With enrollment and revenue declining, the University of Phoenix announced yesterday that it will close about half of its physical locations around the country in an effort to save $300 million.

The closed locations includes 90 learning centers and 25 campuses, accounting for a total of 13,000 students. This will leave 112 Phoenix locations in 36 states.

Apollo Group Inc., the school’s parent company, tried to downplay the closures by saying that the money saved will go back into the massive online education programs run by the University.

“This decision is in direct response to student demand to what students have told us and demonstrated what they want,” a rep for the company tells the Phoenix Business Journal.

The closure announcement came as Apollo reported a drop in net income and revenue for the fourth quarter on Tuesday.

Apollo recently reported a huge 60% drop in year-over-year income (from $183.9 million to $74.2 million) for the quarter ended Aug. 31. For the year, income is down around 23%, with total enrollment down 13.8%.

“People are simply holding off investing money in education at a time when the costs are escalating and the outcomes are uncertain,” the University’s president tells the AP.

For-profit schools like Phoenix have come under increased scrutiny in the last couple of years, after several reports showed these colleges have significantly higher drop-out rate and the highest level of student loan defaults. Some have accused for-profit institutions of charging exorbitant tuitions for educations that are not worth the price tag. Furthermore, some of these colleges have allegedly pushed students into taking out loans they do not need or should not qualify for in order to pay for school.

Some legislators have called for a requirement that schools receiving federal aid should only be able to spend a portion of their funding on marketing.

Phoenix recently upped its investment in education in an effort to provide a better product to students. It also recently announced a tuition freeze.

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