Covista Q1 FY2027 revenue rises 10.7% to $512M
Revenue rose across all three segments, while net cash provided by operating activities declined year over year.
Sentiment and the balance of points
Rhea-AI Sentiment reads the wording of the document, how positive or negative its language is on a 1 to 5 scale. The balance of points shown with the takes weighs what the document actually discloses, so the two can disagree, for example when a trial that missed its main goal is described in upbeat language.
Covista Inc. (CVSA) reported first-quarter fiscal 2027 revenue of $511.5 million for the three months ended September 30, 2026, up 10.7% from $462.3 million a year earlier. Net income was $67.4 million versus $61.8 million, while income from continuing operations was $71.5 million versus $61.1 million. Revenue increased in all three segments: Chamberlain, $192.4 million; Walden, $216.7 million; and Medical and Veterinary, $102.5 million. Walden enrollment was 58,881, up 12.8% from the prior-year period.
Operating income was $98.0 million, up 14.7%, while net cash provided by operating activities was $114.0 million versus $130.5 million. Covista repaid $163.0 million under its revolving credit facility during the quarter, ending with no revolver borrowings and $500.0 million of available capacity. As of September 30, 2026, Term Loan B principal was $510.0 million at a 6.07% interest rate. Share repurchases totaled 658,088 shares at an average price of $127.63 per share and a total cost of $83.99 million; $577.8 million remained authorized under the program as of September 30, 2026.
How this balance works
Rhea-AI gives every point it takes from this document a weight. Minor counts 1, Moderate 3 and Major 9, so one Major point outweighs several Minor ones. The bar adds up the weights on each side, and when neither side holds more than 65% of the total the balance reads Mixed.
It reads the document as published, with the same rules for every company, and it does not look at what the market expected or at how the stock traded, so a point can be objectively good on a day the stock falls.
Rhea-AI Sentiment measures something else, the tone of the wording.
Positive
- Moderate pointRevenue increased 10.7% to $511.5 million in fiscal Q1 2027.
- Moderate pointOperating income rose 14.7% to $98.0 million year over year.
- Moderate pointCovista repaid $163.0 million under its Revolver during the quarter. 3.7% of market cap
Negative
- Moderate pointOperating cash flow fell from $130.5 million to $114.0 million year over year.
Filing Explained
At
Key Figures
Key Terms
adjusted operating income financial
SOFR financial
Term Loan B financial
material rights financial
FAQ
AI-generated questions and answers. How Rhea-AI works. Not financial advice.
How much revenue did CVSA report in the first quarter of fiscal 2027?
How many students were enrolled at Walden in September 2026?
AI-generated analysis. How Rhea-AI works. Not financial advice.
Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
| |
(Mark One) | |
| |
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |
For the quarterly period ended | |
| |
or | |
| |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |
| |
For the transition period from _____ to _____ | |
| |
Commission File Number: | |
(Exact name of registrant as specified in its charter)
(State or other jurisdiction of | (I.R.S. Employer |
incorporation or organization) | Identification No.) |
|
|
(Address of principal executive offices) | (Zip Code) |
(
(Registrant’s telephone number; including area code)
Not Applicable
(Former name, former address and former fiscal year, if changed since last report)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
NYSE Texas |
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| ||||
þ | Accelerated filer | ☐ | ||
Non-accelerated filer | ◻ | Smaller reporting company | ||
| |
| Emerging growth company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ◻
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes
As of October 23, 2026, there were
Table of Contents
Covista Inc.
Form 10-Q
Table of Contents
| Page | |
| Part I. Financial Information | |
Item 1. | Financial Statements | 1 |
| Consolidated Balance Sheets | 1 |
| Consolidated Statements of Income | 2 |
| Consolidated Statements of Cash Flows | 3 |
| Consolidated Statements of Shareholders’ Equity | 4 |
| Notes to Consolidated Financial Statements | 5 |
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 24 |
Item 3. | Quantitative and Qualitative Disclosures About Market Risk | 36 |
Item 4. | Controls and Procedures | 36 |
| Part II. Other Information | |
Item 1. | Legal Proceedings | 37 |
Item 1A. | Risk Factors | 37 |
Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds | 37 |
Item 5. | Other Information | 37 |
Item 6. | Exhibits | 38 |
Signature | 39 |
Table of Contents
Part I. Financial Information
Item 1. Financial Statements
Covista Inc.
Consolidated Balance Sheets
(unaudited)
(in thousands, except par value)
| | | | | | |
| | September 30, | | June 30, | ||
| | 2026 | | 2026 | ||
Assets: | | | | | | |
Current assets: | | | | | | |
Cash and cash equivalents | | $ | | | $ | |
Restricted cash | |
| | |
| |
Accounts and financing receivables, net | |
| | |
| |
Prepaid expenses and other current assets | |
| | |
| |
Total current assets | |
| | |
| |
Noncurrent assets: | |
| | |
| |
Property and equipment, net | | | | | | |
Operating lease assets | |
| | |
| |
Intangible assets, net | |
| | |
| |
Goodwill | |
| | |
| |
Other assets, net | |
| | |
| |
Total noncurrent assets | |
| | |
| |
Total assets | | $ | | | $ | |
Liabilities and shareholders' equity: | |
| | | | |
Current liabilities: | |
| | | | |
Accounts payable | | $ | | | $ | |
Accrued payroll and benefits | |
| | |
| |
Accrued liabilities | |
| | |
| |
Deferred revenue | |
| | |
| |
Current operating lease liabilities | |
| | |
| |
Current portion of long-term debt | | | | | | |
Total current liabilities | |
| | |
| |
Noncurrent liabilities: | |
| | |
| |
Long-term debt | |
| | |
| |
Long-term operating lease liabilities | |
| | |
| |
Deferred income taxes | |
| | |
| |
Other liabilities | |
| | |
| |
Total noncurrent liabilities | |
| | |
| |
Total liabilities | |
| | |
| |
Commitments and contingencies | |
| | |
| |
Shareholders' equity: | |
| | |
| |
Common stock, $ | |
| | |
| |
Additional paid-in capital | |
| | |
| |
Retained earnings | |
| | |
| |
Accumulated other comprehensive loss | |
| ( | |
| ( |
Treasury stock, at cost, | |
| ( | |
| ( |
Total shareholders' equity | |
| | |
| |
Total liabilities and shareholders' equity | | $ | | | $ | |
See accompanying Notes to Consolidated Financial Statements.
1
Table of Contents
Covista Inc.
Consolidated Statements of Income
(unaudited)
(in thousands, except per share data)
| | | | | | |
| | Three Months Ended | ||||
| | September 30, | ||||
| | 2026 | | 2025 | ||
Revenue | | $ | | | $ | |
Operating cost and expense: | |
| | | | |
Cost of educational services | |
| | |
| |
Student services and administrative expense | |
| | |
| |
Restructuring expense | |
| | |
| |
Total operating cost and expense | |
| | |
| |
Operating income | |
| | |
| |
Interest expense | |
| ( | |
| ( |
Other income, net | |
| | |
| |
Income from continuing operations before income taxes | |
| | |
| |
Provision for income taxes | |
| ( | |
| ( |
Income from continuing operations | |
| | |
| |
Discontinued operations: | |
| | | | |
(Loss) income from discontinued operations before income taxes | |
| ( | |
| |
Benefit from income taxes | |
| | |
| |
(Loss) income from discontinued operations | |
| ( | |
| |
Net income and comprehensive income | | $ | | | $ | |
| | | | | | |
Earnings (loss) per share: | |
| | | | |
Basic: | |
| | | | |
Continuing operations | | $ | | | $ | |
Discontinued operations | | $ | ( | | $ | |
Total basic earnings per share | | $ | | | $ | |
Diluted: | |
| | |
| |
Continuing operations | | $ | | | $ | |
Discontinued operations | | $ | ( | | $ | |
Total diluted earnings per share | | $ | | | $ | |
| | | | | | |
Weighted-average shares outstanding: | | | | | | |
Basic shares | | | | | | |
Diluted shares | | | | | | |
See accompanying Notes to Consolidated Financial Statements.
2
Table of Contents
Covista Inc.
Consolidated Statements of Cash Flows
(unaudited)
(in thousands)
| | | | | | |
| | Three Months Ended | ||||
| | September 30, | ||||
| | 2026 | | 2025 | ||
Operating activities: | | | | | | |
Net income | | $ | | | $ | |
Loss (income) from discontinued operations | |
| | |
| ( |
Income from continuing operations | | | | | | |
Adjustments to reconcile net income to net cash provided by operating activities: | |
| | |
| |
Stock-based compensation | |
| | |
| |
Amortization of operating lease assets | | | | | | |
Depreciation | |
| | |
| |
Amortization of acquired intangible assets | |
| | |
| |
Amortization and write-off of debt discount and issuance costs | | | | | | |
Provision for credit losses | | | | | | |
Deferred income taxes | |
| | |
| |
Loss on disposals and impairments of property and equipment | |
| — | |
| |
Loss (gain) on investments | | | | | | ( |
Changes in assets and liabilities: | |
| | |
| |
Accounts and financing receivables | |
| ( | |
| ( |
Prepaid expenses and other current assets | |
| ( | |
| ( |
Cloud computing implementation assets | |
| ( | |
| ( |
Accounts payable | |
| ( | |
| |
Accrued payroll and benefits | | | ( | | | ( |
Accrued liabilities | |
| | |
| ( |
Deferred revenue | |
| | |
| |
Operating lease liabilities | | | | | | ( |
Other assets and liabilities | |
| ( | |
| ( |
Net cash provided by operating activities-continuing operations | |
| | |
| |
Net cash used in operating activities-discontinued operations | |
| ( | |
| ( |
Net cash provided by operating activities | |
| | |
| |
Investing activities: | |
| | | | |
Capital expenditures | |
| ( | |
| ( |
Proceeds from sales of marketable securities | |
| — | |
| |
Purchases of marketable securities | |
| — | |
| ( |
Net cash used in investing activities | |
| ( | |
| ( |
Financing activities: | |
| | | | |
Proceeds from exercise of stock options | |
| — | |
| |
Employee taxes paid on withholding shares | |
| ( | |
| ( |
Proceeds from stock issued under Colleague Stock Purchase Plan | |
| | |
| |
Repurchases of common stock for treasury | |
| ( | |
| ( |
Repayments under long-term debt obligations | |
| ( | |
| |
Payment of debt issuance costs | |
| — | |
| ( |
Net cash used in financing activities | |
| ( | |
| ( |
Net (decrease) increase in cash, cash equivalents and restricted cash | |
| ( | |
| |
Cash, cash equivalents and restricted cash at beginning of period | |
| | |
| |
Cash, cash equivalents and restricted cash at end of period | | $ | | | $ | |
Non-cash investing and financing activities: | | | | | | |
Accrued capital expenditures | | $ | | | $ | |
Accrued liability for repurchases of common stock | | $ | | | $ | |
Accrued excise tax on share repurchases | | $ | | | $ | |
Accrued debt issuance costs | | $ | — | | $ | |
See accompanying Notes to Consolidated Financial Statements.
3
Table of Contents
Covista Inc.
Consolidated Statements of Shareholders’ Equity
(unaudited)
(in thousands)
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | Accumulated | | | | | | | | | | |
| | | | | | | | Additional | | | | | Other | | | | | | | | | | ||
| | Common Stock | | Paid-In | | Retained | | Comprehensive | | Treasury Stock | | | | |||||||||||
| | Shares | | Amount | | Capital | | Earnings | | Loss | | Shares | | Amount | | Total | ||||||||
June 30, 2025 | | | | | $ | | | $ | | | $ | | | $ | ( | | | | | $ | ( | | $ | |
Net income |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Stock-based compensation |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Net activity from stock-based compensation awards |
| | |
| | |
| | |
| | |
| | |
| | |
| | ( |
| | ( |
Proceeds from stock issued under Colleague Stock Purchase Plan | | | | | | | | | | | | | | | | | | ( | | | | | | |
Repurchases of common stock for treasury | | | | | | | | | | | | | | | | | | | | | ( | | | ( |
September 30, 2025 | | | | | $ | | | $ | | | $ | | | $ | ( | | | | | $ | ( | | $ | |
| | | | | | | | | | | | | | | | | | | | | | | | |
June 30, 2026 | | | | | $ | | | $ | | | $ | | | $ | ( | | | | | $ | ( | | $ | |
Net income |
| | | | | | | | | | | | | | | | | |
| | |
| | |
Stock-based compensation |
| | | | | | | | | | | | | | | | | | | | |
| | |
Net activity from stock-based compensation awards |
| | | | | | | | ( | | | | | | | | | | | | ( |
| | ( |
Proceeds from stock issued under Colleague Stock Purchase Plan |
| | | | | | | | | | | | | | | | | ( | | | |
| | |
Repurchases of common stock for treasury | | | | | | | | | | | | | | | | | | | | | ( | | | ( |
September 30, 2026 | | | | | $ | | | $ | | | $ | | | $ | ( | | | | | $ | ( | | $ | |
See accompanying Notes to Consolidated Financial Statements.
