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spk06: and restaurateur and chef Scott Conant, which we expect to grow significantly in the coming years. Turning now to our now closed acquisitions of Torrens University Think Education and the Media Design School. First, I'd like to say that we're thrilled to be the new owners of these very high-quality assets, and we look forward to investing in their long-term growth, where we see significant opportunities. For 2021, we expect Australia and New Zealand to generate approximately 270 million US dollars of revenue and 60 million US dollars of EBITDA, representing 10% growth for each. And as a reminder, Torrens University is the only federally recognized investor-funded university in Australia, uniquely positioning it to innovate within Australia's higher education market. Now, in terms of next year, Our initial 2021 notional model assumes, until we have evidence to the contrary, that our current enrollment trends continue into next year, and specifically, that we see continued weakness in new enrollments at Strayer University through the first half of 2021, stabilizing in the second half. We also see a continuation of Capella University's current performance with mid-single-digit new student growth. The notional model also assumes significant growth within alternative learning, as I just said, and the $270 million of revenue and $60 million of EBITDA in Australia and New Zealand. All of that then would generate consolidated SEI revenue growth in 2021 of approximately 15%. We would also then assume flat EBITDA, a 29.5% tax rate, capital expenditures of between $50 and $55 million, and our new share count of 24.2 million shares. So in summary, we project continued strong cash generation and accumulation of $450 million in liquidity at the end of this year and $500-plus million at the end of next year. We remain committed to our student-first focus on academic achievement. And as has been our practice in other periods of economic downturns, we don't try to chase or create demand that isn't there organically. Our solid financial strength enables us to withstand wide variations in enrollment, and we remain highly confident that Strayer's demand will eventually recover to pre-pandemic levels and begin to grow again, particularly as overall demand for high-quality digital learning is now higher than ever. And operationally next year, our primary focus will remain to serve the highest possible levels of academic quality for all of our students and work to successfully integrate Torrens, Think Education, and the Media Design School into SEI. And importantly, we remain committed to addressing college affordability and will actively work to reduce our cost of attendance and debt levels for all of our students. In our Investor Day last year, I said that we have an aspirational 10-year vision to fully convert 100 percent of our tuition from Title IV funding to the private sector via our employer partnerships. We remain committed to that vision and, in fact, intend to modify our executive incentive compensation program to include this metric as a qualifier in determining whether incentive compensation has been earned and at what levels. We will also maintain our disciplined cost approach, and with the support of our full board of directors, will deploy our financial capital towards the highest long-term returns, including returning surplus capital back to our shareholders. And finally, I'd like to thank all of my colleagues within SEI, including our newest colleagues in Australia and New Zealand, for all of the dedication and continued hard work during this very challenging year. And with that, Daphne, we'd be happy to open up for Q&A.
spk07: Operator?
spk00: At this time, in order to ask a question, press star 1 on your telephone keypad. To withdraw your question, press the pound key. Please stand by while we compile the Q&A roster. Your first question comes from the line of Jeff Silber with BMO Capital Markets.
spk05: Thank you so much. I want to focus first on, I guess, your core business. The last quarter you had given us, you know, some color on new enrollment trends. I'm wondering if you can do the same thing right now. What is that tracking both at Strayer University and Capella University? Yeah, good morning, Jeff.
spk06: Well, we're still in the fourth quarter, obviously, but I can – share that the new student enrollment trends at both Strayer and Capella are largely in line with the third quarter.
spk05: Okay, that's fine. And why do you think Capella outperformed your initial expectations you gave us last quarter?
spk06: Well, when we provided that initial forecast, it was very early in the quarter. We were cautiously optimistic that the traction that we were seeing early in the quarter would hold, but obviously we weren't sure. We were very pleased that they ended up as strong as they did, up 4%. And as I said in my prepared remarks, they serve a student body that is more established professionally. 70% graduate, meaning everyone in a graduate program obviously already has a four-year degree, and that's just a part of the economy that tends to fare better even in periods of economic distress, which is in contrast to the Strayer student body, which has that rather large portion of the student body that are first-time college students, and that part of the economy we know tends to suffer the worst. In periods where you have you know, a sizable change in economic activity as we've had this year with the pandemic and the immediate shutdown of the economy.
