UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2026

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ___ to ____

Commission File Number: 001-42283

LEGACY EDUCATION INC.

(Exact name of registrant as specified in its charter)

Nevada		84-5167957
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

701 W Avenue K, Suite 123 Lancaster, CA		93534
(Address of principal executive offices)		(Zip Code)

(661) 940-9300

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading symbol(s)		Name of each exchange on which registered
Common stock, $0.001 par value		LGCY		NYSE American LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☒

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The number of shares of the issuer’s common stock, $0.001 par value per share, outstanding as of May 1, 2026 was 12,652,038.

Table of Contents

		Page
PART I - FINANCIAL INFORMATION		F-1
ITEM 1.	FINANCIAL STATEMENTS	F-1
	Condensed Consolidated Balance Sheets as of March 31, 2026 (Unaudited) and June 30, 2025	F-2
	Condensed Consolidated Income Statements for the Three and Nine Months Ended March 31, 2026 and 2025 (Unaudited)	F-3
	Condensed Consolidated Statements of Changes in Stockholders’ Equity for the Three and Nine Months Ended March 31, 2026 and 2025 (Unaudited)	F-4
	Condensed Consolidated Statements of Cash Flows for the Nine Months Ended March 31, 2026 and 2025 (Unaudited)	F-5
	Notes to Unaudited Condensed Consolidated Financial Statements	F-6
ITEM 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	1
ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	13
ITEM 4.	CONTROLS AND PROCEDURES	13

PART II - OTHER INFORMATION		14
ITEM 1.	LEGAL PROCEEDINGS	14
ITEM 1A.	RISK FACTORS	14
ITEM 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	14
ITEM 3.	DEFAULTS UPON SENIOR SECURITIES	15
ITEM 4.	MINE SAFETY DISCLOSURE	15
ITEM 5.	OTHER INFORMATION	15
ITEM 6.	EXHIBITS	15
SIGNATURES		16

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS AND INDUSTRY DATA

This Quarterly Report on Form 10-Q contains certain forward-looking statements which are made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Any statements in this Quarterly Report on Form 10-Q about our expectations, beliefs, plans, objectives, assumptions or future events or performance are not historical facts and are forward-looking statements. These statements are often, but not always, made through the use of words or phrases such as “may,” “should,” “believes,” “will,” “expects,” “anticipates,” “estimates,” “predicts,” “potential,” “continues” “intends,” “plans” and “would” or the negative of these terms or other comparable terminology. For example, statements concerning financial condition, possible or assumed future results of operations, growth opportunities, and plans are all forward-looking statements. Our forward-looking statements are based on a series of expectations, assumptions, estimates and projections about our company, are not guarantees of future results or performance and involve substantial risks and uncertainty. They involve known and unknown risks, uncertainties and assumptions that may cause actual results, levels of activity, performance or achievements to differ materially from any results, levels of activity, performance or achievements expressed or implied by any forward-looking statement. We may not actually achieve the plans, intentions or expectations disclosed in these forward-looking statements. Our business and our forward-looking statements involve substantial known and unknown risks and uncertainties, including the risks and uncertainties inherent in our statements regarding:

	●	compliance with the extensive existing regulatory framework applicable to our industry or our failure to timely obtain and maintain regulatory approvals and accreditation;

	●	compliance with continuous changes in applicable federal laws and regulations including recently enacted federal legislation, executive orders and new and pending rulemaking by the U.S. Department of Education (“ED”);

	●	the effect of current and future Title IV Program laws and regulations arising out of recent legislation, executive orders and negotiated rulemakings, including any recent and potential future reductions in funding or restrictions on the use of funds received through Title IV Programs;

	●	successful updating and expansion of the content of existing programs and developing new programs in a cost-effective manner or on a timely basis;

	●	uncertainties regarding our ability to comply with federal laws and regulations regarding the 90/10 revenue test, gainful employment and earnings metrics, and limits on cohort default rates;

	●	successful implementation of our strategic plan;

	●	our inability to maintain eligibility for or to process federal student financial assistance;

	●	regulatory investigations of, or actions commenced against, us or other companies in our industry;

	●	changes in the state regulatory environment or budgetary constraints;

	●	enrollment declines or challenges in our students’ ability to find employment as a result of economic conditions;

	●	maintenance and expansion of existing industry relationships and develop new industry relationships;

