While Australian education providers are reeling financially in the wake of the pandemic-forced mass exodus of international students, US-based education provider Keypath Education International (ASX: KED) has not had such problems, boosting revenue by 37%.
Although based out of the United States, Keypath’s increased revenue has been attributed to its international expansion where it has targeted SouthEast Asia, flipping the narrative around international students by bringing education there, rather than relying on them to come to the US. This has been facilitated by a focus on science, technology, engineering and math (STEM) disciplines which have been designed to function as pathway programs into higher education, either online or abroad.
“We continue to grow partnerships with universities and programs within healthcare, business, data and STEM disciplines, and we have already closed 28 programs from our FY23 vintage,” said Keypath Founder and CEO, Steve Fireng.
“Keypath is well positioned across the globe to expand its technology and services to continue to help universities provide quality access to education in a digital environment.”
Meeting the demand for education where people around the world have used pandemic lockdowns to increase their education, Keypath now offers 166 education programs, adding 33 in the last six months alone with half launched in North America and the other half across the Asia Pacific region.
These increased student enrollments contributed to the USD $56.9 million in revenue generated for the Half Year ended 31 December 2021, a 37% increase on the previous corresponding period.
Increased administrative costs preparing these programs, as well as a one-off $5.7m compensation expense, resulted in a net loss of $13.5m for the Half Year but the Company expects their new student enrollments to be reflected in future reporting periods.
“As a market-leading global education technology company driven by our vision to ‘Transform education, transform the world’ we are ideally placed to contribute to the digital transformation of higher education, an industry expected to grow from US$36 billion to US$97 billion in 2025 with current online education penetration levels of 2% also forecast to increase,” added Fireng.
“We remain confident in our outlook and achieving our prospectus forecast for FY22 and continuing to drive strong momentum in revenue growth and profitability into the future.”
Keypath has forecast revenue of USD $116.4m for FY22 with five new University partners expected to be signed shortly which will include new pathways into the Nursing discipline. While these students will not solve the many healthcare shortfalls the world encountered during the pandemic, massive pressure on public health systems highlighted the need for trained nurses which is likely to see popularity at the tertiary level in the years to come.