Now, that's embarrassing. Last week, when previewingCorinthian Colleges' (NASDAQ:COCO) fiscal Q1 2007 earnings results, I opined that for all the bad news out of the company, the fact that it was continuing to generate healthy free cash flow made it still a worthy investment. A day later, the earnings news came out, and guess what?

No free cash flow. Or at least none to speak of. Whereas one year previously, the company had pumped out a cool $14 million in free cash flow, the most the company could muster up in its inaugural fiscal 2007 quarter was a measly $0.9 million. For that, you can blame lower operating cash flow (for one thing) and 54% greater capital spending (for another).

Margins contracted significantly on all levels, as fewer new students enrolled at Corinthian this year than last, fewer students overall attended, fewer revenues (by 2%) were taken in -- actually, just about everything at Corinthian was "fewer" this first quarter than last, with the sole exception of expenses. The firm's initiative to revamp how it attracts students and helps students pay for their education -- code-named "Operation IGNITE!" -- burned a hole right through the firm's income statement as selling, general, and administrative expenses increased 6%.

So all in all, it was a pretty lousy quarter, helping to explain why Corinthian's stock continues to trail the broader S&P over the last 52 weeks. The firm does, however, seem to think things will improve going forward. Taking advantage of the weakness in its own stock price, Corinthian has bought back sufficient stock to reduce its diluted share count nearly 6% over the past year. In the earnings release, management announced its authorization (remember, there's a difference between "authorization" and "obligation") to buy back almost 5% more.

The other good news: One day after confirming receipt of a letter from Nasdaq warning it that its stock was subject to delisting for failure to file its fiscal 2006 10-K on time, Corinthian completed its review of past stock options grants and submitted both the 10-K and its fiscal Q1 2007 10-Q to the SEC.

The rest of the bad news: Before doing so, Corinthian confirmed that it had engaged in stock options backdating -- actually, that it discovered "contingencies, errors, administrative delays or discrepancies" in the dating of its grants -- and took a total of $6.2 million in charges to earnings for the fiscal years 2001-2006.

For related Foolishness on Corinthian and its peers, read:

Check out our suite of investing newsletters with a 30-day free trial.

Fool contributor Rich Smith does not own shares of any company named above.