Universal Technical Institute at East Coast IDEAS: Strategic Growth and Expansion

On Wednesday, 11 June 2025, Universal Technical Institute (NYSE:UTI) presented its strategic plans at The 15th Annual East Coast IDEAS Conference. The company outlined ambitious growth targets and expansion plans while addressing challenges such as regulatory changes and pricing dynamics. UTI’s strategy focuses on closing the skills gap in key industries and expanding its campus network.

Key Takeaways

• UTI projects a 13% revenue growth and a 38% net income increase for fiscal year 2025.
• Plans include launching six new programs annually and expanding with three new campuses in 2026.
• The company is investing $55 million in capital expenditures to support growth.
• UTI is strengthening partnerships with over 13,000 employment partners to enhance student job opportunities.
• Federal funding changes and pricing elasticity are key considerations for future strategies.

Financial Results

UTI’s financial outlook is robust, with revenue expected to reach between $825 million and $835 million this year, a significant rise from $300 million in 2019. The company aims for a 10% compound annual growth rate (CAGR) to hit $1.1 billion in revenue. Adjusted EBITDA is projected at $126 million, with a target of 20% EBITDA by 2029. Net income is forecasted to grow by 38%, reaching $56 million to $60 million. The company anticipates 30,000 new student starts, a 10% increase, supported by a $55 million CapEx plan for new campuses.

Operational Updates

UTI is committed to launching at least six new programs each year, with nine announced for 2025. The company plans to open three new campuses in 2026 in Atlanta, San Antonio, and an expanded Dallas location, with a goal of ten new campuses over the next five years. Current campus utilization is at 40%, and UTI is optimizing space by integrating online learning.

Recent acquisitions, including MIAT and Concord Career Colleges, have expanded UTI’s offerings in skilled trades and healthcare, respectively. The company is leveraging its partnerships with 6,000 UTI and 7,000 Concord employment partners to enhance job placement for graduates.

Future Outlook

UTI’s North Star strategy is entering a new phase focused on organic growth. The company expects 3% annual organic growth through increased enrollment and an additional 2-3% through price adjustments. Geographical expansion is a priority, particularly in regions like Georgia and the Northwest. UTI is also exploring opportunities in nursing programs to meet healthcare demands.

Q&A Highlights

During the Q&A session, UTI addressed the potential impact of increased federal funding on trade schools and advocated for more student support through loan programs and Pell Grants. Pricing and demand elasticity were discussed, with UTI noting the challenges of covering student gaps due to fixed loan amounts. The company highlighted its collaboration with private industry partners, offering job placement benefits like sign-on bonuses and student loan repayment assistance.

For a complete understanding of UTI’s strategic plans and financial projections, refer to the full transcript of the conference call.

Full transcript - The 15th Annual East Coast IDEAS Conference:

Unidentified speaker: It started. Thanks you all for coming out. Universal Technical Institute. This is a company that I think has done our conference maybe two or three years. We’ve been really hot on the thesis of educational services companies.

We have a couple more here today. In Chicago, I think there’s a couple of more that’ll be there in Chicago and more guys will talk to you about maybe coming out to Chicago. But we really like this theme and we like this name. It’s done very well for us, helped us with the outperformance of our track record. So with that, I’ll turn it over to Jerome, CEO.

Jerome Grant, CEO, Universal Technical Institute: I want to thank the RV or the excuse me, not the RV, the AV people for trusting me with this in my hand. Appreciate that. My name is Jerome Grant. I’m the CEO of Universal Technical Institute. Universal Technical Institute oh, actually, before I go, I’ve got

Bruce Schumann, CFO, Universal Technical Institute: to do the quick obligatory. Are talking about forward looking statements. Certain risks and assumptions have been baked in here. We encourage investors to look at our 10 Q and 10 ks for a full discussion of all those. Thanks so much.

Great. Sorry to ask.

Jerome Grant, CEO, Universal Technical Institute: So we actually celebrated our anniversary this year. Universal Technolist, who started as a single campus in Phoenix, Arizona, training about five auto workers. Now we’re addressing skill gaps in two areas. We have 32 campuses. We’ll start somewhere in the neighborhood of 30,000 students.

