Cornell University recently announced a strong financial performance, boasting a 12.3% return on its endowment for the 2025 fiscal year. This increase raised the endowment’s value from $10.7 billion in the previous year to around $11.8 billion. The impressive growth was highlighted by Christopher Cowen, the executive vice president, and Kenneth Miranda, the chief investment officer.
However, Cornell faces challenges. In April 2025, the Trump administration froze $1 billion in federal funding due to civil rights investigations. This freeze sparked major cost-cutting measures across the university. President Michael Kotlikoff noted that Cornell now grapples with approximately $250 million in halted federal projects and an additional $80 million owed for previous expenses.
In response to these financial pressures, Cornell implemented urgent measures. August’s “Next steps for our financial future” statement included hiring freezes and budget cuts. The College of Arts and Sciences planned to trim nearly $11 million from its budget, which totals $456 million.
Cornell’s endowment cannot be fully tapped for yearly expenses. Each year, the university can only withdraw about 4.4% of its endowment’s average valuation over the past seven years. For fiscal year 2025, the endowment provided $439 million for essential areas like financial aid and faculty salaries, which translated to about 7% of the university’s operational budget. This compares to $411 million in the previous fiscal year.
Looking ahead, Cornell committed to a record $463 million in grants and scholarship aid for the 2025-2026 academic year, making education more accessible for students.
Even with its sizable endowment, Cornell ranks lower relative to its peers in funding per student. According to the 2024 NACUBO-Commonfund Study, it stands at number 71 among U.S. and Canadian institutions.
Recent studies show that many universities are facing similar financial challenges, as funding sources tighten. The increased need for affordable education adds pressure on institutions like Cornell to maximize their endowments while managing costs effectively.
As the landscape evolves, universities must balance financial health with their mission to provide quality education. Keeping a keen eye on funding trends and adapting strategies will be critical as they navigate these turbulent times.
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