasions to discuss the status of the investigation, additional information requests, and specific concerns related to possible unfair business practices in connection with the Company’s recruitment of students and debt collection practices. The parties also discussed a potential resolution involving injunctive relief, other non-monetary remedies and a payment to the CA Attorney General and in the third quarter of 2016, the Company recorded an expense of $8.0 million related to the cost of resolving this matter. The parties did not reach a resolution and on November 29, 2017, the CA Attorney General filed suit against Ashford and the Company. The Company intends to vigorously defend this case and emphatically denies the allegations made by the CA Attorney General that it ever deliberately misled its students, falsely advertised its programs, or in any way was not fully accurate in its statements to investors. A bench trial for this matter is scheduled to begin in November 2021. We cannot predict the outcome of this matter at this time. The Company cannot reasonably estimate any updated range of loss for this action based on currently available information and as such, the prior accrual of $8.0 million remains and is recorded on the accounts payable and accrued liabilities line item on the condensed consolidated balance sheets.

Segment Reporting

Segment Reporting	9 Months Ended
	Sep. 30, 2021
Segment Reporting [Abstract]
Segment Reporting Disclosure	Segment Information Prior to December 1, 2020, the Company operated in one segment for reporting purposes. Following the Sale Transaction, the Company now operates in two reportable segments: University Partners and Zovio Growth. These segments were recast based upon the Company’s respective offerings. On December 1, 2020, the Company consummated the Sale Transaction. For additional information see Note 1, “Nature of Business.” The Company reports segment information based upon the management approach, and the Sale Transaction resulted in a change in how the chief operating decision maker viewed the operations moving forward. This change included the creation of three operating segments: Fullstack, TutorMe, and Zovio, and two reportable segments: University Partners and Zovio Growth. The Company’s operating segments are determined based on (i) financial information reviewed by the chief operating decision maker, (ii) internal management and related reporting structure, and (iii) the basis upon which the chief operating decision maker makes resource allocation decisions. In conjunction with the departure of the Company's previous chief executive officer in March 2021, the chief operating decision maker transitioned to the Office of the CEO, which is comprised of three executives. The Fullstack and TutorMe operating segments are aggregated into a single reportable segment, the Zovio Growth segment. The aggregation of the Fullstack and TutorMe operating segments is based on their uniform customer bases and methods of services provided, as well as evaluation of quantitative thresholds as required by ASC 280-10-50-12. Based on these same quantitative tests, the Zovio operating segment is a separate reportable segment, the University Partners Segment. This change in segment reporting did not have any impact on the determination of reporting units used to assess impairment under ASC 350, Intangibles - Goodwill and Other. The Company’s University Partners segment includes the technology and services provided to colleges and universities to enable the online delivery of degree programs and related goods and services. University Partners also includes the tuition revenue related to the University prior to the Sale Transaction on December 1, 2020. Segment Performance The following table summarizes financial information regarding each reportable segment’s results of operations for the periods presented (in thousands): Three Months Ended Nine Months Ended 2021 2020 2021 2020 Revenue by segment University Partners $ 55,185 $ 95,991 $ 187,118 $ 288,819 Zovio Growth 7,041 6,175 21,153 15,159 Total revenue and other revenue $ 62,226 $ 102,166 $ 208,271 $ 303,978 Segment profitability University Partners $ (408) $ 6,036 $ (6,499) $ 11,109 Zovio Growth (2,648) (2,517) (6,121) (6,916) Total segment profitability(1) $ (3,056) $ 3,519 $ (12,620) $ 4,193 (1) Segment profitability represents EBITDA. The following table reconciles total loss before income taxes to total segment profitability (in thousands): Three Months Ended Nine Months Ended 2021 2020 2021 2020 Income (loss) before income taxes $ (5,160) $ 693 $ (18,827) $ (4,618) Adjustments: Other expense, net 69 (39) (90) 62 Depreciation and amortization expense 2,035 2,865 6,297 8,749 Total segment profitability $ (3,056) $ 3,519 $ (12,620) $ 4,193 During both the nine months ended September 30, 2021 and September 30, 2020, Global Campus accounted for the entire amount of the University Partners segment revenue, respectively. During both the nine months ended September 30, 2021 or 2020, there were no customers or individual university clients which accounted for 10% or more of the Zovio Growth segment revenue. The Company’s total assets by segment are as follows (in thousands): As of As of University Partners $ 95,903 $ 111,830 Zovio Growth 61,872 49,476 Total assets $ 157,775 $ 161,306 The Company’s accounts receivable and deferred revenue in each segment are as follows (in thousands): As of As of University Partners accounts receivable $ 49 $ 45 Zovio Growth accounts receivable 8,490 7,159 Total accounts receivable $ 8,539 $ 7,204 University Partners deferred revenue $ — $ 10 Zovio Growth deferred revenue 14,025 8,080 Total deferred revenue $ 14,025 $ 8,090 As of each September 30, 2021 and December 31, 2020, the University Partners accounts receivable balance was immaterial. As of each September 30, 2021 and December 31, 2020, there were no individual partners or customers which accounted for 10% or more of the Zovio Growth accounts receivable balance, as customers are individual students or third parties paying on their behalf, rather than university clients. The Company’s goodwill amounts as of September 30, 2021 and December 31, 2020, respectively, are fully attributable to the Zovio Growth segment. For additional information on goodwill, see Note 8, “Other Significant Balance Sheet Accounts - Goodwill and intangibles, net.”