And we focus two divisions, one in transportation, skilled trades, energy, and the other one is in healthcare skills. We offer over 35 programs, and the dynamics in our market, if you’re not familiar with it, are judged based on outcomes, and foremost. We graduate about 60% of our, excuse me, seventy percent of our students, which is a very high outcome. Community colleges tend to graduate somewhere in the neighborhood of thirty percent of their students. And four out of five of our graduates are employed within one year.

Those are important statistics because not only are they about your reputation, but they’re also about your accreditation and your ability to continue to have Title IV funding and things along those lines. These are very high standards we have. We have a strong financial outlook for the year. Our current guidance for the year is between eight point two five and eight point three five. We’ve raised it twice, so the wind is nicely at our back.

Net income of between 56 and 60, and I think the midpoint’s right at about 1.26 for adjusted EBITDA. There’s a lot of words on this page around a compelling thesis. We’ve been in a growth trajectory since 2020, excuse me, 2019. In 2019, the company was $300,000,000 with no EBITDA, and now we’ll be somewhere in the mid-eight 100 range with $126,000,000 in EBITDA. We’ve got a proven track record for orchestrating growth organically and We’re the largest single player in the skilled trades space, when you think about the pie chart in the market.

And we’re continuing to chart out what we believe to be the great opportunity there is in this market. As I said, we’ve got two divisions, Universal Technical Institute, 60 years old, Auto Diesel Welding, Energy, etcetera, and Concord Career Colleges, which focuses in about 40% of the business in the dental areas, dental hygiene, dental assistance, and 60% in mostly allied health. An opportunity for us moving forward is to move more strongly into nursing, where we are not a strong player in nursing. We acquired Concord just about two years ago, coming up on two years ago. So what binds together they seem like sort of weird businesses that you think are connected to each other.

Why health care and trades? What binds them together is that we will only focus in areas where supply and demand curve for workers is wildly out of whack. There are four jobs on our job board for every UTI graduate. There are between five and ten jobs on our job board for every Conquered Career College graduate. And the markets in which we focus are projected, that gap is projected to increase over the next fifteen years, if you were to believe the Bureau of Labor Statistics and everything that’s out there.

Again, the aging population and people retiring, fewer students going to high school, things along those lines are where the supply and demand curve really focuses. There are areas we won’t focus that are alternate to a college education and have a certification. We won’t focus in culinary. Not a big supply and demand curve issue. And a lot of the aesthetic areas, not a lot of supply and demand curve issue.

And so there is a logic to the connection point between healthcare and the trades, which is we’re trying to solve this big middle skills problem. We always like to show pictures. We encourage investors and potential investors to come and visit our campuses, because when they come and visit our campuses, and we have 32 of them around the country, the number one thing they say is, I didn’t think it was gonna look like this. And the industry aligned education that we have at UTI and the reputation we have for that industry alignment really shows through in our campuses. Our relationships with Mercedes, BMW, Volvo, and 34 other OEM manufacturers, And the state of the art technology we’re using in our healthcare campuses really stands out.

All right, I oh, you’re going to do this one.

Bruce Schumann, CFO, Universal Technical Institute: Sure. Yeah. Happy to.

Jerome Grant, CEO, Universal Technical Institute: This is Bruce Schumann, our CFO.

Bruce Schumann, CFO, Universal Technical Institute: Hey there. So this company has really been on a very, very significant multi year transformation journey. This is just kind of a look back at our revenue growth from 2018, and really what’s driven this is a few things that Drum already talked about. We continue to add new programs, new curriculum additions, new campuses. We’ve had three that have opened up in this time period.

We’ve already announced three new ones this year. We’ve really focused on local marketing and admissions optimization. Really investing in the field teams, or the admission teams who are out in the high schools generating interest in some of the skilled trades in our high schools, for example. Really overhauled our marketing muscle for the company. We’ve moved away from a generic scattershot marketing to a very focused social SEO, SEM optimized lead generation engine that’s really driven some nice returns for us.