spk08: Hey, Jeff, it's Rob. Just to even simplify it more, think about the fact that the Capella student is more likely to have been able to work from home and the Strayer student is much less likely to have been able to work from home and much more subject to involuntary employment reductions, layoffs, et cetera.
spk05: Okay, that's actually very helpful. Can we talk a little bit about retention trends? I guess we can kind of back into it with your numbers, but it would be helpful if you'd just give us some color what's been going on at both schools.
spk06: In the third quarter, Strayer was down slightly. We had a slight increase in drops, which, again, given everything that Rob just said, is not surprising to us that that portion of the student body might be struggling a little bit more. Capella's retention has been relatively stable and flat. Okay, great.
spk05: If I could just sneak in one more. During the quarter, you announced the Workforce Edge product. Can you give us a little bit more color in exactly what this entails? Sure.
spk06: Workforce Edge is a technology platform that allows corporations to market their education benefits broadly to their workforce in one place so that an employee can log in and see all of the educational benefits that the company has negotiated on behalf of the workforce and then click through and be able to get information from a particular school and then carry forward and actually enroll as well as get administrative insights into what is the performance of people taking educational benefits within the schools what's the participation rate, and so forth. So that's the platform. What's wrapped around it is the consortia of institutions that we formed with Noodle Partners. So our institutions, Strayer and Capella, along with the 22 or 24 partner institutions with Noodle Partners, consists of an exclusive consortia that employees of these companies can participate with pre-negotiated discounted tuition. And we're going to launch our first client eminently here within the next week or so. All right, that's helpful. I'll jump back in the queue.
spk05: Thanks, Jeff.
spk00: Your next question comes from the line of Toby Sommer with Truist Securities.
spk04: Thank you. I had a couple questions on Sophia. How do you think the growth you're forecasting for next year will compares to competitors, and could you give us a little bit of color on the profile of the sign-ups and how you anticipate that profile evolving? Sure.
spk06: Well, first on profile, these are what we believe to be people either preparing to attend college for the first time or existing college students who are looking for a low-cost alternative to college tuition where, assuming that you successfully complete the course, you have the opportunity to transfer that credit into another institution. And I should just say that one of the benefits of attending either of our universities, Stray or Capella, is those students get free access to Sophia and can really reduce the cost of a degree by transferring in as many as 10 or 15 courses that are predominantly general education. In terms of growth, I can't speak to the growth of Sophia competitors. But we do expect that Sophia will have significant growth next year, as I said, 300% basically. And we would expect to be able to continue to add paid subscribers given its very attractive price point of roughly $80 a month.
spk04: Okay. Thank you. With respect to how your corporate programs are trending, what is the growth like and how does it compare to your overall numbers and You mentioned sort of a long-term, decade-long goal. Does that mean you expect that to approach, you know, sort of 100% of the book in a decade, or could you give us some perspective on that? Thanks.
spk06: Yeah, so in Capella in particular, through this year, employer solutions-related enrollments have been very strong, particularly in health care. where we've seen year-over-year increases for new students in excess of 30%, so well above what the non-employer solution channel has been doing. Strayer hasn't been as strong, but we are seeing traction within Strayer because Strayer has many enterprise-level employer solution partnerships, including national retailers like Best Buy or healthcare companies like CVS, Aetna, and others, where the entire workforce is covered by an agreement. And our aspirational vision is sort of what you said. It is to transfer the burden of paying for college from the taxpayer for those people that use subsidized student lending to private sector employers via these large enterprise-level agreements because, frankly, we see it as a win-win. It's a win for the employer. because they can attract and retain a talented workforce. It's clearly a win for the employee slash student because they get a debt-free degree. It's a win for society because we're helping to transfer the responsibility of payment away from the government and the taxpayer. So our vision is to replace 100% of our tuition from federally funded dollars into private sector funded dollars.
spk04: Thank you. Last question from you, and I'll get back in the queue. How do you see Strayer Market Share investing versus its sort of direct competitor set, given the demographic is more vulnerable to the high unemployment this recession?
