Ladies and gentlemen, thank you for standing by, and welcome to Coursera's Third Quarter Fiscal Year 2021 Earnings Call. [Operator Instructions]. I'd like to turn the call over to Cam Carey, Head of Investor Relations. Mr. Carey, you may begin.

Hi, everyone, and thank you for joining our Q3 earnings conference call. With me today is Jeff Maggioncalda, Coursera's Chief Executive Officer; and Ken Hahn, our Chief Financial Officer. Following their prepared remarks, we will open the call for your questions. Our press release, including financial tables, was issued after market close and is posted on our Investor Relations website where this call is being simultaneously webcast. Additionally, downloadable versions of our prepared remarks and supplemental slides have also been made available. During this call, we will present both GAAP and non-GAAP financial measures. A reconciliation of non-GAAP measures to the most directly comparable GAAP measure can be found in today's press release and supplemental presentation, which are distributed and available to the public through our Investor Relations website located at investor.coursera.com. Please note that all growth percentages refer to year-over-year change, unless otherwise specified. Additionally, I'd like to remind you that all statements made during this call that relate to future results and events are forward-looking statements based on current expectations. Actual results and events could differ materially from those projected due to a number of risks and uncertainties, which are discussed in our press release, SEC filings and supplemental materials. These forward-looking statements are not guarantees of future performance or plans, and therefore, investors should not place undue reliance on them. We assume no obligation to update our forward-looking statements. And with that, I'd like to turn it over to Jeff.

Thanks, Cam, and good afternoon, everyone. Today, I'm pleased to report strong third quarter results, which reflect the continued trend of institutions and individual learners embracing online learning to develop skills for the future. In Q3, we grew revenue 33% to $109.9 million. Performance was strong across the business with double-digit revenue growth in each of our segments: Consumer, Enterprise and Degrees, and in every region. Since its founding, Coursera's #1 goal has been and always will be to serve learners. And as of the end of Q3, we have more than 92 million registered learners on the platform, adding 5.5 million in Q3 and more than 15 million year-to-date. Learners come to Coursera seeking new skills to advance their careers and improve their lives. In particular, we continue to see strong demand for our growing catalog of entry-level Professional Certificates. Since launching this category in 2018, we have seen more than 2 million learner enrollments in programs from industry partners like Facebook, Google, IBM, Intuit and Salesforce. With a professional certificate, learners with no college degree or background in the field can learn the skills needed for an entry-level digital job in less than a year. We're also excited about the impact these certificate training programs can have in reducing the gender gap in digital jobs. According to our latest Women and Skills Report, women's enrollments in entry-level professional certificates have increased from 25% of all enrollments in 2019 to 37% in the first half of 2021. But a career pathway isn't the only option. Content on Coursera is modular and increasingly stackable, so that bite-sized learning can build towards a broader course of study, including a college degree. We recently announced ACE Credit Recommendation for all Google entry-level professional certificates on Coursera as well as 3 from IBM.…

Thanks, Jeff, and good afternoon, everyone. We are pleased with our strong third quarter results, which reflect the sustained demand we continue to see for online learning. In Q3, we generated total revenue of $109.9 million, which was up 33% from a year ago. This strong growth was on top of the 70% year-over-year growth delivered last year, so we are quite pleased with the performance on top of a difficult comp. As Jeff discussed, we're seeing a global trend of not just individual learners but also institutions, including companies, campuses and governments, investing in digital and new skills required to compete in a post-pandemic economy. Please note that for the remainder of the call, I will discuss key operational metrics as well as non-GAAP financial metrics, excluding pro forma adjustments unless otherwise noted. Our non-GAAP adjustments remove only stock-based compensation and related payroll tax, nothing else. Gross profit was $68.3 million, up 56% from a year ago, for 62.1% gross margin as a percentage of revenue. This percentage was approximately 910 basis points higher than the prior year period, a continuation of similar dynamics that we saw in the second quarter. As a reminder, there are two components of our cost of services. First is our content cost, which vary based on both the revenue mix amongst our 3 businesses as well as the content margin rate within each segment. Our higher-margin Enterprise and Degree segments accounted for 39% of our overall revenue mix this quarter compared to 31% in the prior year period. This mix shift is key to our long-term financial framework, including structurally expanding margins over time. Additionally, we can see changes in the segment content margin rates depending on what learners consumed in any quarter. For Q3, this continued to be a positive variance primarily…