4
Table of Contents
Covista Inc.
Notes to Consolidated Financial Statements
(unaudited)
Table of Contents
Note |
| Page |
1 | Nature of Operations | 6 |
2 | Summary of Significant Accounting Policies | 6 |
3 | Discontinued Operations | 7 |
4 | Revenue | 7 |
5 | Restructuring Expense | 9 |
6 | Other Income, Net | 9 |
7 | Income Taxes | 10 |
8 | Earnings per Share | 10 |
9 | Accounts and Financing Receivables | 10 |
10 | Property and Equipment, Net | 13 |
11 | Leases | 13 |
12 | Goodwill and Intangible Assets | 14 |
13 | Debt | 16 |
14 | Share Repurchases | 18 |
15 | Stock-Based Compensation | 19 |
16 | Fair Value Measurements | 20 |
17 | Commitments and Contingencies | 21 |
18 | Segment Information | 22 |
5
Table of Contents
1. Nature of Operations
In this Quarterly Report on Form 10-Q, Covista Inc., together with its subsidiaries, is collectively referred to as “Covista,” “we,” “our,” “us,” or similar references. Covista reports on a fiscal year period ending on June 30. Therefore, this Quarterly Report for the quarterly period ended September 30, 2026 is for our first quarter of fiscal year 2027.
Covista is America’s largest healthcare educator. Our schools consist of Chamberlain University (“Chamberlain”), Walden University (“Walden”), American University of the Caribbean School of Medicine (“AUC”), Ross University School of Medicine (“RUSM”), and Ross University School of Veterinary Medicine (“RUSVM”). AUC, RUSM, and RUSVM are collectively referred to as the “medical and veterinary schools.” “Home Office” includes activities not allocated to a reportable segment. See Note 18 “Segment Information” for information on our reportable segments.
2. Summary of Significant Accounting Policies
Basis of Presentation
Our significant accounting policies are described in Note 2 “Summary of Significant Accounting Policies” of our Annual Report on Form 10-K for the fiscal year ended June 30, 2026 (the “2026 Form 10-K”). We have prepared the accompanying unaudited consolidated financial statements in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial statements and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (which are normal and recurring in nature) considered necessary for a fair presentation have been included. The year-end balance sheet data was derived from audited financial statements, but does not include all disclosures required by GAAP. We use the same accounting policies in preparing quarterly and annual financial statements. Unless otherwise noted, amounts presented within the Notes to Consolidated Financial Statements refer to our continuing operations. Unless indicated, or the context requires otherwise, references to years refer to Covista’s fiscal years. Certain items presented in tables may not sum due to rounding. These consolidated financial statements and accompanying notes should be read in conjunction with our annual consolidated financial statements and the notes thereto included in our 2026 Form 10-K.
Use of Estimates
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of the date of the financial statements, as well as the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.
Recent Accounting Standards
In November 2024, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2024-03: “Income Statement–Reporting Comprehensive Income–Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses.” The guidance was issued to improve the disclosures about a public business entity’s expenses and address requests from investors for more detailed information about the types of expenses in commonly presented expense captions as well as disclosures about selling expenses. The guidance is effective for financial statements issued for fiscal years beginning after December 15, 2026 and interim reporting periods within fiscal years beginning after December 15, 2027. The amendments should be applied prospectively, however retrospective application is permitted. Early adoption of the amendments is permitted, including adoption in an interim reporting period. The amendments will expand our footnote disclosures to include a disaggregation of expenses in accordance with the amendments but will not otherwise impact Covista’s Consolidated Financial Statements.
In July 2025, the FASB issued ASU No. 2025-05: “Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets.” The guidance was issued to provide a practical expedient to measure credit losses on current accounts receivable and current contract assets. The guidance is effective prospectively for financial statements issued for fiscal years beginning after December 15, 2025, and interim reporting periods within those fiscal years. The guidance was effective for Covista on July 1, 2026 and we did not elect the practical expedient. Therefore, the guidance did not have an impact on Covista’s Consolidated Financial Statements or disclosures.
6
Table of Contents
In September 2025, the FASB issued ASU No. 2025-06: “Intangibles–Goodwill and Other–Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software.” The guidance was issued to modernize the accounting for software costs. The guidance is effective on a prospective, modified, or a retrospective transition approach for financial statements issued for fiscal years beginning after December 15, 2027, and interim reporting periods within those fiscal years. Early adoption of the guidance is permitted. We are currently evaluating the impact the guidance will have on Covista’s Consolidated Financial Statements.
In December 2025, the FASB issued ASU No. 2025-11: “Interim Reporting (Topic 270): Narrow-Scope Improvements.” The guidance was issued to improve the guidance in Topic 270, Interim Reporting, by improving the navigability of the required interim disclosures and clarifying when that guidance is applicable. The guidance also provides additional guidance on what disclosures should be provided in interim reporting periods. The guidance is effective on a prospective or retrospective basis for financial statements issued for interim reporting periods within fiscal years beginning after December 15, 2027. Early adoption of the guidance is permitted. We do not expect the guidance will have a material impact on Covista’s Consolidated Financial Statements or disclosures.
We reviewed all other recently issued accounting pronouncements and concluded that they were either not applicable or not expected to have a significant impact on our Consolidated Financial Statements or disclosures.
3. Discontinued Operations
We continue to have activity associated with ongoing litigation and settlements related to prior divestitures, which is classified within discontinued operations. We had a loss from discontinued operations of $
4. Revenue
Revenue is recognized when control of the promised goods or services is transferred to our customers (students), in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services.
The following tables disaggregate revenue by source (in thousands):
| | | | | | | | | | | | |
| | Three Months Ended September 30, 2026 | ||||||||||
| | Chamberlain | | Walden |
| Medical and | | Consolidated | ||||
Tuition and fees |
| $ | |
| $ | |
| $ | |
| $ | |
Other | | | | | | | | | | | | |
Total |
| $ | |
| $ | |
| $ | |
| $ | |
| | | | | | | | | | | | |
| | Three Months Ended September 30, 2025 | ||||||||||
| | Chamberlain | | Walden |
| Medical and | | Consolidated | ||||
Tuition and fees | | $ | |
| $ | |
| $ | |
| $ | |
Other | | | | | | | | | | | | |
Total |
| $ | |
| $ | |
| $ | |
| $ | |
In addition, see Note 18 “Segment Information” for a disaggregation of revenue by geographical region.
Performance Obligations and Revenue Recognition
Tuition and fees: The majority of revenue is derived from tuition and fees, which is recognized on a straight-line basis over the academic term as instruction is delivered.
Other: Other revenue consists of housing and other miscellaneous services. Other revenue is recognized over the period in which the applicable performance obligation is satisfied.
7
Table of Contents
Arrangements for payment are agreed to prior to registration of the student’s first academic term. The majority of U.S. students obtain Title IV or other financial aid resulting in institutions receiving a significant amount of the transaction price at the beginning of the academic term. Students not utilizing Title IV or other financial aid funding may pay after the academic term is complete.
Transaction Price
Revenue, or transaction price, is measured as the amount of consideration expected to be received in exchange for transferring goods or services.
Students may receive scholarships, discounts, or refunds, which gives rise to variable consideration. The amounts of scholarships or discounts are generally applied to individual student accounts when such amounts are awarded. Therefore, the transaction price is immediately reduced directly by these scholarships or discounts from the amount of the standard tuition rate charged. Scholarships and discounts that are only applied to future tuition charged are considered a separate performance obligation if they represent a material right in accordance with ASC 606. In those instances, we defer the value of the related performance obligation associated with the future scholarship or discount based on estimates of future redemption informed by our historical experience of student persistence toward completion of study.
Upon withdrawal, a student may be eligible to receive a refund, or partial refund, the amount of which is dependent on the timing of the withdrawal during the academic term. If a student withdraws prior to completing an academic term, federal and state regulations and accreditation criteria permit Covista to retain a set percentage of the total tuition received from such student, which varies with, but generally equals or exceeds, the percentage of the academic term completed by such student. Payment amounts received by Covista in excess of such set percentages of tuition are refunded to the student or the appropriate funding source. For contracts with similar characteristics and historical data on refunds, the expected value method is applied in determining the variable consideration related to refunds. Estimates of Covista’s expected refunds are determined at the outset of each academic term, based upon actual refunds in previous academic terms. Reserves related to refunds are presented as refund liabilities within accrued liabilities on the Consolidated Balance Sheets. All refunds are netted against revenue during the applicable academic term.
Management reassesses collectability on a student-by-student basis throughout the period revenue is recognized. This reassessment is based upon new information and changes in facts and circumstances relevant to a student’s ability to pay. Management also reassesses collectability when a student withdraws from the institution and has unpaid tuition charges. Such unpaid charges do not meet the threshold of reasonably collectible and are recognized as revenue on a cash basis.
Contract Balances
Students are billed at the beginning of each academic term and payment is due at that time. Covista’s performance obligation is to provide educational services in the form of instruction during the academic term and to provide for any scholarships or discounts that are deemed a material right under ASC 606. As instruction is provided or the deferred value of material rights is recognized, deferred revenue is reduced. A significant portion of student payments are from Title IV financial aid and other programs and are generally received during the first month of the respective academic term. For students utilizing Covista’s credit extension programs (see Note 9 “Accounts and Financing Receivables”), payments are generally received after the academic term, and the corresponding performance obligation, is complete. When payments are received, accounts and financing receivables are reduced.
Deferred revenue within current liabilities is $
8
Table of Contents
The difference between the opening and closing balances of deferred revenue includes decreases from revenue recognized during the period, increases from charges related to the start of academic terms beginning during the period, increases from payments received related to academic terms commencing after the end of the period, and increases from recognizing additional performance obligations for material rights during the period.
5. Restructuring Expense
During the three months ended September 30, 2026 and 2025, Covista recorded restructuring expense primarily driven by prior real estate consolidations at Covista’s home office. We continue to incur restructuring charges or reversals related to exited leased space from previous restructuring actions. When estimating costs of exiting lease space, estimates are made which could differ materially from actual results and may result in additional restructuring charges or reversals in future periods. Termination benefit charges represent severance pay and benefits for employees impacted by workforce reductions.
| | | | | | | | | |
| | Three Months Ended September 30, 2026 | |||||||
| | Real Estate | | Termination | | Total | |||
Home Office | | $ | |
| $ | |
| $ | |
Total | | $ | | | $ | | | $ | |
| | | | | | | | | |
| | Three Months Ended September 30, 2025 | |||||||
| | Real Estate | | Termination | | Total | |||
Medical and Veterinary | | $ | |
| $ | |
| $ | |
Home Office | | | |
| | |
| | |
Total | | $ | | | $ | | | $ | |
The following table summarizes the separation and restructuring plan activity for fiscal years 2026 and 2027, for which cash payments are required (in thousands):
| | | |
Liability balance as of June 30, 2025 | | $ | — |
Increase in liability (termination and other charges) | | | |
Reduction in liability (payments and adjustments) | | | ( |
Liability balance as of June 30, 2026 | | | |
Increase in liability (termination and other charges) | | | |
Reduction in liability (payments and adjustments) | | | ( |
Liability balance as of September 30, 2026 | | $ | |
These liability balances are recorded within accrued liabilities on the Consolidated Balance Sheets.
6. Other Income, Net
Other income, net consisted of the following (in thousands):
| | | | | | |
| | Three Months Ended | ||||
| | September 30, | ||||
| | 2026 | | 2025 | ||
Interest and dividend income | | $ | | | $ | |
Investment (loss) gain | | | ( | | | |
Other income, net | | $ | | | $ | |
Investment (loss) gain includes trading gains and losses related to the rabbi trust used to fund nonqualified deferred compensation plan obligations.
