S&P Global Ratings reported that even with enrollment gains across public and private colleges in fiscal 2025, operating margins worsened—raising pressure on institutions that face discounting, deferred maintenance, and rising personnel costs. The median operating margin for private nonprofits fell to -0.4% from -0.3%, while public colleges’ median margin was 0.7% down from 0.9%. S&P said large flagship institutions remain better positioned due to “demand elasticity, sound resources, and excellent reputations,” but smaller and more regional public colleges face higher competition and credit risk. For private colleges, intensified rivalry for new students and tuition discounting contributed to margin deterioration. The ratings context matters as federal and state policy shifts continue to affect student aid and enrollment demand. For campuses, the report signals that near-term enrollment stability may not translate into financial resilience, especially where inflation and aid dynamics keep squeezing budgets. For CFOs and boards, the message is clear: budgeting assumptions based solely on headcount improvements may be insufficient without structural cost and revenue planning.