Thanks, Ken. Our mission is to provide universal access to world-class learning so that anyone anywhere has the power to transform their life through learning. Today, we launched our second Coursera Impact Report. Early in the pandemic, online learning shaped a global crisis response that changed the way we learn. More than a year later, the ability to learn without limits is unlocking new possibilities. New trends show that the combined force of online learning and remote work is creating a powerful opportunity to provide not just learning but more equitable job opportunities worldwide. As the 2021 impact report affirms, creating inclusive pathways to skilling, which prepare people for remote digital jobs, can pave the way for talent to rise from anywhere in the world. Together with our partners, we're excited to continue our efforts to fulfill this promise in our quest to build a more just world. And with that, let's get to Q&A. Could you please introduce the first question?

[Operator Instructions]. Your first question comes from Tom Singlehurst with Citigroup.

Tom here from Citi, and congratulations on the results. Just a couple of questions maybe to open up. First one on Coursera Plus, you mentioned last quarter that you had sort of encouraging early adoption. And sort of lo and behold, it's 25% of Consumer revenue. I mean I suppose it would be great to get some more detail on where that -- why that's suddenly gone so well, and also whether that drives structurally higher gross margins for the Consumer division. Any more detail or color on that would be very much appreciated. That was the first question. And the second question was going to be on just all of us looking at education companies suggesting the impact of rapidly falling community college enrollments and the impact that's having on some of the other names in the space. I'm just wondering whether you think the strength in Consumer is the other side of that coin? I think you referenced that I believe in the comments, but I mean just firming that up a bit. Do you think community college enrollments are coming down because there is just broader adoption of courses like the ones you offer on the Consumer side of the business and in the completely new programs?

Yes, Tom. Thanks for the questions. Do you hear me, okay?

Yes, loud and clear.

Great. So on the first question, Tom, Coursera Plus, I think a lot of what this is, is a consumption play. I mean the idea -- I often compare it to Apple iTunes in the early days. Steve Jobs said, "You buy every song and it has to be exactly $0.99. Every single one was $0.99." And that was great. It was a breakthrough from having to go to a record store, but you still have to pay every time you listen to a song. And so you kind of had to have a favorite song before you really made the commitment to consume it. Similar, I think, for the sort of standard pricing model for Coursera, where you have to know what specialization you want before you actually buy it. I think what Coursera Plus does is it kind of Spotifys, if you will, not just the pricing model but the consumption model. The ability to be interested in one subscription or one specialization and then go to adjacencies and supplement it with other courses or hands-on projects, I think it really just increases the consumption. So I think that's what we're basically seeing is for a fairly small price increase, learners can get unlimited and more friction-free consumption. And what that does is to boost retention rates because it's not like you finish a piece of content and then you're done and then you have to buy another one. This is sort of just a subscription that you can continue to explore. With respect to structural higher gross margins, I don't think so. I don't expect that, that would change it. The only way that, that might happen is if because of this lower-friction ability to explore, learners ended up exploring content with lower content costs to the…

That's very interesting, and thanks for that detail. I'll jump back in the queue.

Your next question comes from the line of Josh Baer with Morgan Stanley.

One follow-up or continuation on that theme, just wondering if the kind of shift or impact of enrollments that we've been hearing about, if it played a role in the Degrees business at all for you?

Josh, we think it has. We think it has. Our Degrees segment is still growing very nicely, as Ken talked about. But when we look at the -- some of the ratios of how often does someone see -- who sees a certain message for a degree actually click on it and take a closer look at what we call the degree description page, and then when they see the degree on the description page, how often do they start an application. When they start an application, how often do they submit. Generally speaking -- and I think it's partly because of a strong labor market, I also think it's partly because a lot of the people that came to Coursera during the pandemic, like the height of the pandemic, they weren't necessarily technical learners. They're more sort of interested in some of the science of well-being course, learning, how to learn course, et cetera. That cohort is a little different than previous ones. But when we look at our data, our traffic and our registrations are looking not perturbed. But when we look at when we see the interest levels of people on the site, it looks like it is skewing a bit more towards the entry-level Professional Certificates; and relatively speaking a little bit less towards college degrees. Although master's degrees are actually doing relatively well vis-a-vis bachelor's. And also higher-tier degree programs, more selective degree programs seem to be -- according to the Clearinghouse data, seem to be less affected than lower-tier degree programs. And so I think we also enjoy the benefit of having more technical degrees on Coursera from top name partners with selected programs. And so I think we're maybe not seeing as much of that, given our partners and the degrees that are on the platform.