Summary of Significant Accoun_2

Summary of Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 2021
Accounting Policies [Abstract]
Principles of Consolidation	Principles of Consolidation The condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. Intercompany transactions have been eliminated in consolidation.
Unaudited Interim Financial Information	Unaudited Interim Financial Information The condensed consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the U.S. (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, these financial statements do not include all of the information and footnotes required by GAAP for complete annual financial statements and should be read in conjunction with the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020, which was filed with the Securities and Exchange Commission (“SEC”) on February 24, 2021. In the opinion of management, the condensed consolidated financial statements include all adjustments, consisting of normal recurring adjustments, considered necessary to present a fair statement of the Company’s condensed consolidated financial position, results of operations and cash flows as of and for the periods presented. Operating results for any interim period are not necessarily indicative of the results that may be expected for the full year. The year-end condensed consolidated balance sheet data was derived from audited consolidated financial statements but does not include all disclosures required by GAAP for complete annual consolidated financial statements.
Use of Estimates	Use of Estimates The preparation of the condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts in the condensed consolidated financial statements. Actual results could differ from those estimates.
Revenue	Revenue and Other Revenue Revenues are recognized when control of the promised goods or services are transferred, in an amount that reflects the consideration the Company expects to be entitled in exchange for those goods or services. Determining whether a valid customer contract exists includes an assessment of whether amounts due under the contract are collectible. The Company performs this assessment at the beginning of every contract and subsequently thereafter if new information indicates there has been a significant change in facts and circumstances. On December 1, 2020, the Company entered into the Services Agreement with Global Campus whereby the Company will provide certain educational technology and support services, which has an initial term of just over fifteen years, subject to renewal options and certain early termination provisions. The amounts earned from the Services Agreement are within the scope of ASC 606, Revenue from Contracts with Customers (“ASC 606”), and are denoted as revenue on the condensed consolidated statements of income (loss). On December 1, 2020, the Company also entered into a transition services agreement with Global Campus whereby the Company will provide certain temporary transition services (the “Transition Services Agreement”), which has a term of three years. The amounts earned from the Transition Services Agreement are denoted as other revenue on the condensed consolidated statements of income (loss). The Services Agreement has a single performance obligation, as the promises to provide the identified services are not distinct within the context of these agreements. The single performance obligation constitutes a series of distinct services as the customer benefits as services are provided. Service revenue is recognized over time using the input method. The input method provides a faithful depiction of the performance toward complete satisfaction of the performance obligation and can be tied to the direct cost incurred. The service fees received over the term of the agreement are variable in nature in that they are dependent upon the number of students attending the university and revenues generated from those students during the service period. The service fees are subject to certain adjustments, including performance-based adjustments, minimum profit level adjustments, and excess direct cost adjustments. These adjustments are all variable in nature in that they depend upon the Company’s performance during each service period. Such adjustments are presented as minimum residual liability within accounts payable and accrued liabilities. For additional information, see Note 8, “Other Significant Balance Sheet Accounts - Accounts Payable and Accrued Liabilities.” The Company allocates variable consideration to the distinct increments of service to which it relates, as the variability is directly related to the Company’s effort to satisfy the distinct increments of service provided. This is consistent with the allocation objective in ASC 606. The Company meets the criteria in the standard and exercises the practical expedient to not disclose the aggregate amount of the transaction price allocated to the single performance obligation that is unsatisfied as of the end of the reporting period. The Company does not disclose the value of unsatisfied performance obligations because the variable consideration is allocated entirely to a wholly unsatisfied promise to transfer a service that forms part of a single performance obligation. The Company, through Fullstack, offers both full-time and part-time technology bootcamps. The tuition fees for these programs are recognized as revenue as the services are provided to the student, which occurs over the applicable period of instruction. For most Fullstack programs, tuition is collected prior to the start of the cohort; however, for certain programs students can defer payment until completion of the program and for these students an accounts receivable balance is recorded. The Company, through TutorMe, provides online on-demand tutoring services through hourly and access license contracts. Revenue for these contracts are recognized based on hours used or ratably over the contract period depending on the type of contract. For most TutorMe contracts, cash is collected at or near the onset of the contract. The collected cash is recognized as deferred revenue until recognized into revenue.
TechnologyAndAcademicServices	Technology and Academic Services Technology and academic services costs consist primarily of costs related to ongoing maintenance of educational infrastructure, including online course delivery and management, student records, assessment, customer relations management and other internal administrative systems. These costs were previously components of instructional costs and services, as well as general and administrative. This also includes costs to provide support for curriculum and new program development, support for faculty training and development and technical support. This expense category includes salaries, benefits and share-based compensation, information technology costs, curriculum and new program development costs (which are expensed as incurred) and other costs associated with these support services. This category also includes an allocation of depreciation, amortization, human resources, rent, and occupancy costs attributable to the provision of these services.
CounselingServicesAndSupport	Counseling Services and Support Counseling services and support costs consist primarily of costs including team-based counseling and other support to prospective and current students as well as financial aid processing. These costs were previously components of instructional costs and services, admissions advisory and marketing, as well as general and administrative. This expense category includes salaries, benefits and share-based compensation, and other costs such as dues, fees and subscriptions and travel costs. This category also includes an allocation of depreciation, amortization, human resources, rent, and occupancy costs attributable to the provision of these services.
Marketing and Promotional Costs, Policy	Marketing and Communication Marketing and communication costs consist primarily of lead acquisition, digital communication strategies, brand identity advertising, media planning and strategy, video, data science and analysis, marketing to potential students and other promotional and communication services. These costs were previously components of admissions advisory and marketing, as well as some general and administrative. This expense category includes salaries, benefits and share-based compensation for marketing and communication personnel, brand advertising, marketing leads and other promotional and communication expenses. This category also includes an allocation of depreciation, amortization, human resources, rent, and occupancy costs attributable to the provision of these services. Advertising costs are expensed as incurred.
Selling, General and Administrative Expenses, Policy	General and Administrative General and administrative costs consist primarily of compensation and benefit costs, including related stock-based compensation, for employees engaged in corporate management, finance, compliance, and other corporate functions. This category also includes an allocation of depreciation, amortization, human resources, rent, and occupancy costs attributable to the provision of these services.
Comprehensive Income (Loss)	Comprehensive Income (Loss) The Company has no components of other comprehensive income (loss), and therefore, comprehensive income (loss) equals net income (loss).
Recent Accounting Pronouncements	Recent Accounting Pronouncements In December 2019, the Financial Accounting Standards Board (“FASB”) issued ASU 2019-12 , Income Taxes (Topic 740) Simplifying the Accounting for Income Taxes (“ASU 2019-12”), which removes certain exceptions to the general principles in Topic 740. The amendments in this update also improve consistent application of and simplify GAAP for other areas of Topic 740 by clarifying and amending existing guidance. For public business entities, the amendments in this standard are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. The Company applied the new standard, including all applicable updates, effective January 1, 2021. The adoption of ASU 2019-12 did not have a material impact on the Company’s condensed consolidated financial statements.
UniversityRelatedExpenses	University-Related Expenses University-related expenses represent those costs that were transferred to Global Campus in the Sale Transaction and that are no longer incurred by the Company. These costs were previously primarily components of instructional costs and services, with some costs from admissions advisory and marketing and some general and administrative, including instructor fees and other employee costs, student related bad debt expense, license fees for licenses transferred to Global Campus and other costs.
Debt	Notes Payable The fair value of the Company’s outstanding notes payable was estimated using the net present value of the payments, discounted at an interest rate consistent with market interest rates. The Company, through Fullstack, had previously entered into a contract whereby its counterparty advanced funds to the Company for certain program development costs, which the Company was obligated to repay out of future revenues from the developed program. The Company originally recognized these advances as a debt obligation. During the first half of 2021, the notes payable contract was amended and the amount was revalued. As such, included within the other income (loss), net, on the condensed consolidated statements of income (loss) for the nine months ended September 30, 2021, is an offset of interest expense in the amount of $3.1 million, as well as a loss on extinguishment of debt of $2.8 million, the net impact of which is immaterial.