9
Table of Contents
7. Income Taxes
Our effective tax rate from continuing operations was
RUSM and RUSVM each have agreements with their respective domestic governments that exempt them from local income taxation. RUSM has an exemption in Barbados until 2039 and RUSVM has an exemption in St. Kitts until 2038.
8. Earnings per Share
The following table sets forth the computations of basic and diluted earnings per share and antidilutive shares (in thousands, except per share data):
| | | | | | |
| | Three Months Ended | ||||
| | September 30, | ||||
| | 2026 | | 2025 | ||
Numerator: | | | | | | |
Net income (loss): | |
| | |
| |
Continuing operations | | $ | | | $ | |
Discontinued operations | | | ( | | | |
Net income | | $ | | | $ | |
| | | | | | |
Denominator: | | | | | | |
Weighted-average basic shares outstanding |
| | |
| | |
Effect of dilutive stock awards |
| | |
| | |
Weighted-average diluted shares outstanding |
| | |
| | |
| | | | | | |
Earnings (loss) per share: | | | | | | |
Basic: | | | | | | |
Continuing operations | | $ | | | $ | |
Discontinued operations | | $ | ( | | $ | |
Total basic earnings per share | | $ | | | $ | |
Diluted: | | | | | | |
Continuing operations | | $ | | | $ | |
Discontinued operations | | $ | ( | | $ | |
Total diluted earnings per share | | $ | | | $ | |
| | | | | | |
Weighted-average antidilutive shares | | | — | | | — |
9. Accounts and Financing Receivables
Our accounts receivables relate to student balances occurring in the normal course of business. Accounts receivables have a term of less than one year and are included in accounts and financing receivables, net on our Consolidated Balance Sheets. Our financing receivables relate to credit extension programs, which provide students with payment terms in excess of one year and are included in accounts and financing receivables, net and other assets, net on our Consolidated Balance Sheets.
10
Table of Contents
The classification of our accounts and financing receivable balances was as follows (in thousands):
| | | | | | | | | |
| | September 30, 2026 | |||||||
| | | Gross | | | Allowance | | | Net |
Accounts receivables, current | | $ | | | $ | ( | | $ | |
Financing receivables, current | | | | | | ( | | | |
Accounts and financing receivables, current | | $ | | | $ | ( | | $ | |
| | | | | | | | | |
Financing receivables, current | | $ | | | $ | ( | | $ | |
Financing receivables, noncurrent | | | | | | ( | | | |
Total financing receivables | | $ | | | $ | ( | | $ | |
| | | | | | | | | |
| | June 30, 2026 | |||||||
| | | Gross | | | Allowance | | | Net |
Accounts receivables, current | | $ | | | $ | ( | | $ | |
Financing receivables, current | | | | | | ( | | | |
Accounts and financing receivables, current | | $ | | | $ | ( | | $ | |
| | | | | | | | | |
Financing receivables, current | | $ | | | $ | ( | | $ | |
Financing receivables, noncurrent | | | | | | ( | | | |
Total financing receivables | | $ | | | $ | ( | | $ | |
Our financing receivables relate to credit extension programs available to students at Chamberlain, AUC, RUSM, and RUSVM. These credit extension programs are designed to assist students who are unable to completely cover educational costs consisting of tuition, fees, and books, and are available only after all other student financial assistance has been applied toward those purposes. In addition, AUC, RUSM, and RUSVM allow students to finance their living expenses. Repayment plans for financing agreements are developed to address the financial circumstances of the particular student. Interest charges at rates from
Credit Quality
The primary credit quality indicator for our financing receivables is delinquency. Balances are considered delinquent when contractual payments on the loan become past due. We generally write-off financing receivable balances when they are at least 181 days past due. Payments are applied first to outstanding interest and then to the unpaid principal balance.
The credit quality analysis of financing receivables as of September 30, 2026 was as follows (in thousands):
| | | | | | | | | | | | | | | | | | | | | |
| | Amortized Cost Basis by Origination Year | |||||||||||||||||||
| | Prior | | 2023 | | 2024 | | 2025 | | 2026 | | 2027 | | Total | |||||||
1-30 days past due |
| $ | | | $ | |
| $ | |
| $ | |
| $ | |
| $ | |
| $ | |
31-60 days past due | | | | | | | | | | | | | | | | | | | | | |
61-90 days past due | | | | | | | | | | | | | | | | | | | | | |
91-120 days past due | | | | | | | | | | | | | | | | | | | | | |
121-150 days past due | | | | | | | | | | | | | | | | | | | | | |
Greater than 150 days past due | | | | | | | | | | | | | | | | | | | | | |
Total past due | | | | | | | | | | | | | | | | | | | | | |
Current | | | | | | | | | | | | | | | | | | | | | |
Financing receivables, gross | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | |
Gross write-offs | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | |
11
Table of Contents
The credit quality analysis of financing receivables as of June 30, 2026 was as follows (in thousands):
| | | | | | | | | | | | | | | | | | | | | |
| | Amortized Cost Basis by Origination Year | |||||||||||||||||||
| | Prior | | 2022 | | 2023 | | 2024 | | 2025 | | 2026 | | Total | |||||||
1-30 days past due |
| $ | | | $ | |
| $ | |
| $ | |
| $ | |
| $ | |
| $ | |
31-60 days past due | | | | | | | | | | | | | | | | | | | | | |
61-90 days past due | | | | | | | | | | | | | | | | | | | | | |
91-120 days past due | | | | | | | | | | | | | | | | | | | | | |
121-150 days past due | | | | | | | | | | | | | | | | | | | | | |
Greater than 150 days past due | | | | | | | | | | | | | | | | | | | | | |
Total past due | | | | | | | | | | | | | | | | | | | | | |
Current | | | | | | | | | | | | | | | | | | | | | |
Financing receivables, gross | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | |
Gross write-offs | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | | | $ | |
Allowance for Credit Losses
The allowance for credit losses represents an estimate of the lifetime expected credit losses inherent in our accounts and financing receivable balances as of each balance sheet date. In evaluating the collectability of our accounts and financing receivable balances, we utilize historical events, current conditions, and reasonable and supportable forecasts about the future.
For our accounts receivables, we use historical loss rates based on an aging schedule and a student’s status to determine the allowance for credit losses. As these accounts receivables are short-term in nature, management believes a student’s status provides the best credit loss estimate, while also factoring in delinquency. Students still attending classes, recently graduated, or current on payments are more likely to pay than those who are inactive due to being on a leave of absence, withdrawing from school, or not current on payments.
For our financing receivables, we use historical loss rates based on an aging schedule. As these financing receivables are based on long-term financing agreements offered by Covista, management believes that delinquency provides the best credit loss estimate. As the financing receivable balances become further past due, it is less likely we will receive payment, causing our estimate of credit losses to increase.
The following tables provide a roll-forward of the allowance for credit losses (in thousands):
| | | | | | | | | |
| | Three Months Ended September 30, 2026 | |||||||
| | Accounts | | Financing | | Total | |||
Beginning balance |
| $ | | | $ | |
| $ | |
Write-offs | | | ( | | | ( | | | ( |
Recoveries | | | | | | | | | |
Provision for credit losses | | | | | | | | | |
Ending balance | | $ | | | $ | | | $ | |
| | | | | | | | | |
| | Three Months Ended September 30, 2025 | |||||||
| | Accounts | | Financing | | Total | |||
Beginning balance |
| $ | | | $ | |
| $ | |
Write-offs | | | ( | | | ( | | | ( |
Recoveries | | | | | | | | | |
Provision for credit losses | | | | | | | | | |
Ending balance | | $ | | | $ | | | $ | |
12
Table of Contents
10. Property and Equipment, Net
Property and equipment, net consisted of the following (in thousands):
| | | | | | | | |
| | | | September 30, | | June 30, | ||
| | Useful Life | | 2026 | | 2026 | ||
Land |
| - |
| $ | | | $ | |
Buildings and improvements | | | | | | | | |
Leasehold improvements | | Shorter of asset useful life or lease term | | | | | | |
Furniture and equipment | | | | | | | | |
Software | | | | | | | | |
Construction in progress | | - | | | | | | |
Property and equipment, gross | | | | | | | | |
Accumulated depreciation | | | |
| ( | |
| ( |
Property and equipment, net | | | | $ | | | $ | |
11. Leases
We determine if a contract contains a lease at inception. We have entered into operating leases for academic sites, housing facilities, and office space which expire at various dates through December 2042, most of which include options to
Operating lease assets represent our right to use an underlying asset during the lease term. Operating lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease assets and liabilities are recognized at the lease commencement date based on the present value of future lease payments over the lease term. Operating lease assets are adjusted for any prepaid or accrued lease payments, lease incentives, initial direct costs, and impairments. Our incremental borrowing rate is utilized in determining the present value of the lease payments based upon the information available at the commencement date. Our incremental borrowing rate is determined using a secured borrowing rate for the same currency and term as the associated lease. Operating lease expense is recognized on a straight-line basis over the lease term.
The components of lease cost were as follows (in thousands):
| | | | | | |
| | Three Months Ended | ||||
|
| September 30, | ||||
| | 2026 | | 2025 | ||
Operating lease cost | | $ | | | $ | |
Sublease income | |
| — | |
| ( |
Total lease cost | | $ | | | $ | |
13
Table of Contents
Maturities of lease liabilities as of September 30, 2026 were as follows (in thousands):
| | | |
| | Operating | |
Fiscal Year | | Leases | |
2027 (remaining) | | $ | |
2028 | | | |
2029 | | | |
2030 | | | |
2031 | | | |
Thereafter | | | |
Total lease payments | |
| |
Less: lease incentives not yet received | | | ( |
Less: imputed interest | | | ( |
Present value of lease liabilities | | $ | |
Lease term and discount rate were as follows:
| | | |
| | September 30, | |
| | 2026 | |
Weighted-average remaining operating lease term (years) | | | |
Weighted-average operating lease discount rate | | | |
Supplemental disclosures of cash flow information related to leases were as follows (in thousands):
| | | | | | |
| | Three Months Ended | ||||
| | September 30, | ||||
| | 2026 | | 2025 | ||
Cash (received) paid for amounts in the measurement of operating lease liabilities (net of sublease and lease incentive receipts) | | $ | ( | | $ | |
Operating lease assets obtained in exchange for operating lease liabilities | | $ | | | $ | |
12. Goodwill and Intangible Assets
Goodwill balances by reportable segment were as follows (in thousands):
| | | | | | |
| | September 30, | | June 30, | ||
| | 2026 | | 2026 | ||
Chamberlain | | $ | | | $ | |
Walden | | | | | | |
Medical and Veterinary | | | | | | |
Total | | $ | | | $ | |
Indefinite-lived intangible assets consisted of the following (in thousands):
| | | | | | |
| | September 30, | | June 30, | ||
| | 2026 | | 2026 | ||
Title IV eligibility and accreditations | | $ | | | $ | |
Trade name | |
| | |
| |
Total | | $ | | | $ | |
14
Table of Contents
Amortizable intangible assets consisted of the following (in thousands):
| | | | | | | | | | | | | | |
| | September 30, 2026 | | June 30, 2026 | | | ||||||||
| | Gross Carrying | | Accumulated | | Gross Carrying | | Accumulated | | Weighted-Average | ||||
| | Amount | | Amortization | | Amount | | Amortization | | Amortization Period | ||||
Curriculum | | $ | | | $ | ( |
| $ | | | $ | ( |
| |
Total | | $ | | | $ | ( |
| $ | | | $ | ( |
| |
Curriculum is a finite-lived intangible asset that is amortized on a straight-line basis. Curriculum amortization expense was $
Indefinite-lived intangible assets related to trade names and Title IV eligibility and accreditations are not amortized, as there are no legal, regulatory, contractual, economic, or other factors that limit the useful life of these intangible assets to the reporting entity.
Goodwill and indefinite-lived intangible assets are not amortized, but are reviewed for impairment annually and when an event occurs or circumstances change such that it is more likely than not that an impairment may exist. Our annual testing date is May 31.