Great context. One more, might be a quick one. Funny you mentioned iTunes. So I was just wondering if changes to the apps store fees at Google and Apple, if that's having any impact on the Consumer business? I'm not sure if the Consumer revenue runs through the apps stores in that way?

Yes, some of it some of it does, Josh. Ken, do you have any visibility on any relative effects of platform stores on us?

No, it has a little bit of effect on the cost for obvious reasons that are much broader than -- for Coursera. Nothing hugely material for us, And we haven't seen any kind of effect on the demand on the Consumer side. So pretty much a nonissue not a negative or a positive for us.

Your Next question comes from Stephen Sheldon with William Blair.

First, it seems like you're continuing to see some nice wins on the government side with the win in Costa Rica being a good example. Can you talk some about the pipeline there and what you're seeing in terms of government focus and the ability to pay for kind of these broad upskilling initiatives?

Yes, sure. We are seeing uptake on the government side. I think that when we look at what happened in 2020, we launched in May -- I think it was May, maybe it was April -- the workforce recovery initiative where Coursera for Government was available to any government agency through the end of 2020. And we saw a lot of utilization. Hundreds of agencies ended up signing up for that free version. And like with many institutions, with businesses doing remote work for the first time and campuses doing online learning for the first time, governments got to do workforce training virtually for the first time. And I think that they were pretty shocked. I hear a number of them say, "Wow, like this has really advanced a lot since 5 years ago, 10 years ago. We can get access to a broader range of curriculum. It is online. It's flexible. It's more affordable. It's more tailored to jobs, including entry-level jobs." And there is a growing awareness as well that many of these entry-level digital jobs can be done remotely. They're less place-based. And so governments are thinking, what's the fastest, cheapest way to try to get somebody employed, to a large degree, teaching them digital skills online where they might be able to get an entry-level digital job even if that job not in their community is creating exciting new possibilities. And so we're seeing good uptake on the government side. And as you can imagine, as with the U.S., there's just a lot of governments are putting a lot of money towards retraining, reskilling and sort of reemployment. So we're looking forward to a good year in 2022, and we're seeing good uptake following on 2020.

Got it. And then great to hear it seems like you're seeing some nice traction so far with Consumer subscriptions, but I would be curious to give more detail on the type of individual learners that are signing up for subscriptions. Is it the consumers that were already highly engaged in paying on a per-course basis or a per-certificate basis? Or are you pulling in people to buy subscriptions that maybe weren't more that engaged before? Would just love some detail on that.

Yes. I think it's sort of a combination of all of the above. Generally speaking, it certainly appeals most to those who are avid learners who were going to buy multiple courses anyway. Which by the way, is not a huge portion of our learner base. We don't think there's a lot of cannibalization. But they're the happiest. They're like, "Wow, this is great. I get to learn a lot more stuff and I don't have to pay for it every time." But I think more importantly for your learner that might have otherwise bought one technical specialization, those techniques are changing and the tools that are being used are changing. So there are adjacent courses specializations, projects that can be done And maybe they wouldn't have otherwise bought them, but they're like, "Hey, I can do this adjacent program." The other thing that we're seeing with reskillers, still early days, but a lot of folks know that they don't want to be in their current job, and they want some other job, but they don't necessarily know what job is available. They don't know where the high-demand jobs are or what kind of skills they're going to need or how to get those skills. And so for those who are switching jobs and thinking about a digital career, it's valuable to have the ability to say, you don't have to pick a career to get started. Just come to Coursera. We have 15 entry-level Professional Certificates now from some of the best names in the world. If you want to do project management, great, here's a project management certificate from Google. If you want to do marketing, here's the social media marketer certificate from Facebook. We're seeing good traction with Intuit. They have a bookkeeper certificate. If you want to go into finance or bookkeeping, here's a certificate from Intuit. And you don't have to pay right away, which really changes the purchase decision. Because it's kind of like if you're not sure and you may want to try it before you decide what career to go to, suddenly that subscription model is a pretty attractive way to sample lots of different programs and sort of career skills before deciding that, "Maybe this is a path that's right for me." So I think it works for many types of learners, including those entry-level professional certificate seeker.

Makes sense.

Next question comes from Ryan MacDonald with Needham & Company.

