EpicQuest Education Group International Limited reported a 17% revenue increase to $6.27 million for the six months ended March 31, 2026, driven by the expansion of its international foundational and collaborative programs. Despite the top-line growth, the company recorded a net loss of $3.16 million, widening from $0.16 million in the prior year period, due to rising costs and operating expenses. Jianbo Zhang, CEO of EpicQuest Education, attributed the revenue gains to the continued expansion of foundational programs delivered in students’ home countries and strengthened agreements with leading universities worldwide.

Financial Performance

The rise in revenue was primarily due to an increase in international student enrollment for programs offered by Davis University. Gross profit for the period was $3.63 million, an increase of 6.3% from $3.42 million in the same period of 2025. However, gross margins contracted as a 35.2% increase in costs of services offset revenue growth. This contraction was primarily due to lower student occupancy rates within dormitory services, which reduced fixed-cost absorption, and higher agent recruiting fees incurred to launch a new academic program.

Operating expenses rose 13.0% to $6.08 million, driven by a 12.7% increase in general and administrative expenses to $5.08 million and a 14.7% increase in selling expenses to $1.00 million. The increase in general and administrative expenses was mainly due to non-cash share-based compensation. Consequently, operating loss widened to $2.45 million from $1.96 million in the prior year.

Net Loss and Per Share Data

Net loss for the first half of fiscal 2026 was $3.16 million compared to a net loss of $0.16 million in the same period of 2025. The widened loss was influenced by a $0.6 million expense attributable to an expected reduction in revenue from soccer matches in the current period and a $1.9 million gain from the sale of fixed assets in the year-ago period. Net loss per basic and diluted share was $1.92 compared to a net loss of $0.28 per share in the prior year. The weighted average number of shares used in the computation was 1,470,812 shares, retroactively adjusted for a 1-for-16 reverse stock split effected on February 17, 2026.

Financial Condition and Liquidity

As of March 31, 2026, the company had $0.31 million in cash and cash equivalents, a decrease of $4.45 million from $4.75 million as of September 30, 2025. Working capital stood at $5.59 million with a current ratio of 1.91, compared to working capital of $7.41 million and a current ratio of 1.83 at the end of the prior fiscal year. Stockholders’ equity decreased to $7.25 million from $8.81 million.

Net cash used in operating activities was $4.09 million for the six months ended March 31, 2026, an increase of $1.80 million in net cash outflow compared to the prior year, primarily due to the higher net loss. Net cash used in investing activities was $0.02 million for the purchase of furniture and fixtures, compared to net cash generated of $1.50 million from the sale of real estate in the prior year. Net cash used by financing activities was $0.35 million for loan repayment to a third party.

Strategic Initiatives

EpicQuest Education is exploring new partnerships in the US and international markets to broaden academic pathways. The company is developing an AI-powered platform to enhance student engagement and tutoring, planned for launch in the Fall 2026 semester. Additionally, the company plans to establish Davis University branch campuses, with the first US branch campus targeted for the Spring 2027 semester. On May 6, 2026, the company closed a private placement, selling 150,000 ordinary shares and warrants to purchase up to 600,000 ordinary shares, raising capital to support operations.

Key Financial Metrics