Financial Data and Key Metrics Changes - Revenues increased by 1% to $551.1 million in the second quarter, with operating income improving to $95 million from $78.9 million in the prior year period [22][23] - Adjusted EBITDA grew by 13% to $122.5 million compared to $108.7 million a year ago, while net income rose to $66.3 million from $52 million [22][23] - Adjusted earnings per diluted share increased to $2.57 from $1.82 last year [23] Business Line Data and Key Metrics Changes - Children's Book Publishing and Distribution revenues increased by 4% to $380.9 million, driven by strong performance in Book Fairs, which generated $242 million, a 5% increase [23][24] - Trade Publishing revenues rose by 7% to $110.4 million, supported by new releases, particularly the latest Dog Man title [24] - Scholastic Education segment revenues decreased to $62.2 million from $71.2 million, reflecting lower spending on supplemental curriculum products [25] Market Data and Key Metrics Changes - International segment revenues increased to $89.5 million from $86.7 million, with growth driven by new titles and favorable foreign currency exchange [26] - The company anticipates modest declines in revenues and profitability in the international segment following strong performance in fiscal 2025 [27] Company Strategy and Development Direction - The company has focused on transforming into a growth-oriented, shareholder-focused entity, with significant changes in leadership and organizational structure [4][5] - Strategic initiatives include the acquisition of 9 Story Media Group and the implementation of a disciplined capital allocation approach, returning nearly $500 million to shareholders since fiscal 2022 [7][8] - The company aims to leverage its unique strengths in brand, IP, and channels to drive long-term growth and value creation [9] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the second half of fiscal 2026, expecting revenue growth in school reading events and entertainment divisions, despite anticipated lower revenues in trade and international segments [31] - The company remains cautiously optimistic about the education segment, anticipating improvements in the sales pipeline and federal funding disbursements [18][31] - Management highlighted the importance of maintaining operational efficiencies and preparing for market recovery in the education sector [56][58] Other Important Information - The company closed two sale-leaseback transactions, unlocking over $400 million in liquidity, which will be used for share repurchases and other capital allocation priorities [8][29] - The board has authorized an increase in the open market share repurchase program to $150 million [30] Q&A Session Summary Question: Use of proceeds from the sale-leaseback transactions - Management indicated that the first step is to increase the share buyback authorization, with plans to return cash to shareholders as shares are currently viewed as undervalued [41][43] Question: Guidance on top-line revenue changes - Management noted that the education business is experiencing softness due to funding issues, but expects growth in book fairs to help offset this [48] Question: Expectations for trade channel sales - Management confirmed that trade channel sales are expected to be in line with the previous year, despite tough comparisons due to major releases last year [49] Question: Performance in the education solutions segment - Management acknowledged the challenges in the education segment but highlighted cost management efforts that have helped stabilize the business [56][58]