Congrats on the nice quarter. Jeff, you alluded to it in your last answer about there are individuals in the workforce that you know, that they want to switch their careers and are looking for ways to do that. I'm curious given what we've seen in terms of the voluntary turnover rates in the coined Great Resignation over the past few months, I'm curious how that's impacting your conversations with Coursera for Business, and how that's maybe impacting L&D strategies with the enterprise organizations you're talking to?

Yes. Ryan, it's a great question, and it's still shaping up a bit. I mean what we're seeing, and you're seeing it, too, is there has been a long tradition of U.S. businesses offering tuition reimbursement benefits. It's sort of education as a benefit, and there's a tax policy in the U.S. that makes it a little bit more attractive. Pretty much a U.S. kind of thing. We don't see that very big in other countries. But in U.S. Coursera for Business customers, we've seen that, and that's kind of with bachelor's degrees, for the most part. And usually for frontline workers who don't have a college degree, it's a way of providing them a benefit and also retaining them because it's typically a 4-year program. I think to a large degree, the conversation that's being had about micro credentials, job-relevant, job-specific skill training, the conversations we're hearing with individuals looking for something that's shorter, more affordable, more flexible, is also starting to trickle into L&D thinking as well. I've definitely been aware of a few of our customers who are relooking at their tuition reimbursement benefit and thinking, "Hey, education as a benefit, that's something we want to do, maybe even do more of." But when we think about what should be the architecture of how we do that, what kinds of education, what kinds of credentials, we think, at Coursera, that it's not degrees or micro credentials. With Coursera for Campus, we are helping universities build micro credentials right into their degree program for credit and with degree pathways vis-a-vis the American College Education Credit Recommendations that I mentioned in the script, We now have 7 of the Professional Certificates have ACE Credit Recommendations, which is basically the American College Education telling universities and colleges in the U.S., "We have deemed this content to be creditworthy." So the idea that you could start with a professional certificate, and by virtue of the blessings of the ACE, count that as credit towards a master's degree, we think that hybrid model of industry-plus degrees, where they can be more bite-size, more affordable, more job relevant, but have the option to have that degree pathway we think that's a winning combination. And we think there's a big opportunity there.

Great. And then as a follow-up, I wanted to ask about degrees. You mentioned 8 new programs being launched in September. Just curious if we can get a sense of how we should expect that sort of cadence of program launches as we start thinking about 2022. Obviously, you continue to add new partners here, I think up to 33. I would just love to hear more about how that sort of translates into the revenue stream as we look at fourth quarter and into next year.

Yes. So we won't be -- we don't plan to be reporting sort of -- any sort of guidance or forecast on this. I will say that if you go to the website, oftentimes we will start -- we will announce a degree before it's live and start taking pre-enrollment, preadmission submissions. So I know that there are some people that go to our website and just see kind of which degrees are announced but not yet live, but then you can actually see when they're going to be live. You'll notice, if you look at the number of announced degrees and the number of live degrees where there are actually students in session, that number was pretty wide during the last, say, 6 to 9 months. It's a bit more less wide now. We launched a lot of degrees that were in the pipeline. I'm not saying that there's not a pipeline coming, but I do think that those 8 that went live represent a few things. One was they all signed up around the same point in time. It also -- we also want to just kind of mention, it's pretty neat that the way that we enable multiple universities to build and launch degree programs on Coursera gives us a lot of scalability and kind of parallel processing. I mean it's conceivable that 4, or 8 in this case, or more than 8 could all go live at the same time because we don't put our working capital towards building all the content. That was a little bit different than some other types of program management models. But I wouldn't necessarily say that because we launched 8 this quarter, we're going to launch 8 next quarter. And sort of keep an eye on the announced degrees, and then you'll expect, in almost every case, we've launched every degree that has been announced. That will be a reasonable indicator of the degrees that are in the pipeline, at least at the point of announcement.

Ryan, I guess I'd also -- this is Ken. I'd like to emphasize what that model looks like in the degree revenue creation cycle. So first, it starts with the partnership where we land a degree; and then announce it, which is what you're referring to. It tends to take 6 to 12 months for the partner to launch the degree on our platform. And then we start generating revenue by filling cohorts. And that revenue builds over time until you get a full set of cohorts. A 2-year program takes roughly 3 years to fill. So you start to lap. So it takes 4 to 5 years to get full productivity, which means we have amazing visibility on revenue but you don't see an immediate impact from these announcements. So what we announced now, the landed partners, again, they'll implement now over 6 to 12 months, and then we'll begin the revenue production cycle. So there's a long lead time, but a lot of visibility.