	●	a loss of members of our senior management or other key employees;

	●	uncertainties associated with opening of new campuses and closing existing campuses;

	●	uncertainties associated with integration of acquired schools;

	●	industry competition;

	●	the effect of any cybersecurity incident;

	●	general economic conditions; and

	●	other factors discussed under the headings “Business,” “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

All of our forward-looking statements are as of the date of this Quarterly Report on Form 10-Q only. In each case, actual results may differ materially from such forward-looking information. We can give no assurance that such expectations or forward-looking statements will prove to be correct. An occurrence of, or any material adverse change in, one or more of the risk factors or risks and uncertainties referred to in this Quarterly Report on Form 10-Q or included in our other public disclosures or our other periodic reports or other documents or filings filed with or furnished to the U.S. Securities and Exchange Commission (the “SEC”) could materially and adversely affect our business, prospects, financial condition and results of operations. Except as required by law, we do not undertake or plan to update or revise any such forward-looking statements to reflect actual results, changes in plans, assumptions, estimates or projections or other circumstances affecting such forward-looking statements occurring after the date of this Quarterly Report on Form 10-Q, even if such results, changes or circumstances make it clear that any forward-looking information will not be realized. Any public statements or disclosures by us following this Quarterly Report on Form 10-Q that modify or impact any of the forward-looking statements contained in this Quarterly Report on Form 10-Q will be deemed to modify or supersede such statements in this Quarterly Report on Form 10-Q.

This Quarterly Report on Form 10-Q may include market data and certain industry data and forecasts, which we may obtain from internal company surveys, market research, consultant surveys, publicly available information, reports of governmental agencies and industry publications, articles and surveys. Industry surveys, publications, consultant surveys and forecasts generally state that the information contained therein has been obtained from sources believed to be reliable, but the accuracy and completeness of such information is not guaranteed. While we believe that such studies and publications are reliable, we have not independently verified market and industry data from third-party sources.

PART I – FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS.

Legacy Education Inc.

(dba High Desert Medical College)

(dba Central Coast College)

(dba Integrity College of Health)

(dba Contra Costa Medical Career College)

Condensed Consolidated Financial Statements

for the three and nine months

ended March 31, 2026 and 2025

Table of Contents

	Page

Financial Statements:	F-1

Condensed Consolidated Balance Sheets	F-2

Condensed Consolidated Income Statements	F-3

Condensed Consolidated Statements of Stockholders’ Equity	F-4

Condensed Consolidated Statements of Cash Flows	F-5

Notes to Condensed Consolidated Financial Statements	F-6 to F-23

F-1

Legacy Education Inc.

Consolidated Balance Sheets

	March 31, 2026		June 30, 2025*
	(Unaudited)		*
ASSETS
Current assets
Cash and cash equivalents	$	21,681,064	$	20,316,357
Accounts receivable, net of $2,654,820 and $1,641,052 allowance for doubtful accounts as of March 31, 2026 and June 30, 2025, respectively		19,187,619		15,050,841
Prepaid expenses		2,473,842		1,383,405
Other receivables		626,284		302,424
Total current assets		43,968,809		37,053,027

Property and equipment, net		3,097,656		2,484,304
Operating lease right-of-use asset		14,394,889		15,781,177
Financing lease right-of-use asset		286,207		311,711
Intangible assets		3,843,319		3,858,027
Goodwill		6,846,911		6,852,076
Accounts receivable, long-term		2,111,840		1,966,137
Deferred income tax assets		395,546		395,546
Security deposits		514,671		503,133
Total assets	$	75,459,848	$	69,205,138

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Accounts payable and accrued liabilities	$	4,023,718	$	4,929,530
Accrued income tax payable		776,854		596,250
Deferred, unearned tuition		5,612,857		4,956,396
Other current liabilities		4,749		3,197
Current portion of debt		558,772		875,350
Debt owed, related party		50,000		50,000
Current portion of financing lease		69,555		63,989
Current portion of operating lease liability		1,992,419		2,306,061
Total current liabilities		13,088,924		13,780,773

Debt, net of current portion		36,711		481,264
Financing lease, net of current portion		77,728		151,420
Other liabilities		-		-
Operating lease liability, net of current portion		12,738,525		13,748,161
Total liabilities		25,941,888		28,161,618

Commitments and contingencies		-		-

Stockholders’ equity
Preferred stock: $0.001 par value, 10,000,000 shares authorized; no shares issued and outstanding		-		-
Common stock: $0.001 par value, 100,000,000 shares authorized, 12,636,605 and 12,452,670 shares issued and outstanding as of March 31, 2026, and June 30, 2025, respectively		12,636		12,453
Additional paid in capital		28,488,665		27,273,365
Retained earnings		21,016,659		13,757,702
Total stockholders’ equity		49,517,960		41,043,520
Total liabilities and stockholders’ equity	$	75,459,848	$	69,205,138

*	Derived from audited information

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

F-2

Legacy Education Inc.