Covista has
During the first quarter of fiscal year 2027, Covista performed an assessment to determine whether there were indicators of a triggering event which could indicate the carrying value of the reporting units may not be supported by the fair value. No indicators of a triggering event for potential impairment were noted in the first quarter of fiscal year 2027.
If economic conditions deteriorate or operating performance of our reporting units does not meet expectations such that we revise our long-term forecasts, we may recognize impairments of goodwill and other intangible assets in future periods.
15
Table of Contents
13. Debt
Long-term debt consisted of the following senior secured credit facilities (in thousands):
| | | | | | |
| | September 30, | | June 30, | ||
| | 2026 | | 2026 | ||
Term Loan B | | $ | | | $ | |
Revolver | | | | | | |
Total principal | |
| | |
| |
Unamortized debt discount and issuance costs | |
| ( | |
| ( |
Total long-term debt | | | | | | |
Less current portion | | | ( | | | ( |
Long-term debt | | $ | | | $ | |
Scheduled future maturities of long-term debt were as follows (in thousands):
| | | |
| | Maturity | |
Fiscal Year | | Payments | |
2027 (remaining) | | $ | |
2028 | |
| |
2029 | |
| |
2030 | |
| |
2031 | |
| |
Thereafter | |
| |
Total | | $ | |
Credit Agreement
On August 12, 2021, in connection with the Walden acquisition, Covista entered into a credit agreement (the “Credit Agreement”) that provided for (1) a $
Term Loan B
On August 21, 2024, we entered into Amendment No. 3 to Credit Agreement, which reduced our Term Loan B interest rate margin and removed the leverage-based pricing grid. From August 21, 2024 through March 2, 2026, borrowings under the Term Loan B bore interest at a rate per annum equal to, at our option, the Secured Overnight Financing Rate (“SOFR”) plus
On March 2, 2026, we entered into Amendment No. 5 to Credit Agreement and Incremental Assumption Agreement (the “Term Loan B Amendment”) to incur new term loans under Term Loan B in an aggregate principal amount of $
On September 18, 2026, we entered into Amendment No. 6 to Credit Agreement, which resulted in a
16
Table of Contents
Revolver
On August 6, 2025, we entered into Amendment No. 4 to Credit Agreement and Incremental Assumption Agreement (the “Revolver Amendment”), to (i) increase available commitments under our revolving facility by $
Borrowings under the Revolver bear interest at a rate per annum equal to SOFR plus an applicable margin ranging from
The Credit Agreement requires payment of a commitment fee equal to
Senior Secured Notes due 2028
On March 1, 2021, Covista issued $
Debt Discount and Issuance Costs
The new Term Loan B was issued on March 2, 2026 at a price of
The debt issuance costs related to the Revolver are classified as other assets, net on the Consolidated Balance Sheets. In connection with the Revolver Amendment on August 6, 2025, we wrote-off $
The following table summarizes the unamortized debt discount and issuance costs activity for the three months ended September 30, 2026 (in thousands):
| | | | | | | | | |
| | Term Loan B | | Revolver | | Total | |||
Unamortized debt discount and issuance costs as of June 30, 2026 | | $ | | | $ | | | $ | |
Amortization of debt discount and issuance costs | |
| ( | |
| ( | |
| ( |
Unamortized debt discount and issuance costs as of September 30, 2026 | | $ | | | $ | | | $ | |
17
Table of Contents
Interest Expense
Interest expense consisted of the following (in thousands):
| | | | | | |
| | Three Months Ended | ||||
| | September 30, | ||||
| | 2026 | | 2025 | ||
Term Loan B interest expense | | $ | | | $ | |
Notes interest expense | | | | | | |
Loss on debt extinguishment | | | | | | |
Amortization of debt discount and issuance costs | | | | | | |
Letters of credit fees | | | | | | |
Other | | | | | | |
Total | | $ | | | $ | |
Covenants and Guarantees
The Credit Agreement contains customary covenants, including restrictions on our restricted subsidiaries’ ability to merge and consolidate with other companies, incur indebtedness, grant liens or security interest on assets, make acquisitions, loans, advances or investments, or sell or otherwise transfer assets. Obligations under the Credit Agreement are secured by a first-priority lien on substantially all of the assets of Covista and certain of its domestic wholly-owned subsidiaries. The Credit Agreement contains customary events of default for facilities of this type. If an event of default under the Credit Agreement occurs and is continuing, the commitments thereunder may be terminated and the principal amount outstanding thereunder, together with all accrued and unpaid interest and other amounts owed thereunder, may be declared immediately due and payable.
With respect to the Revolver, the terms of the Credit Agreement require Covista to maintain a Total Net Leverage Ratio (as defined in the Credit Agreement) equal to or less than
Off-Balance Sheet Arrangements
As of September 30, 2026, Covista had $
As of September 30, 2026, Covista had $
14. Share Repurchases
The Covista Board of Directors (the “Board”) has authorized several share repurchase programs. Most recently, on December 15, 2025, we announced that the Board authorized Covista’s sixteenth share repurchase program, which allows Covista to repurchase up to $
| | | | | | |
| | Three Months Ended | ||||
| | September 30, | ||||
| | 2026 | | 2025 | ||
Total number of share repurchases | | | | | | |
Total cost of share repurchases | | $ | | | $ | |
Average price paid per share | | $ | | | $ | |
As of September 30, 2026, $
18
Table of Contents
repurchases, privately negotiated transactions, or otherwise. Repurchases will be funded through available cash balances and ongoing business operating cash generation and may be suspended or discontinued at any time. Shares of stock repurchased under the programs are held as treasury shares. Repurchases under our share repurchase programs reduce the weighted-average number of shares of common stock outstanding for basic and diluted earnings per share calculations.
15. Stock-Based Compensation
Under Covista’s current stock-based incentive plan, employees and Board members are eligible to receive stock options, restricted stock units (“RSUs”), performance-based restricted stock units (“PSUs”), and other forms of stock awards. As of September 30, 2026,
Stock-based compensation expense is recognized on a straight-line basis over the requisite service period. We account for forfeitures of unvested awards in the period they occur. Covista issues new shares of common stock to satisfy stock option exercises, RSU vests, and PSU vests. Stock-based compensation expense is included in student services and administrative expense in the Consolidated Statements of Income. There was
Stock Options
Beginning in fiscal year 2023, the Compensation Committee of the Board determined to no longer grant stock options. Prior to fiscal year 2023, we granted stock options generally with a
| | | | | | | | | | |
| | | | | | Weighted-Average | | | ||
| | Number of | | | | Remaining | | Aggregate | ||
| | Stock | | Weighted-Average | | Contractual Life | | Intrinsic Value | ||
| | Options | | Exercise Price | | (in years) | | (in thousands) | ||
Outstanding as of June 30, 2026 |
| | | $ | |
| | | | |
Outstanding as of September 30, 2026 |
| | |
| |
| | $ | | |
Exercisable as of September 30, 2026 |
| | | $ | |
| | $ | | |
As of June 30, 2026, all stock options were vested. Therefore,
RSUs
We grant RSUs generally with a
| | | | | |
| | | | Weighted-Average | |
| | Number of | | Grant Date | |
| | RSUs | | Fair Value | |
Unvested as of June 30, 2026 |
| | | $ | |
Granted |
| | |
| |
Vested |
| ( | |
| |
Forfeited |
| ( | |
| |
Unvested as of September 30, 2026 |
| | | $ | |
The weighted-average grant date fair value per share of RSUs granted in the three months ended September 30, 2026 and 2025 was $
19
Table of Contents
ended September 30, 2026 and 2025 was $
PSUs
We grant PSUs with an approximate
| | | | | |
| | | | Weighted-Average | |
| | Number of | | Grant Date | |
| | PSUs | | Fair Value | |
Unvested as of June 30, 2026 |
| | | $ | |
Incremental PSUs granted based on achievement of metrics |
| | |
| |
Vested |
| ( | |
| |
Forfeited |
| ( | |
| |
Unvested as of September 30, 2026 |
| | | $ | |
The grant date fair value of PSUs that vested during the three months ended September 30, 2026 and 2025 was $
16. Fair Value Measurements
Fair value is defined under GAAP as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value is a market-based measurement that is determined based on assumptions that market participants would use in pricing an asset or a liability. The following fair value hierarchy prioritizes the inputs in valuation methodologies used to measure fair value:
Level 1 – Quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2 – Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.
Level 3 – Unobservable inputs for the asset or liability. These fair value measurements require significant judgment.
The valuation methodologies used for our assets and liabilities measured at fair value and their classification in the valuation hierarchy are described below.
The carrying value of our cash, cash equivalents, and restricted cash approximates fair value because of their short-term nature and is classified as Level 1.
Covista maintains a rabbi trust with investments in stock and bond mutual funds to fund obligations under our nonqualified deferred compensation plan. The fair value of the investments in the rabbi trust included in prepaid expenses and other current assets on the Consolidated Balance Sheets as of September 30, 2026 and June 30, 2026 was $
The carrying value of the credit extension programs, which approximates their fair value, is included in accounts and financing receivables, net and other assets, net on the Consolidated Balance Sheets as of September 30, 2026 and June 30, 2026 of $
20
Table of Contents
Covista has a nonqualified deferred compensation plan for highly compensated employees and its Board members. The participants’ “investments” are in a hypothetical portfolio of investments which are tracked by an administrator. Changes in the fair value of the nonqualified deferred compensation obligation are derived using quoted prices in active markets based on the market price per unit multiplied by the number of units. Total liabilities under the plan included in accrued liabilities on the Consolidated Balance Sheets as of September 30, 2026 and June 30, 2026 were $
As of September 30, 2026 and June 30, 2026, the principal amount of our Term Loan B was $
Covista has elected not to measure any assets or liabilities at fair value other than those required to be measured at fair value on a recurring basis. Equity investments without readily determinable fair values are accounted for under the measurement alternative, under which the carrying value is adjusted for observable price changes and impairments recognized through net income.
Assets measured at fair value on a nonrecurring basis include goodwill, intangible assets, and assets of businesses where the long-term value of the operations are deemed to be impaired. Goodwill and indefinite-lived intangible assets are not amortized, but are reviewed for impairment annually or more frequently if circumstances arise indicating potential impairment. This impairment review was most recently completed as of May 31, 2026. See Note 12 “Goodwill and Intangible Assets” for additional information on the impairment review, including valuation techniques and assumptions.
17. Commitments and Contingencies
Covista is subject to lawsuits, administrative proceedings, regulatory reviews, and investigations associated with financial assistance programs and other matters arising in the conduct of its business and certain of these matters are discussed below. As of September 30, 2026, we adequately reserved for matters that management has determined a loss is probable and that loss can be reasonably estimated. For those matters for which we have not recorded an accrual, their possible impact on Covista’s business, financial condition, or results of operations cannot be predicted at this time. The continued defense, resolution, or settlement of any of the following matters could require us to expend significant resources and could have a material adverse effect on our business, financial condition, results of operations, and cash flows, and result in the imposition of significant restrictions on us and our ability to operate.
As previously disclosed, pursuant to the terms of the Stock Purchase Agreement by and between Covista and Cogswell Education, LLC (“Cogswell”), dated as of December 4, 2017, as amended, Covista sold DeVry University to Cogswell and Covista agreed to indemnify DeVry University for certain losses up to $
In late January 2024 and early February 2024, ED sent notices to Chamberlain, RUSM, RUSVM, and Walden that it had received Borrower Defense to Repayment (“BDR”) applications filed by students between June 23, 2022 and November 15, 2022, which ED subsequently sent to each institution for awareness and optional response. Without a similar notice, in June 2025, AUC also received BDR claims that had been filed during the same 2022 timeframe. Each application seeks forgiveness of federal student loans made to these students. In the notices received, ED indicated that: (1) the notification was occurring prior to any substantive review of the application as well as its adjudication; (2) it would send the applications to each institution in batches of
21
Table of Contents
forgiveness. To date, none of Covista’s institutions have received an ED notice of BDR application approvals or recoupment intent.
18. Segment Information
We present
Chamberlain – This segment includes the operations of Chamberlain, which offers degree and certificate programs in the nursing and health professions postsecondary education industry.
Walden – This segment includes the operations of Walden, which offers degree and certificate programs, including those in nursing, education, counseling, business, information technology, psychology, public health, social work and human services, public administration and public policy, and criminal justice.
