Stride, Inc. (NYSE:LRN) Q2 2023 Earnings Call Transcript

Jeff Silber: Okay. I appreciate that. I can follow-up with the details offline. If I could sneak in one more question. I’m actually at an EdTech conference and we’re hearing a lot about, AI, ChatGPT, et cetera. A lot of the folks thinks it could be positive in terms of helping them prepare their lesson plans, et cetera. But there’s a lot more people who are seem to be worried about students abusing tools like this. I’m just wondering if you’ve seen anything, are you hearing anything, are you doing anything?

James Rhyu: Yes. So I mean, obviously, the sort of the past couple of months opening eye has exploded generally and of course it has had a lot of press around the education industry and for what it can do sort of inferior on education. And I think it’s still too early to really know how it’s going to impact the education space. I would say this though. I think early on, people were worried about Google search as it relates to education. And kids being able to ask questions to Google search and then along comes things like Alexa and things like that to help solve math problems, there are apps where you can take pictures of math problems and they give you the answers. This is not a new phenomenon. Technology — the application of technology to assist in, I’ll say, generically educational problem solving is not new.

And I think as an industry, we have to — our job is to ensure that we’re teaching our kids critical thinking skills, which cannot necessarily be replicated yet in any of these technologies. And so we’re going to continue to evolve our programs, our curriculum to focus on that. Obviously, to the extent that we’re aware of, we do not promote the use of these tools to substitute work. But I think it’s very early still on what the impact is going to be. And I think that we’re certainly not pushing against it, because just like Google, I don’t think the technologies are going to go away or there’s going to be some magical way to stop people from using these technologies. I think we have to lean into it, find ways that we can really adapt with it as opposed to push against it.

I’m seeing a lot of people in education industry, I think as you’re referencing, thinking about how to push against it and that’s I think probably not how I think about it.

Jeff Silber: Alright. I really appreciate the color. Thanks so much.

Operator: Thank you. We’ll take our next question now from Stephen Sheldon with William Blair.

Stephen Sheldon: Hey, thanks, and really nice work in the quarter. First question here, just wanted to kind of ask how you’ve been managing teacher capacity through all this? It seems like enrollments are exceeding your expectations. So just how are you feeling about your capacity if you continue to see strong enrollment demand second half of this year and into fiscal 2024?

James Rhyu: So I think there’s sort of a good news bad news this. I think we mentioned we actually were planning for higher enrollments in the beginning of the year, i.e., that meant we were sort of a little over hired in some places, obviously, this normalized some of that. So sort of like bad news early, bad news now. In that situation — also in our situation unlike maybe a brick and mortar environment where you’ve got 25, 30 desks in the classroom, help to squeeze in that many more. We can add a few to different classrooms and class sizes and we have a little bit more flexibility there. We have yet to see across our network significant stress on our system that would be unusual, meaning, every year there’s some level stress in our system.