How much of 2U’s revenue comes from haram?

2U provides an online education platform currently serving over 350,000 students, partnered with more than 80 universities.

2U earns its revenue from the following revenue sources:

  • Degree Program Segment

Includes revenue generated from providing online degree programs to nonprofit colleges and universities, including both graduate and undergraduate programs.

  • Alternative Credential Segment

Includes admission fees charged to access short online courses and technical skill-based boot camps offered on 2U’s platform.

The contributions from each of 2U’s revenue segments in their 2020 annual report were as follows:

Practical Islamic Finance concludes:

None of 2U’s revenue comes from anything inherently haram.

Does 2U rely on interest to operate?

Year-to-Date
for period ended
6/30/2021
Fiscal year
ended
1/31/2020
Fiscal year
ended
1/31/2019
Interest Income$714$1,354$5,800
Total Revenue$469,682$774,533$574,671
Interest Expense$16,069$27,317$13,419
Total Expenses$561,075$993,885$835,553
Interest Income / Revenue0.15%0.17%1.01%
Interest Expense / Total Expense2.86%2.75%1.61%
*Numbers in thousands, U.S. dollars

Practical Islamic Finance concludes:

Riba is used but not relied upon in 2U’s operations.

What is 2U’s Environmental, Social, and Governance (ESG) impact?

Environment

No notable environmental highlights. 

Social

In 2019, 2U invested $19.5 million in scholarships and fellowships for students in 2U-powered degree programs.

That said, some have criticized 2U for contributing to the rising cost of college. Senators Elizabeth Warren and Sherrod Brown called 2U to turn over the terms of their contracts with universities to determine if they are breaking federal law by using predatory recruitment tactics. 

So far 2U has been compliant with the investigation.

PIF will treat these allegations as unproven unless the investigation concludes otherwise.

2U has a Glassdoor rating of 3.9 out of 5.0 from over 900 current and previous employees compared to a 3.3 average for all other Glassdoor rated companies.

Governance

No notable governance highlights.

Practical Islamic Finance concludes: 

2U has a net positive ESG impact. 

Comfort Rating

From 2U’s business, financial, and ESG reviews, Practical Islamic Finance rates 2U stock as: 

Comfortable to invest in from a Halal perspective.

Sources

2U 2020 10-K

2U Q2 2021 10-Q

2U Website

2U Reviews

Profit Off Education

Senators Investigations

2019 Transparency Report I Press Release I 2U, Inc.