Helpful reminder.

Your next question comes from the line of Jason Celino with KeyBanc.

Staying on this topic of degrees, with the pricing announcement in August, I'd be interested in how your conversations are going with partners, whether new to the platform or existing? Is it international versus domestic, grad versus undergrad? I'm curious how those discussions are going.

Yes. Thanks, Jason. I would say that the fee structure announcement that we made was more to remove an objection where a school would say, "Wait, I can see us doing 1 or 2 degrees with you, but if -- but now we're thinking post-pandemic, we're going to have a lot more online degrees." By the way, you might notice in the National Clearinghouse data, they showed that all enrollments were down a bit -- well, master degrees were up a bit, but undergrads. Institutions that deliver only online degrees, and there are a handful, they saw even larger declines in enrollment than traditional universities. And so I think one of the reasons is that those universities who are a little bit maybe -- say, maybe less selective. The online universities are less selective. I think they compete for a little bit more of the same kind of students as community colleges do. And they're also sort of seeing the labor market as an alternative to one of these online degrees. But the second thing I think that they might be seeing is a lot more conventional universities putting out more college degrees online. And so I think that what we -- what I would say is 3 years ago, 4 years ago at least at the selective -- for those selective programs, they kind of saw online degrees a bit as a hobby. Like let's try this here, let's try this there. Now they're thinking more substantially about doing more of them. I think the pricing model really helps them think more broadly about doing this on Coursera. I will also say that a lot of universities are thinking, "Hey, how strategic is this for us? Should we build it ourselves?" And so as we think about -- if…

Okay, and maybe I'll just sneak one more in. Thanks for sharing those enrollments. That's quite helpful. With the strong job market, learners certainly have options of working, learning or both. But aside from the drop of the expanding content of your platform, what controllable execution factors gives you confidence about your ability to attract learners to ramp these programs?

I think -- sorry, on the degree program or on the alternative credentials?

Degree program.

Yes, I think on the degree programs, I think what it really comes down to is can we help a university do a combination of get a degree program built using the tools and all the online pedagogy that's going to make it effective, get it launched and fill cohort at low cost? Because recruitment is definitely a major value driver for pretty much every university that we talk to. Maybe not the super duper uber elites, but kind of everybody else globally. And then the final piece of it really is the -- how well can you scale instruction and grading, and the whole learner -- in fact, the experience. So I think when it comes to execution, what we need to be able to do is, I think in order of importance, we have to make sure we can fill cohorts at low cost and fill it with a global audience, because that's something that we do distinctively well. And then I think that doing a lot of hands-on learning and taking a lot of what we're learning from Coursera for Business and helping universities make sure that their programs are modern, they use modern tools, they're on the cloud, all the hands-on learning is happening, I think that's another good differentiator. So building up Coursera labs, building up recruitment, building of labs and then just improving ingestion and offering would be 3 of the things, I'd say, that we're trying to focus on in order to have our execution impact the growth of our Degrees segment.

Excellent, quite helpful.

Your next question comes from Rishi Jaluria with RBC.

Nice to see continued trajectory, especially against the really tough comps. I just want to maybe dial back into what -- the whole discussion around the tight labor market and labor shortages. Maybe get a little bit more explicit on how it impacts different segments. So I think Enterprise, it makes sense that companies want their existing employees to be more skilled, and that should serve as a tailwind there. How should we think about it on the Consumer side, specifically both here and kind of -- as this lasts on for a while? Is it a case of because it's a better job market for prospective employers, there's less demand for this? Or are there other offsetting tailwinds that might work against that impact? And then I've got a follow-up.

Yes, so I think you got it right on the Enterprise side. Now there are 3 different customer types. The businesses, they seem to be increasing their budgets. They seem to be doing more automation, digital transformation. By the way, there's a little bit of a substitution effect, I think, too, in that businesses are spending more money training their people. So the likelihood that I have to go back to a formal education, when my employer is helping me get semi-formal micro credentials might be a little bit of a substitution effect. But employers are really leaning into it, like you said. Campuses, we are starting to see a much bigger sense that, "Hey, we're facing competition and we need to make sure our graduates have some skills to get a job when they graduate." And I think a lot of it is differentiating themselves from micro credentials and boot camps and things. So we're seeing a nice tailwind on that part of the Enterprise business well. On the Consumer side, we continue to see good traffic coming, good registration rates. As our portfolio of entry-level Professional Certificates grows, we're seeing more conversion. And so we kind of start with what jobs are in demand that don't require a college degree. And then we say, who is an industry partner out there that really knows the stuff cold and has a good brand that consumers would like? And then we say, what skills are needed to be taught in -- we talk to hiring managers, like what skills do you need for someone to get this job? And then we work with the industry partner and we build out the certs. That recipe is just really going nicely. And when we link the degree pathways to that, so hey,…