Consolidated Income Statements

(Unaudited)

	2026			2025			2026			2025
	For the Three Months Ended March 31,						For the Nine Months Ended March 31,
	2026			2025			2026			2025
Revenue
Tuition and related income, net	$	21,368,706		$	18,577,565		$	59,954,372		$	46,217,790

Operating expenses
Educational services		11,044,240			10,116,976			31,657,916			24,800,776
General and administrative		6,164,610			4,618,026			18,377,874			12,933,202
General and administrative – related party		61,250			46,500			267,850			170,700
Depreciation and amortization		155,753			130,066			453,095			317,046
Total costs and expenses		17,425,853			14,911,568			50,756,735			38,221,724

Operating income		3,942,853			3,665,997			9,197,637			7,996,066

Loss on disposal of fixed assets		(8,005	)		-			(11,895	)		-
Interest expenses		(8,067	)		(26,342	)		(60,210	)		(84,010	)
Interest income		320,715			305,382			969,946			861,800
Total other income		304,643			279,040			897,841			777,790

Income before income tax expenses		4,247,496			3,945,037			10,095,478			8,773,856
Income tax expenses		(1,218,200	)		(1,127,572	)		(2,836,521	)		(2,466,592	)
Net income	$	3,029,296		$	2,817,465		$	7,258,957		$	6,307,264

Net income per share
Basic net income per share	$	0.24		$	0.23		$	0.58		$	0.56
Diluted net income per share	$	0.22		$	0.21		$	0.52		$	0.51

Weighted average number of common stock outstanding
Basic weighted average shares outstanding		12,617,328			12,377,420			12,563,067			11,309,831
Diluted weighted average shares outstanding		14,064,470			13,528,144			13,949,964			12,460,555

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

F-3

Legacy Education Inc.

Consolidated Statements of Changes in Stockholders’ Equity

for the three months and nine months ended March 31, 2026 and 2025

(Unaudited)

	Shares		Amount		Shares		Amount		capital			Earnings		Total
	Preferred Stock				Common Stock				Additional paid in			Retained
	Shares		Amount		Shares		Amount		capital			Earnings		Total
Balance, June 30, 2025		-	$	-		12,452,670	$	12,453	$	27,273,365		$	13,757,702	$	41,043,520

Stock-based compensation		-		-		-		-		269,246			-		269,246
Exercise of options		-		-		44,357		44		165,851			-		165,895
Net income		-		-		-		-		-			2,186,960		2,186,960
Balance, September 30, 2025		-		-		12,497,027		12,497		27,708,462			15,944,662		43,665,621

Stock-based compensation		-		-		-		-		295,958			-		295,958
Exercise of options		-		-		18,617		19		69,609			-		69,628
Cashless exercise of warrants						88,742		88		(88	)				-
Net income													2,042,701		2,042,701
Balance, December 31, 2025		-		-		12,604,386		12,604		28,073,941			17,987,363		46,073,908

Stock-based compensation		-		-		-		-		296,001			-		296,001
Exercise of options		-		-		32,219		32		118,723			-		118,755
Net income													3,029,296		3,029,296
Balance, March 31, 2026		-	$	-		12,636,605	$	12,636	$	28,488,665		$	21,016,659	$	49,517,960

	Preferred Stock				Common Stock				Additional paid in			Retained
	Shares		Amount		Shares		Amount		capital			Earnings		Total
Balance, June 30, 2024		-	$	-		9,291,149	$	9,291	$	16,186,251		$	6,223,470	$	22,419,012

