Columbia University’s FY25 operating income plunges 63% as federal research cuts hit funding
Columbia University’s operating income fell sharply in fiscal year 2025, declining by just over 63% to $112.6 million. The Ivy League institution reported that revenue grew only modestly while expenses increased at a faster pace, putting pressure on its financial position, as quoted by Higher Ed Dive.The slowdown comes amid a turbulent political climate. Federal grant revenue remained essentially flat at $1.3 billion, and the Trump administration’s termination of hundreds of grants contributed to what Anne Sullivan, Columbia’s executive vice president for finance, described as “destabilising,” as reported by Higher Ed Dive.Operating costs rise faster than revenueColumbia’s financial statements show operating revenues increased by 2.1%, while expenses jumped 5.3% to $6.6 billion. Costs rose across multiple areas, including salaries for faculty and staff, research projects, and maintenance of facilities. Sullivan in conversation with Higher Ed Dive called the operating surplus “modest” and “lower than our historical average.”Net tuition and fee revenue rose 4.1% to $1.6 billion, tempered by a 4.6% increase in institutional financial aid to $622.6 million. Despite the high tuition fees, the university continues to offer free tuition to families earning under $150,000 annually.Federal grant terminations and settlement paymentsIn March, the Trump administration terminated $400 million in federal grants and contracts. Shortly after, Columbia agreed to unprecedented conditions to have most of the funding reinstated, including a $200 million payment to the government over three years and a $21 million settlement with the US Equal Employment Opportunity Commission, as reported by Higher Ed Dive.To support ongoing research, the university established the Research Stabilization Fund, which issued approximately 500 internal grants in June and September, Sullivan noted in a public message quoted by Higher Ed Dive. Nearly 180 employees tied to federally funded projects were laid off as a result of the cuts.Endowment and assets remain strongDespite the operating income decline, Columbia’s net assets increased by 3.7% year over year to $20.5 billion. Gifts to the endowment fell roughly 25% to $177.9 million, while donor-restricted funds rose 8.7% to $10.9 billion, according to the financial statements shared with Higher Ed Dive.Columbia’s peer, Harvard University, recorded an operating loss of $112.6 million in FY25, its largest in nearly 15 years. Sullivan emphasised in conversation with Higher Ed Dive that ongoing cost-containment efforts remain critical to preserve financial flexibility and support teaching, research, and patient care.