Financial Data and Key Metrics Changes - Revenues increased by 1% to $551.1 million in the second quarter, with operating income improving to $95 million from $78.9 million in the prior year period [21] - Adjusted EBITDA grew by 13% to $122.5 million compared to $108.7 million a year ago, while net income rose to $66.3 million from $52 million [21] - Adjusted earnings per diluted share increased to $2.57 from $1.82 last year [22] Business Line Data and Key Metrics Changes - Children's Book Publishing and Distribution revenues increased by 4% to $380.9 million, driven by strong performance in Book Fairs [22] - Book Fairs revenues were $242 million, a 5% increase due to higher fair count and increased revenue per fair [22] - Trade Publishing revenues rose by 7% to $110.4 million, supported by new releases, including the latest Dog Man title [23] - Scholastic Education segment revenues decreased to $62.2 million from $71.2 million, reflecting lower spending on supplemental curriculum products [24] Market Data and Key Metrics Changes - International segment revenues increased to $89.5 million from $86.7 million, with growth driven by new Dog Man titles and other major franchises [25] - The company anticipates modest declines in revenues and profitability in the international segment following strong performance in fiscal 2025 [25] Company Strategy and Development Direction - The company has focused on transforming into a growth-oriented, shareholder-focused entity, with significant changes in leadership and board composition [4][5] - Strategic initiatives include reorganizing core businesses, investing in growth opportunities, and implementing disciplined capital allocation [6][7] - The company aims to return nearly $500 million to shareholders through share repurchases and dividends while maintaining a strong balance sheet [6][28] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the second half of Fiscal 2026, expecting revenue growth in school reading events and entertainment divisions [30] - The company remains cautiously optimistic about the education segment, anticipating improvements in the sales pipeline and federal funding [18][40] - Management highlighted the importance of adapting to market conditions and preparing for growth as the funding environment stabilizes [41][42] Other Important Information - The company closed two sale-leaseback transactions, unlocking over $400 million in net proceeds, which will be used for share repurchases and other capital allocation priorities [7][28] - The company has seen strong engagement across digital channels, with significant viewership on platforms like YouTube and the launch of Scholastic TV [16][15] Q&A Session Summary Question: Use of proceeds from the sale-leaseback transactions - Management indicated that the first step is to increase the open market share buyback authorization, with plans to return cash to shareholders [34][36] Question: Guidance on top-line revenue changes - Management noted softness in the education business due to funding issues but expects growth in book fairs to help offset this [38] Question: Trade channel sales expectations - Management confirmed that trade channel sales are expected to be in line with the previous year, despite tough comparisons due to major releases last year [39] Question: Education solutions segment performance - Management acknowledged the challenges in the education segment but expressed optimism about stabilizing the business and benefiting from seasonal spending in the spring [42]

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Core Insights - The publishing house reported a profit of $55.9 million, indicating strong financial performance driven by growth in the children's book publishing and distribution segment [1] Group 1 - The profit of $55.9 million reflects a positive trend in the company's financial health [1] - Growth in the children's book publishing and distribution segment has significantly contributed to the increase in revenue [1]

Financial Performance - Scholastic achieved a 13% growth in adjusted EBITDA during the second quarter of fiscal year 2026[5] - Revenue increased by 1% to $551.1 million in Fiscal 2026 Q2, compared to $544.6 million in Fiscal 2025 Q2[9] - Operating income increased by 11% to $82.9 million in Fiscal 2026 Q2, compared to $74.7 million in Fiscal 2025 Q2[9] - Diluted earnings per share increased by 27% to $2.17 in Fiscal 2026 Q2, compared to $1.71 in Fiscal 2025 Q2[9] - Adjusted EBITDA reached $122.5 million in Fiscal 2026 Q2, compared to $108.7 million in Fiscal 2025 Q2[9] Segment Performance - Children's Book Publishing and Distribution revenue increased by 4% to $380.9 million, with operating income up 7% to $108.8 million[10] - Education Solutions revenue decreased by 13% to $62.2 million[10] - International revenue increased by 3% to $89.5 million, with operating income up 80% to $12.8 million[10] Strategic Initiatives and Capital Allocation - The company unlocked over $400 million through sale-leaseback transactions to advance capital allocation priorities[5, 6] - Nearly $500 million was returned to shareholders, reducing share count by approximately 25%[6] Fiscal Year 2026 Outlook - The company affirmed its adjusted EBITDA outlook of $146 to $156 million, including a $14 million partial-year impact from sale-leasebacks[12] - Free cash flow is expected to exceed $430 million, reflecting sale-leaseback net proceeds[12]

