LOW LIBRARY – Having his shoes shined by a work-study podiatry student, a finely dressed and eminently confident President Bollinger proudly toted the for-profit university’s bottom line in an earnings call with investors this week. “He really emphasized the university’s long-term revenue strategy,” reported Zach Davidson, an analyst at Goldman Sachs who took part in the call. “He called it ‘leveraging student assets.’”
Though a common misperception posits that Columbia is a not-for-profit institution, the company has actually been churning remarkable profits for hundreds years. Many analysts see no end in sight to Columbia’s long-standing financial success. “Columbia’s fundamentals are as strong as ever,” advised Joe Nicholson, senior analyst at Oppenheimer Funds. “With a price tag on its core product topping $64,000, consumers still keep coming back for more. It’s like if Audi sold people a new car every year, then thoughtfully repossessed all the vehicles – leaving its customers free to ruminate on the Western canon and their smothering debt at their Starbucks barista jobs without having to worry about where they left their keys.”
“And just look at its profit margins on its auxiliary products,” continued Nicholson. “Name me another company that can charge $3.00 for a Clif bar or $50.00 for a plastic room key. That kind of racket makes the University of Phoenix look like some kind of a public school – like Cornell.”
The company’s strong performance has quieted critics who have complained about the inequity of its executive compensation structure. With his recent raise bringing his salary to a whopping $3.4 million, President Lee Bollinger has come under fire as one of the highest-paid university presidents in the country. But the earnings call has given weight to the views of analysts like Nicholson, who declared, “Considering the kinds of profits he’s generating, the guy is underpaid as far as I’m concerned. He’s like the Steve Jobs of higher education, if Steve Jobs cut his own hair.”
Columbia’s strong favor with shareholders may have a dark underside, as the company has recently come under scrutiny for its corporate practices. “We’re hearing tales of people packed into cramped quarters, accounts of kids being forced to work through consistent all-nighters without pay, and stories of starving teens subsisting on pilfered morsels of Nutella,” said Matt Zuckerman of Human Rights Watch, an advocacy group. “Not to mention reports of highly unsafe levels of workplace exposure to a toxic chemical known as ‘Keystone Light.’ Unacceptable – you’d think this was an 18th century institution, not a 21st century global leader.”
Despite its impressive bottom line, the financial outlook for the Columbia Corporation was not rosy across the board. Bollinger conceded that one peripheral business continues to be a consistent source of major losses for the company: the football team. However, shareholders were pacified by Bollinger’s promise of swift corrective action. “Though it exhibited such a poor performance cheering on the marching band during the band’s undefeated season this year, we’re going to liquidate our football sector for a significant profit,” Bollinger assured during this week’s earnings call. “In the next three to six months, we plan to spin off the business and sell it to Nestlé for use in its Butterfingers marketing division.”