Exercise of option		-		-		76,000		76		39,444			-		39,520
Issuance of common stock, net of offering costs		-		-		2,500,000		2,500		7,937,072			-		7,939,572
Stock-based compensation		-		-		-		-		67,031			-		67,031
Net income		-		-		-		-		-			2,090,753		2,090,753
Balance, September 30, 2024		-		-		11,867,149		11,867		24,229,798			8,314,223		32,555,888

True up, reverse split		-		-		2,013		2		(2	)		-		-
Issuance of common stock under acquisition agreement		-		-		118,906		119		999,881			-		1,000,000
Exercise of option		-		-		10,044		10		37,553			-		37,563
Issuance of common stock, net of offering costs		-		-		375,000		375		1,312,401			-		1,312,776
Stock-based compensation		-		-		-		-		109,157			-		109,157
Net income		-		-		-		-		-			1,399,046		1,399,046
Balance, December 31, 2024		-		-		12,373,112		12,373		26,688,788			9,713,269		36,414,430
Balance		-		-		12,373,112		12,373		26,688,788			9,713,269		36,414,430

Paid offering cost		-		-		-		-		(89,503	)		-		(89,503	)
Exercise of option		-		-		7,445		7		27,838			-		27,845
Stock-based compensation		-		-		-		-		107,365			-		107,365
Net income		-		-		-		-		-			2,817,465		2,817,465
Balance, March 31, 2025		-		-		12,380,557	$	12,380	$	26,734,488		$	12,530,734	$	39,277,602
Balance		-		-		12,380,557	$	12,380	$	26,734,488		$	12,530,734	$	39,277,602

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

F-4

Legacy Education Inc.

Consolidated Statements of Cash Flows

(Unaudited)

	2026			2025
	For the nine months ended March 31,
	2026			2025
Cash flows provided by (used in) operating activities:
Net income	$	7,258,957		$	6,307,264
Adjustments to reconcile net loss to net cash (used in) provided by operating activities:
Loss on disposal of fixed assets		11,895			-
Non cash compensation		861,205			283,553
Depreciation & amortization		453,095			317,047
Provision for allowance for doubtful accounts for accounts receivable and contracts receivable		1,435,190			3,445,762
Changes in assets and liabilities:
Accounts receivable		(5,712,506	)		(5,659,199	)
Prepaid expenses		(1,090,437	)		(280,625	)
Other receivable		(323,860	)		(656,340	)
Other assets		51,471			(38,119	)
Accounts payable and accrued liabilities		(905,810	)		(15,435	)
Income tax payable		180,604			(1,371,247	)
Deferred unearned tuition		656,461			2,430,343
Net cash provided by operating activities		2,876,265			4,763,003

Cash flows used in investing activities:
Cash paid under APA		-			(6,133,087	)
Purchases of property and equipment		(1,038,130	)		(750,163	)
Net cash used in investing activities		(1,038,130	)		(6,883,250	)

Cash flows provided by (used in) financing activities:
Proceeds from IPO, net of offering cost		-			9,162,845
Proceeds from exercise of options		354,278			104,927
Principal payment on finance lease		(68,126	)		(63,145	)
Principal payments on debt		(759,580	)		(133,531	)
Net cash provided by (used in) financing activities		(473,428	)		9,071,096

Net increase cash and cash equivalents and restricted cash		1,364,707			6,950,849
Cash and cash equivalents and restricted cash, beginning of year		20,316,357			10,376,149
Cash and cash equivalents and restricted cash, end of period	$	21,681,064		$	17,326,998

Supplemental disclosure of cash flow information
Cash paid during the periods for interest	$	56,326		$	79,142
Cash paid during the periods for income taxes	$	2,657,067		$	1,211,413

Supplemental disclosure of noncash activities
Non-cash purchase of equipment	$	-		$	39,275
Prepaid expense reclassifies to offering cost	$	-		$	276,866
Common stock issued as part of APA	$	-		$	1,000,000
Promissory note under APA	$	-		$	400,000
Net identifiable assets acquired under APA	$	-		$	267,136

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

F-5

Legacy Education Inc.