spk06: I can't speak to what is the market share because I don't know necessarily the enrollment of the competitor set, which is a growing competitor set every day. But suffice it to say, in a period where we've seen double-digit declines in new students, In a very short term, there's probably been an adverse impact, but we also, as I said, fully expect that that demand will recover. I can't imagine the Strayer students being adversely impacted from employment or necessarily choosing to go somewhere else. I just think life events are such that they're just having to pause their education. And because the economy over the long term is such that you still need a four-year degree to really begin earning a meaningful middle-class wage, that's the confidence that we had that the demand will ultimately return when we get to a more normalized set of economic activity.
spk08: Yeah, I think I read recently that the overall student enrollment in universities in the fall of 20 was down about 2%, which would include traditional universities, which obviously have fared much better. So I think working adults undergraduate, first-time college enrollment across the entire educational space is probably down at least as high as Strayer's has been. So I don't think it's much of an impact on market share. Overall demand is down in a pandemic-created economic distress. And as Carl said, we're highly confident. We've seen this kind of wave before, and we've seen how Strayer University responds. positively as you get labor force participation rates starting to increase again as the economy strengthens. Thank you very much.
spk00: As a reminder, in order to ask a question, press star 1 on your telephone. And you have no further questions at this time. And I will now turn the call back over to Mr. Silberman.
spk08: Thank you very much, Operator. And thank you, ladies and gentlemen. We are available for questions if you have follow-up. We look forward very much to the coming year and the integration of the ANZ assets. And although it's late in the evening there, we want to welcome any of our panelists faculty or staff who happen to be listening in and say that we couldn't be more excited to have you as part of the SCI community. And we will talk to all of you in February. Thanks very much.
spk00: Ladies and gentlemen, this concludes today's conference call. Thank you for participating, and you may now disconnect. Thank you. Thank you. Thank you. Thank you. Thank you. Thank you. Thank you. Hello. Thank you.
spk01: Thank you.
spk00: Welcome to the Strategic Education's Third Quarter 2020 Results Conference Call. I will now turn the call over to Therese Wilke, Manager of Investor Relations for Strategic Education. Mrs. Wilke, please go ahead.
spk02: Thank you. Good morning, everyone, and welcome to Strategic Education's Conference Call, in which we will discuss Third Quarter 2020 Results. and Closure of the Australia-New Zealand Acquisition we announced this morning. With us today are Robert Silberman, Executive Chairman, Carl MacDonald, President and Chief Executive Officer, and Daniel Jackson, Executive Vice President and Chief Financial Officer. Thank you. Thank you. Thank you.
spk00: Welcome to the Strategic Education's Third Quarter 2020 Results Conference Call. I will now turn the call over to Therese Wilke, Manager of Investor Relations for Strategic Education. Mrs. Wilke, please go ahead.
spk02: Thank you. Good morning, everyone, and welcome to Strategic Education's Conference Call, in which we will discuss Third Quarter 2020 Results. and Closure of the Australia-New Zealand Acquisition we announced this morning. With us today are Robert Silberman, Executive Chairman, Carl McDonald, President and Chief Executive Officer, and Daniel Jackson, Executive Vice President and Chief Financial Officer. This conference call is also available via webcast with the corresponding slide presentation. We encourage you to log into the webcast as the slide presentation is only available at this time for viewing via the webcast. You can access the webcast at strategiceducation.com in the investor relations section. After completion of the call, the slide presentation will be posted to the website. Following today's remarks, we will open the call for questions. Please note that this call may include forward-looking statements made pursuant to the Safe Harbor provisions the Private Securities Litigation Reform Act of 1995. The statements are based on current expectations and are subject to a number of assumptions, uncertainties, and risks that Strategic Education has identified in today's press release that could cause actual results to differ materially. Further information about these and other relevant uncertainties may be found in Strategic Education's most recent annual report on Form 10-K the 10Q to be filed, and other filings with the Securities and Exchange Commission, as well as Strategic Education's future 8Ks, 10Qs, and 10Ks. Copies of these filings and the full press release are available for viewing on the website at strategiceducation.com. And now, I'd like to turn the call over to Rob. Rob, please go ahead.
