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Overview
This report presents the Faculty of Arts and Sciences’ (FAS) financial results for the fiscal year ending June 30, 2024. It does not include the results for the Harvard John A. Paulson School of Engineering and Applied Sciences (SEAS). For a consolidated view of the FAS including SEAS, please refer to the FAS Financial Report Appendix, which includes the operating results in both the Balance Sheet and Modified Generally Accepted Accounting Principles (GAAP) and Management, or cash, views for the entire FAS.
Fiscal Year 24 Highlights
In fiscal year 2024, the Faculty of Arts and Sciences (FAS) continued to attract and retain extraordinary faculty, students, researchers, and staff and to support world-leading teaching and research.
- The FAS welcomed 33 new ladder faculty and continued to invest in robust financial aid and student support.
- The FAS made meaningful investments in our physical campus, for example in the House Renewal Program and in new space for the Harvard Quantum Initiative and the Rowland Institute.
- The FAS rebuilt staffing to pre-pandemic levels and invested in compensation for faculty and staff through salary and equity increases.
The FAS ended fiscal year 2024 with revenues totaling $1.68 billion and expenses totaling $1.67 billion, resulting in a modest surplus of $3 million under Generally Accepted Accounting Principles ($15.6 million on a cash basis). The FAS spent $14 million from our unrestricted reserves but maintains reserves of $191 million (11% of annual cash operating expenses). Restricted reserves grew by $30 million, bringing the total to $798 million. These reserves provide resources to invest in academic priorities and stability as the FAS navigates future uncertainties, including fluctuations in endowment returns.
Summary of Revenue
Revenues in fiscal year 2024 totaled $1.68 billion, reflecting a 3.2 percent increase ($52.4 million) over fiscal year 2023 and a compound annual growth rate of 3.3 percent since 2019. Growth in total revenues was driven by growth in endowment distributions and dramatic growth in Other Investment Income due to higher interest rates on reserve balances.
Consolidated (Excluding SEAS) Revenues (in Millions)
| Category | Color | FY23 to FY24 | FY23 to FY24 |
|---|---|---|---|
| TOTAL | – | 3.2% | $52.4M |
| Other Income | Dark Blue | 37.4% | $20.7 |
| Other Investment Income | Dark Green | 446% | $18.9 |
| Current Use Gifts | Brown | -24.7% | -$37.7 |
| Endowment Income: Distributed | Gold | 5.3% | $45.5 |
| Grants and Contacts: Indirect | Black | -0.9% | -$0.4 |
| Grants and Contacts: Direct | Orange | 2.0% | $3.3 |
| Net Tuition | Crimson | 0.6% | $2.1 |
Long Description: Consolidated Cash View of Revenue
Overview
The stacked bar graphs compare the sources of revenue between 2023 and 2024. Growth in total revenues was driven by modest growth in endowment distributions and dramatic growth in Other Investment Income due to higher interest rates on fund balances in 2024 (2%) relative to 2023 (0.7%).
Values
| Category | Color | FY23 | FY24 |
|---|---|---|---|
| TOTAL | – | $1.62B | $1.67B |
| Other Income | Dark Blue | 55.3M | 76M |
| Other Investment Income | Dark Green | 4.2M | 23.1M |
| Current-use Gifts | Brown | 153.0M | 115.3M |
| Endowment Income: Distributed | Gold | 858.5M | 904.0M |
| Grants and Contracts-Indirect | Black | 44.9M | 44.5M |
| Grants and Contracts-Direct | Orange | 161.0M | 164.3M |
| Net Tuition | Crimson | 346.9M | 349.0M |
Presentation
Two bar graphs compare the sources of revenue between 2023 and 2024. In each chart, a multicolored column is topped by a white section, which contains the total revenue for that year. The bar is divided into seven distinct colors, each representing a specific revenue category. These categories and their respective percentages in 2023 and 2024 are as follows:
- Other Income, in dark blue, constitutes $55.3 million of the total revenue in 2023 and $76.0 million in 2024;
- Other Investment Income, in dark green, constitutes $4.2 million of the revenue in 2023 and $23.1 million in 2024;
- Current Use Gifts, in brown, constitutes $153.0 million of the total revenue in 2023 and $115.3 million in 2024.
