Dive Brief:
- Apollo Education Group, the parent company of the University of Phoenix, announced major losses Wednesday in revenue and enrollment.
- CNN Money reports the university has fewer than half the students it had five years ago, and its revenues have taken a similar tumble from $5 billion in 2010 to what will probably be half that by the end of 2015.
- Apollo Education Group stock dropped almost 30% after it announced revenue and enrollment had both gone down about 14% and 15%, respectively, in the latest quarter as compared to last year, CNN Money reports.
Dive Insight:
The University of Phoenix’s decline has been a political one. The for-profit university has been attacked from critics in the government and consumer advocates questioning whether the cost of the education is worth the quality of the online coursework. The CNN Money article notes University of Phoenix students made up half of all student loan defaults in 2013 but only 12% of the nation’s students in the same year. It is now harder to get federal financial aid to attend for-profit colleges and, as CNN Money also pointed out, the offer of free community college likely will pull even more students from the University of Phoenix.
With Republican control of both the U.S. House and Senate, there is a chance the furor over the for-profit model might lessen, but as the University of Phoenix continues to struggle with enrollment, the change in leadership could be too late.