Things like real estate rationalization doesn’t sound like a super fun topic, but this has really been an unlock of value for us. It used to be when we’d launch a new program, the very next question would be, we’re gonna have to go get a new building, let’s lease new space. We’ve really focused on let’s optimize every single campus, move into more of a blended learning. Some of that academic in class things have moved online. That’s really generated a lot of capacity for us.

So a lot of the new programs now are going into existing capacity, existing footprint. That’s been a huge both revenue unlock and a margin unlock for the company. I think the final pillar of what’s driven this growth is very well executed, well integrated acquisitions. We bought MIIT back in 2022. That unlocked a lot of portfolio of skilled trades on our existing campuses.

Aviation, wind energy, of the electrical suite, that type of thing that Jerome talked about. And then of course Concord, that was closed in fiscal twenty three. That’s a huge unlock for the company, really opening up the whole healthcare skilled trades for us, which is gonna be a very significant pillar of growth going forward. This page really quickly for Jerome and I and the executive team. This is kind of the ultimate scorecard for us.

We wanna look back and say, this is the lens through which we look at everything we do, every initiative in the company. Are we meeting our commitments? Are we meeting our external expectations we’ve set? Our own expectations we’ve set for ourselves, and are we creating meaningful shareholder value? Those are really the two most important metrics.

So this is a quick look back through ’22. You can see kind of our our guidance, what we set for ourselves, our our our goals, how well we did in meeting those, both in revenue and EBITDA. Then ultimately that translates into meaningful share price appreciation and market cap. We’re focused on student outcomes and doing what we say and meeting expectations. That’s really critical for

Unidentified speaker: us and the exec team.

Jerome Grant, CEO, Universal Technical Institute: So we’ve been talking about the strategy of the company, and in 2020 we went to the market, we raised about $50,000,000 in capital to launch this North Star strategy. And the North Star strategy really did have three pillars to it, which was growth, diversification, and optimization. And that’s why you’ll see these words like optimize and grow and things on the slides as move forward. And the engines for both growth and diversification really stands in the lines of new programs that we bring to the table, adding programs like the skilled trades and healthcare, new campuses. And the reason we put this slide in here is that our next phase of our North Star strategy, which we’ve put out into the public, really is an organic phase that has to do with these two pillars.

Where we have a significant opportunity to continue to optimize our campuses by putting new programs, net new programs as well as MIT programs on the UTI campuses, as well as a lot of greenfield. And looking at our investor deck, you’ll see a lot of greenfield geographically for us to launch new campuses. And so what we’ve said, and I don’t know if it’s on the next slide or not, that’s what I mean about greenfield. A lot of gray space there to put more campuses. What we’ve said in order to affect this phase of the North Star strategy is that we will open a minimum of two new campuses a year.

We’ve announced three for 2026. We’ll launch at least a half a dozen new programs a year. We announced nine for 2025, and we’ll move on to announce our 2026 category. Every year for the next five years. We like to make things very simple for people.

And doing the math on this is in our investor deck, you’ll see a pro form a for a campus, you’ll see a pro form a for programs. And if you add six programs executed in two campuses, you see the new programs, etcetera. And the other thing we ask you to believe is that this management team has a way to organically grow our same store sales or the same program sales and enrollments by 3% a year. We don’t go out on a limb and say there’s going to be a huge win behind us. There may be.

But 3% a year. And that we can get about two or 3% out of price. So if we can get 3% increases in same store enrollments every year, a couple of points out of price, and then execute the way we have executed over the last five years on new programs and new campuses, that’s how you get to that $1,100,000,000 and the 10% CAGR, and the EBITDA that you see approaching 20% by 2029.

Bruce Schumann, CFO, Universal Technical Institute: Okay. a quick breakdown for you of our fiscal twenty twenty five guidance. I thought it’d be good just to show a few of the the major elements here. So on the revenue side, the midpoint of our guide would be about a 13% growth year over year. We’ve said it’ll be sort of $8.25 to 835,000,000 on the top line.

We’re very focused not only on top line growth but also profitability growth. So our midpoint of the guide for net income will be 38% growth year over year, same for earnings per share obviously. New student starts, again, that’s a critical indicator for us because that’s a leading indicator for future revenue. Almost 30,000 starts, about 10% growth is what we’re anticipating for this year on new student starts, which is gonna be important for ’twenty six. Very healthy adjusted EBITDA profile, about 22% growth at the midpoint.