Got it. That's really helpful. And then just going to Enterprise land, it continues to be really impressive. Can you maybe give us -- and I apologize if you did address this earlier. But can you maybe give us a little bit of color on the size of the lands? And would you be attributing the Enterprise success more to fine-tuning the go to market on your side? Or is it more of a broad secular tailwind industry-wide?

Yes. I would say on Coursera for Business, I would characterize that mostly as a broad secular tailwind, and businesses all around the world are investing in digital transformation. I think that our SkillSets and academies, they're really resonating. This idea that you don't start with content. You start with which jobs do you need to imbue with certain skills. Like, "I need my software engineers to know machine learning." Well, great. Here's a SkillSet for that. And then the SkillSet links to the content. That skills-first approach, frankly, it seems like it's really resonating for us. And I think -- we're kind of, I think in a pretty strong position there with all of our data and our SkillSet. On the Coursera -- but I'd say the ticket sizes, I think there's -- that, I don't think we're driving a ton because of bigger ticket size in Coursera for Business. The government, by the way, pretty big average selling price. Those are generally a little bit more lumpy, and when they come in, they're a little bit bigger than business. And on the Coursera for Campus, my view on this one is to me, it's almost like it's you have 2 choices, either -- for not every university, but for a lot of universities. Either you adapt and integrate some of the more modern curriculum or students will start -- stop coming. And so like what are you going to do? The tricky thing about Coursera for Campus right now is there's often not a buyer and a budget. This is not something that universities are used to doing. And so universities have to get their head around, "Hey, we need to supplement our curriculum with this online capability. Our NPS scores are extremely high, and our upsells are quite healthy on Coursera for Campus." But we're early in that market. I'd like to say that we're kind of making that market. And so that one might take a little bit more time.

Okay. That's really helpful.

Your next question comes from Michael Ng with Goldman Sachs.

I just have two. First, could you just talk a little bit more about the strength in content arrangements with industry partners that drove the strong Consumer margins in the quarter? Is this something that can continue to be a tailwind to margins over time? Do you see the opportunity for a 70% gross margin in the segment at some point in the future? And then second, could you just talk a little bit more about whether you see the opportunity for Coursera Plus to continue to increase as a mix of Consumer revenue? 25% was really impressive. Are you working to increase that over time? And how does that improve revenue visibility for you guys?

Yes, sure. No problem, Michael. With respect to industry partners and the content fees, a lot of this really comes down to the interest, sort of the strategic interest of the educator partner; and then to some degree, like who does the work and who adds the value. I will say that for industry partners who are taking more of a social impact point of view on it, and they asked us to do a lot of the heavy lifting in getting these things built at high quality with their names on them and also in partnership with them, that will tilt more of the economics towards us. So generally lower content fees. And that being said, I could see structurally for a longer period of time, those types of industry partners raising our segment gross margin in the Consumer segment. We also have industry partners, though, who are interested in actually making money off of selling content. And so many technology companies have training divisions and they have P&Ls, and they need to earn revenues. And so they really want the reach from Coursera, but they have expert teams, they build a lot of content, it's very high quality, and they need to post revenue on their P&L. And so for them, they want to do more of the work, they also want a bigger share of the economics. So it's not quite as simple as industry partners will always be higher segment margins than other university partners. It will be a mix. My guess is that it's -- my guess is it's not going to trend to 70%, but I do think that we are...

Jeff, we actually gave specific guidance, and Michael, more importantly. But as part of the script, we talked about we expect to see 60%-plus. So we're not forecasting increases. It's been extraordinary improvement in our brief time as a public company. And we want to let people know we didn't expect it to revert, but we're not expecting explosion in the margins. North of 60%, though, is what we committed to in the near term.

Ken, I like that answer.

There are currently no further questions at this time. I'll turn the call back to Cam Carey for any closing remarks.

That wraps our Q&A. A replay of the webcast will be available on our Investor Relations website, along with the transcript in the next 24 hours. We appreciate you joining today. Take care.

Thanks, Cam.

That concludes today's conference call. Thank you for participating. You may now disconnect.