Revenue Recognition (Tables)

Revenue Recognition (Tables)	9 Months Ended
	Sep. 30, 2021
Revenue Recognition [Abstract]
Disaggregation of revenue	The following table presents the Company’s net revenue disaggregated based on the revenue source (in thousands): Three Months Ended Nine Months Ended 2021 2020 2021 2020 Strategic services revenue $ 52,702 $ — $ 179,318 $ — Transition services income 2,418 — 7,685 — Tuition revenue, net 7,012 93,183 20,967 277,533 Digital materials revenue, net — 5,809 — 17,415 Technology fee revenue, net — 2,628 — 7,628 Other revenue, net (1) 94 546 301 1,402 Total revenue, net $ 62,226 $ 102,166 $ 208,271 $ 303,978 (1) Primarily consists of revenues generated from various services and other miscellaneous fees. The following table presents the Company’s net revenue disaggregated based on the timing of revenue recognition (in thousands): Three Months Ended Nine Months Ended 2021 2020 2021 2020 Over time, over period of instruction $ 62,159 $ 82,659 $ 208,062 $ 244,872 Over time, full tuition grant (1) — 13,948 — 42,792 Point in time (2) 67 5,559 209 16,314 Total revenue, net $ 62,226 $ 102,166 $ 208,271 $ 303,978 (1) Represents revenue generated from the FTG program. (2) Represents revenue generated from digital textbooks and other miscellaneous fees.
Deferred revenue of Company's contracts with customers	Below are the opening and closing balances of current deferred revenue from the Company’s contracts with customers (in thousands): 2021 2020 Current deferred revenue opening balance, January 1 $ 7,477 $ 23,356 Current deferred revenue closing balance, September 30 12,126 29,413 Increase (decrease) $ 4,649 $ 6,057
Deferred Revenue and Student Deposits	Current deferred revenue and student deposits consisted of the following (in thousands): As of As of Deferred revenue, current $ 12,126 $ 7,477 Student deposits 957 613 Total current deferred revenue and student deposits $ 13,083 $ 8,090