Medical and Veterinary – This segment includes the operations of AUC, RUSM, and RUSVM, collectively referred to as the “medical and veterinary schools,” which offer degree and certificate programs in the medical and veterinary postsecondary education industry.
These segments are consistent with the method by which Covista’s Chief Operating Decision Maker (“CODM”) evaluates performance and allocates resources. Covista’s CODM is our Chief Executive Officer. Our measure of segment profitability utilized by our CODM is adjusted operating income. Our CODM uses this measure to assess the operating results and performance of our segments, perform analytical comparisons to budget, and allocate resources to each segment during monthly operating reviews and annual budget process. Adjusted operating income excludes Home Office expense, restructuring expense, amortization of acquired intangible assets, strategic advisory costs, and debt modification costs because these are not associated with the ongoing operations of the segments. “Home Office” includes activities not allocated to a reportable segment and is included to reconcile segment results to the Consolidated Financial Statements. Total assets by segment are not presented as our CODM does not review or allocate resources based on segment assets.
22
Table of Contents
Summary financial information by reportable segment is as follows (in thousands):
| | | | | | |
| | Three Months Ended | ||||
| | September 30, | ||||
| | 2026 | | 2025 | ||
Revenue: |
| | |
| | |
Chamberlain | | $ | | | $ | |
Walden | | | | | | |
Medical and Veterinary | | | | | | |
Consolidated | | $ | | | $ | |
Cost of educational services: | |
| | | | |
Chamberlain | | $ | | | $ | |
Walden | | | | | | |
Medical and Veterinary | | | | | | |
Other segment expenses(1): | |
| | | | |
Chamberlain | | $ | | | $ | |
Walden | | | | | | |
Medical and Veterinary | | | | | | |
Adjusted operating income: | |
| | | | |
Chamberlain | | $ | | | $ | |
Walden | | | | | | |
Medical and Veterinary | | | | | | |
Total segment adjusted operating income | | | | | | |
Reconciliation to Consolidated Financial Statements: | | | | | | |
Home Office expense | |
| ( | |
| ( |
Restructuring expense | |
| ( | |
| ( |
Amortization of acquired intangible assets | | | ( | |
| ( |
Strategic advisory costs | | | ( | |
| ( |
Debt modification costs | | | ( | |
| — |
Consolidated operating income | | | | | | |
Interest expense | |
| ( | |
| ( |
Other income, net | |
| | |
| |
Consolidated income from continuing operations before income taxes | | $ | | | $ | |
Depreciation: | |
| | | | |
Chamberlain | | $ | | | $ | |
Walden | | | | | | |
Medical and Veterinary | | | | | | |
Home Office | |
| | |
| |
Consolidated | | $ | | | $ | |
Amortization of acquired intangible assets: | |
| | | | |
Walden | | $ | | | $ | |
Consolidated | | $ | | | $ | |
(1)
23
Table of Contents
Covista conducts its educational operations in the U.S., Barbados, St. Kitts, St. Maarten, and the U.K.
| | | | | | |
| | Three Months Ended | ||||
| | September 30, | ||||
| | 2026 | | 2025 | ||
Revenue by geographic area: | | | | | | |
Domestic operations | | $ | | | $ | |
Barbados, St. Kitts, St. Maarten, and the U.K. | |
| | |
| |
Consolidated | | $ | | | $ | |
| | | | | | |
| | September 30, | | June 30, | ||
| | 2026 | | 2026 | ||
Long-lived assets by geographic area: |
| | | | | |
Domestic operations | | $ | | | $ | |
Barbados, St. Kitts, St. Maarten, and the U.K. | |
| | |
| |
Consolidated | | $ | | | $ | |
No one customer accounted for more than 10% of Covista’s consolidated revenue for all periods presented.
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
This management’s discussion and analysis of financial condition and results of operations (“MD&A”) should be read with and is qualified in its entirety by the Consolidated Financial Statements and the notes thereto included in this report. It should also be read in conjunction with our consolidated financial statements and the related MD&A included in our Annual Report on Form 10-K for the fiscal year ended June 30, 2026 (the “2026 Form 10-K”). Readers of this report should also refer to the Cautionary Disclosure Regarding Forward-Looking Statements, Item 1A. “Risk Factors,” and the Financial Aid and Legislative and Regulatory Requirements disclosures set forth in Item 1. “Business” of the 2026 Form 10-K, all of which are incorporated herein by this reference. Covista reports on a fiscal year period ending on June 30. Therefore, this Quarterly Report for the quarterly period ended September 30, 2026 is for our first quarter of fiscal year 2027.
Throughout this MD&A, we sometimes use information derived from the Consolidated Financial Statements and the notes thereto but not presented in accordance with U.S. generally accepted accounting principles (“GAAP”). Certain of these items are considered “non-GAAP financial measures” under the Securities and Exchange Commission (“SEC”) rules. See the “Non-GAAP Financial Measures and Reconciliations” section for the reasons we use these non-GAAP financial measures and the reconciliations to their most directly comparable GAAP financial measures.
Certain items presented in tables may not sum due to rounding. Percentages presented are calculated from the underlying numbers in thousands. Discussions throughout this MD&A are based on continuing operations unless otherwise noted.
Segments
We present three reportable segments as follows:
Chamberlain – This segment includes the operations of Chamberlain, which offers degree and certificate programs in the nursing and health professions postsecondary education industry.
Walden – This segment includes the operations of Walden, which offers degree and certificate programs, including those in nursing, education, counseling, business, information technology, psychology, public health, social work and human services, public administration and public policy, and criminal justice.
Medical and Veterinary – This segment includes the operations of AUC, RUSM, and RUSVM, collectively referred to as the “medical and veterinary schools,” which offer degree and certificate programs in the medical and veterinary postsecondary education industry.
24
Table of Contents
“Home Office” includes activities not allocated to a reportable segment. Financial and descriptive information about Covista’s reportable segments is presented in Note 18 “Segment Information” to the Consolidated Financial Statements.
First Quarter Highlights
Financial and operational highlights for the first quarter of fiscal year 2027 include:
| ● | Covista revenue increased 10.7%, or $49.2 million, to $511.5 million in the first quarter of fiscal year 2027 compared to the prior year period driven by increased revenue across all segments. |
| ● | Net income increased 9.0%, or $5.6 million, to $67.4 million in the first quarter of fiscal year 2027 compared to the prior year period. This increase was primarily driven by an increase in revenue, partially offset by an increase in marketing expense, labor and other costs to support increased enrollment, provision for credit losses, strategic advisory costs, investments to support growth initiatives, and provision for income taxes, as well as a loss from discontinued operations. |
| ● | Diluted earnings per share increased 16.8%, or $0.28, to $1.95, in the first quarter of fiscal year 2027 compared to the prior year period driven by the increase in net income and lower diluted shares due to share repurchases. |
| ● | Adjusted net income increased 16.8%, or $10.9 million, to $75.8 million in the first quarter of fiscal year 2027 compared to the prior year period. This increase was primarily driven by an increase in revenue, partially offset by an increase in marketing expense, labor and other costs to support increased enrollment, provision for credit losses, investments to support growth initiatives, and provision for income taxes. |
| ● | Diluted adjusted earnings per share increased 25.1%, or $0.44, to $2.19 in the first quarter of fiscal year 2027 compared to the prior year period driven by the increase in adjusted net income and lower diluted shares due to share repurchases. |
| ● | For the July 2026 and September 2026 sessions, total student enrollment at Chamberlain increased 2.7% and 1.3%, respectively, compared to the same sessions last year. |
| ● | As of September 30, 2026, total student enrollment at Walden increased 12.8% compared to September 30, 2025. |
| ● | For the September 2026 semester, total student enrollment at the medical and veterinary schools increased 3.5% compared to the same semester last year. |
| ● | Covista repurchased a total of 658,088 shares of its common stock under its share repurchase programs at an average cost of $127.63 per share during the first quarter of fiscal year 2027. The timing and amount of any future repurchases will be determined based on an evaluation of market conditions and other factors. |
25
Table of Contents
Results of Operations
Revenue
The following table presents revenue by segment detailing the changes from the prior year period (in thousands):
| | | | | | | | | | | | | |
| | Three Months Ended September 30, 2026 |
| ||||||||||
| | Chamberlain |
| Walden |
| Medical and |
| Consolidated |
| ||||
Fiscal year 2026 | | $ | 179,201 | | $ | 189,960 | | $ | 93,127 | | $ | 462,288 | |
Growth | | | 13,199 | | | 26,713 | | | 9,334 | | | 49,246 | |
Fiscal year 2027 | | $ | 192,400 | | $ | 216,673 | | $ | 102,461 | | $ | 511,534 | |
% change from prior year | | | 7.4 | % | | 14.1 | % | | 10.0 | % | | 10.7 | % |
Chamberlain
Chamberlain Student Enrollment:
| | | | | | | | | | | | | |
| | Fiscal Year 2027 | | | | | | | | | | ||
Session | | July 2026 | | Sept. 2026 | | | | | | | | | |
Total students | | 38,730 | | 40,351 | | | | | | | | | |
% change from prior year | | 2.7 | % | 1.3 | % | | | | | | | | |
| | | | | | | | | | | | | |
| | Fiscal Year 2026 | | ||||||||||
Session | | July 2025 | | Sept. 2025 | | Nov. 2025 | | Jan. 2026 | | Mar. 2026 | | May 2026 |
|
Total students | | 37,697 | | 39,846 | | 39,278 | | 40,145 | | 40,767 | | 39,501 | |
% change from prior year | | 4.5 | % | 2.2 | % | (1.0) | % | (0.7) | % | 0.5 | % | 1.6 | % |
Chamberlain revenue increased 7.4%, or $13.2 million, to $192.4 million in the first quarter of fiscal year 2027 compared to the prior year period, driven by higher enrollment, average student courseload, and tuition rates. Enrollment increased in pre-licensure nursing programs; however, enrollment has declined in post-licensure nursing programs. Chamberlain is achieving pre-licensure growth by optimizing investments in student enrollment and experience while leveraging scale through a national footprint with in-person and online curriculum delivery modalities. Management is focused on optimizing marketing and enrollment operations to address post-licensure enrollment.
Tuition Rates:
Tuition rates in the current fiscal year increased compared to the prior fiscal year for the Bachelor of Science in Nursing (“BSN”) onsite and online degree, Master of Science in Nursing (“MSN”), Master of Social Work (“MSW”) and Master of Public Health (“MPH”) online degree programs. The average increase across all of these programs was approximately 3.4% from the prior year.
Walden
Walden Student Enrollment:
| | | | | | | | | |
| | Fiscal Year 2027 | | | | | | | |
| | September 30, | | | | | | | |
Period | | 2026 | | | | | | | |
Total students | | 58,881 | | | | | | | |
% change from prior year | | 12.8 | % | | | | | | |
| | | | | | | | | |
| | Fiscal Year 2026 | | ||||||
| | September 30, | | December 31, | | March 31, | | June 30, | |
Period | | 2025 | | 2025 | | 2026 | | 2026 | |
Total students | | 52,216 | | 52,435 | | 54,474 | | 54,851 | |
% change from prior year | | 13.6 | % | 13.0 | % | 12.3 | % | 14.0 | % |
26
Table of Contents
Walden total student enrollment represents those students attending instructional sessions as of the dates identified above. Walden revenue increased 14.1%, or $26.7 million, to $216.7 million in the first quarter of fiscal year 2027 compared to the prior year period, driven by an increase in enrollment and higher tuition rates. Walden’s improved enrollment has been accelerated by investments in student experience and brand along with providing flexibility to working adults through part-time and Tempo Learning® competency-based programs.
Tuition Rates:
Tuition rates for Walden programs, including general education, are charged on a per credit hour basis that varies based on the nature of the program. For other programs such as those with a subscription-based learning modality, tuition is charged on a per term basis. Students are also charged program and clinical fees depending on the specific programs. Some programs require students to attend residencies, skills labs, and pre-practicum labs, for which tuition is charged per event. The average increase in tuition rates, event charges, and fees across all programs was approximately 2.6% from the prior year.
