Duke's Financials

The information below regarding Duke University's financial performance is based on results from fiscal year 2008 (July 2007 – June 2008). While the operating budget is slightly larger at $2 billion, the breakdown of revenue and expense is comparable.

University Operating Performance (excluding Duke University Health System)

Duke University's operating activities for fiscal 2008 include all revenues and expenses that support teaching and research efforts and other University priorities. Total operating revenues for the University increased $180.4 million, or 10%, to $1.93 billion in fiscal 2008. The University's major revenue components are summarized below:

FY 2008 University Operating Revenues by Source -- $1.93 billion 

  • Blue/Yellow: Sponsored Research represented the largest component of University revenue (44%).
  • Red: Net tuition and fees of $316.2 million represented 16% of University operating revenue in fiscal 2008. The net revenue is offset by student financial assistance, which reflects the university's commitment to need-blind admission and to ensuring the affordability of a Duke education for all qualified applicants.
  • Green: Endowment spending of $231.8 million represented 12% of University operating revenue.

Total operating expenses for the University increased $136.7 million, or 7%, to $1.96 billion in fiscal 2008. The major components of University operating expenses are summarized below:

FY 2008 University Operating Expenses -- $1.96 billion 

  • Blue: Salaries and benefits totaled $1.1 billion, representing 58% of total operating expenses and an 8% increase over fiscal 2007.
  • Purple: Other operating expenses increased $13.3 million, or 2% from the prior year.
  • Red: Depreciation and amortization expense of $163.4 million represented 8% of total operating expenses in fiscal 2008, an increase of $14.4 million, or 10%, over the prior year.
  • Green: Interest on indebtedness of $52.3 million represents 3% of total operating expenses, and a 27% increase over fiscal 2007.

Investments/Endowments

Responsibility for managing Duke's investment portfolio rests with DUMAC, LLC, a separate, affiliated corporation established by the University's Board of Trustees. Growth of the investment and endowment base is a critical factor in maintaining Duke's financial strength and flexibility to meet current needs and future initiatives.

Duke's total investment portfolio stood at $8.5 billion at the end of fiscal 2008. Endowment and similar funds, representing approximately $6.1 billion of this total, support the current and future operations of academic departments, libraries and other facilities, and a variety of faculty-led initiatives. DUHS accounts for another $1.4 billion of the portfolio, which primarily represents reinvested operating surpluses and associated appreciation.

Growth of Investments & Endowment (in billions) 

To balance current and future needs, the University employs investment and spending policies designed to provide an appropriate flow of income to the operating budget while preserving the future purchasing power of the endowment assets in perpetuity. The spending rate is approved by the Board of Trustees and is currently set at a rate of 5.5% of the average value for the previous three calendar year-ends.

The University's endowment, which began the fiscal year at $6.1 billion, lost more than 20 percent of its value during the last six months of 2008. Because the endowment partially funds the annual operating budget, the investment loses are expected to reduce the amount available to support the operating budget in the coming years.