Restructuring and Impairment _2

Restructuring and Impairment Expense Restructuring and Impairment Expense (Tables)	9 Months Ended
	Sep. 30, 2021
Restructuring and Related Activities [Abstract]
Restructuring and impairment charges	The following table summarizes the amounts recorded in the restructuring and impairment expense line item on the Company’s condensed consolidated statements of income (loss) for each of the periods presented (in thousands): Three Months Ended Nine Months Ended 2021 2020 2021 2020 Severance costs $ 300 $ (70) $ 2,641 $ 2,902 Lease exit and other costs — 254 — 528 Total restructuring and impairment expense $ 300 $ 184 $ 2,641 $ 3,430
Schedule of restructuring reserve by type of cost	The following table summarizes the changes in the Company's restructuring and impairment liability by type during the nine months ended September 30, 2021 (in thousands): Student Transfer Costs Severance Costs Lease Exit and Other Costs Total Balance at December 31, 2020 $ 1,282 $ 742 $ 1,974 $ 3,998 Restructuring and impairment expense — 2,641 — 2,641 Payments and adjustments — (2,493) (1,115) (3,608) Balance at September 30, 2021 $ 1,282 $ 890 $ 859 $ 3,031

Fair Value Measurements (Tables

Fair Value Measurements (Tables)	9 Months Ended
	Sep. 30, 2021
Fair Value Disclosures [Abstract]
Fair Value Information of Short and Long-term Investments	The following tables summarize the fair value information as of September 30, 2021 and December 31, 2020, respectively (in thousands): As of September 30, 2021 Level 1 Level 2 Level 3 Total Mutual funds $ 1,322 $ — $ — $ 1,322 As of December 31, 2020 Level 1 Level 2 Level 3 Total Mutual funds $ 1,515 $ — $ — $ 1,515

Accounts Receivable, Net (Table

Accounts Receivable, Net (Tables)	9 Months Ended
	Sep. 30, 2021
Receivables [Abstract]
Schedule of Accounts Receivable, Net	Accounts receivable, net, consisted of the following (in thousands): As of As of Accounts receivable $ 10,372 $ 8,420 Less allowance for credit losses 1,833 1,216 Accounts receivable, net $ 8,539 $ 7,204
Changes in Allowance for Doubtful Accounts, Accounts Receivable	The following table presents the changes in the allowance for credit losses for the nine months ended September 30, 2021 (in thousands): Beginning Charged to Write-offs Recoveries of amounts Ending Non-FTG related allowance $ 1,216 $ 1,002 $ (385) $ — $ 1,833 Total allowance for credit losses $ 1,216 $ 1,002 $ (385) $ — $ 1,833 The following table presents the changes in the allowance for credit losses for the nine months ended September 30, 2020 (in thousands): Beginning Charged to Write-offs Recoveries of amounts Ending FTG-related allowance $ 1,749 $ 1,524 $ (1,872) $ 337 $ 1,738 Non-FTG related allowance 11,963 8,321 (14,124) 4,518 10,678 Total allowance for credit losses $ 13,712 $ 9,845 $ (15,996) $ 4,855 $ 12,416

Other Significant Balance She_2

Other Significant Balance Sheet Accounts (Tables)	9 Months Ended
	Sep. 30, 2021
Balance Sheet Related Disclosures [Abstract]
Prepaid Expenses and Other Current Assets	Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consisted of the following (in thousands): As of As of Prepaid expenses $ 3,106 $ 3,027 Prepaid licenses 2,257 1,371 Prepaid income taxes — 48 Income tax receivable — 1,644 Prepaid insurance 3,044 1,127 Insurance recoverable 476 404 Other current assets (1) 6,681 4,996 Total prepaid expenses and other current assets $ 15,564 $ 12,617 (1) Other current assets includes a net asset adjustment due from Global Campus related to the Sale Transaction, which is currently in mediation.
Property and Equipment, Net	Property and Equipment, Net Property and equipment, net, consisted of the following (in thousands): As of As of Furniture and office equipment $ 23,974 $ 36,146 Software 5,502 7,512 Leasehold improvements 15,901 16,325 Vehicles 22 22 Total property and equipment 45,399 60,005 Less accumulated depreciation and amortization (17,688) (29,430) Total property and equipment, net $ 27,711 $ 30,575 For the three months ended September 30, 2021 and 2020, depreciation and amortization expense related to property and equipment was $1.4 million and $1.5 million, respectively. For the nine months ended September 30, 2021 and 2020, depreciation and amortization expense related to property and equipment was $3.9 million and $4.7 million, respectively.
Goodwill and Intangibles, Net	Goodwill and Intangibles, Net Goodwill and intangibles, net, consisted of the following (in thousands): September 30, 2021 Definite-lived intangible assets: Gross Carrying Amount Accumulated Amortization Net Carrying Amount Capitalized curriculum costs $ 13,932 $ (12,760) $ 1,172 Purchased intangible assets 14,185 (8,535) 5,650 Total definite-lived intangible assets $ 28,117 $ (21,295) $ 6,822 Goodwill 23,176 Total goodwill and intangibles, net $ 29,998 December 31, 2020 Definite-lived intangible assets: Gross Carrying Amount Accumulated Amortization Net Carrying Amount Capitalized curriculum costs $ 13,745 $ (12,644) $ 1,101 Purchased intangible assets 14,185 (6,677) 7,508 Total definite-lived intangible assets $ 27,930 $ (19,321) $ 8,609 Goodwill 23,176 Total goodwill and intangibles, net $ 31,785 For the three months ended September 30, 2021 and 2020, amortization expense was $0.7 million and $1.3 million, respectively. For the nine months ended September 30, 2021 and 2020, amortization expense was $2.4 million and $4.0 million, respectively.
Intangibles, Estimated Remaining Amortization Expense	The following table summarizes the estimated remaining amortization expense as of each fiscal year ended below (in thousands): Year Ended December 31, Remainder of 2021 $ 658 2022 2,533 2023 2,380 2024 791 2025 122 Thereafter 338 Total future amortization expense $ 6,822
Accounts Payable and Accrued Liabilities	Accounts Payable and Accrued Liabilities Accounts payable and accrued liabilities consisted of the following (in thousands): As of As of Accounts payable $ 9,129 $ 11,246 Accrued salaries and wages 7,305 6,149 Accrued bonus 2,521 11,428 Accrued vacation 3,084 3,369 Accrued litigation and fees 8,041 8,341 Minimum residual liability 7,422 1,216 Accrued expenses 14,494 12,473 Current leases payable 4,405 6,934 Accrued insurance liability 1,424 1,537 Accrued income taxes payable 53 — Total accounts payable and accrued liabilities $ 57,878 $ 62,693
Deferred Revenue and Student Deposits	Current deferred revenue and student deposits consisted of the following (in thousands): As of As of Deferred revenue, current $ 12,126 $ 7,477 Student deposits 957 613 Total current deferred revenue and student deposits $ 13,083 $ 8,090
Other Long-Term Liabilities	Other Long-Term Liabilities Other long-term liabilities consisted of the following (in thousands): As of As of Uncertain tax positions $ 28 $ 28 Notes payable 2,885 2,981 Deferred revenue 942 — Other long-term liabilities 4,722 4,172 Total other long-term liabilities $ 8,577 $ 7,181