spk08: Thank you, Therese, and good morning, ladies and gentlemen. In our earnings release this morning, we reported both our Q3 earnings results as well as announced the closing of our acquisition of Torrance University and related educational assets in Australia and New Zealand. I think it's important to note at the outset that the regulatory approval for this acquisition by the governments of Australia and New Zealand took less than 90 days in the midst of a worldwide pandemic. I believe that the speed of this approval is a testament to the high regard which both those governments hold for the academic quality of Torrance University, as well as their confidence in SEI's track record as a responsible steward of academic institutions. Now, Carl will cover both of these announcements in his remarks this morning, as well as share with you our view of the impact of the coronavirus pandemic on our operations And I think more importantly, what our company will look like post this acquisition in 2021 and beyond. Now, because there's a lot of material to cover, we're going to take a little more time this morning than we usually do in our introductory remarks before we open it up for questions. In fact, to assist you in following along, we've included some slides on this webcast, which Carl will refer to in his remarks. Those of you who are using the dial-in and want to see the slides should join the webcast now. And, of course, we will stay as long as needed to answer any of your questions. Suffice it to say that 2020 has been an eventful year for our students, our faculty, and our universities. I just want to say, on behalf of our Board of Directors, we could not be prouder of the way our entire organization has risen to this moment. Carl?
spk06: Thank you, Rob, and good morning, everyone. Today we have a slightly different presentation of our earnings information. which is intended to provide you, our owners, with a more detailed view of our outlook for the current year, as well as our preliminary view on 2021 notionally. And as Rob just said, my commentary will be accompanied by slides, which will be available on our website, strategiceducation.com, following this morning's call. And to contextualize 2020, I thought it would be helpful to start with SEI's 2019 results, which are here on slide three. In 2019, we educated 91,000 students, which generated just under $1 billion in revenue. And to educate those students, we spent $803 million in operating expenses, which then generated $194 million of adjusted operating income and $6.67 of adjusted earnings per share. Then in November of 2019, we hosted our investor day to lay out our plans for 2020, which included an expected 5% increase in total enrollment, roughly flat revenue per student, and that would yield at least a 10% increase in both adjusted operating income and EPS, as well as expanding our operating margin. And actually, through the first half of 2020, as you can see here on slide five, we were well ahead of that plan. We had a 6% increase in both enrollment and revenue, and that growth, when you combine it with our disciplined approach to cost management, yielded a 30% increase in pre-tax income and a 28% increase in adjusted earnings per share. And you may recall in our last earnings call, I said that the third quarter was the first quarter in which the full impact of the pandemic and associated economic damage was felt by our company. Our two universities, Strayer and Capella, are experiencing substantially different effects from the current macroeconomic conditions. And last quarter, we pre-announced Strayer's enrollment results, which again included a 28% decline in new students and a 1% decline in total enrollment. At that time, we also forecasted Capella's new enrollment would be down somewhere between 5% and 10% for the third quarter. Capella's actual third quarter enrollment was substantially better, with both new and total enrollment growing 4% over the prior year. And while Strayer's performance is disappointing to us, it is not necessarily surprising, given that it's an institution that predominantly serves an undergraduate population, including a large percentage of first-time college students, which we know is a segment of the population even pre-pandemic, that is most sensitive to adverse changes in the economy and employment. And this is in contrast to Capella's 70% graduate student mix, where that segment of the population, people that have existing four-year degrees, is faring substantially better. To help offset some of the economic pain for some of our students, we have implemented several scholarship programs, which will likely result in a 2% decrease in revenue per student for the full year 2020. Slide seven provides an overview of our Q3 consolidated results, which we released this morning. This included a 1 percent increase in enrollment, a 1 percent decrease in revenue, a 3 percent decrease in pre-tax income, and an 8 percent decrease in adjusted earnings per share. And slide eight provides an outlook for the full year, and it's important to note, this is if you assume that Q4's enrollment results would essentially be in line with the third quarter. And I should note, we obviously don't know the fourth quarter's enrollment results as we're not even halfway through the quarter. So this is simply a notional outlook and excludes Australia and New Zealand. But if the third quarter's enrollment results continued, you would have full year results that would include a 2% increase in enrollment, flat revenue of $1 billion, a 3% increase in pre-tax income, and flat earnings per share. Now, in order to maintain our financial strength, should these macro conditions continue next year, the company has already begun a fairly comprehensive expense rationalization, which I'll speak to momentarily. But more importantly, the company remains committed to increasing investments in our areas of strength for growth, including employer solutions, SOFIA, and other strategic assets. and our newly closed Torrens acquisition will be a major contributor next year, generating over a dollar of earnings per share. Earlier in the third quarter, the company initiated several strategic reviews of our business, and based on these reviews, we have decided to organize our business into three distinct operating divisions. U.S. higher education will consist of Strayer and Capella Universities, alternative