Universal Technical Institute delivered results in the first quarter that surpassed Wall Street’s expectations, leading to a significant positive market reaction. Management attributed the outperformance to robust demand for skilled trades and healthcare programs, sustained marketing investments, and successful program expansions across both the Concorde and UTI divisions. CEO Jerome Grant explained, “Our campus network and program offerings are increasingly aligned with employer demand, and our investments in Concorde’s marketing and admissions continue to drive very strong conversion rates.” The quarter also benefited from operational discipline and favorable macroeconomic trends supporting vocational education.
Is now the time to buy UTI? Find out in our full research report (it’s free).
Universal Technical Institute (UTI) Q1 CY2025 Highlights:
- Revenue: $207.4 million vs analyst estimates of $196.4 million (12.6% year-on-year growth, 5.6% beat)
- EPS (GAAP): $0.21 vs analyst estimates of $0.12 (72.6% beat)
- Adjusted EBITDA: $28.9 million vs analyst estimates of $22.09 million (13.9% margin, 30.8% beat)
- The company lifted its revenue guidance for the full year to $830 million at the midpoint from $815 million, a 1.8% increase
- EPS (GAAP) guidance for the full year is $1.04 at the midpoint, beating analyst estimates by 4.3%
- EBITDA guidance for the full year is $126 million at the midpoint, above analyst estimates of $123.5 million
- Operating Margin: 8.1%, up from 6.1% in the same quarter last year
- New Students: 6,650, up 1,170 year on year
- Market Capitalization: $1.73 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions Universal Technical Institute’s Q1 Earnings Call
- Mike Grondahl (Northland Securities) asked which campuses or programs drove strong new student starts, and CEO Jerome Grant pointed to Concorde’s clinical healthcare programs and skilled trades expansions at UTI, noting these outperformed initial expectations.
- Jasper Bibb (Truist) requested a breakdown of enrollment growth by segment and questioned whether new start guidance increases were driven by one division. Grant explained growth was robust in both Concorde and UTI, but noted Concorde’s double-digit growth may moderate due to capacity constraints.
- Bruce Goldfarb (Lake Street Capital Markets) inquired about trends in employer demand for graduates. Grant described steady demand in transportation, accelerating need for skilled trades, and strong healthcare labor shortages, with all areas exceeding initial projections.
- Griffin Boss (B. Riley) questioned the magnitude of upcoming operating and capital investment, and CFO Bruce Schuman explained the company will have higher operating and capital expenditures in 2026 and 2027, especially for new campus launches.
- Raj Sharma (Texas Capital Bank) asked if student start gains were driven by macroeconomic uncertainty or marketing. Grant replied the increase was mainly due to marketing effectiveness and demand for skilled trades, not changes in macro conditions.
Catalysts in Upcoming Quarters
In coming quarters, the StockStory team will watch (1) enrollment and conversion rates for new programs in skilled trades and healthcare, (2) the pace and cost management of planned campus openings and relocations, and (3) the impact of investments on adjusted EBITDA margins as the company enters its next growth phase. Updates on regulatory developments and the effectiveness of targeted marketing will also be important indicators of continued momentum.
Universal Technical Institute currently trades at $31.86, up from $29.62 just before the earnings. Is the company at an inflection point that warrants a buy or sell? The answer lies in our full research report (it’s free).
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