Revenue Performance - Fiscal 2026 Q2 revenues increased by 1% to $551.1 million, driven by strength in the Children's Book Publishing and Distribution segment[8]. - The Children's Book Publishing and Distribution segment's revenues increased 4% to $380.9 million, with Book Fairs revenues up 5% to $242.0 million[10]. - Year-to-date revenues of $776.7 million were in line with the prior year, primarily reflecting strength in Book Fairs[21]. - Revenues for the three months ended November 30, 2025, were $551.1 million, a 1.0% increase from $544.6 million in the same period last year[30]. - The total revenues for the Children's Book Publishing and Distribution segment increased by 4% to $380.9 million for the three months ended November 30, 2025, compared to $367.0 million in the same period last year[31]. - International revenues increased by 3% to $89.5 million for the three months ended November 30, 2025, compared to $86.7 million in the same period last year[31]. Income and Profitability - Operating income rose 11% to $82.9 million, with adjusted EBITDA improving 13% to $122.5 million[9]. - Net income for the three months ended November 30, 2025, was $55.9 million, up from $48.8 million in the prior year, representing a 14.5% increase[30]. - Operating income for the three months ended November 30, 2025, was $82.9 million, compared to $74.7 million for the same period last year, reflecting a 10.8% increase[30]. - Adjusted EBITDA for the three months ended November 30, 2025, was $122.5 million, compared to $108.7 million for the same period in 2024, indicating a 12.5% growth[42]. - The Children's Book Publishing and Distribution segment reported earnings before income taxes of $108.7 million for the three months ended November 30, 2025, compared to $102.1 million in the same period of 2024, indicating a year-over-year increase of approximately 5.8%[45]. Cash Flow and Financial Position - The Company expects full-year Adjusted EBITDA to be between $146 million and $156 million, with free cash flow forecasted to exceed $430 million[6]. - Free cash flow increased by 40% to $59.2 million in fiscal 2026 compared to $42.4 million in the prior period[16]. - Cash and cash equivalents decreased to $99.3 million as of November 30, 2025, down from $139.6 million a year earlier[33]. - Total stockholders' equity as of November 30, 2025, was $931.2 million, a decrease from $986.0 million in the prior year[33]. - The Company generated $481 million in gross proceeds from sale-leaseback transactions, with estimated net proceeds of $401 million[19]. Segment Performance - Education Solutions revenues decreased 13% to $62.2 million, reflecting a challenging funding environment for schools[11]. - The Education Solutions segment reported revenues of $62.2 million, a decrease of 13% from $71.2 million in the prior year[31]. - The Education Solutions segment experienced a loss of $4.7 million for the three months ended November 30, 2025, compared to a loss of $0.5 million in the prior year[37]. - The International segment reported income of $12.4 million for the three months ended November 30, 2025, compared to $5.7 million in the prior year, a significant increase of 117.5%[37]. - The International segment reported earnings before income taxes of $11.9 million for the three months ended November 30, 2025, compared to $5.2 million in the same period of 2024, marking a significant increase of approximately 128.8%[45]. Shareholder Returns and Debt - The Board authorized a $150 million expanded share repurchase program, building on nearly $500 million returned to shareholders since 2021[3]. - Net debt increased to $186.6 million, primarily due to share repurchases over the last 12 months[17]. One-time Items and Adjustments - The company reported a one-time benefit of $3.3 million for income taxes related to pretax items in the three months ended November 30, 2025[39]. - The total one-time items before income taxes for the three months ended November 30, 2025, amounted to $13.7 million, compared to $4.2 million in the same period of 2024, indicating an increase of approximately 226.2%[45]. - The company recognized pretax asset impairment of $3.4 million related to certain education products in the three months ended November 30, 2025[40]. Losses and Impairments - For the six months ended November 30, 2025, the company recognized a net loss of $15.2 million, an improvement from a loss of $13.7 million in the same period of 2024[38]. - The total adjusted EBITDA for the six months ended November 30, 2025, was $66.8 million, down from $80.9 million in the prior year, reflecting a decrease of approximately 17.4%[45]. - The Entertainment segment reported a loss before income taxes of $9.4 million for the three months ended November 30, 2025, compared to a loss of $5.7 million in the same period of 2024[45]. - The Education Solutions segment experienced a loss before income taxes of $4.7 million for the three months ended November 30, 2025, an improvement from a loss of $5.7 million in the prior year[45].