- Endowment Income: Distributed, depicted in gold, constitutes $858.5 million of revenue in 2023 and $904.0 million in 2024;
- Grants and Contracts: Indirect, in black, constitutes $44.9 million of the revenue in 2023 and $44.5 million in 2024;
- Grants and Contracts: Direct, depicted in orange, constitutes $161.0 million in 2023 and 164.3 million in 2024;
- and Net Tuition, in crimson, constitutes $346.9 million of the total revenue in 2023 and $349.0 million in 2024.
Undergraduate Net Tuition, Board, and Lodging
Harvard College’s net tuition, board, and lodging revenue is influenced by student enrollment, tuition rate, and financial aid. Student enrollment continues to be impacted by the pandemic. In fiscal years 2022–2024, Harvard College experienced an enrollment surge, as students who deferred enrollment during the pandemic returned to campus. From a peak average enrollment in residence in fiscal 2023 of 7,058, fiscal 2024 enrollment declined to 6,960. The class of 2025 represents the last of these large cohorts, and we expect to return to more typical enrollment of approximately 6,650 by fiscal year 2026. Enrollment was also impacted by an increase in students studying abroad, as this program returns to pre-pandemic participation. The net result was a modest reduction in average College enrollment from fiscal year 2023.
Harvard College tuition, board, and lodging rates increased by 3.5 percent for the 2023–2024 academic year, maintaining Harvard’s position of 10th out of 11 peer schools, ranked from most expensive to least. Committed to affordability, the FAS increased funding for undergraduate financial aid by 6 percent, keeping a College education within reach for all students regardless of family income. Fifty-five percent of undergraduate students received financial aid, and the average annual family contribution for an aided student was $13,000. For students whose families have annual incomes under $85,000 (approximately 25% of students), there is no family contribution toward the cost of their student’s Harvard education. In addition, these students receive a $2,000 Start-Up Grant in their first year to help defray the cost of transitioning to Harvard, and, new this year, juniors receive a $2,000 Launch Grant to aid in preparation for life post-graduation. This overall increase in financial aid expenses was supported by a $5 million increase in endowment and gift revenue and by a $9 million increase in unrestricted funds budgeted for aid. The result of these factors—a reduction in enrollment, an increase in tuition rate, and an increase in financial aid expense—was a decrease in net undergraduate tuition revenue of 5.3%.
As the FAS continues to return to historical levels of undergraduate enrollment and remains committed to affordability, growing philanthropic support for financial aid is a core priority to reduce reliance on our unrestricted funds and to ensure long-term financial sustainability.
Graduate Net Tuition
Incoming class sizes in the Harvard Kenneth C. Griffin Graduate School of Arts and Sciences Ph.D. programs based in the FAS have rebounded and stabilized to approximately pre-COVID pandemic levels. Despite a 3% increase in Harvard Griffin GSAS tuition rates, net tuition for fiscal year 2024 declined by 25% due to increased financial aid for tuition and health fees.
Continuing Education
Net tuition revenue from the Division of Continuing Education increased 6 percent in fiscal year 2024, following a 2 percent decline in the prior year. This increase was driven by increases in enrollment across a variety of DCE programs. Enrollments increased by 4 percent in the Extension School and 23 percent in Professional & Executive Development Programs. For Summer School, the two-week Pre-College Program grew enrollment by 7 percent in 2024, following a 19 percent increase in 2023 resulting in a positive net impact of $1.9 million. The Summer General Program and Secondary School Program on-campus summer enrollments boosted fiscal year 2024 board-and-lodging revenues by 11 percent over last year. Healthy growth in enrollment was offset somewhat by increased operating expenses related to this growth, and by a scheduling change for the Summer School that resulted in a shift in revenue recognition from fiscal year 2024 to fiscal year 2025.