Medical and Veterinary
Medical and Veterinary Student Enrollment:
| | | | | | | |
| | Fiscal Year 2027 | | | | | |
Semester | | Sept. 2026 | | | | | |
Total students | | 5,481 | | | | | |
% change from prior year | | 3.5 | % | | | | |
| | | | | | | |
| | Fiscal Year 2026 | | ||||
Semester | | Sept. 2025 | | Jan. 2026 | | May 2026 |
|
Total students | | 5,297 | | 5,344 | | 5,120 | |
% change from prior year | | 2.4 | % | 4.1 | % | 7.3 | % |
Medical and Veterinary revenue increased 10.0%, or $9.3 million, to $102.5 million in the first quarter of fiscal year 2027 compared to the prior year period, driven by an increase in enrollment and higher tuition rates. Management continues to focus on increasing enrollment and driving operational effectiveness, specifically around academic support and enrollment experience.
Tuition Rates:
| ● | Effective for semesters beginning in September 2026, tuition rates and administrative fees for the basic sciences and clinical rotation portions of AUC’s medical program increased 2.0% from the prior academic year. |
| ● | Effective for semesters beginning in September 2026, tuition rates and administrative fees for the basic sciences and clinical rotation portions of RUSM’s medical program increased 2.0% from the prior academic year. |
| ● | Effective for semesters beginning in September 2026, tuition rates for the pre-clinical and clinical curriculum of RUSVM’s veterinary program increased 1.5% from the prior academic year. |
Cost of Educational Services
The cost of educational services expense category includes expenses related to the cost of faculty and staff who support educational operations, facilities, adjunct faculty, supplies, housing, bookstore, other educational materials, student
27
Table of Contents
education-related support activities, and provision for credit losses. The following table presents information regarding cost of educational services (in thousands):
| | | | | | | | | | | | | |
| | Three Months Ended September 30, 2026 |
| ||||||||||
|
| Chamberlain |
| Walden |
| Medical and |
| Consolidated | | ||||
Fiscal year 2026 |
| $ | 83,198 | | $ | 64,752 |
| $ | 52,817 | | $ | 200,767 | |
Cost increase |
|
| 10,106 | |
| 9,317 | |
| 569 | |
| 19,992 | |
Fiscal year 2027 |
| $ | 93,304 | | $ | 74,069 |
| $ | 53,386 | | $ | 220,759 | |
% change from prior year |
| | 12.1 | % |
| 14.4 | % | | 1.1 | % | | 10.0 | % |
As a percentage of revenue: | | | | | | | | | | | | | |
Fiscal year 2026 | | | 46.4 | % | | 34.1 | % | | 56.7 | % | | 43.4 | % |
Fiscal year 2027 | | | 48.5 | % | | 34.2 | % | | 52.1 | % | | 43.2 | % |
Consolidated cost of educational services increased 10.0%, or $20.0 million, to $220.8 million in the first quarter of fiscal year 2027 compared to the prior year period. This cost increase was primarily driven by an increase in labor and other costs to support increased enrollment and an increase in provision for credit losses. As a percentage of revenue, consolidated cost of educational services remained consistent at 43.2% in the first quarter of fiscal year 2027 compared to 43.4% in the prior year period. As a result, consolidated gross profit margin remained consistent at 56.8% in the first quarter of fiscal year 2027 compared to 56.6% in the prior year period.
Chamberlain
Segment cost of educational services increased 12.1%, or $10.1 million, to $93.3 million in the first quarter of fiscal year 2027 compared to the prior year period. This cost increase was primarily driven by an increase in provision for credit losses, labor, rent, facilities, and technology costs. As a percentage of revenue, segment cost of educational services was 48.5% and 46.4% in the first quarter of fiscal year 2027 and 2026, respectively. The increase in the percentage was the result of the increase in cost of educational services, partially offset by revenue growth. As a result of the investments to support enrollment and revenue growth, gross profit margin decreased to 51.5% in the first quarter of fiscal year 2027 compared to 53.6% in the prior year period.
Walden
Segment cost of educational services increased 14.4%, or $9.3 million, to $74.1 million in the first quarter of fiscal year 2027 compared to the prior year period. This cost increase was primarily driven by an increase in provision for credit losses, labor, and technology costs. As a percentage of revenue, segment cost of educational services remained consistent at 34.2% in the first quarter of fiscal year 2027 compared to 34.1% in the prior year period. As a result, gross profit margin remained consistent at 65.8% in the first quarter of fiscal year 2027 compared to 65.9% in the prior year period.
Medical and Veterinary
Segment cost of educational services increased 1.1%, or $0.6 million, to $53.4 million in the first quarter of fiscal year 2027 compared to the prior year period. This cost increase was primarily driven by an increase in labor and technology costs, partially offset by a decrease in clinical rotation costs. As a percentage of revenue, segment cost of educational services was 52.1% and 56.7% in the first quarter of fiscal year 2027 and 2026, respectively. The decrease in the percentage was the result of revenue growth, partially offset by the increase in cost of educational services. As a result of the revenue growth, gross profit margin increased to 47.9% in the first quarter of fiscal year 2027 compared to 43.3% in the prior year period.
28
Table of Contents
Student Services and Administrative Expense
The student services and administrative expense category includes expenses related to student admissions, marketing and advertising, general and administrative, and amortization of acquired intangible assets. The following table presents information regarding student services and administrative expense (in thousands):
| | | | | | | | | | | | | | | | |
| | Three Months Ended September 30, 2026 |
| |||||||||||||
|
| Chamberlain |
| Walden |
| Medical and |
| Home Office | | Consolidated | | |||||
Fiscal year 2026 | | $ | 70,395 | | $ | 71,939 | | $ | 23,538 | | $ | 9,862 | | $ | 175,734 | |
Cost increase (decrease) | |
| 1,971 | |
| 8,427 | |
| 3,286 | |
| (725) | |
| 12,959 | |
Amortization of acquired intangible assets decrease | | | — | | | (1,411) | | | — | | | — | | | (1,411) | |
Strategic advisory costs increase | | | — | | | — | | | — | | | 4,547 | | | 4,547 | |
Debt modification costs increase | | | — | | | — | | | — | | | 756 | | | 756 | |
Fiscal year 2027 | | $ | 72,366 | | $ | 78,955 | | $ | 26,824 | | $ | 14,440 | | $ | 192,585 | |
Fiscal year 2027 % change: | |
| | | | | |
| | | | | | | | |
Cost increase (decrease) | | | 2.8 | % |
| 11.7 | % | | 14.0 | % |
| (7.4) | % | | 7.4 | % |
Amortization of acquired intangible assets decrease | |
| — | |
| (2.0) | % |
| — | |
| — | |
| (0.8) | % |
Strategic advisory costs increase | |
| — | |
| — | |
| — | |
| 46.1 | % |
| 2.6 | % |
Debt modification costs increase | |
| — | |
| — | |
| — | |
| 7.7 | % |
| 0.4 | % |
Fiscal year 2027 % change | |
| 2.8 | % |
| 9.8 | % |
| 14.0 | % |
| 46.4 | % |
| 9.6 | % |
As a percentage of revenue: | | | | | | | | | | | | | | | | |
Fiscal year 2026 | | | 39.3 | % | | 37.9 | % | | 25.3 | % | | n/a | | | 38.0 | % |
Fiscal year 2027 | | | 37.6 | % | | 36.4 | % | | 26.2 | % | | n/a | | | 37.6 | % |
Consolidated student services and administrative expense increased 9.6%, or $16.9 million, to $192.6 million in the first quarter of fiscal year 2027 compared to the prior year period. After excluding amortization of acquired intangible assets, strategic advisory costs, and debt modification costs, consolidated student services and administrative expense increased 7.4%, or $13.0 million, in the first quarter of fiscal year 2027 compared to the prior year period. This cost increase was primarily driven by an increase in marketing expense and investments to support growth initiatives. As a percentage of revenue, consolidated student services and administrative expense was 37.6% and 38.0% in the first quarter of fiscal year 2027 and 2026, respectively. The decrease in the percentage was the result of revenue growth, partially offset by the increase in student services and administrative expense.
Chamberlain
Segment student services and administrative expense increased 2.8%, or $2.0 million, to $72.4 million in the first quarter of fiscal year 2027 compared to the prior year period. This cost increase was primarily driven by an increase in marketing expense. As a percentage of revenue, segment student services and administrative expense was 37.6% and 39.3% in the first quarter of fiscal year 2027 and 2026, respectively. The decrease in the percentage was the result of revenue growth, partially offset by the increase in student services and administrative expense.
Walden
Segment student services and administrative expense increased 9.8%, or $7.0 million, to $79.0 million in the first quarter of fiscal year 2027 compared to the prior year period. This cost increase was primarily driven by an increase in marketing expense and investments to support growth initiatives. As a percentage of revenue, segment student services and administrative expense was 36.4% and 37.9% in the first quarter of fiscal year 2027 and 2026, respectively. The decrease in the percentage was the result of revenue growth, partially offset by the increase in student services and administrative expense.
29
Table of Contents
Medical and Veterinary
Segment student services and administrative expense increased 14.0%, or $3.3 million, to $26.8 million in the first quarter of fiscal year 2027 compared to the prior year period. This cost increase was primarily driven by an increase in professional services. As a percentage of revenue, segment student services and administrative expense was 26.2% and 25.3% in the first quarter of fiscal year 2027 and 2026, respectively. The increase in the percentage was the result of the increase in student services and administrative expense, partially offset by revenue growth.
Restructuring Expense
Restructuring expense was $0.2 million and $0.3 million in the first quarter of fiscal year 2027 and 2026, respectively. We continue to incur restructuring charges or reversals related to exited leased space from previous restructuring activities and workforce reductions.
Operating Income
The following table presents a reconciliation of operating income to adjusted operating income (in thousands):
| | | | | | | | | | | | |
| | Three Months Ended | | |||||||||
| | September 30, | | |||||||||
| | | | | | | | Increase/(Decrease) | | |||
| | 2026 | | 2025 | | $ | | % | | |||
Chamberlain: | | | | | | | | | | | | |
Operating income | | $ | 26,730 | | $ | 25,608 | | $ | 1,122 | | 4.4 | % |
Adjusted operating income | | $ | 26,730 | | $ | 25,608 | | $ | 1,122 | | 4.4 | % |
Operating margin | | | 13.9 | % | | 14.3 | % | | | | | |
Adjusted operating margin | | | 13.9 | % | | 14.3 | % | | | | | |
| | | | | | | | | | | | |
Walden: | | | | | | | | | | | | |
Operating income | | $ | 63,649 | | $ | 53,269 | | $ | 10,380 | | 19.5 | % |
Amortization of acquired intangible assets | | | 1,394 | | | 2,805 | | | (1,411) | | | |
Adjusted operating income | | $ | 65,043 | | $ | 56,074 | | $ | 8,969 | | 16.0 | % |
Operating margin | | | 29.4 | % | | 28.0 | % | | | | | |
Adjusted operating margin | | | 30.0 | % | | 29.5 | % | | | | | |
| | | | | | | | | | | | |
Medical and Veterinary: | | | | | | | | | | | | |
Operating income | | $ | 22,251 | | $ | 16,728 | | $ | 5,523 | | 33.0 | % |
Restructuring expense | | | — | | | 44 | | | (44) | | | |
Adjusted operating income | | $ | 22,251 | | $ | 16,772 | | $ | 5,479 | | 32.7 | % |
Operating margin | | | 21.7 | % | | 18.0 | % | | | | | |
Adjusted operating margin | | | 21.7 | % | | 18.0 | % | | | | | |
| | | | | | | | | | | | |
Covista(1): | | | | | | | | | | | | |
Operating income (GAAP) | | $ | 98,027 | | $ | 85,477 | | $ | 12,550 | | 14.7 | % |
Restructuring expense | | | 163 | | | 310 | | | (147) | | | |
Amortization of acquired intangible assets | | | 1,394 | | | 2,805 | | | (1,411) | | | |
Strategic advisory costs | | | 6,231 | | | 1,684 | | | 4,547 | | | |
Debt modification costs | | | 756 | | | — | | | 756 | | | |
Adjusted operating income (non-GAAP) | | $ | 106,571 | | $ | 90,276 | | $ | 16,295 | | 18.1 | % |
Operating margin (GAAP) | | | 19.2 | % | | 18.5 | % | | | | | |
Adjusted operating margin (non-GAAP) | | | 20.8 | % | | 19.5 | % | | | | | |
(1) Consolidated results include Home Office activities not allocated to segments.
