PHOENIX (AP) -- For-profit education company Apollo Group Inc., owner of the University of Phoenix, said on Tuesday that its third-quarter earnings plunged 40 percent as fewer students enrolled.
The University of Phoenix's enrollment fell 17 percent to 287,500 students. New student sign-ups dropped almost 25 percent, to 38,900. The company's shares slid more than 5 percent in after-hours trading.
When the Great Recession began, for-profit education companies saw a boom in students as people went to school to improve their job prospects. But demand has faded as the schools have come under increased scrutiny and additional federal regulations.
The company said it earned almost $80 million, or 71 cents per share, for the quarter that ended May 31. That was down from $134 million, or $1.13 per share, during the same period last year. Excluding restructuring costs and other one-time items, per-share profit fell to $1.05 from $1.18.
Revenue fell 16 percent, to $946.8 million from $1.12 billion.
Analysts surveyed by FactSet had been expecting a profit of 86 cents per share on revenue of $964.6 million.
As its student population shrinks, Apollo has been cutting costs. It expects to cut at least $300 million in expenses by the end of this fiscal year, at the end of August, and is aiming to have cut $400 million in annual expenses during 2014, compared to fiscal 2012.
For all of 2013, the company expects revenue of $3.65 billion to $3.7 billion. Analysts had been expecting revenue of almost $3.71 billion.
Its shares had risen 26 cents to close at $19.38 before the results were released. They dropped $1.03, or 5.3 percent, to $18.35 in aftermarket trading. The stock has lost 40 percent of its value in the past 12 months.