Scholastic Earnings Call Transcripts
Fiscal Year 2026
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Fiscal 2026 saw a 3% revenue decline but strong growth in adjusted operating income and EBITDA, driven by cost discipline and capital returns from sale-leaseback transactions. Book Fairs and Entertainment segments performed well, while Education faced funding headwinds. FY 2027 guidance calls for 2%-4% revenue growth and higher adjusted EBITDA.
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Q3 results met expectations with revenues of $329.1M and improved profitability in key segments. Over $400M was unlocked via sale leasebacks, fueling share repurchases and a new $300M buyback. Fiscal 2026 guidance for flat revenue and $146M-$156M adjusted EBITDA reaffirmed.
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Q2 saw 13% Adjusted EBITDA growth, strong book fairs, and robust franchise performance. Sale-leasebacks unlocked $400M for share repurchases, with FY26 revenue expected to be flat or slightly up and free cash flow forecasted above $430M.
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First quarter results reflected normal seasonality with a 5% revenue decline and improved operating loss, while strong franchise demand and cost-saving initiatives supported performance. Full-year guidance was affirmed, with real estate monetization and digital expansion progressing.
Fiscal Year 2025
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Q4 and FY25 saw strong revenue and Adjusted EBITDA growth, led by bestsellers and the 9 Story acquisition, despite headwinds in education and consumer spending. FY26 targets 20% Adjusted EBITDA growth, continued cost savings, and modest revenue gains, with ongoing capital returns and real estate monetization initiatives.
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Third quarter saw 4% revenue growth and improved profitability, led by strong children's book sales and the Nine Story Media Group acquisition. Full-year adjusted EBITDA is forecast at $140 million, with continued cost-saving actions and modest revenue growth expected amid consumer and education spending headwinds.
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Second quarter revenues and profits declined year-over-year due to timing in book publishing, but guidance for Fiscal 2025 was reaffirmed with expectations of modest growth. Entertainment benefited from the Nine Story acquisition, while education solutions faced headwinds.
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Q1 revenue rose 4% to $237.2M, with improved profitability and reduced operating loss, driven by the 9 Story acquisition and growth in core businesses. Guidance for fiscal 2025 is affirmed, with continued investment in growth and capital returns to shareholders.
Fiscal Year 2024
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Q4 and full-year results declined due to market headwinds in education and book fairs, but strong free cash flow enabled significant shareholder returns. The 9 Story Media acquisition positions the company for growth in entertainment, with modest revenue and EBITDA growth targeted for FY25.