Consolidated operating income increased 14.7%, or $12.6 million, to $98.0 million in the first quarter of fiscal year 2027 compared to the prior year period. Consolidated operating margin increased in the first quarter of fiscal year 2027 to 19.2% compared to 18.5% in the prior year period. The operating income and margin increase in the first quarter of fiscal year 2027 was primarily driven by an increase in revenue, partially offset by an increase in marketing expense, labor and other costs to support increased enrollment, provision for credit losses, strategic advisory costs, and investments to support growth initiatives.
30
Table of Contents
Consolidated adjusted operating income increased 18.1%, or $16.3 million, to $106.6 million in the first quarter of fiscal year 2027 compared to the prior year period. Consolidated adjusted operating margin increased in the first quarter of fiscal year 2027 to 20.8% compared to 19.5% in the prior year period. The adjusted operating income and margin increase in the first quarter of fiscal year 2027 was primarily driven by an increase in revenue, partially offset by an increase in marketing expense, labor and other costs to support increased enrollment, provision for credit losses, and investments to support growth initiatives.
Chamberlain and Medical and Veterinary operate physical campus locations and therefore incur costs associated with maintaining and operating those campuses. In contrast, Walden primarily delivers education through an online model and does not incur campus-related operating costs. As a result, the operating margins of Chamberlain and Medical and Veterinary historically have been lower than those of Walden.
Chamberlain
Segment adjusted operating income increased 4.4%, or $1.1 million, to $26.7 million in the first quarter of fiscal year 2027 compared to the prior year period. The adjusted operating income increase in the first quarter of fiscal year 2027 was primarily driven by an increase in revenue, partially offset by an increase in marketing expense, provision for credit losses, labor, rent, facilities, and technology costs. Segment adjusted operating margin decreased in the first quarter of fiscal year 2027 to 13.9% compared to 14.3% in the prior year period. The adjusted operating income margin decrease in the first quarter of fiscal year 2027 was primarily driven by an increase in marketing expense, provision for credit losses, labor, rent, facilities, and technology costs, partially offset by an increase in revenue.
Walden
Segment adjusted operating income increased 16.0%, or $9.0 million, to $65.0 million in the first quarter of fiscal year 2027 compared to the prior year period. Segment adjusted operating margin increased in the first quarter of fiscal year 2027 to 30.0% compared to 29.5% in the prior year period. The adjusted operating income and margin increase in the first quarter of fiscal year 2027 was primarily driven by an increase in revenue, partially offset by an increase in marketing expense, provision for credit losses, labor, technology costs, and investments to support growth initiatives.
Medical and Veterinary
Segment adjusted operating income increased 32.7%, or $5.5 million, to $22.3 million in the first quarter of fiscal year 2027 compared to the prior year period. Segment adjusted operating margin increased in the first quarter of fiscal year 2027 to 21.7% compared to 18.0% in the prior year period. The adjusted operating income and margin increase in the first quarter of fiscal year 2027 was primarily driven by an increase in revenue and a decrease in clinical rotation costs, partially offset by an increase in professional services, technology costs, and labor.
Interest Expense
Interest expense was $9.9 million and $11.1 million in the first quarter of fiscal year 2027 and 2026, respectively. This decrease was primarily driven by decreased borrowings and a lower interest rate on our Term Loan B.
Other Income, Net
Other income, net was $1.4 million and $2.5 million in the first quarter of fiscal year 2027 and 2026, respectively. This decrease was primarily driven by an investment loss in the current year period compared to an investment gain in the prior year period.
Provision for Income Taxes
Our effective income tax rate from continuing operations can differ from the 21% U.S. federal statutory rate due to several factors, including U.S. tax on foreign earnings, limitation of tax benefits on certain executive compensation, the rate of tax applied by state and local jurisdictions, the rate of tax applied to earnings outside the U.S., tax incentives, tax credits related to research and development expenditures, changes in unrecognized tax benefits, and tax benefits on stock-based compensation.
31
Table of Contents
Our effective tax rate from continuing operations was 20.1% and 20.6% in the first quarter of fiscal year 2027 and 2026, respectively. The effective tax rate for the first quarter of fiscal year 2027 decreased compared to the prior year period primarily due to an increase in U.S. tax benefits on foreign-derived income, partially offset by a decrease in tax benefits on stock-based compensation.
Discontinued Operations
We continue to have activity associated with ongoing litigation and settlements related to prior divestitures, which is classified within discontinued operations. We had a loss from discontinued operations of $4.1 million in the first quarter of fiscal year 2027 and income from discontinued operations of $0.8 million in the first quarter of fiscal year 2026.
Liquidity and Capital Resources
Covista’s primary source of liquidity is the cash received from payments for student tuition, fees, books, and other educational materials. These payments include funds originating as financial aid from various federal and state loan and grant programs, student and family educational loans, employer educational reimbursements, scholarships, and student and family financial resources. Covista continues to provide financing options for its students, including Covista’s credit extension programs.
The pattern of cash receipts during the year is seasonal. Covista’s cash collections on accounts receivable peak at the start of each institution’s term. Accounts receivable reach their lowest level at the end of each institution’s term.
Covista’s consolidated cash and cash equivalents balance of $222.2 million and $406.3 million as of September 30, 2026 and June 30, 2026, respectively, included cash and cash equivalents held at Covista’s international operations of $53.0 million and $58.3 million as of September 30, 2026 and June 30, 2026, respectively, which is available to Covista for general corporate purposes.
Cash Flow Summary
Operating Activities
Net cash provided by operating activities from continuing operations in the three months ended September 30, 2026 decreased $16.4 million to $114.3 million, compared to $130.6 million in the prior year period. This decrease was primarily driven by a $51.0 million increase in payments to employees and vendors, partially offset by a $16.1 million increase in cash collected from students and a $13.9 million increase in lease incentives received.
Investing Activities
Net cash used in investing activities in the three months ended September 30, 2026 and 2025 was $37.6 million and $16.0 million, respectively, and was driven by capital expenditures. Capital expenditures for fiscal year 2027 primarily consisted of new campus development at Chamberlain and information technology investments.
Financing Activities
Net cash used in financing activities in the three months ended September 30, 2026 was $259.6 million, primarily driven by repayments under long-term debt obligations of $163.0 million, share repurchases of $81.0 million, and employee taxes paid on withholding shares of $16.2 million. Net cash used in financing activities in the three months ended September 30, 2025 was $49.5 million, primarily driven by employee taxes paid on withholding shares of $39.1 million.
On December 15, 2025, we announced that the Board of Directors (the “Board”) authorized Covista’s sixteenth share repurchase program, which allows Covista to repurchase up to $750.0 million of its common stock through December 15, 2028. As of September 30, 2026, $577.8 million of authorized share repurchases remained under the sixteenth share repurchase program. The timing and amount of any future repurchases will be determined based on an evaluation of market conditions and other factors. See Note 14 “Share Repurchases” to the Consolidated Financial Statements for additional information on our share repurchase programs.
32
Table of Contents
Material Cash Requirements
Long-Term Debt – As of September 30, 2026, under the Credit Facility, Covista had an outstanding principal amount on its Term Loan B of $510.0 million, which matures on March 2, 2033 and requires quarterly principal payments. See Note 13 “Debt” to the Consolidated Financial Statements for additional information on our Credit Facility.
As of September 30, 2026, Covista had $202.6 million of surety-backed letters of credit outstanding in favor of the U.S. Department of Education. See “Off-Balance Sheet Arrangements” in Note 13 “Debt” to the Consolidated Financial Statements for additional information.
As of September 30, 2026, Covista had $85.0 million of surety bonds to satisfy certain state regulatory requirements for licensure.
In the event of unexpected market conditions or negative economic changes that could negatively affect Covista’s earnings and/or operating cash flow, our Credit Facility includes a $500.0 million Revolver with available capacity of $500.0 million as of September 30, 2026.
Operating Lease Obligations – We have operating lease obligations for the minimum payments required under various lease agreements which are recorded on the Consolidated Balance Sheets. See Note 11 “Leases” to the Consolidated Financial Statements for additional information on our lease obligations.
We believe our cash flows from operations, and our existing cash balances, combined with availability under our credit facility and access to the debt markets, will provide sufficient liquidity to fund our current obligations, projected working capital requirements, capital spending, and anticipated stock repurchases for a period that includes the next twelve months as well as the next several years. However, our ability to maintain sufficient liquidity may be affected by numerous factors, many of which are outside our control.
We have engaged in and continue to engage in the review and planning of strategies to refinance or otherwise optimize our capital structure, which may include issuing debt, equity or other securities, or entering into new credit facilities. This review and planning could result in our pursuing one or more significant corporate transactions. There can be no assurance as to when or whether we will determine to pursue any such transaction, whether any such transaction will be successful, or the effects the failure to undertake any such transaction may have on our business, including our ability to achieve our operational, strategic, and financial goals.
Critical Accounting Estimates
There have been no material changes in our critical accounting estimates as disclosed in our 2026 Form 10-K.
Recent Accounting Pronouncements
For information regarding recent accounting pronouncements, see Note 2 “Summary of Significant Accounting Policies” to the Consolidated Financial Statements.
Cautionary Disclosure Regarding Forward-Looking Statements
Certain statements contained in this Quarterly Report on Form 10-Q are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements provide current expectations of future events based on certain assumptions and include any statement that does not directly relate to any historical or current fact, which includes statements regarding Covista’s future growth. Forward-looking statements generally can be identified by the use of forward-looking terminology such as “future,” “believe,” “project,” “expect,” “anticipate,” “estimate,” “plan,” “intend,” “may,” “will,” “would,” “could,” “can,” “continue,” “preliminary,” “potential,” “range,” and similar terms. These forward-looking statements are subject to risk and uncertainties that could cause actual results to differ materially from those described in the statements. Important factors that could cause actual results to differ materially from the expectations expressed or implied by our forward-looking statements are disclosed in Item 1A. “Risk Factors,” of our 2026 Form 10-K and that might be contained in this Quarterly Report on Form 10-Q, all of which should be read in conjunction with the forward-looking statements in this Quarterly Report on Form 10-Q. You should evaluate forward-looking
33
Table of Contents
statements in the context of these risks and uncertainties and are cautioned to not place undue reliance on such forward-looking statements. We caution you that these factors may not contain all of the factors that are important to you. We cannot assure you that we will realize the results, performance or developments we expect or anticipate or, even if substantially realized, that they will result in the consequences or affect us or our operations in the way we expect. All forward-looking statements are based on information available to us as of the date any such statements are made, and Covista assumes no obligation to publicly update or revise its forward-looking statements even if experience or future changes make it clear that any projected results expressed or implied therein will not be realized, except as required by law.
Non-GAAP Financial Measures and Reconciliations
We believe that certain non-GAAP financial measures provide investors with useful supplemental information regarding the underlying business trends and performance of Covista’s ongoing operations as seen through the eyes of management and are useful for period-over-period comparisons. We use these supplemental non-GAAP financial measures internally in our assessment of performance and budgeting process. However, these non-GAAP financial measures should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. The following are non-GAAP financial measures used in this Quarterly Report on Form 10-Q:
Adjusted net income (most comparable GAAP measure: net income) – Measure of Covista’s net income adjusted for restructuring expense, amortization of acquired intangible assets, strategic advisory costs, loss on debt extinguishment, debt modification costs, U.S. tax benefit due to an increase in foreign-derived income, and loss (income) from discontinued operations.
Adjusted earnings per share (most comparable GAAP measure: diluted earnings per share) – Measure of Covista’s diluted earnings per share adjusted for restructuring expense, amortization of acquired intangible assets, strategic advisory costs, loss on debt extinguishment, debt modification costs, U.S. tax benefit due to an increase in foreign-derived income, and loss (income) from discontinued operations.
Adjusted operating income (most comparable GAAP measure: operating income) – Measure of Covista’s operating income adjusted for restructuring expense, amortization of acquired intangible assets, strategic advisory costs, and debt modification costs.
Adjusted EBITDA (most comparable GAAP measure: net income) – Measure of Covista’s net income adjusted for loss (income) from discontinued operations, interest expense, other income, net, provision for income taxes, depreciation, amortization of acquired intangible assets, amortization of cloud computing implementation assets, stock-based compensation, restructuring expense, strategic advisory costs, and debt modification costs. Provision for income taxes, interest expense, and other income, net are not recorded at the reportable segments, and therefore, the segment adjusted EBITDA reconciliations begin with adjusted operating income.