learning, will consist of all of our employer solution efforts, SOFIA, our coding schools, and our new digital enablement function. And Australia and New Zealand will include Torrens University, Think Education, and the Media Design School. We have also implemented a series of expense reductions that will reduce our run rate operating expenses next year by approximately $33 million. This includes almost $8 million of real estate savings from reducing our corporate square footage as a result of the effectiveness of working remotely, which is a trend we see continuing for many even post-pandemic, as well as a rationalization of the Strayer campus footprint as 95% of Strayer students are already taking 100% of their classes online. And the company intends to take a restructuring charge of approximately $30 million between the third quarter of this year and the first quarter of next year. And slide 11 provides detail on these divisions, and it's important to note that the company will begin new segment reporting reflecting this structure beginning with our Q4 and full year 2020 results, which we will announce next February. And as I said a moment ago, we intend to invest in our growth next year including significant new investments in our new alternative learning segment. This segment includes all employer solutions, Workforce Edge, which is our new education benefits management solution for corporations that we recently launched, along with our partnership with Noodle Partners. It includes Sophia, our coding schools, and our new digital enablement efforts. Employer Solutions is a key differentiator for our universities and has shown steady strength throughout 2020, particularly at Capella University, but also within Strayer. We have set a goal to increase total Employer Solutions enrollments at both Strayer and Capella from 20% of our student population this year to 30% in 2021, representing a 50% increase in the overall mixed percentage. To assist that team, the company has committed to a 30% increase in total employer solutions-related headcount. We also expect significant growth with Sophia and have seen quite good traction with our new subscription-based pricing model. Since August 1st, when we introduced the new pricing plan, we have added more than 13,000 paid subscribers, and we expect to grow that by at least 50% next year. Sophia's revenue... which was on roughly a $3 million run rate pre-pandemic, should exceed $12 million in 2021, representing a 300 percent growth rate. And our digital enablement efforts to license SEI tools, technologies, and other assets to other higher education institutions is also off to a strong start. And this morning, as part of our release, we were excited to announce a major new culinary education product with Sir Latab and restaurateur and chef Scott Conant, which we expect to grow significantly in the coming years. Turning now to our now closed acquisitions of Torrens University Think Education and the Media Design School. First, I'd like to say that we're thrilled to be the new owners of these very high-quality assets, and we look forward to investing in their long-term growth, where we see significant opportunities. For 2021, we expect Australia and New Zealand to generate approximately 270 million U.S. dollars of revenue and 60 million U.S. dollars of EBITDA, representing 10% growth for each. And as a reminder, Torrens University is the only federally recognized investor-funded university in Australia, uniquely positioning it to innovate within Australia's higher education market. Now, in terms of next year, Our initial 2021 notional model assumes, until we have evidence to the contrary, that our current enrollment trends continue into next year, and specifically, that we see continued weakness in new enrollments at Strayer University through the first half of 2021, stabilizing in the second half. We also see a continuation of Capella University's current performance with mid-single-digit new student growth. The notional model also assumes significant growth within alternative learning, as I just said, and the $270 million of revenue and $60 million of EBITDA in Australia and New Zealand. All of that then would generate consolidated SEI revenue growth in 2021 of approximately 15%. We would also then assume flat EBITDA, a 29.5% tax rate, capital expenditures of between $50 and $55 million, and our new share count of 24.2 million shares. So in summary, we project continued strong cash generation and accumulation of $450 million in liquidity at the end of this year and $500-plus million at the end of next year. We remain committed to our student-first focus on academic achievement, And as has been our practice in other periods of economic downturns, we don't try to chase or create demand that isn't there organically. Our solid financial strength enables us to withstand wide variations in enrollment, and we remain highly confident that Strayer's demand will eventually recover to pre-pandemic levels and begin to grow again, particularly as overall demand for high-quality digital learning is now higher than ever. And operationally next year, our primary focus will remain to serve the highest possible levels of academic quality for all of our students and work to successfully integrate Torrens, Think Education, and the Media Design School into SEI. And importantly, we remain committed to addressing college affordability and will actively work to reduce our cost of attendance and debt levels for all of our students. In our Investor Day last year, I said that we have an aspirational 10-year vision to fully convert 100% of our tuition from Title IV funding to the private sector via our employer partnerships. We remain committed to that vision and, in fact, intend to modify our executive incentive compensation program to include this metric as a qualifier in determining whether incentive compensation has been earned and at what levels. We will also maintain our disciplined cost approach, and with the support of our full board of directors, will deploy our financial capital towards the highest long-term returns, including returning surplus capital back to our shareholders. And finally, I'd like to thank all of my colleagues within SEI, including our newest colleagues in Australia and New Zealand, for all of the dedication and continued hard work during this very challenging year. And with that, Daphne, we'd be happy to open up for Q&A.