Income Per Share (Tables)

Income Per Share (Tables)	9 Months Ended
	Sep. 30, 2021
Earnings Per Share [Abstract]
Computation of Basic and Diluted Earnings Per Common Share	The following table sets forth the computation of basic and diluted income (loss) per share for the periods indicated (in thousands, except per share data): Three Months Ended Nine Months Ended 2021 2020 2021 2020 Numerator: Net income (loss) $ (5,219) $ 1,121 $ (18,745) $ 8,288 Denominator: Weighted average number of common shares outstanding 33,427 32,646 33,182 31,711 Effect of dilutive options and stock units — 1,369 — 631 Diluted weighted average number of common shares outstanding 33,427 34,015 33,182 32,342 Income (loss) per share: Basic $ (0.16) $ 0.03 $ (0.56) $ 0.26 Diluted $ (0.16) $ 0.03 $ (0.56) $ 0.26
Antidilutive Securities	The following table sets forth the number of stock options and stock units excluded from the computation of diluted income (loss) per share for the periods indicated below because their effect was anti-dilutive (in thousands): Three Months Ended Nine Months Ended 2021 2020 2021 2020 Stock options 1,279 1,525 1,391 1,654 Stock units 972 — 1,170 577

Segment Reporting (Tables)

Segment Reporting (Tables)	9 Months Ended
	Sep. 30, 2021
Segment Reporting [Abstract]
Schedule of Segment Reporting Information, by Segment	The following table summarizes financial information regarding each reportable segment’s results of operations for the periods presented (in thousands): Three Months Ended Nine Months Ended 2021 2020 2021 2020 Revenue by segment University Partners $ 55,185 $ 95,991 $ 187,118 $ 288,819 Zovio Growth 7,041 6,175 21,153 15,159 Total revenue and other revenue $ 62,226 $ 102,166 $ 208,271 $ 303,978 Segment profitability University Partners $ (408) $ 6,036 $ (6,499) $ 11,109 Zovio Growth (2,648) (2,517) (6,121) (6,916) Total segment profitability(1) $ (3,056) $ 3,519 $ (12,620) $ 4,193

Summary of Significant Accoun_3

Summary of Significant Accounting Policies (Details) - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2021	Sep. 30, 2021
Accounting Policies [Abstract]
Interest Expense	$ 3,100	$ 3,100
Gain (Loss) on Extinguishment of Debt	$ 2,800	$ 2,800

Revenue Recognition (Details)