Philanthropy
Philanthropic contributions continue to be a vital component of the FAS’s financial health, providing more than 60 percent of annual revenues. Fundraising for the FAS endowment grew 13.7 percent and endowment distributions increased 5.3 percent in fiscal year 2024. Current-use gift income declined by $38 million relative to the preceding year, mainly attributable to a one-time $35 million single gift received in fiscal year 2023.
Sponsored Research
Revenue from sponsored research increased by 1.5% in fiscal year 2024 compared with fiscal year 2023. Federal funding continues to grow, with a compound annual growth rate of 4.4% over the past five years. In fiscal year 2024, the FAS undertook a rigorous review of our School-wide research support structure, which informed changes to the way faculty research is supported; these changes will be implemented over the next two fiscal years.
Summary of Expenses
Expenses in fiscal year 2024 totaled $1.67 billion, an increase of $112 million or 7.2 percent compared with fiscal year 2023. Driven primarily by increased compensation expense as well as inflation affecting operations and plant maintenance expenses, this uptick in total expense growth is higher than during the pandemic period, which has averaged 3.6 percent since 2019, on a compound basis.
Consolidated Cash View (Excluding SEAS) Expenses (in Millions)
| Category | Color | FY23 to FY24 | FY23 to FY24 |
|---|---|---|---|
| TOTAL | – | 7.2% | $112.3 |
| Other Expenses | Dark Blue | 4.2% | $5.6 |
| Services Purchased | Brown | 6.5% | $12.5 |
| Depreciation | Light Blue | 1.9% | $2.4 |
| Interest on Debt | Light Green | 3.0% | $1.3 |
| Operations and Maintenance of Plant | Dark Green | 12.8% | $25.9 |
| Supplies, Materials, and Equipment | Gold | 1.8% | $1.3 |
| Fellowships and Awards | Black | 6.8% | $5.8 |
| Employee Benefits | Orange | 4.4% | $6.1 |
| Salaries and Wages | Crimson | 9.0% | $51.4 |
Long Description: Consolidated Cash View of Expenses
Overview
The stacked bar charts compare the expense profiles between fiscal year 2023 and 2024. Expenses in fiscal year 2024 totaled $1.67 billion, an increase of $112 million or 7.2 percent compared with fiscal year 2023. This was driven primarily by increased compensation expenses as well as inflation affecting operations and plant maintenance expenses. The uptick in total expense growth is higher than during the pandemic period, which has averaged 3.6 percent since 2019, on a compound basis.
Values
| Category | Color | FY23 | FY24 |
|---|---|---|---|
| TOTAL | – | 1,56 B | 1.67 B |
| Other Expenses | Dark Blue | 133.6 M | 139.2M |
| Services Purchased | Green | 191.2 M | 203.7 |
| Depreciation | Light Blue | 128.0 M | 130.4 M |
| Interest on Debt | Light Green | 42.7 M | 44.0 M |
| Operations and Maintenance of Plant | Brown | 202.7 M | 228.6 M |
| Supplies, Materials and Equipment | Gold | 71.3 M | 72.6 M |
| Fellowships and Awards | Dark Blue | 85.2 M | 91.0 M |
| Employee Benefits | Orange | 136.3 M | 142.4 M |
| Salaries and Wages | Crimson | 570.0 M | 621.4 M |
Presentation
Two stacked bar charts compare the expense profiles between fiscal years 2023 and 2024. In each chart, a multicolored column is topped by a white section, which contains the total revenue for that year. The bar is divided into nine distinct colors, each representing a specific revenue category. These categories and their respective percentages in fiscal years 2023 and 2024 are as follows:
- Other Expenses, in dark blue, $133.6 million of the total expenses in 2023 and $139.2 million in 2024;
- Services Purchased, in green, $191.2 million of the total expenses in 2023 and $203.7 million in 2024;
- Depreciation, depicted in light blue, 128.0 million of the total expenses in 2023 and 130.4 million in 2024;
- Interest on Debt, depicted in light green, comprised $42.7 million of the total expenses in 2023 and $44.0 million in 2024;
- Operations and Maintenance of Plant, in brown, constitute $202.7 million of the total expenses in 2023 and $228.6 million in 2024;
- Supplies, Materials, and Equipment, in gold, constitute $71.3 million of the total expenses in 2023 and $72.6 million in 2024;
- Fellowships and Awards, in black, constitute $85.2 million of the expenses in 2023 and $91.0 million in 2024;
- Employee Benefits, in orange, constitute $136.3 million of the total expenses in 2023 and $142.4 million in 2024;
- and Salaries and Wages, depicted in crimson, constitute $570 million of expenses in 2023 and $621.4 million in 2024.
