2U, Inc. (TWOU) SEC Filing 10-K Annual report for the fiscal year ending Tuesday, December 31, 2019

Exhibit 99.1

2U, Inc. Reports Results for Fourth Quarter and Full-Year 2019

Delivers fourth quarter revenue growth of 42%

Full-year revenue growth of 40%

LANHAM, Md. — February 6, 2020 — 2U, Inc. (Nasdaq: TWOU)

Results for Fourth Quarter 2019 Compared to Fourth Quarter 2018

Non-GAAP Results for Fourth Quarter 2019 Compared to Fourth Quarter 2018

Results for Full-Year 2019 Compared to Full-Year 2018

Non-GAAP Results for Full-Year 2019 Compared to Full-Year 2018

“Over the past year, with the addition of our boot camp and undergraduate offerings, we have opened up significant new market segments, more than doubled our client base, and now deliver a portfolio of over 400 career-relevant, high-quality product offerings,” Co-Founder and Chief Executive Officer Christopher “Chip” Paucek said. “Our recent expansion of 2U’s relationship with the University of London and the London School of Economics and Political Science is a testament to the strength of our partnerships and will allow us to power a compelling mix of seven bachelor’s degrees from two of the world’s most recognized and respected institutions.”

Chief Financial Officer Paul Lalljie commented, “We closed out 2019 with strong results, and enter 2020 with excellent momentum. The business is on pace to deliver industry-leading growth for the year, with revenue expected to grow by 26-30% and adjusted EBITDA expected to turn positive in the third quarter. We remain focused on improving operational efficiency and accelerating our path to profitability and positive free cash flow.”

Discussion of Fourth Quarter 2019 Results

Revenue totaled $163.2 million, a 42% increase from $115.1 million in the fourth quarter of 2018. Graduate Program Segment revenue grew 12% to $108.2 million, driven by a 20% increase in full course equivalent enrollments, partially offset by a 7% decrease in average revenue per full course equivalent enrollment. Alternative Credential Segment revenue increased 202% to $54.9 million, driven by full course equivalent enrollments of 14,639.

Costs and expenses totaled $204.5 million, an 83% increase from $111.8 million in the fourth quarter of 2018. This $92.7 million increase was primarily driven by $55.1 million of incremental operating costs related to Trilogy and $5.8 million in transaction, integration, restructuring-related and shareholder activism costs. The remainder of the cost increase was primarily attributable to direct marketing, personnel, and curriculum and teaching costs.