Revenue Recognition (Details) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2021USD ($)	Sep. 30, 2020USD ($)	Sep. 30, 2021USD ($)reportableSegment	Sep. 30, 2020USD ($)	Dec. 31, 2020USD ($)	Jan. 01, 2020USD ($)	Jan. 01, 2019USD ($)
Disaggregation of Revenue [Line Items]
Number of reportable segments | reportableSegment			2
Revenue and other revenue	$ 62,226	$ 102,166	$ 208,271	$ 303,978
Contract with Customer, Liability, Current	12,126		12,126		$ 7,477
Contract with Customer, Refund Liability, Current	957		957		613
Deferred revenue and student deposits	13,083		13,083		$ 8,090
Deferred revenue, opening balance	12,126	29,413	12,126	29,413		$ 7,477	$ 23,356
Deferred revenue, ending balance	12,126	29,413	12,126	29,413		$ 7,477	$ 23,356
Deferred revenue, increase (decrease)			4,649	6,057
Deferred revenue, revenue recognized			6,400	23,300
Over time, over period of instruction
Disaggregation of Revenue [Line Items]
Revenue and other revenue	62,159	82,659	208,062	244,872
Over time, full tuition grant
Disaggregation of Revenue [Line Items]
Revenue and other revenue	0	13,948	0	42,792
Point in time
Disaggregation of Revenue [Line Items]
Revenue and other revenue	67	5,559	209	16,314
Tuition revenue, net
Disaggregation of Revenue [Line Items]
Revenue and other revenue	7,012	93,183	20,967	277,533
Digital materials revenue, net
Disaggregation of Revenue [Line Items]
Revenue and other revenue	0	5,809	0	17,415
Technology fee revenue, net
Disaggregation of Revenue [Line Items]
Revenue and other revenue	0	2,628	0	7,628
Other revenue, net
Disaggregation of Revenue [Line Items]
Revenue and other revenue	94	546	301	1,402
Strategic Services Agreement
Disaggregation of Revenue [Line Items]
Revenue and other revenue	52,702	0	179,318	0
Transition Service Agreement
Disaggregation of Revenue [Line Items]
Revenue and other revenue	$ 2,418	$ 0	$ 7,685	$ 0

Restructuring and Impairment _3

Restructuring and Impairment Expense (Details) - USD ($)	3 Months Ended			9 Months Ended
	Sep. 30, 2021	Dec. 31, 2020	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Restructuring Reserve [Roll Forward]
Restructuring reserve at beginning of period				$ 3,998,000
Restructuring and impairment expense	$ 300,000		$ 184,000	2,641,000	$ 3,430,000
Payments and adjustments				(3,608,000)
Restructuring reserve at end of period	3,031,000	$ 3,998,000		3,031,000
Student Transfer Costs
Restructuring Reserve [Roll Forward]
Restructuring reserve at beginning of period				1,282,000
Restructuring and impairment expense		1,500,000		0
Payments and adjustments				0
Restructuring reserve at end of period	1,282,000	1,282,000		1,282,000
Lease Exit and Other Costs
Restructuring Reserve [Roll Forward]
Restructuring reserve at beginning of period				1,974,000
Restructuring and impairment expense	0		254,000	0	528,000
Payments and adjustments				(1,115,000)
Restructuring reserve at end of period	859,000	1,974,000		859,000
Severance Costs
Restructuring Reserve [Roll Forward]
Restructuring reserve at beginning of period				742,000
Restructuring and impairment expense	300,000		$ (70,000)	2,641,000	$ 2,902,000
Payments and adjustments				(2,493,000)
Restructuring reserve at end of period	$ 890,000	$ 742,000		$ 890,000

Fair Value Measurements (Detail

Fair Value Measurements (Details) - USD ($)	9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Dec. 31, 2020
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Mutual funds	$ 1,322,000		$ 1,515,000
Reclassification from accumulated other comprehensive income, current period, before Tax	0	$ 0
Mutual funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Mutual funds	1,322,000		1,515,000
Mutual funds | Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Mutual funds	1,322,000		1,515,000
Mutual funds | Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Mutual funds	0		0
Mutual funds | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Mutual funds	$ 0		$ 0

Accounts Receivable, Net (Detai

Accounts Receivable, Net (Details) - USD ($) $ in Thousands	Sep. 30, 2021	Dec. 31, 2020
Receivables [Abstract]
Accounts receivable	$ 10,372	$ 8,420
Less allowance for credit losses	1,833	1,216
Accounts receivable, net	$ 8,539	$ 7,204

Accounts Receivable, Net (Chang

Accounts Receivable, Net (Change in Allowance) (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020
Accounts, Notes, Loans and Financing Receivable [Line Items]
Beginning Balance	$ 1,216	$ 13,712
Charged to Expense	1,002	9,845
Write-offs	(385)	(15,996)
Recoveries of amounts	0	4,855
Ending Balance	1,833	12,416
FTG-related allowance
Accounts, Notes, Loans and Financing Receivable [Line Items]
Beginning Balance		1,749
Charged to Expense		1,524
Write-offs		(1,872)
Recoveries of amounts		337
Ending Balance		1,738
Non-FTG related allowance
Accounts, Notes, Loans and Financing Receivable [Line Items]
Beginning Balance	1,216	11,963
Charged to Expense	1,002	8,321
Write-offs	(385)	(14,124)
Recoveries of amounts	0	4,518
Ending Balance	$ 1,833	$ 10,678

Other Significant Balance She_3

Other Significant Balance Sheet Accounts (Prepaid Expenses and Other Current Assets) (Details) - USD ($) $ in Thousands	Sep. 30, 2021	Dec. 31, 2020
Prepaid Expense and Other Assets, Current [Abstract]
Prepaid expenses	$ 3,106	$ 3,027
Prepaid licenses	2,257	1,371
Prepaid income taxes	0	48
Income tax receivable	0	1,644
Prepaid insurance	3,044	1,127
Insurance recoverable	476	404
Other current assets (1)	6,681	4,996
Total prepaid expenses and other current assets	$ 15,564	$ 12,617