Compensation
Compensation—which includes salaries, wages, and benefits—remains the largest expense for the FAS, comprising 46 percent of total expenditures. Total compensation rose by 8 percent in fiscal year 2024, a slight decrease compared with the 8.5 percent growth experienced in fiscal year 2023. Salaries and wages increased by 9 percent, also a somewhat slower growth than the 10.5 percent of fiscal year 2023. Growth in total staff salaries and wages reflects a combination of annual pay increases, retention pressure in a competitive labor market, and workforce growth of 6.9 percent, as units rebuilt the staffing levels following early retirements and high attrition rates during the pandemic. Faculty salary growth reflects a competitive market for recruitment, as the FAS welcomed new ladder faculty, responded to retention pressure, and funded one-time payments related to a faculty retirement incentive program. The cost of employee benefits increased 4.4 percent, a higher increase than we have seen in recent years when growth has been relatively flat. It is our expectation that the slowing of growth in overall compensation costs experienced in fiscal 2024 relative to 2023 will continue as inflation has moderated, wage pressures have reduced, and staff vacancies have been filled.
Fellowships and Awards
Fellowships and Awards, including graduate student stipends, totaled $91 million in fiscal year 2024, an increase of 7 percent from last year. While some of this increase is a result of collectively bargained increases in Ph.D. stipends, it is also a result of Harvard’s commitment to recruiting the most talented Ph.D. candidates by offering stipend increases up to 5.5 percent last year. (Note: for fiscal 2025, based on the recommendation of the GSAS Admissions and Graduate Education Working Group, Harvard has committed to a minimum stipend of $50,000, an increase of up to 14.4 percent, depending on the program.)
Noncompensation Expenses
Noncompensation expenses, including expenses for space and occupancy, supplies and equipment, and services purchased, increased 7.9 percent over fiscal year 2023. The largest increases in this category were operations and maintenance costs, which rose due to utility rate increases, construction cost escalation, and an increase in renovation costs to accommodate new faculty. In addition, a one-time change in capitalization policy increased expenses in this category by $3 million. Other noncompensation expenses, including travel, food, and subcontracted services increased 4.2 percent over fiscal year 2023. Looking ahead, we expect expenditure growth in this category to slow following the one-time policy change impact and reduction in inflation in the overall economy.
Managerial Report
This report presents a financial view of the Faculty of Arts and Sciences of Harvard University operations, including results of the John A. Paulson School of Engineering and Applied Sciences.
Looking ahead
The FAS faced increased operational costs due to inflation and a full return to post-pandemic activities in fiscal year 2024 requiring investments in both our campus and our people. As a result, expense growth outpaced revenue growth. Moving forward, to ensure long-term financial sustainability, the FAS must remain disciplined in managing our expenses. Our approach will include reviewing the FAS’s administrative functions and investing in technologies to operate more efficiently. The FAS will also continue efforts to unlock restricted funds for our academic priorities and to work with departments—such as the Division of Continuing Education, Athletics, and Museums—to generate additional revenues. We will also continue to connect with alumni, donors, parents, and friends who support our world-renowned teaching and research. The FAS’s strong financial condition will continue to advance our teaching and research mission; to support our extraordinary students, faculty, researchers, and staff; and to position our School for a sustainable future.