spk07: Operator?
spk00: At this time, in order to ask a question, press star 1 on your telephone keypad. To withdraw your question, press the pound key. Please stand by while we compile the Q&A roster. Your first question comes from the line of Jeff Silber with BMO Capital Markets.
spk05: Thank you so much. I want to focus first on, I guess, your core business. The last quarter you had given us, you know, some color on new enrollment trends. I'm wondering if you can do the same thing right now. What is that tracking both at Strayer University and Cattell University?
spk06: Yeah, good morning, Jeff. Well, we're still in the fourth quarter, obviously, but I can – share that the new student enrollment trends at both Strayer and Capella are largely in line with the third quarter.
spk05: Okay, that's fine. And why do you think Capella outperformed your initial expectations you gave us last quarter?
spk06: Well, when we provided that initial forecast, it was very early in the quarter. We were cautiously optimistic that the traction that we were seeing early in the quarter would hold, but obviously we weren't sure. We were very pleased that they ended up as strong as they did, up 4%. And as I said in my prepared remarks, they serve a student body that is more established professionally. 70% graduate, meaning everyone in a graduate program obviously already has a four-year degree, and that's just a part of the economy that tends to fare better even in periods of economic distress, which is in contrast to the Strayer student body, which has that rather large portion of the student body that are first-time college students, and that part of the economy we know tends to suffer the worst. In periods where you have you know, a sizable change in economic activity as we've had this year with the pandemic and the immediate shutdown of the economy.
spk08: Hey, Jeff, it's Rob. Just to even simplify it more, think about the fact that the Capella student is more likely to have been able to work from home and the Strayer student is much less likely to have been able to work from home and much more subject to involuntary employment reductions, layoffs, et cetera.
spk05: Okay, that's actually very helpful. Can we talk a little bit about retention trends? I guess we can kind of back into it with your numbers, but it would be helpful if you'd just give us some color what's been going on at both schools.
spk06: In the third quarter, Strayer was down slightly. We had a slight increase in drops, which, again, given everything that Rob just said, is not surprising to us that that portion of the student body might be struggling a little bit more. Capella's retention has been relatively stable and flat. Okay, great.
spk05: If I could just sneak in one more. During the quarter, you announced the Workforce Edge product. Can you give us a little bit more color in exactly what this entails? Sure.
spk06: Workforce Edge is a technology platform that allows corporations to market their education benefits broadly to their workforce in one place so that an employee can log in and see all of the educational benefits that the company has negotiated on behalf of the workforce, and then click through and be able to get information from a particular school and then carry forward and actually enroll, as well as get administrative insights into what is the performance of people taking educational benefits within the school's what's the participation rate, and so forth. So that's the platform. What's wrapped around it is the consortia of institutions that we formed with Noodle Partners. So our institutions, Strayer and Capella, along with the 22 or 24 partner institutions with Noodle Partners, consists of an exclusive consortia that employees of these companies can participate with pre-negotiated discounted tuition. And we're going to launch our first client eminently here within the next week or so. All right, that's helpful. I'll jump back in the queue.
spk08: Thanks, Jeff.