Other Significant Balance She_4

Other Significant Balance Sheet Accounts (Property and Equipment, Net) (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020	Dec. 31, 2020
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 45,399		$ 45,399		$ 60,005
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment	(17,688)		(17,688)		(29,430)
Property, Plant and Equipment, Net, Total	27,711		27,711		30,575
Depreciation	1,400	$ 1,500	3,900	$ 4,700
Furniture and office equipment
Property, Plant and Equipment [Line Items]
Property and equipment, gross	23,974		23,974		36,146
Software
Property, Plant and Equipment [Line Items]
Property and equipment, gross	5,502		5,502		7,512
Leasehold improvements
Property, Plant and Equipment [Line Items]
Property and equipment, gross	15,901		15,901		16,325
Vehicles
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 22		$ 22		$ 22

Other Significant Balance She_5

Other Significant Balance Sheet Accounts (Goodwill and Intangibles, Net) (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020	Dec. 31, 2020
Goodwill and Intangibles, Net
Definite-lived intangible assets, gross carrying amount	$ 28,117		$ 28,117		$ 27,930
Definite-lived intangible assets, accumulated amortization	(21,295)		(21,295)		(19,321)
Total future amortization expense	6,822		6,822		8,609
Goodwill	23,176		23,176		23,176
Total goodwill and intangibles, net	29,998		29,998		31,785
Amortization of intangible Assets	700	$ 1,300	2,400	$ 4,000
Capitalized curriculum costs
Goodwill and Intangibles, Net
Definite-lived intangible assets, gross carrying amount	13,932		13,932		13,745
Definite-lived intangible assets, accumulated amortization	(12,760)		(12,760)		(12,644)
Total future amortization expense	1,172		1,172		1,101
Purchased intangible assets
Goodwill and Intangibles, Net
Definite-lived intangible assets, gross carrying amount	14,185		14,185		14,185
Definite-lived intangible assets, accumulated amortization	(8,535)		(8,535)		(6,677)
Total future amortization expense	$ 5,650		$ 5,650		$ 7,508

Other Significant Balance She_6

Other Significant Balance Sheet Accounts (Remaining Amortization Expense) (Details) - USD ($) $ in Thousands	Sep. 30, 2021	Dec. 31, 2020
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract]
Remainder of 2021	$ 658
2022	2,533
2023	2,380
2024	791
2025	122
Thereafter	338
Total future amortization expense	$ 6,822	$ 8,609

Other Significant Balance She_7

Other Significant Balance Sheet Accounts (Accounts Payable and Accrued Liabilities) (Details) - USD ($) $ in Thousands	Sep. 30, 2021	Dec. 31, 2020
Balance Sheet Related Disclosures [Abstract]
Accounts payable	$ 9,129	$ 11,246
Accrued salaries and wages	7,305	6,149
Accrued bonus	2,521	11,428
Accrued vacation	3,084	3,369
Accrued litigation and fees	8,041	8,341
Minimum residual liability	7,422	1,216
Accrued expenses	14,494	12,473
Current leases payable	4,405	6,934
Accrued insurance liability	1,424	1,537
Accrued income taxes payable	53	0
Total accounts payable and accrued liabilities	$ 57,878	$ 62,693

Other Significant Balance She_8

Other Significant Balance Sheet Accounts (Other Long-term Liabilities) (Details) - USD ($) $ in Thousands	Sep. 30, 2021	Dec. 31, 2020
Balance Sheet Related Disclosures [Abstract]
Uncertain tax positions	$ 28	$ 28
Notes payable	2,885	2,981
Contract with Customer, Liability, Noncurrent	942	0
Other long-term liabilities	4,722	4,172
Total other long-term liabilities	$ 8,577	$ 7,181

Credit Facilities (Details)

Credit Facilities (Details) $ in Millions	Sep. 30, 2021USD ($)
Debt Disclosure [Abstract]
Revolving line of credit, letters of credit outstanding	$ 9.8
Surety bond facility, issued amount	$ 0

Lease Obligations (Details)

Lease Obligations (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2021USD ($)ft²sublease	Sep. 30, 2020USD ($)	Dec. 31, 2020USD ($)
Lessee, Lease, Description [Line Items]
Number of subleases | sublease	2
Sublease income	$ 1,900	$ 1,400
Operating lease assets	29,909		$ 20,114
Fullstack Academy
Lessee, Lease, Description [Line Items]
Operating lease assets	$ 14,600
CALIFORNIA
Lessee, Lease, Description [Line Items]
Area of Real Estate Property | ft²	24,000
Commitment to lease	3 months
Sublease income	$ 300
COLORADO, Commencing on April 1, 2019 [Member]
Lessee, Lease, Description [Line Items]
Area of Real Estate Property | ft²	21,000
Commitment to lease	17 months
Sublease income	$ 900

