v3.23.3
Segment and Geographic Information
 9 Months Ended
Sep. 30, 2023
Segment Reporting [Abstract]  
Segment and Geographic Information Segment and Geographic Information
The Company has two reportable segments: the Degree Program Segment and the Alternative Credential Segment. The Company’s reportable segments are determined based on (i) financial information reviewed by the chief operating decision maker, the Chief Executive Officer (“CEO”), (ii) internal management and related reporting structure, and (iii) the basis upon which the CEO makes resource allocation decisions. The Company’s Degree Program Segment includes the technology and services provided to nonprofit colleges and universities to enable the online delivery of degree programs. The Company’s Alternative Credential Segment includes the premium online executive education programs and technical skills-based boot camps provided through relationships with nonprofit colleges, universities, and other leading organizations.
Significant Customers
For the three months ended September 30, 2023, one university client in the Degree Program Segment accounted for 10% or more of the Company’s consolidated revenue, contributing $29.8 million, or approximately 13.0% of the Company’s consolidated revenue. Of the $29.8 million of revenue from this university client, $25.8 million related to portfolio management activities. For the three months ended September 30, 2022, no university clients accounted for 10% or more of the Company’s consolidated revenue. For the nine months ended September 30, 2023 and September 30, 2022, no university clients accounted for 10% or more of the Company’s consolidated revenue.
As of September 30, 2023, two university clients in the Degree Program Segment each accounted for 10% or more of the Company’s consolidated accounts receivable, net balance, with $15.9 million and $12.7 million, or approximately 14.1% and 11.2% of the Company’s consolidated accounts receivable, net balance, respectively. As of December 31, 2022, one university client in the Degree Program Segment each accounted for 10% or more of the Company’s consolidated accounts receivable, net balance, with $7.3 million, or approximately 12% of the Company’s consolidated accounts receivable, net balance.
Segment Performance
The following table presents financial information regarding each of the Company’s reportable segment’s results of operations for each of the periods indicated.
 Three Months Ended
September 30,		Nine Months Ended
September 30,
 2023202220232022
 (dollars in thousands)
Revenue by segment*  
Degree Program Segment$137,604 $137,242 $397,578 $434,499 
Alternative Credential Segment92,095 94,996 292,714 292,532 
Total revenue$229,699 $232,238 $690,292 $727,031 
Segment profitability**  
Degree Program Segment$43,647 $44,907 $123,962 $120,264 
Alternative Credential Segment(15,018)(12,389)(43,350)(53,564)
Total segment profitability$28,629 $32,518 $80,612 $66,700 
Segment profitability margin***  
Degree Program Segment31.7 %32.7 %31.2 %27.7 %
Alternative Credential Segment(16.3)(13.0)(14.8)(18.3)
Total segment profitability margin12.5 %14.0 %11.7 %9.2 %
*
The Company has excluded immaterial amounts of intersegment revenues from each of the three and nine months ended September 30, 2023 and 2022.
**
The Company defines segment profitability as net income or net loss, as applicable, before net interest income (expense), other income (expense), net, taxes, depreciation and amortization expense, transaction costs, integration costs, restructuring-related costs, stockholder activism costs, certain litigation-related costs, consisting of fees for certain non-ordinary course litigation and other proceedings, impairment charges, debt modification expense and losses on debt extinguishment, and stock-based compensation expense. Some or all of these items may not be applicable in any given reporting period.
***
The Company defines segment profitability margin as segment profitability as a percentage of the respective segment’s revenue.
The following table presents a reconciliation of the Company’s total segment profitability to net loss for each of the periods indicated.
 Three Months Ended
September 30,		Nine Months Ended
September 30,
 2023202220232022
 (in thousands)
Net loss$(47,443)$(121,676)$(275,159)$(310,308)
Adjustments:
Stock-based compensation expense10,440 15,967 35,986 62,740 
Other (income) expense, net1,585 1,845 751 4,242 
Net interest expense18,804 15,644 53,941 42,942 
Income tax expense (benefit)107 (59)430 (474)
Depreciation and amortization expense29,498 29,313 86,846 95,070 
Impairment charges— 79,509 134,117 138,291 
Debt modification expense and loss on debt extinguishment— — 16,735 — 
Restructuring charges14,085 11,632 22,582 29,172 
Other*1,553 343 4,383 5,025 
Total adjustments76,072 154,194 355,771 377,008 
Total segment profitability$28,629 $32,518 $80,612 $66,700 
*
Includes (i) transaction and integration expense of $0.1 million and $0.0 million for the three months ended September 30, 2023 and 2022, respectively, and $0.3 million and $3.4 million for the nine months ended September 30, 2023 and 2022, respectively, and (ii) litigation-related expense of $1.5 million and $0.3 million for the three months ended September 30, 2023 and 2022, respectively, and $4.1 million and $1.6 million for the nine months ended September 30, 2023 and 2022, respectively.
The following table presents the Company’s total assets by segment as of each of the dates indicated.
 September 30,
2023		December 31,
2022
 (in thousands)
Total assets  
Degree Program Segment
$380,162 $459,252 
Alternative Credential Segment1,157,773 1,351,607 
Total assets$1,537,935 $1,810,859 
Geographical Information
The Company’s non-U.S. revenue is based on the currency of the country in which the university client primarily operates. The Company’s non-U.S. revenue was $28.1 million and $24.5 million for the three months ended September 30, 2023 and 2022, respectively. The Company’s non-U.S. revenue was $87.6 million and $79.8 million for the nine months ended September 30, 2023 and 2022, respectively. Substantially all of the Company’s non-U.S. revenue for each of the aforementioned periods was sourced from the Alternative Credential Segment’s operations outside of the U.S. The Company’s long-lived tangible assets in non-U.S. countries as of September 30, 2023 and December 31, 2022 totaled approximately $3.7 million and $4.5 million, respectively.