Notes to Condensed Consolidated Financial Statements

For the nine months ended March 31, 2026 and 2025

(Unaudited)

Note 1 - Nature of Business

For purposes of these financial statements, “Legacy,” the “Company,” “we,” “our,” “us,” or similar references refers to Legacy Education Inc. and its consolidated subsidiaries, unless the context requires otherwise. Legacy Education, LLC was formed on October 19, 2009 in the state of California as a limited liability company. The Company operates as a career institution that focuses on real-life training by utilizing educational practices in different job markets. The Company offers programs in career paths such as healthcare, veterinary, medical information technology, business management, and green technology. The Company’s institutions are accredited by the Accrediting Council for Continuing Education and Training (“ACCET”) or the Accrediting Bureau of Health Education Schools (“ABHES”) and approved to operate in the state of California by the Bureau for Private Postsecondary Education (“BPPE”). The consolidated financial statements include accounts of Legacy Education Inc. d/b/a High Desert Medical College (“HDMC”) and its wholly-owned subsidiary, Legacy Education Monterey LLC (“Monterey”) d/b/a Central Coast College (“CCC”), its wholly-owned subsidiary, Advanced Health Services, LLC d/b/a Integrity College of Health (“Integrity”) and Legacy Education Antioch, LLC (“Antioch”) d/b/a Contra Costa Medical Career College (“CCMCC”). Pursuant to an Agreement and Plan of Merger and Reorganization (the “Reorganization Merger”), dated September 1, 2021, effective as of September 3, 2021 (the “Effective Date”), Legacy Education Merger Sub, LLC, a wholly-owned subsidiary of Legacy Education Inc. formed solely for the purpose of implementing the Reorganization Merger, merged with and into Legacy Education, LLC, with Legacy Education, LLC surviving the merger and becoming a wholly-owned subsidiary of Legacy Education Inc., a corporation formed on March 18, 2020 in the State of Nevada for the sole purpose of restructuring the Company from a member-owned Limited Liability Corporation to a shareholder-owned C-Corporation. On the Effective Date, in exchange for each Class A Unit owned in Legacy Education, LLC, the members of Legacy Education, LLC received one share of common stock in Legacy Education Inc. in a one for one exchange. The members immediately prior to the Reorganization Merger became the 100% owners of Legacy Education Inc. immediately following the Reorganization Merger.

HDMC offers instruction in several programs including, but not limited to, ultrasound technician, ultrasound technician associate of applied science degree, medical billing and coding, vocational nursing, clinical medical assisting, pharmacy technician, dental assisting, medical administrative vocational nursing associate of applied science degree and registered nursing.

CCC, a wholly-owned subsidiary of HDMC, offers instruction in healthcare career training programs, veterinary career training, and additional fields such as accounting.

Integrity, a wholly-owned subsidiary of HDMC, is an accredited college offering instruction in medical assisting, vocational nursing, medical insurance coding and billing, diagnostic medical sonography (ultrasound technician) Bachelors of Science in nursing (RN to BSN), and veterinary assistant.

CCMCC, a wholly owned subsidiary of HDMC effective as of December 18, 2024, is accredited by ACCET and has been granted temporary approval to participate in the Financial Student Aid programs by the Department of Education (“ED”) following the consummation of the transaction discussed below in Note 3. CCMCC offers vocational nursing, surgical technology, sterile processing technician, pharmacy technician, dental assisting, medical assisting, diagnostic medical sonography, EKG/ECG technician, and medical administrative assistant/billing and coding specialist programs.

The accompanying consolidated financial statements, and all per share information contained herein, have been retroactively adjusted to reflect the reverse stock split described in Note 13.

F-6

Legacy Education Inc.

Notes to Condensed Consolidated Financial Statements

For the nine months ended March 31, 2026 and 2025

(Unaudited)

Note 2 – Summary of Significant Accounting Principles

Principles of Consolidation

The unaudited consolidated financial statements include the accounts of HDMC and its wholly owned subsidiaries, CCC, Integrity and CCMCC. All significant intercompany balances and transactions have been eliminated in consolidation.

Basis of Presentation Unaudited Interim Financial Information

The accompanying interim condensed consolidated financial statements are unaudited. In the opinion of management, the accompanying unaudited condensed consolidated financial statements contain all the normal recurring adjustments necessary to present fairly the financial position and results of operations as of and for the periods presented. The interim results are not necessarily indicative of the results to be expected for the full year or any future period.

Certain information and footnote disclosures normally included in the consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). The Company believes that the disclosures are adequate to make the interim information presented not misleading. These consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and the notes thereto included in the Company’s Report on Form 10-K filed on September 25, 2025, for the year ended June 30, 2025.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant items subject to such estimates and assumptions include the assumptions used in the evaluation of the Company’s distinct performance obligations, the valuation of equity instruments and allowance for credit losses related to accounts receivable.

