At CAVA, teachers have been saying for years that more resources must be focused in our classrooms. A number of recent academic studies about online charters echo concerns we have raised about the under funding of instruction at our school (we will provide a more detailed summary of these studies in our next newsletter). We believe our schools could be better if educators input were taken more seriously, instruction was prioritized over administrative tasks, and teacher turnover was actually considered a problem that should be fixed. Unfortunately, K12 Inc.’s priorities have too often focused on shareholder return rather than classroom success. We know that strategy has hurt our classrooms. It appears it has also hurt their bottom line.
K12’s first quarter conference call with investors took place on October 27th with the company reporting losses totaling $12.8 million and a 6.5 percent drop in revenues. Additionally, K12’s stock price continues to plummet, falling 19 percent over the past 12 months. In fact, it is currently at its lowest level in the past five years. This likely isn’t the news investors were hoping to hear as the tech-ed giant kicks off its 2016 fiscal year. Still, analysts are recommending investors hold out and not sell off their shares quite yet, as the company anticipates a slight uptick in its second quarter, projecting profits on operations in the range of $10-$15 million. While the company is far from going under, falling stock prices and declining revenues are contributing to some vulnerability, particularly in an environment in which the public and regulators are becoming increasingly critical of K12’s for-profit model and increasingly aware of the need to ensure for-profit education companies like K12 Inc. are held accountable to the communities and the students they serve.
Faced with these challenges, CAVA and K 12 Inc. will have a choice: improve the quality of education at our schools by making sure a larger portion of our resources are focused in our classrooms or try to send more of our valuable resources out of state to K12 Inc. HQ in Virginia. Obviously, we believe improving our schools by spending more resources in our classrooms is the answer. We’ve been saying that for years and will continue to press for these positive changes. We think it is time CAVA and K 12 Inc. listen to front line teachers who are doing the work, and sit down and work with us to make the necessary changes here at CAVA. Now that our union is certified, we have an opportunity to do that!