Income Per Share (Basic and Dil

Income Per Share (Basic and Diluted Earnings Per Share) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended						9 Months Ended
	Sep. 30, 2021	Jun. 30, 2021	Mar. 31, 2021	Sep. 30, 2020	Jun. 30, 2020	Mar. 31, 2020	Sep. 30, 2021	Sep. 30, 2020
Numerator:
Net income (loss)	$ (5,219)	$ (4,033)	$ (9,493)	$ 1,121	$ 5,147	$ 2,020	$ (18,745)	$ 8,288
Denominator:
Weighted average number of common shares outstanding (in shares)	33,427			32,646			33,182	31,711
Effect of dilutive options and stock units (in shares)	0			1,369			0	631
Diluted weighted average number of common shares outstanding (in shares)	33,427			34,015			33,182	32,342
Income (loss) per share:
Earnings Per Share, Basic (in dollars per share)	$ (0.16)			$ 0.03			$ (0.56)	$ 0.26
Earnings Per Share, Diluted (in dollars per share)	$ (0.16)			$ 0.03			$ (0.56)	$ 0.26

Income Per Share (Anti-dilutive

Income Per Share (Anti-dilutive Securities) (Details) - shares shares in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Stock options
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of dilutive common shares outstanding	1,279	1,525	1,391	1,654
Stock units
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of dilutive common shares outstanding	972	0	1,170	577

Stock-Based Compensation (Detai

Stock-Based Compensation (Details) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	$ 1	$ 1.1	$ 3.6	$ 6.1
Income tax benefit of stock-based compensation expense	0.2	$ 0.3	0.9	$ 1.5
Unrecognized compensation cost related to unvested options and RSUs	$ 5.4		$ 5.4
Restricted Stock Units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Non-option equity instruments granted during the period (in shares)			1,100,000	1,400,000
Grant date fair value (in dollars per share)			$ 3.31	$ 2.22
Equity instruments other than options vested during period (in units)			1,000,000	800,000
Performance Shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant date fair value (in dollars per share)			$ 2.72	$ 2.18
Equity instruments other than options vested during period (in units)			0	0
Other than option equity instruments granted during the period (in shares)			900,000	1,100,000
Stock options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options granted during the period (in shares)			0	0
Exercise of stock options (in shares)			0	0

Income Taxes (Details)

Income Taxes (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2021	Dec. 31, 2020
Income Tax Contingency [Line Items]
Effective tax rate	0.40%
Unrecognized tax benefits	$ 19	$ 19
Gross unrecognized tax benefits that would impact effective tax rate if recognized	$ 15	$ 15
Settlement with taxing authority
Income Tax Contingency [Line Items]
Effective tax rate	(1.00%)

Regulatory US Department of Edu

Regulatory US Department of Education (Details) - USD ($) $ in Thousands	3 Months Ended			9 Months Ended
	Sep. 30, 2021	Dec. 31, 2020	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Regulatory Liabilities [Line Items]
Restructuring and impairment expense	$ 300		$ 184	$ 2,641	$ 3,430
Revenue, Regulatory Terms, Title 4 Eligibility, Maximum Allowable Percentage of Revenue Over Two Consecutive Fiscal Years From Title 4 Programs				90.00%
Revenue, Regulatory Terms, Title 4 Eligibility, Minimum Term of Ineligibility Once Noncompliant				2 years
Accreditation, Regulatory Terms, Maximum Cohort Default Rate over Prior Three Years				30.00%
Student Transfer Costs
Regulatory Liabilities [Line Items]
Restructuring and impairment expense		$ 1,500		$ 0
Minimum
Regulatory Liabilities [Line Items]
Eligibility for Title 4 Programs, Regulatory Compliance, Composite Score				1.5

Commitments and Contingencies (

Commitments and Contingencies (Details) $ in Millions	Sep. 30, 2021USD ($)
CALIFORNIA
Loss Contingencies [Line Items]
Estimated litigation liability	$ 8

Segment Reporting (Details)

Segment Reporting (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020	Dec. 31, 2020
Segment Reporting Information [Line Items]
Revenue and other revenue	$ 62,226	$ 102,166	$ 208,271	$ 303,978
ProfitLossFromSegmentOperations	(3,056)	3,519	(12,620)	4,193
Interest Revenue (Expense), Net	69	(39)	(90)	62
Depreciation and amortization	2,035	2,865	6,297	8,749
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest	(5,160)	693	(18,827)	(4,618)
Carrying value of assets	157,775		157,775		$ 161,306
Accounts and Other Receivables, Net, Current	8,539		8,539		7,204
Deferred Revenue	14,025		14,025		8,090
University partnerships segment
Segment Reporting Information [Line Items]
Revenue and other revenue	55,185	95,991	187,118	288,819
ProfitLossFromSegmentOperations	(408)	6,036	(6,499)	11,109
Carrying value of assets	95,903		95,903		111,830
Accounts and Other Receivables, Net, Current	49		49		45
Deferred Revenue	0		0		10
Growth segment
Segment Reporting Information [Line Items]
Revenue and other revenue	7,041	6,175	21,153	15,159
ProfitLossFromSegmentOperations	(2,648)	$ (2,517)	(6,121)	$ (6,916)
Carrying value of assets	61,872		61,872		49,476
Accounts and Other Receivables, Net, Current	8,490		8,490		7,159
Deferred Revenue	$ 14,025		$ 14,025		$ 8,080

Uncategorized Items - zvo-20210

Label	Element	Value
Retained Earnings [Member]
Cumulative effect of adoption new accounting principle	zvo_CumulativeEffectOfAdoptionNewAccountingPrinciple	$ 91,000