Core Insights - Scholastic Corporation reported strong financial performance in the second quarter of fiscal 2026, driven by successful book fairs and trade publishing, particularly from popular titles like "Dog Man: Big Jim Believes" [2][4] - The company has authorized a $150 million expanded share repurchase program as part of its capital allocation strategy following the successful sale-leaseback of major real estate assets, which generated over $400 million in net proceeds [4][19] - The outlook for fiscal 2026 remains positive, with expected Adjusted EBITDA between $146 million and $156 million and free cash flow forecasted to exceed $430 million [7][20] Financial Performance - Revenues for the second quarter increased by 1% to $551.1 million, with notable growth in the Children's Book Publishing and Distribution segment, offset by a decline in Education Solutions sales [9][11] - Operating income rose by 11% to $82.9 million, while Adjusted EBITDA improved by 13% to $122.5 million, reflecting higher revenues and reduced discretionary overhead expenses [10][12] - The diluted earnings per share increased by 27% to $2.17, and when excluding one-time items, it rose by 41% to $2.57 [9][10] Segment Analysis - The Children's Book Publishing and Distribution segment saw revenues increase by 4% to $380.9 million, with Book Fairs contributing $242.0 million, up 5% from the previous year [11][12] - Education Solutions revenues decreased by 13% to $62.2 million due to a challenging funding environment, resulting in a segment operating loss of $4.7 million [13] - The International segment's revenues increased by 4% to $89.5 million, driven by the success of global franchises, with operating income improving significantly [15] Capital Position and Shareholder Returns - The company generated $73.2 million in net cash from operating activities, with free cash flow increasing by 40% to $59.2 million [17][18] - Scholastic's net debt increased to $186.6 million, primarily due to share repurchases, and the company distributed $5.1 million in dividends during the quarter [18][19] - Following the sale-leaseback transactions, the company expects a significant boost to free cash flow, with an estimated $400 million benefit anticipated [20]

Core Insights - Analysts forecast Scholastic (SCHL) to report quarterly earnings of $2.07 per share, reflecting a year-over-year increase of 13.7% [1] - Expected revenues are projected at $556.73 million, indicating a 2.2% increase compared to the same quarter last year [1] Earnings Estimates Revisions - Over the last 30 days, the consensus EPS estimate has been revised downward by 7.8%, indicating a collective reassessment by analysts [2] - Revisions to earnings estimates are crucial indicators for predicting investor actions regarding the stock [3] Revenue Projections - Analysts expect 'Revenues- Education Solutions' to be $64.80 million, suggesting a year-over-year decline of 9% [4] - 'Revenues- Children’s Book Publishing and Distribution' is projected to reach $383.12 million, reflecting a year-over-year increase of 4.4% [5] - Estimated 'Revenues- International' is $89.29 million, indicating a 3% increase from the prior-year quarter [5] Stock Performance - Scholastic shares have returned +2% over the past month, outperforming the Zacks S&P 500 composite, which has seen a -0.2% change [5] - With a Zacks Rank 5 (Strong Sell), SCHL is expected to underperform the overall market in the near future [5]

Core Viewpoint - Scholastic Corporation is set to announce its second quarter fiscal year 2026 earnings on December 18, 2025, highlighting its ongoing commitment to literacy and education for children [1][2]. Company Overview - Scholastic Corporation has over 100 years of experience in providing quality content and experiences focused on literacy, aiming to empower children to become lifelong readers and learners [1]. - The company is recognized as the world's largest publisher and distributor of children's books, reaching over 135 countries through various channels including school-based book clubs, book fairs, and online platforms [1]. Earnings Announcement Details - The earnings release will occur on December 18, 2025, at 4:00 PM ET, and will be available on the company's investor relations website [2]. - A conference call will follow at 4:30 PM ET, hosted by the President and CEO, Peter Warwick, and CFO, Haji Glover, with access provided via a live webcast [2]. - Participants are encouraged to join the conference call five minutes early to avoid delays, and an archived version of the webcast will be available shortly after the live call [2].

Scholastic agreed to sell its New York City headquarters as it works to streamline its publishing business and monetize assets. https://t.co/EYYGWW7mMS ...