The joint message from Chancellor David Thodey AO, FTSE and Vice-Chancellor and President Professor Mark Scott AO is below.

Dear colleagues, 

On Friday the University’s 2025 Annual Report, including our 2025 financial results, will be tabled in the NSW Parliament. These results are important to our community, so we want to share some insights with you before it is released publicly. 

While our financial position remains stronger than most, we’ve started to experience the shifts that other institutions in the sector earlier suffered and we expect will materially impact our settings from 2027. Our results for 2025 reflect the challenging financial environment in which Australian universities are operating, and the ongoing impact of federal government policy, changing international student demand, reduced public funding for research and increasing operating expenses on our bottom line. The softening of student demand from China is a pattern we expect will continue to deepen in the coming years.  

Financial results

The University reported an overall surplus of $194 million – a considerably lower result than previous years. 

Our core operating expenses – the cost of delivering and supporting our core academic missions of education and research – continue to grow faster than our income.  

In 2025, after adjusting for revenue generated from philanthropy and investments, we experienced an operating deficit of $176 million. This result is consistent with an overall trend we have seen over the past five years.   

We can be proud of another strong year for philanthropy, with $87 million in philanthropic funding. This result affirms the University of Sydney as a partner of choice, and how our community sees the value of the teaching and research we do here. 

Investment returns are subject to volatility, and we experienced a significant reduction in investment income in 2025, returning $284 million compared to $518 million in 2024. 

While we recorded an increase in income from student fees, this result is unlikely to be repeated for the foreseeable future as we enter a low-growth environment and adjust to federal government policy settings and a continuing pattern of softening student demand from China in particular. 

Surplus vs underlying operating result  

The University cannot rely on income from philanthropy or investments to fund its core operations, as a substantial portion of philanthropic funding is restricted under the University’s endowment, and investment returns vary from year to year.  

While the headline result of $194 million reflects our financial performance in accordance with Australian accounting standards, the $176 million underlying operating deficit result provides a clearer picture of the University’s financial performance.  

Investing in our academic mission

Every dollar of our surplus is reinvested in our academic missions of teaching, research and making Sydney a better place to work and study. 

In total, we deployed $274 million of our philanthropy and investment income to support these activities. The remainder is either restricted or being re-invested to maintain our investment capital, so we can continue to use investment income to help subsidise our teaching and research.

We continued to invest in a mix of long-term initiatives tied to our Sydney in 2032 aspirations, as well as initiatives that bring more immediate benefit for our students, staff and the community.  

• We welcomed nearly 600 students from low socioeconomic backgrounds to the University with MySydney scholarships. We also congratulated our first cohort of MySydney graduates, who completed their studies at the end of Semester 2, marking an exciting milestone since the program launched in 2022. 
• We made Collective Excellence 2028 an institutional strategic priority to uplift our educational and research capabilities and meet our ambitious Sydney in 2032 aspirations through disciplined, integrated execution across the institution.  
• We moved into the construction phase of the Sydney Biomedical Accelerator (SBA), a world-leading partnership with the Sydney Local Health District and NSW Government that will fast-track scientific discovery into better health outcomes – due to open in 2028. 
• We launched Digital Sydney, our biggest ever investment in long-term digital transformation to improve the lives of students and staff across the University. We aligned the program to other University-wide initiatives like myResearch Sydney, Collective Excellence, Service Excellence and our approach to generative AI – and began laying the foundations to improve the systems and processes that support teaching, research and working here. 

We continued with our investment in our campus ‘glow-up’ and Deferred Maintenance Program, improving the campus experience and creating inspiring spaces for research excellence and transformational learning. This included a major refurbishment of the Molecular Bioscience Building (G08) – the most significant expansion of our research infrastructure in over a decade.  

Partnering for good

The University deepened our government, industry and academic ties in 2025 through initiatives fostering innovation and real-world learning. We built and nurtured strong partnerships across a range of sectors, in particular technology, engineering and health. 

• We launched the Snow Vision Accelerator, a $50 million partnership between the University and the Snow family to fight glaucoma, the world’s leading cause of irreversible blindness. It is the largest single philanthropic investment in vision science in Australia.   
• We entered a three-year funding agreement with Investment NSW to support the next stage of the Tech Central precinct, accelerating ambitions for Sydney to become a world-leading digital and technology hub. 
• We established new partnerships across Western Sydney and collaborated on addressing the region’s workforce needs, mitigating the effects of heat and climate change, and exploring the potential of the region’s innovation ecosystem. 
• We announced a $100 million donation from the Khuda Family Foundation to create pathways for girls from Western Sydney into STEM; embarked on a historic expansion of the Sydney Conservatorium of Music to Parramatta; and made significant progress on our negotiations with the NSW Government to build a multidisciplinary second major campus at Parramatta-Westmead.   

Transformative initiatives like these are strongly aligned to our overarching strategic aspirations, to contribute to the common good and translate our research for the benefit of society. 

Looking forward

As we reflect on 2025, we are struck by the resilience, ambition and collective commitment that continued to define our University community in a year shaped by significant change – both within the sector and across society. 

It’s important that we maintain a clear view of this change and the challenges that lie ahead. Universities continue to face increasing scrutiny and regulation from both federal and state governments. Australia’s higher education funding model remains unsustainable and public funding for research has fallen in real terms. And our University is moving from a decade of year-on-year student and revenue growth to regulated student growth with softening demand in key international markets and increasing operating expenses.  

Although we are in a stronger position than most, careful financial management will be required for us to continue delivering world-class teaching and research into the future. We encourage you to read the 2025 Annual Report when it is released on Friday. Further information has been published on the intranet to help explain key components of the report, and increase understanding of the University’s financial position. 

Thank you for your dedication, as we continue to work together to build a university that inspires, transforms and leads today and for generations to come. 

Regards,
Mark and David.

Professor Mark Scott AO
Vice-Chancellor and President

David Thodey AO, FTSE
Chancellor