Reclassifications

Certain amounts in the prior period financial statements have been reclassified to conform to the current period presentation. These reclassifications had no effect on reported consolidated net income.

Cash and Cash Equivalents

The Company considers all highly liquid instruments purchased with a maturity of three months or less to be cash equivalents. As of March 31, 2026 and June 30, 2025 approximately $10.62 million and $10.38 million, respectively, of cash equivalents was held in instruments considered level 1 securities as defined in the “Fair Value of Financial Instruments” note below.

Property and Equipment

Property and equipment are recorded at cost less accumulated depreciation. Depreciation is computed using the straight-line method. Normal repairs and maintenance are expensed as incurred. Expenditures that materially extend the useful life of an asset are capitalized. Depreciation is provided using the straight-line method over the estimated useful lives of the assets. Furniture and fixtures, machinery, computer equipment, and vehicles generally have estimated useful lives of 10ten, 7seven, 4four, and five years, respectively. Leasehold improvements are depreciated over the shorter of their lease term or their useful life.

F-7

Legacy Education Inc.

Notes to Condensed Consolidated Financial Statements

For the nine months ended March 31, 2026 and 2025

(Unaudited)

Note 2 – Summary of Significant Accounting Principles (Continued)

Leases

The Company accounts for leases in accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 842 Leases, which requires the recognition of assets and liabilities by lessees for those leases classified as operating leases under GAAP. The Company determines if an arrangement is a lease at inception and evaluates the lease agreement to determine whether the lease is a finance or operating lease. The guidance requires that a lessee should recognize on the balance sheet a liability to make lease payments and a right-to-use asset representing the Company’s right to use the underlying assets for the term of the lease. The guidance allows a lessee who enters into a lease with a term of 12 months or less to make an accounting policy election by class of underlying assets not to recognize assets and liabilities. Right-of-use (“ROU”) assets and lease liabilities are recognized at commencement date based on the present value of lease payment over the lease term. The Company uses its incremental borrowing rate based on the information available at the commencement to determine the present value of lease payments over the lease term. See Note 12 for more information about the Company’s lease-related obligations.

Goodwill and Intangibles

The Company has implemented the Business Combinations Topic FASB ASC 350, Intangibles - Goodwill and Other. Goodwill represents the excess of the purchase price over the fair market value of the net assets (including intangibles) acquired on December 31, 2019, January 15, 2019 and on December 18, 2024.

Goodwill, tradename, and accreditation are deemed to have an indefinite life, and course curriculum has a definite life of approximately 18 years. Goodwill and indefinite life intangible assets are not amortized but are subject to, at a minimum, annual impairment tests. The Company expenses costs to maintain or extend intangible assets as incurred.

The Company reviews intangible assets (with a definite life), excluding goodwill, accreditation and tradenames, for impairment when events or changes in circumstances indicate the carrying amount may not be recoverable. The Company measures the recoverability of these assets by comparing the carrying amounts to the future undiscounted cash flows that the assets are expected to generate. If the carrying value of the assets are not recoverable, the impairment recognized is measured as the amount by which the carrying value of the asset exceeds its fair value. There were no impairments for the periods presented.

The Company tests goodwill, accreditation and trade names for impairment at least annually, or more frequently if events or changes in circumstances indicate that the asset may be impaired. There were no goodwill, accreditation or trade names impairments for the periods presented.

The Company amortizes intangible assets with definite lives on a straight-line basis.

Long-Lived Assets

The Company evaluates the recoverability of its long-lived assets for impairment, other than goodwill, whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to undiscounted future net cash flows expected to be generated by the assets. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. Fair value estimates are based on assumptions concerning the amount and timing of estimated future cash flows. The Company had no long-lived asset impairments as of March 31, 2026 and June 30, 2025.

Revenue Recognition

Revenue is recognized when control of promised goods or services is transferred to the Company’s customers in an amount of consideration to which the Company expects to be entitled to in exchange for those goods or services. The Company follows the five steps approach for revenue recognition under FASB ASC 606: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract, and (v) recognize revenue when (or as) the Company satisfies a performance obligation.

F-8

Legacy Education Inc.