The only indicator on this whole page that’s not up into the right is adjusted free cash flow. That’s directly related to what Jerome just talked about, the North Star phase two strategy. We have a very significant investment period that’s really starting this year on CapEx, extending into ’26 and ’27. We have about a $55,000,000 CapEx expenditure in ’25 to really build out those three campuses we just announced. The Atlanta campus, our fully optimized campus in Atlanta, San Antonio, which is kind of a skilled trades campus, and then expanding the Dallas campus as well.

So all of that CapEx has to be executed on in ’25 to make sure that we can maintain that growth that Jerome just showed you. And then quickly, just this last page on growth. So I mentioned the growth investment. We even talked about on our call, we have about 6 and a half million of growth OpEx planned for second half of twenty twenty five. That is all the advanced staging and advanced hiring personnel you have to put in place to make sure that you can execute on your growth plans.

And then I mentioned the 55,000,000 of CapEx. So over 50% of our CapEx, you can see there, 29,000,000 is going toward growth, purely growth, getting these new campuses, new programs built out. Quick note here, we to be compliant with the SEC, we are no longer calling these one time adjustments. This is now our normal operating rhythm as a company. We’re gonna be doing multiple campuses, multiple programs a year for the foreseeable future.

Can’t really call those one time expenses anymore, so we’re no longer adding those back to EBITDA. So if you’re doing the year over year compare, that does hurt us a little bit on the compare, but it’s the right thing to not back those out anymore. So I think that’s all I had on the growth piece. Any questions on the growth side?

Jerome Grant, CEO, Universal Technical Institute: Yeah. Well, any questions on anything? We like to get through it and have more question and answer than anything else here. Yes?

Unidentified speaker: Me. If the federal government were to direct

Unidentified speaker: more education funding to trade schools,

Unidentified speaker: how would that affect Universal?

Jerome Grant, CEO, Universal Technical Institute: Boy, that was a softball. Quite positively. Okay. The question was, if the federal government is to direct more federal funding towards trade schools and away from Harvard, like a tweet was in that, or four year education, how would that affect trade schools? It would be quite positive.

of all, we don’t plan on that. We don’t budget for that. We have room for it. And so I think that gets to the point of the regulatory environment right now, is the question, is that we are seeing a more favorable regulatory environment. Our second quarter report, I talked uncharacteristically positively about that environment, to the point where for the four years prior, I was never actually allowed a meeting with the Undersecretary for Higher Education and the Department of Education.

They just wouldn’t even take a meeting. And I’ve already met with them multiple occasions, because they want to know what we think is the largest provider in this space of how they can get more skilled workers in America. If we’re going to build ships in America and we’re going to build planes in America and we’re not going to build them in China or somewhere else, they don’t have nearly the workers they need. Give you an example of that. I had dinner in Washington with a gentleman who has two contracts for shipbuilding.

He needs 15,000 welders right now. Right now. I graduate 3,000 a year across my entire and so that’s an opportunity for us to think about bespoke training programs, where we may be able to work with them on it. So to follow-up,

Unidentified speaker: what would be the administrative mechanism right, that would get the funds from the government to Universal?

Jerome Grant, CEO, Universal Technical Institute: It’s not, it’s not about getting funds to Universal. I can tell you the advice that I gave under Secretary Bergeron, which is number one, I think you need more direct support for students in terms of loan programs and Pell Grants to encourage them to seek in these areas. And some of the budget proposals you’ll see in the BBB are angling towards the trades. For instance, Pell Grants and loans for short term programs. So certificate programs as opposed to degrees, etcetera, has been added into the bill.

So direct support for students is one. And this one sort of threw them for a loop. I said, I think you guys need to spend a lot more money in high schools and community colleges. Some people would say, well, community colleges Some people will say, well, community colleges are your competitor. Why would you say that?

