Phoenix Education Partners (PXED) risk factors, FY2025 10-K

Other

1. 01The University’s 90/10 Rule percentages were 88.6% and 88.3% for fiscal years 2025 and 2024, respectively. The University has no direct control over the amount of Title IV student loans and grants sought and other federal funds for which its students are determined to be eligible
2. 02Any failure to comply with the Department of Education’s “gainful employment” metrics and financial transparency regulations could limit the programs we can offer students, the Title IV eligibility of the impacted programs and/or increase our cost of operations
3. 03If we fail to maintain our institutional accreditation, or our institutional accrediting body loses recognition by the Department of Education, we will lose our ability to participate in Title IV programs
4. 04If we fail to satisfy the various accreditation standards of our programmatic accreditors, or fail to satisfy state licensure and certification requirements applicable to our professional licensing programs, we could face restrictions on, or the loss of accreditation for or the ability to offer, certain programs
5. 05Failure of the University to resolve examination pass rate concerns with the Commission on Collegiate Nursing Education could result in potential action by the accreditor to limit or remove accreditation from all of the University’s Master of Science in Nursing programs
6. 06If we fail to maintain our state authorization, we would lose our ability to participate in Title IV programs
7. 07If our graduates are unable to obtain professional licenses or certifications required for employment in their chosen fields of study, our reputation may suffer and we may face declining enrollments and revenue or be subject to student litigation
8. 08We may lose our eligibility to participate in Title IV programs if our student loan default rates are too high
9. 09If we fail to comply with the Department of Education’s incentive compensation rule, we could be subject to sanctions and other liabilities
10. 10If we fail to comply with the Department of Education’s misrepresentation rules or its rules prohibiting aggressive and deceptive recruitment tactics, we could be subject to sanctions and other liabilities
11. 11If any of the education regulatory agencies that regulate us delay their approval of, or do not approve, any transaction involving us that constitutes a “change in control,” our ability to operate or participate in Title IV programs may be materially impaired
12. 12The University is subject to sanctions if it fails to calculate accurately and make timely payment of refunds of Title IV program funds for students who withdraw from the University
13. 13Our unauthorized release of, or failure to secure, confidential information could subject us to civil penalties or cause us to lose our eligibility to participate in Title IV programs
14. 14Our reputation and our stock price may be negatively affected by the actions of other postsecondary educational institutions

Risks Related to Our Business

1. 15We face intense and increasing competition in the post-secondary education market, which could decrease our market share and create pricing pressures
2. 16A decline in the overall growth of enrollment in post-secondary institutions, or in the number of students seeking degrees online, could lead to lower enrollment, which could negatively impact our future growth
3. 17Our financial performance depends on our ability to develop and maintain favorable awareness of the University among, and enroll and retain, students
4. 18Our Tuition Price Guarantee program limits our ability to raise additional revenue from current students through tuition increases, and any changes to the Tuition Price Guarantee program could harm our reputation, enrollment numbers, retention rates and overall business and financial performance
5. 19The occurrence of natural or man-made catastrophes could have a material adverse effect on our business, financial condition, cash flows and results of operations
6. 20If we fail to adapt to changing market needs or new technologies, our business may be adversely affected
7. 21Our strategy is to focus on positive student outcomes and the long-term success of students rather than short-term interests of our stockholders, which may negatively influence financial performance
8. 22If we do not maintain existing, and develop additional, B2B relationships with employers, our business may be impaired
9. 23If we cannot attract or retain a qualified senior management team, our business could be adversely affected
10. 24To effectively educate our students, we must continue to attract and retain qualified faculty members
11. 25If we are unable to successfully conclude pending litigation and governmental inquiries, our business and financial condition could be adversely affected
12. 26Our business may be adversely affected if we are unable to adequately establish, maintain, protect and enforce our intellectual property and proprietary rights or prevent third parties from making unauthorized use of such rights
13. 27Our efforts to protect our intellectual property may require use of funds in litigation to seek to protect our proprietary rights against any infringement, misappropriation or other violation, which could have a material adverse effect on our business and financial condition
14. 28We may become subject to litigation brought by third parties claiming infringement, misappropriation or other violation by us of their intellectual property rights
15. 29property claimed by that third party. Some third-party intellectual property rights may prove to be extremely broad, and it may not be possible for us to conduct our operations in such a way as to avoid violating those intellectual property rights
16. 30System disruptions to our computer networks, phone systems, digital platforms or infrastructure could have a material adverse effect on our business
17. 31Our collection, use, retention, and processing of personal information makes us a target for security incidents, increasing the risks of personal data breaches, which can impact our business and result in reporting, notice and regulatory obligations
18. 32federal and international data privacy laws and statutes, data breach and reporting laws, negative publicity, and legal actions by state attorneys general and private litigants, including class actions, any of which could have a material adverse effect on our reputation and business and financial condition
19. 33The types of data that we collect and process are generally higher risk and/or sensitive, which comes with higher regulatory scrutiny and makes us a bigger target for malicious cyber threats
20. 34We face risks of cyber and other data security incidents, which can impact our business, result in harm to our operations, and require costly remediation measures
21. 35Our use of artificial intelligence may subject us to increased compliance obligations and legal risk
22. 36We rely on third-party vendors whose service may be of lower quality than ours, whose responsiveness may be less timely than ours, and whose compliance practices may increase our operational and compliance risk
23. 37We may incur liability for the unauthorized duplication, distribution or other use of materials posted online
24. 38We may have unanticipated tax liabilities that could adversely impact our results of operations and financial condition

Risks Related to Ownership of Our Common Stock

1. 39Our stock price may fluctuate significantly
2. 40the realization of any risks described under this “Risk Factors” section, or other risks that may materialize in the future
3. 41We are an “emerging growth company” and take advantage of reduced disclosure requirements applicable to “emerging growth companies,” which could make our common stock less attractive to investors
4. 42We continue to be controlled by the Apollo Stockholder, and Apollo’s interests may conflict with our interests and the interests of other stockholders
5. 43will continue to be able to substantially influence or effectively control our decisions, including our ability to enter into corporate transactions
6. 44We are a “controlled company” within the meaning of the NYSE rules and, as a result, qualify for and intend to rely on exemptions from certain corporate governance requirements. You will not have the same protections afforded to stockholders of companies that are subject to such requirements
7. 45there be an annual performance evaluation of the nominating and corporate governance committee and compensation committee
8. 46We are a holding company and rely on dividends, distributions, and other payments, advances, and transfers of funds from our subsidiaries to meet our obligations
9. 47As of November 11, 2025, we had 35,652,963 shares of common stock outstanding and 1,802,966 shares of common stock potentially issuable in respect of the Company’s outstanding share-based awards and 5,028,648 shares of common stock potentially issuable in respect of the University’s outstanding share-based awards