Notes to Condensed Consolidated Financial Statements

For the nine months ended March 31, 2026 and 2025

(Unaudited)

Note 2 – Summary of Significant Accounting Principles (Continued)

Revenue Recognition (Cont’d)

The Company identifies a contract for revenue recognition when there is approval and commitment from both parties, the rights of the parties and payment terms are identified, the contract has commercial substance and the collectability of consideration is probable. The Company evaluates each contract to determine the number of distinct performance obligations in the contract, which requires the use of judgment. The Company’s contracts include promises for educational services and course materials which are distinct performance obligations.

Tuition revenue is primarily derived from postsecondary education services provided to students. Generally, tuition and other fees are paid upfront and recorded in contract liabilities in advance of the date when education services are provided to the student. A tuition receivable is recorded for the portion of tuition not paid in advance. In some instances, installment billing is available to students which reduces the amount of cash consideration received in advance of performing the service. The contractual terms and conditions associated with installment billing indicate that the student is liable for the total contract price, therefore mitigating the Company’s exposure to losses associated with nonpayment. Tuition revenue is recognized ratably over the instruction period. The Company generally uses the time elapsed method, an input measure, as it best depicts the simultaneous consumption and delivery of tuition services. Revenue associated with distinct course materials is recognized at the point of time when control transfers to the student, generally when the materials are delivered to the student. Revenue associated with lab services is recognized over the period of time when the service is performed.

The Company’s refund policy may permit students who do not complete a course to be eligible for a refund for the portion of the course they did not attend. Refunds generally result in a reduction of deferred revenue during the period that the student drops or withdraws from a class.

The transaction price is stated in the contract and known at the time of contract inception, as such there is variable consideration for situations when a student drops from a program based on the Company’s refund policy and additional charges if a student requires additional hours to complete the program beyond the contracted end date. The Company believes that its experience with these situations is of little predictive value because the future performance of students is dependent on each individual and the amount of variable consideration is highly susceptible to factors outside of the Company’s influence. Accordingly, no variable consideration has been included in the transaction price or recognized as income until the constraint has been eliminated. Revenue is allocated to each performance obligation based on its standalone selling price. Any discounts within the contract are allocated across all performance obligations unless observable evidence exists that the discount relates to a specific performance obligation or obligations in the contract. The Company generally determines standalone selling prices based on prices charged to students.

The Company excludes from revenue taxes assessed by a governmental authority as these are agency transactions collected on their behalf from the customer. Significant judgments include the allocation of the contract price across performance obligations, the methodology for earning tuition ratably over the instruction period, estimates for the amount of variable consideration included in the transaction price as well as the determination of the impact of the constraints preventing the variable consideration from being recognized in revenue.

Disaggregation of Revenue

The tuition and related revenue consist of the following during the three and nine months ended March 31, 2026 and 2025:

Schedule of Disaggregation of Revenue

	2026		2025		2026		2025
	For the Three Months Ended March 31,				For the Nine Months Ended March 31,
	2026		2025		2026		2025
Tuition and lab fees (recognized over time)	$	18,403,642	$	15,750,313	$	52,235,176	$	40,348,548
Books, registration and other fees (recognized at a point in time)		2,965,064		2,827,252		7,719,196		5,869,242
Total revenue	$	21,368,706	$	18,577,565	$	59,954,372	$	46,217,790

F-9

Legacy Education Inc.

Notes to Condensed Consolidated Financial Statements

For the nine months ended March 31, 2026 and 2025

(Unaudited)

Note 2 – Summary of Significant Accounting Principles (Continued)

Segment Reporting

The Company operates one reportable business segment offering career-focused, post-secondary education services to students at all stages of adult life, from recent high school graduates to working parents, through its accredited academic institutions. The Company’s primary revenue source is derived from educational programs and services provided at its colleges through tuition and lab fees as well as fees for supporting educational programs such as books and registration costs.

Operating as a cohesive educational services company, the Company offers its products and services in the State of California at a series of institutions, using a centralized management approach for all educational services and support functions.