And the reason is is that my biggest competitor is lack of knowledge that this exists, this whole industry exists, and parents, who, because their kids aren’t doing tech programs in high schools, don’t know that this is something that they would go on post secondary to do. We talk to about a half a million young people a year who are not going on to four year colleges, right? And the biggest response we get back from them is, I don’t think my parents will let me do this. So money, most of the tech programs have dried up in the high schools. The community colleges have downsized at the time of the programs.

And so the energy level for this type of education needs to be brought back to life. I’ll give you an example about why it’s not a competitive issue, is that we came into Austin, Texas. We have a greatly successful business there. We’ve got about 1,000 kids in our Austin campus, two years into launching it. Across town, there’s another family owned business that’s been there for years and years and years, 500 kids in the same programs that we have.

They now have six fifty. Us coming into the area brought the awareness of the trades to the area and all boats are floating higher, right? And so those were the primary mechanisms that we had. And the other advice I gave, frankly, was I think you need to rethink some of your restrictions and rules to allow me to move faster, Because there’s a lot of red tape you gotta go through to get programs approved and campuses approved and there’s timelines associated, all built into our plan, the current timelines. But if you would ease up on a couple of these things for folks like us, we probably could move faster.

Would you

Unidentified speaker: have a capacity issue?

Jerome Grant, CEO, Universal Technical Institute: No. I’m only 40% filled on my UTI campuses. I used to be around 65% filled, but when we moved to the blended learning curriculum, students are now only on my campus three hours a day. So I’ve been able to double the amount of tracks that I have. So I’ve got plenty of capacity.

Unidentified speaker: So if you’re 40 total, what’s the $55,000,000 CapEx program?

Jerome Grant, CEO, Universal Technical Institute: More campuses, more locations. Students won’t travel to some. So one of the barriers is, I’m not in Georgia. I’m not in the Northwest at all. We could put up the map.

Is that, yes, some students will travel, but not that many. You need to bring the education to them. And so our plan is to open 10 more UTI campuses over the next five years. We’re still developing the plans for our recon acquisition in Concord. Healthcare is very local, right?

Nobody goes more than twenty minutes to go to a healthcare school. We do have about 30 or 40% of our students now that will relocate to come to a UTI campus for a specific program that they have. But you really gotta bring the education to them.

Unidentified speaker: Did the proposed, I know it in the tax bill on increasing the credit requirement for Pell Grants?

Jerome Grant, CEO, Universal Technical Institute: Yeah, that didn’t make it to the Senate. Okay. Sure. The risk share in there didn’t make it to the Senate either. So it’s not in the Senate bill.

Senate bill came out last night, by the way, just last night. And luckily, my government relations person sent me a bulleted point list about five minutes ago. So generally speaking, the entirety of the bill actually will not be good news for four year education, right? And graduate students, etcetera, along those lines, because there’s now new caps on how much funding you can get that would, the more expensive schools are gonna have trouble funding students. Now, what’s the reaction to that?

The reaction to that is you’ll get more students saying, well, maybe I’ll just go do a one year program that I can get funded, or a two year program in nursing that I can get funded. And those caps, I don’t have any programs that come anywhere near breaking those caps on my campuses, so it doesn’t really apply to me. Sure.

Unidentified speaker: Can you talk a little bit about

Bruce Schumann, CFO, Universal Technical Institute: the price of the Grace programs?

Jerome Grant, CEO, Universal Technical Institute: Sure.

Bruce Schumann, CFO, Universal Technical Institute: Any elasticity of demand?

Jerome Grant, CEO, Universal Technical Institute: Tale of Two Cities on pricing. The UTI business, which transportation, skill trades, and energy, that’s actually a pretty rational price scheme. Our average revenue per student per quarter is $9,000 The only thing that changes in those is how many months, you’re with me. So $26,000 for a nine month welding program, 37 or 38,000 for a fifty one week auto diesel program. Pretty standard across the industry.

You don’t really have as much upside pricing power during the 2022 spike in inflation, right? People say, why don’t you just raise your prices 10%? Because most of our students receive Pell grants and government backed loans, and then they have a small gap, usually a few thousand dollars that they have to pay. Every time I raise my prices, all I’m doing is increasing the gap. Because the Pell Grants and the loans didn’t go up.

