As we expected, first quarter revenue per student was down 8.5% year-over-year. RPS was impacted by the increased number of students who withdrew or did not attend class in the quarter due to the disruption related to the new online classroom roll out. As Greg discussed, we’re on track with a plan to aggressively address the new classroom issues impacting students. We anticipate second quarter RPS to be down at about the same rate as the first quarter with more meaningful improvements beginning in the third quarter and moving towards flat by year-end.
Discounts in the first quarter were 11.5% as a percentage of revenue. They were higher year-over-year primarily due to positive response we continue to experience from our Phoenix scholarship reward program as well as additional programs to support students through the new classroom transition. We expect discounts to trend slightly higher in the second quarter with the second half returning close to the level experienced in the first quarter.
In the first quarter, the University of Phoenix operating margin was 15.8% or 17.6%, excluding special items. We expect the University of Phoenix full year 2015 margins, excluding special items to be in line with the first quarter.
Moving onto Apollo Global, we are pleased with Apollo Global’s operating performance as they continue to outperform the market in key global markets. First quarter revenue was $115 million, an increase of 26% year-over-year. This growth was a result of acquisitions and organic growth slightly offset by foreign currency.
In the first quarter, the Apollo Global operating loss was $5 million and adjusted operating income was $7 million. Excluding Open Colleges high growth operating performance which has an adverse impact on the near-term financial results, Apollo Global adjusted operating income was $10 million representing a year-over-year improvement. We expect Apollo Global to be operating cash flow positive by the end of fiscal year 2015.
Now turning to our operating expenses, in the first quarter total operating expenses excluding special items decreased approximately $10 million year-over-year primarily as a result of lower enrollments as well as a reduction in our marketing cost. Admissions advisory expense increased due to market adjustments and wages and the incorporation of the 2014 acquisitions. Bad debt expense as a percentage of revenue was 2.4%.
As new enrollments continue to improve, we expect bad debt expense to be in the 2% to 3% range. We have been diligently managing our cost base, and I will provide some commentary related to this, to the full year in a moment. With respect to the consolidated balance sheet and cash flows, we continue to maintain a well-capitalized balance sheet. At quarter end, our cash and marketable securities were approximately $864 million and our outstanding debt was $63 million. Free cash flow for the quarter was down year-over-year in line with operating income. Additionally, we invested $29 million for the acquisition of FAEL and $18 million in share repurchases.
Now, I’d like to spend a minute on our business outlook. Based on our current view, our financial outlook range for fiscal year 2015 is as follows. Net revenue of $2.74 to $2.8 billion and operating income, excluding special items of $250 to $290 million.In the second quarter we expect to report net revenue between $580 million and $595 million and an operating loss excluding special items of $25 million to $30 million. Regarding the outlook, we have adjusted our revenue and operating profit ranges primarily as a result of the disruption due to this classroom conversion. The conversion has impacted enrollment by approximately 7000 incremental students. As Greg mentioned, we have already addressed the most pressing classroom issues and have now implemented efforts to help students re-enroll. The current outlook reflects a range of outcomes related to our ability to re-enroll these students. Given the majority of the remediation has recently been completed and the re-enrollment efforts have just begun, it’s too early to precisely determine how successful these efforts will be.
