Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Strayer Education (NASDAQ:STRA) were getting sent to the principal's office this morning, falling as much as 23% after it announced a far-reaching restructuring plan in its earnings report.

So what: The for-profit educator actually beat earnings estimates with a per-share profit of $0.30 against estimates of just $0.05. Sales were roughly in line with expectations, falling 11.5%, to $110 million. Total enrollment fell 17%, while new student enrollment dropped 23%, indicating further attrition. What stole investors' attention, however, was the company's bold restructuring plan. Strayer said it would implement aggressive cost-cutting initiatives, reducing headcount by 20%, and closing 20 locations, which would affect 5% of the student body. The company also said it would reduce tuition for new undergraduate students by 20% starting January 1, 2014, which will negatively affect revenue per student.

Now what: The decision to drastically reduce tuition is an odd one. It's extremely rare in business to see a company slash prices across the board by such a large percentage. In its press release, Strayer said the move was to "further address the issue of college affordability." But despite sky-high prices, demand for a college education is by no means falling -- the only thing that's falling is demand for for-profit colleges. Strayer seems to understand this problem in the industry -- but the decision to drop tuition is vexing. The corresponding cost-cutting may ensure the company remains profitable, but this seems like some form of a white flag -- basically, an admission that future growth is going to be difficult, if not impossible.

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