Originally published by Yahoo! Finance
James Rhyu, CEO of Stride, joined Yahoo Finance Live to discuss COVID-19’s impact on virtual learning and the company’s latest earnings report.
ADAM SHAPIRO: We could all learn a thing or two from the businesses and the people who are making a profit with the digital learning phenomenon and one of those companies is Stride Learning. They reported not too long ago their fiscal second quarter earnings. And just to let you know what they’ve seen in quarter over quarter growth year over year. Revenue in fiscal second quarter was up quite a bit. It came in at roughly up 46% to $376.1 million.
Let’s let somebody who should brag about that join us and tell us a little bit more about digital learning. And that would be the CEO of Stride, James Rhyu. It’s good to have you here. And we should point out that when we think of digital learning, a lot of people think K through 12. But you’re much greater than just that. Tell us more about who you’re targeting.
JAMES RHYU: Yeah, that’s right. We traditionally– we actually recently rebranded from being called K12 as a company to being called Stride. And part of that approach is because we believe that K through 12 only represents a portion of the market segment that, I think, we can really go after. It’s a really important segment for us. It’s our history and sort of how we were founded.
But as we look forward, our strategy is really predicated on career learning. And as we know, career learning is, largely today, an adult market. Now, we believe also that the K through 12 market is ripe for more career learning. And we all know the stories about the escalating student debt and the student debt crisis, high dropout rates in our four year colleges and universities, six years for most kids to graduate.
But we feel that our country really is at an inflection point, where our kids really need to get employable skills, career-ready skills. And so we’ve really moved in that direction. Our high schools have career learning programs in them. They can get employable skills right out of high school. We have adult learning programs. We did a series of acquisitions over the past 15 months to bring on adult learning specifically targeted towards the most in-demand careers, technology and health care. Obviously, those are the ones that are most in-demand. And so our strategy, really, is predicated on employability skills and really empowering students to get into the workforce at higher salary levels with a clear career trajectory.
SEANA SMITH: Hey, James, I want to ask you a little bit more about that, more so if we just take a step back and take a look at all the changes that have happened over the last 11 months. Has there been a structural shift, do you think, in this country just around how we view education? And then what do you think that’s going to look like once we get to the other side of the pandemic?
JAMES RHYU: Yeah, listen, I sure hope so, and I sure believe so. I think with anything– and we’ve seen this across numerous industries, where as consumers shift their behaviors increasingly from, say, an analog world to a digital world, they rarely go back. And we’re seeing that in education. We’re seeing that in K through 12 education. We’re seeing that in higher education. We’re seeing that in adult learning.
And so I really don’t see, once people start shifting towards the digital environment, that they want to shift back into a wholly analog environment. Now, education probably is a little bit different in the sense that, for certain age groups and certain learners, it is probably more appropriate for them to be in a physical brick and mortar environment. But we also know that over 8% of the school districts, those same brick and mortar school districts, they need to have, and they are planning to have, online learning options for the foreseeable future because when you say when we get onto the other side of this, I’m not really sure what this is that we’re getting onto the other side of. Like, we already know that the current most prevalent strain of COVID-19 has more new strains. So we have to–
SEANA SMITH: Well, yeah. But once get the majority of the population vaccinated, that will be on the other side of it.
JAMES RHYU: Well, we don’t know yet how those vaccines will adapt and for how long they will adapt to the different strains. So just listen, I’m not a doctor. So what I know is that our education model, I think, will survive and will thrive, irrespective of what happens, I think, with this pandemic because what we see– and we see this through our demand. We see this through the call center activity we have, the website traffic activity we have, that demand, I think, has permanently shifted towards digital education.
To learn more about Stride, visit www.stridelearning.com/