The Chief Executive Officer (“CEO”) serves as the Chief Operating Decision Maker (“CODM”). The CODM evaluates the Company’s performance based on consolidated net income. This measure aligns with the Company’s consolidated financial statements and serves as the basis for resource allocation and performance assessment. The measure of segment assets is reported on the balance sheet as total consolidated assets. The CODM monitors profitability and strategic growth initiatives on a consolidated basis, without disaggregating profit or loss into separate operating segments. The Company determined there are no significant segment expenses that require a separate disclosure. The consolidated net income is used to assess overall company performance, benchmark against industry standards, and identify profitability trends, which guides resource allocation and investment in expansion and program upgrades. The CODM also evaluates company performance using operating income. Operating income provides the CODM with a focused view of the Company’s profitability excluding the effects of financing activities, tax strategies, and other non-operating items. This measure enables the CODM to assess operational efficiency, monitor performance trends, and evaluate the effectiveness of strategies aimed at revenue generation and cost management.

Allowance for Credit Losses

The Company records an allowance for credit losses for estimated losses resulting from the inability, failure or refusal of its students to make required payments, which includes the recovery of financial aid funds advanced to a student for amounts in excess of the student’s cost of tuition and related fees. The Company determines the adequacy of its allowance for doubtful accounts based on an analysis of its historical bad debt experience, current economic trends, and the aging of the accounts receivable and student status. The Company applies reserves to its receivables based upon an estimate of the risk presented by the age of the receivables and student status. The Company writes off account receivable balances of inactive students at the earlier of the time the balances were deemed uncollectible, or one year after the revenue is generated. Bad debt expense is recorded as a general and administrative expense in the accompanying statements of operations. The Company performs an analysis quarterly to determine which accounts are uncollectable and then writes them off.

Refunds

The Company pays or credits refunds within 45 days of a student’s cancellation or withdrawal for students who have completed 60% or less of the period of attendance based on a pro rata calculation. Once the student has completed more than 60% of a period of attendance, all Title IV funds are considered earned and no refunds are due to ED.

Advertising

The Company expenses advertising cost as incurred. Advertising costs amounted to $1,531,441 and $1,153,593 for the three months ended March 31, 2026, and 2025, respectively. Advertising costs amounted to $4,777,333 and $3,480,968 during the nine months ended March 31, 2026, and 2025, respectively. Advertising costs are included in general and administrative expenses on the consolidated income statements.

F-10

Legacy Education Inc.

Notes to Condensed Consolidated Financial Statements

For the nine months ended March 31, 2026 and 2025

(Unaudited)

Note 2 – Summary of Significant Accounting Principles (Continued)

Share-Based Compensation

The Company utilizes FASB ASC 718, Stock Compensation, related to accounting for share-based payments and, accordingly, records compensation expense for share-based awards based upon an assessment of the grant date fair value for stock options and restricted stock awards. The Company estimates the fair value of stock-based compensation awards on the date of grant using an option-pricing model. The value of the portion of the award that is ultimately expected to vest is recognized as an expense over the requisite service periods in the Company’s consolidated statements of operations. The Company estimates the fair value of stock-based compensation awards using the Black-Scholes model. This model requires the Company to estimate the expected volatility and value of its common stock and the expected term of the stock options, all of which are highly complex and subjective variables. The expected life was calculated based on the simplified method as described by the SEC Staff Accounting Bulletin No. 110, Share-Based Payment. The Company’s estimate of expected volatility was based on the volatility of peers. The Company has selected a risk-free rate based on the implied yield available on U.S. Treasury securities with a maturity equivalent to the expected term of the options. The Company accounts for forfeitures upon occurrence.

Fair Value of Financial Instruments

The Company’s financial instruments primarily consist of cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities, deferred, unearned tuition, debt and finance lease obligations. The carrying values of the Company’s financial instruments approximate fair value.

FASB ASC 820, Fair Value Measurements (“ASC 820”) establishes a framework for all fair value measurements and expands disclosures related to fair value measurement and developments. ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

ASC 820 requires that assets and liabilities measured at fair value are classified and disclosed in one of the following three categories:

Level 1—Quoted market prices for identical assets or liabilities in active markets or observable inputs;

Level 2—Significant other observable inputs that can be corroborated by observable market data; and

Level 3—Significant unobservable inputs that cannot be corroborated by observable market data.

Concentration of Credit Risk

A substantial portion of revenues and ending accounts receivable at March 31, 2026 and June 30, 2025 are a direct result of the Company’s participation in Financial Student Aid (“FSA”) programs, which represents a primary source of student tuition. The FSA programs are subject to political budget

SEC Form 10-Q filed by Legacy Education Inc.