A description of special items in our non-GAAP financial measures described above are as follows:
| ● | Restructuring expense primarily related to workforce reductions and prior real estate consolidations at Covista’s home office. We do not include normal, recurring, cash operating expenses in our restructuring expense. |
| ● | Amortization of acquired intangible assets. |
| ● | Amortization of cloud computing implementation assets. |
| ● | Strategic advisory costs related to expanding capabilities and bringing new capacities to market to further enhance our strategic position. We do not include normal, recurring, cash operating expenses in our strategic advisory costs. |
| ● | Loss on debt extinguishment related to the amendment of the Revolver. |
| ● | Debt modification costs related to refinancing our Term Loan B. |
| ● | U.S. tax benefit due to an increase in foreign-derived income. |
| ● | Loss (income) from discontinued operations includes activity from ongoing litigation costs and settlements related to prior divestitures. |
34
Table of Contents
The following tables provide a reconciliation from the most directly comparable GAAP measure to these non-GAAP financial measures. The operating income reconciliation is included in the results of operations section within this MD&A.
Net income reconciliation to adjusted net income (in thousands):
| | | | | | |
| | Three Months Ended | ||||
| | September 30, | ||||
| | 2026 | | 2025 | ||
Net income (GAAP) | | $ | 67,427 | | $ | 61,832 |
Restructuring expense | | | 163 | | | 310 |
Amortization of acquired intangible assets | | | 1,394 | | | 2,805 |
Strategic advisory costs | | | 6,231 | | | 1,684 |
Loss on debt extinguishment and debt modification costs | | | 756 | | | 295 |
U.S. tax benefit due to an increase in foreign-derived income | | | (2,031) | | | — |
Income tax impact on non-GAAP adjustments(1) | | | (2,152) | | | (1,224) |
Loss (income) from discontinued operations | | | 4,055 | | | (770) |
Adjusted net income (non-GAAP) | | $ | 75,843 | | $ | 64,932 |
(1) Represents the income tax impact of non-GAAP continuing operations adjustments that is recognized in our GAAP financial statements.
Diluted earnings per share reconciliation to adjusted earnings per share (shares in thousands):
| | | | | | |
| | Three Months Ended | ||||
| | September 30, | ||||
| | 2026 | | 2025 | ||
Diluted earnings per share (GAAP) | | $ | 1.95 | | $ | 1.67 |
Effect on diluted earnings per share: | | | | | | |
Restructuring expense | | | 0.00 | | | 0.01 |
Amortization of acquired intangible assets | | | 0.04 | | | 0.08 |
Strategic advisory costs | | | 0.18 | | | 0.05 |
Loss on debt extinguishment and debt modification costs | | | 0.02 | | | 0.01 |
U.S. tax benefit due to an increase in foreign-derived income | | | (0.06) | | | - |
Income tax impact on non-GAAP adjustments(1) | | | (0.06) | | | (0.03) |
Loss (income) from discontinued operations | | | 0.12 | | | (0.02) |
Adjusted earnings per share (non-GAAP) | | $ | 2.19 | | $ | 1.75 |
Diluted shares | | | 34,573 | | | 37,057 |
(1) Represents the income tax impact of non-GAAP continuing operations adjustments that is recognized in our GAAP financial statements.
35
Table of Contents
Reconciliation to adjusted EBITDA (in thousands):
| | | | | | | | | | | | |
| | Three Months Ended | | |||||||||
| | September 30, | | |||||||||
| | | | | | | | Increase/(Decrease) | | |||
| | 2026 | | 2025 | | $ | | % | | |||
Chamberlain: | | | | | | | | | | | | |
Adjusted operating income (GAAP) | | $ | 26,730 | | $ | 25,608 | | $ | 1,122 | | 4.4 | % |
Depreciation | | | 6,094 | | | 5,375 | | | 719 | | | |
Amortization of cloud computing implementation assets | | | 2,386 | | | 1,527 | | | 859 | | | |
Stock-based compensation | | | 2,372 | | | 2,570 | | | (198) | | | |
Adjusted EBITDA (non-GAAP) | | $ | 37,582 | | $ | 35,080 | | $ | 2,502 | | 7.1 | % |
Adjusted EBITDA margin (non-GAAP) | | | 19.5 | % | | 19.6 | % | | | | | |
| | | | | | | | | | | | |
Walden: | | | | | | | | | | | | |
Adjusted operating income (GAAP) | | $ | 65,043 | | $ | 56,074 | | $ | 8,969 | | 16.0 | % |
Depreciation | | | 1,784 | | | 1,940 | | | (156) | | | |
Amortization of cloud computing implementation assets | | | 2,253 | | | 1,204 | | | 1,049 | | | |
Stock-based compensation | | | 2,782 | | | 2,653 | | | 129 | | | |
Adjusted EBITDA (non-GAAP) | | $ | 71,862 | | $ | 61,871 | | $ | 9,991 | | 16.1 | % |
Adjusted EBITDA margin (non-GAAP) | | | 33.2 | % | | 32.6 | % | | | | | |
| | | | | | | | | | | | |
Medical and Veterinary: | | | | | | | | | | | | |
Adjusted operating income (GAAP) | | $ | 22,251 | | $ | 16,772 | | $ | 5,479 | | 32.7 | % |
Depreciation | | | 2,823 | | | 2,820 | | | 3 | | | |
Amortization of cloud computing implementation assets | | | 931 | | | 411 | | | 520 | | | |
Stock-based compensation | | | 1,390 | | | 1,410 | | | (20) | | | |
Adjusted EBITDA (non-GAAP) | | $ | 27,395 | | $ | 21,413 | | $ | 5,982 | | 27.9 | % |
Adjusted EBITDA margin (non-GAAP) | | | 26.7 | % | | 23.0 | % | | | | | |
| | | | | | | | | | | | |
Covista(1): | | | | | | | | | | | | |
Net income (GAAP) | | $ | 67,427 | | $ | 61,832 | | $ | 5,595 | | 9.0 | % |
Loss (income) from discontinued operations | | | 4,055 | | | (770) | | | 4,825 | | | |
Interest expense | | | 9,944 | | | 11,090 | | | (1,146) | | | |
Other income, net | | | (1,416) | | | (2,486) | | | 1,070 | | | |
Provision for income taxes | | | 18,017 | | | 15,811 | | | 2,206 | | | |
Depreciation and amortization | | | 17,826 | | | 16,243 | | | 1,583 | | | |
Stock-based compensation | | | 8,181 | | | 8,293 | | | (112) | | | |
Restructuring expense | | | 163 | | | 310 | | | (147) | | | |
Strategic advisory costs | | | 6,231 | | | 1,684 | | | 4,547 | | | |
Debt modification costs | | | 756 | | | — | | | 756 | | | |
Adjusted EBITDA (non-GAAP) | | $ | 131,184 | | $ | 112,007 | | $ | 19,177 | | 17.1 | % |
Adjusted EBITDA margin (non-GAAP) | | | 25.6 | % | | 24.2 | % | | | | | |
(1) Consolidated results include Home Office activities not allocated to segments.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
There have been no material changes in Covista’s market risk exposure during the first three months of fiscal year 2027 from those set forth in Item 7A. “Quantitative and Qualitative Disclosures About Market Risk” contained in our 2026 Form 10-K.
Item 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
Based on an evaluation of our disclosure controls and procedures (as such term is defined in Exchange Act Rule 13a-15(e)) that was conducted under the supervision and with the participation of Covista’s management, including our Chief Executive Officer and Chief Financial Officer, our Chief Executive Officer and Chief Financial Officer concluded that Covista’s disclosure controls and procedures were effective as of September 30, 2026.
36
Table of Contents
Changes in Internal Control over Financial Reporting
There were no changes during the first quarter of fiscal year 2027 in our internal control over financial reporting (as such term is defined in Rule 13a-15(f) under the Exchange Act) that have materially affected or are reasonably likely to materially affect our internal control over financial reporting.
Part II. Other Information
Item 1. Legal Proceedings
For information regarding legal proceedings, see Note 17 “Commitments and Contingencies” to the Consolidated Financial Statements included in Item 1. “Financial Statements.”
Item 1A. Risk Factors
There have been no material changes to Covista’s risk factors from those set forth since Item 1A. “Risk Factors” contained in our 2026 Form 10-K.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Issuer Purchases of Equity Securities
The table below reflects shares of common stock we repurchased during the first quarter of the fiscal year ended June 30, 2027.
| | | | | | | | | | |
Period | | Total Number of Shares Purchased | | Average Price Paid per Share | | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs(1) | | Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs(1) | ||
July 1, 2026 - July 31, 2026 | | — | | $ | — | | — | | $ | 661,811,630 |
August 1, 2026 - August 31, 2026 | | 214,995 | | $ | 132.54 | | 214,995 | | $ | 633,315,476 |
September 1, 2026 - September 30, 2026 | | 443,093 | | $ | 125.24 | | 443,093 | | $ | 577,821,827 |
Total | | 658,088 | | $ | 127.63 | | 658,088 | | | |
(1) See Note 14 “Share Repurchases” to the Consolidated Financial Statements for additional information on our share repurchase programs.
Other Purchases of Equity Securities
| | | | | | | | | |
Period | | Total Number of Shares Purchased(1) | | Average Price Paid per Share | | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | | Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs | |
July 1, 2026 - July 31, 2026 | | 264 | | $ | 115.82 | | NA | | NA |
August 1, 2026 - August 31, 2026 | | 122,195 | | $ | 132.35 | | NA | | NA |
September 1, 2026 - September 30, 2026 | | — | | $ | — | | NA | | NA |
Total | | 122,459 | | $ | 132.31 | | NA | | NA |
(1) Represents shares purchased by Covista for payment of employee withholding taxes on stock awards vesting pursuant to the terms of Covista’s stock incentive plans.
Item 5. Other Information
On
37
Table of Contents
Beard’s New 10b5-1 Plan is intended to satisfy the affirmative defense of Rule 10b5-1(c). Trades under Mr. Beard’s New 10b5-1 Plan are subject to the required “cooling-off” period with the estimated first sale date under Mr. Beard’s New 10b5-1 Plan to occur not before December 15, 2026, after the expiration of his Current Plan. Mr. Beard’s New 10b5-1 Plan expires on
On
In accordance with applicable SEC rules, the following is intended to satisfy Covista’s Item 5.02 Form 8-K reporting obligations by making timely disclosure in accordance with Item 5(a) of Form 10-Q.
Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Retirement of Chief Financial Officer
On October 27, 2026, Mr. Robert J. Phelan, Covista’s Senior Vice President and Chief Financial Officer, as well as its principal financial officer, informed Covista of his intention to retire from these positions after nearly seven years, as part of a planned transition. Mr. Phelan will continue to serve in these roles until his successor is named, with no change in responsibilities. Mr. Phelan will support the incoming Chief Financial Officer through a transition period. Covista has initiated a search for Mr. Phelan’s successor. Mr. Phelan will continue to receive his current compensation and benefits for which he is eligible during this period. The terms of Mr. Phelan’s compensation arrangements in connection with his retirement from Covista have not yet been finalized. Covista will disclose any material terms in a future filing with the SEC once finalized.
Item 6. Exhibits
| | |
10.1 | | Amendment No. 6 to Credit Agreement (incorporated by reference to Exhibit 10.1 of the Registrant’s Form 8-K dated September 23, 2026) |
31.1* | | Certification of Chief Executive Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended |
31.2* | | Certification of Chief Financial Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended |
32.1* | | Certifications pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
101.INS | | Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. |
101.SCH | | Inline XBRL Taxonomy Extension Schema Document |
101.CAL | | Inline XBRL Taxonomy Extension Calculation Linkbase Document |
101.DEF | | Inline XBRL Taxonomy Extension Definition Linkbase Document |
101.LAB | | Inline XBRL Taxonomy Extension Label Linkbase Document |
101.PRE | | Inline XBRL Taxonomy Extension Presentation Linkbase Document |
104 | | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) |
* Filed or furnished herewith.
38
Table of Contents
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| | |
| Covista Inc. | |
| | |
Date: October 29, 2026 | By: | /s/ Robert J. Phelan |
| | Robert J. Phelan |
| | Senior Vice President and Chief Financial Officer |
| | (Principal Financial Officer) |
39