The IDP Education Ltd (ASX: IEL) share price is up by 13% after the troubled business reported its FY26 half-year result.
IDP Education is one of the world’s largest student placement and English language testing businesses.
IDP Education FY26 half-year result
Here are some of the main highlights from the report for the six months to 31 December 2025:
- Revenue grew 5% to $462.2 million
- EBITDA (EBITDA explained) declined 35% to $86.4 million
- Net profit dropped 65% to $23.5 million
- Underlying net profit after tax (NPAT) fell 25% to $48.6 million
- Interim dividend per share of $0.03, down 66%
What happened?
The business said that there were lower student placement and language testing volumes, with a decline of 25% and 7%, respectively. Language testing volumes increased 3%.
IDP Education said that the student placement yield increased by 15% and language testing yield grew 8%.
It almost reported that cost control delivered direct costs down 6% and adjusted overhead costs were down 2%. The company said that it’s on track for a $25 million net reduction of the cost base in FY26.
IDP Education said that the operating model simplification is a priority for the second half of the year, as the business “continues to strengthen the foundations for investment in technology and AI to drive long term profitable growth”.
Profit upgrade
After seeing the performance of the business, the company decided to increase its profit guidance.
The company decided to adjust its FY26 adjusted EBIT guidance to a range of $120 million to $130 million, up from $115 million to $125 million.
That guidance assumes continued challenging industry conditions – it’s planning for FY26 market volumes down 20% to 30% compared to FY25.
But, within that environment, IDP expects revenue “outperformance” driven by a focus on profitable growth and yield improvements.
The business expects the business reported that the student placement yield is expected to grow in low double-digit percentage terms. English language testing’s yield is expected to grow in the mid-single digits in percentage terms.
Management comments
IDP Education CEO and Managing Director Tennealle O’Shannessy said:
We are pleased with the first half performance, with the team executing well across the business whilst also progressing our transformation program at pace. We continue to reinforce our position as a quality partner for universities and students, and this commitment is evidenced by our strong yield performance as we continue to focus on delivering valued outcomes.
We are delivering on our commitment to reset the cost base, simplify and strengthen our operating model and accelerate digital and AI adoption.
Our investment in digital and AI‑enabled tools is already delivering tangible benefits. We are expanding our reach, increasing conversion, improving student engagement, experience and outcomes, and improving productivity across our counsellor network and broader organisation.
The work to reduce cost and focus on cash and working capital discipline will provide a good platform for reinvestment in future phases of the transformation to support profitable growth and shareholder returns.
Final thoughts on the IDP Education share price
The business is doing its best to maintain revenue and profitability for shareholders, but that’s challenging in difficult conditions.
At some point its net profit will find a bottom, but the profit upgrade is pleasing. It’s not one of the businesses on my watchlist. But, if net profit can start rising then it could be a contrarian opportunity.
There are other ASX growth shares that I’d rather buy, in my opinion.
