IBL News | New York
Online learning platform company 2U / edX warned yesterday of substantial doubt about its ability to continue as a going concern.
Referring to its liquidity and cash flow, the Lanham, Md.-based company said:
“The company expects that if it does not amend or refinance its term loan, or raise capital to reduce its debt in the short term, and in the event the obligations under its term loan accelerate or come due within twelve months from the date of its financial statement issuance in accordance with its current terms, there is substantial doubt about its ability to continue as a going concern.”
2U Inc., now under the leadership of a new CEO, presented its results for the fourth quarter and the full year of 2023. “We are resetting and enhancing our operations with renewed financial discipline,” said Paul Lalljie, Chief Executive Officer of 2U.
“Looking ahead, we believe this renewed focus, along with our market-proven offerings, robust partner network, and scalable technology and services, will allow us to take advantage of increasing demand for high-quality online education and continue to deliver on our mission.”
“Our immediate focus in 2024 is to strengthen the fundamentals of our business in order to extend our debt maturities and restore a healthy balance sheet,” added Matthew Norden, Chief Financial Officer of 2U.On the results of 2023 compared to 2022, revenue decreased 2% to $946.0 million and net loss was $317.6 million. Costs and expenses for the year totaled $1.17 billion, a 4% decrease from $1.22 billion in 2022.
The results for the fourth quarter of 2023 compared to fourth quarter 2022 showed a revenue increased of 8% to $255.7 million, while degree program segment revenue increased 19% to $163.5 million and alternative credential segment revenue decreased 7% to $92.2 million.
Looking forward, the company expects to increase its revenue in the first quarter of 2024 from $195 million to $198 million with a net loss ranging from $60 million to $55 million and adjusted EBITDA to range from $10 million to $12 million.
For the full year of 2024, it expects revenue to range from $805 million to $815 million, net loss to range from $90 million to $85 million, and adjusted EBITDA to range from $120 million to $125 million.
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