Right? So a 10% increase makes more students go, oh, I don’t know if I can afford to do that. Right? I don’t like to be glib about demand, is that if I build 20 campuses over the next five years and start 48, 50 programs on the campus that I have over here, there still will be four to five jobs for every single graduate in The United States, and there still will be five to 10 jobs for every healthcare graduate in The United States. The statistics of job growth in these areas can’t be satisfied by this.

The smart thing I would have is where are the cities I should go to to be able to capture as much of that as fast as possible? So when we’re thinking about the cities for UTI campuses and for Concord campuses, we’re looking at what are the locations that probably will have the need the fastest, the longest, so that we can capture them the quickest.

Unidentified speaker: Have you looked at partnering with private industry to help fund the gap?

Jerome Grant, CEO, Universal Technical Institute: We have, actually. Great. So over the last five years, we’ve worked actually very closely with we have 6,000 employment partners on the UTI side, another 7,000 employment partners on the Concord side. When we say partners, five or six years ago, those weren’t really partnerships. They were just people who would hire our kids, right?

So a partnership now manifests itself in a concept of a trip agreement, we call it. So to get access to one of our graduates, are in really high demand, you have to basically lay out what your offer’s gonna be, Right? And then we have platinum partners, gold partners, silver partners, and we have job fairs for each of them based on how good their offers are. So if you go to work for Lithia, 400 car dealerships around the country, or Penske, 400 car dealers around the country, They’re gonna give you a sign on bonus of $7,000 pay you about starting salary of about 45,000 to an auto mechanic, dollars 45,000 a year. And they’ll pay $325 a month to pay off your student loans, up to $25,000 as long as you stay working for them.

They’re a platinum partner. They hire about 1,000 each now of our kids, because what it was taken out of the scenario is that risk scenario of the loan. And mom and dad say, you should go work for a Penske dealership because I don’t have to worry about the student loans. We have 6,000 of those partners now on the UTI side. Concord’s a little further, not as far along.

We just bought them. We haven’t built all those relationships up. And also, frankly, the health care areas, people aren’t as worried about paying back their loans because the wage increases have been significant over the last five years. But industry alignment is one of the things that sets us apart of why someone would wanna come to UTI. The 34 OEM partners, 6,000 employment partners are something we can demonstrate on our campuses.

You can demonstrate the OEM partnerships by the fact that we have all the latest Ford products and Mercedes products and Volvo products and all their battery technologies and all their EV technologies and Lincoln Electric welding and all of that on our campuses. And then we’re able to demonstrate on our campuses how the hiring profiles work. It’s a strong benefit for having our national footprint and being us. They don’t like to work with the individual community colleges because they operate independently. So it’s hard to have a relationship with a single community college here and there.

But because I’ve got 16 campuses around the country and 17 on the health care side, we sort of get in pole position for having conversations with them. Sir?

Unidentified speaker: It would seem to me that there are certifications required for a lot of these jobs that you’re preparing for. Yep. Is the certification

Jerome Grant, CEO, Universal Technical Institute: No. And yet our oath to the students, if you’re an auto mechanic, fifty one weeks, our oath to you is that you’re gonna be able to pass the ASE certification. If you are a good student and you pass well and you will pass the ASE certification. But we are judged by, in the healthcare area, how many of our students pass the certifications after they graduate. We prepare them for them, but we don’t deliver them.

Many of them are delivered by a governing body and a party right after they graduate. But we have very high pass rates, and so therefore we can demonstrate that your risk is very minimal. Again, assuming we have open enrollment, you have to have a high school diploma, and you have to be able to pay, whether it’s through federal money or the like. And so we work very hard to get people to be able to pass those certifications. Absolutely, absolutely.

But we don’t guarantee you’re gonna pass the certification because we can’t guarantee you’re gonna be a good student. Other questions or ideas, concerns? It’s a conference about idea. We’re around, as I said, Matt Kempton’s our head of investor relations and corporate finance, and we do really encourage people to come visit our campuses. Our campus presidents love to tour investors and let them see what it is that what we do.

And if you have any other questions, we’re gonna be around the rest of the day. Okay? Thanks so much. Appreciate it.

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