spk00: Your next question comes from the line of Toby Sommer with Truist Securities.
spk04: Thank you. I had a couple questions on Sophia. How do you think the growth you're forecasting for next year is? compares to competitors, and could you give us a little bit of color on the profile of the sign-ups and how you anticipate that profile evolving? Sure.
spk06: Well, first on profile, these are what we believe to be people either preparing to attend college for the first time or existing college students who are looking for a low-cost alternative to college tuition where, assuming that you successfully complete the course, you have the opportunity to transfer that credit into another institution. And I should just say that one of the benefits of attending either of our universities, Stray or Capella, is those students get free access to SOFIA and can really reduce the cost of a degree by transferring in as many as 10 or 15 courses that are predominantly general education. In terms of growth, I can't speak to the growth of SOFIA competitors. But we do expect that Sophia will have significant growth next year, as I said, 300% basically. And we would expect to be able to continue to add paid subscribers given its very attractive price point of roughly $80 a month.
spk04: Okay. Thank you. With respect to how your corporate programs are trending, what is the growth like and how does it compare to your overall numbers and You mentioned sort of a long-term, decade-long goal. Does that mean you expect that to approach, you know, sort of 100% of the book or in a decade, or is it – could you give us some perspective on that? Thank you.
spk06: Yeah, so in Capella in particular, through this year, employer solutions-related enrollments have been very strong, particularly in health care. where we've seen year-over-year increases for new students in excess of 30%, so well above what the non-employer solution channel has been doing. Strayer hasn't been as strong, but we are seeing traction within Strayer because Strayer has many enterprise-level employer solution partnerships, including national retailers like Best Buy or healthcare companies like CVS, Aetna, and others, where the entire workforce is covered by an agreement. And our aspirational vision is sort of what you said. It is to transfer the burden of paying for college from the taxpayer for those people that use subsidized student lending to private sector employers via these large enterprise-level agreements because, frankly, we see it as a win-win. It's a win for the employer. because they can attract and retain a talented workforce. It's clearly a win for the employee slash student because they get a debt-free degree. It's a win for society because we're helping to transfer the responsibility of payment away from the government and the taxpayer. So our vision is to replace 100% of our tuition from federally funded dollars into private sector funded dollars.
spk04: Thank you. Last question from you, and I'll get back in the queue. How do you see Strayer Market Share investing versus its sort of direct competitor set, given the demographic is more vulnerable to the high unemployment this recession?
spk06: I can't speak to what is the market share, because I don't know necessarily the enrollment of the competitor set, which is a growing competitor set every day. But suffice it to say, in a period where we've seen double-digit declines in new students, In a very short term, there's probably been an adverse impact, but we also, as I said, fully expect that that demand will recover. I can't imagine the Strayer students being adversely impacted from employment or necessarily choosing to go somewhere else. I just think life events are such that they're just having to pause their education. And because the economy over the long term is such that you still need a four-year degree to really begin earning a meaningful middle-class wage, that's the confidence that we had that the demand will ultimately return when we get to a more normalized set of economic activity.
spk08: Yeah, I think I read recently that the overall student enrollment in universities in the fall of 20 was down about 2%, which would include traditional universities, which obviously have fared much better. So I think working adults undergraduate, first-time college enrollment across the entire educational space is probably down at least as high as Strayer's has been. So I don't think it's much of an impact on market share. Overall demand is down in a pandemic-created economic distress. And as Carl said, we're highly confident. We've seen this kind of wave before, and we've seen how Strayer University responds. positively as you get labor force participation rates starting to increase again as the economy strengthens. Thank you very much.
spk00: As a reminder, in order to ask a question, press star 1 on your telephone. And you have no further questions at this time. And I will now turn the call back over to Mr. Silberman.
spk08: Thank you very much, Operator. And thank you, ladies and gentlemen. We are available for questions if you have follow-up. We look forward very much to the coming year and the integration of the ANZ assets. And although it's late in the evening there, we want to welcome any of our panelists faculty or staff who happen to be listening in and say that we couldn't be more excited to have you as part of the SCI community and we will talk to all of you in February. Thanks very much.
spk00: Ladies and gentlemen, this concludes today's conference call. Thank you for participating and you may now
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