Revenue Performance - For the three months ended January 31, 2025, revenue decreased by $56.1 million, or 12%, compared to the prior year, with Adjusted Revenue increasing by 1% on a constant currency basis [163][164]. - Revenue for the nine months ended January 31, 2025, decreased by $169.5 million, or 12%, compared to the prior year [216]. - 83% of the company's revenue for the year ended April 30, 2024, was generated by digital products and services, with 48% of revenue being recurring [158]. - The total Learning Revenue for the three months ended January 31, 2025 decreased by 6% to $137.08 million compared to the prior year [206]. - Revenue for Held for Sale or Sold decreased by $210.9 million, or 92%, compared to the prior year, primarily due to the sale of the University Services, Wiley Edge, and CrossKnowledge businesses [262]. Cost and Expenses - The cost of sales for the same period was $104.2 million, a decrease of $39.4 million, or 27%, primarily due to the sale of University Services and lower costs related to Wiley Edge [167]. - Operating and administrative expenses decreased by $23.4 million, or 9%, primarily due to lower employee-related costs [169]. - Cost of sales for the nine months ended January 31, 2025, decreased by $135.9 million, or 30%, compared to the prior year [220]. - Operating and administrative expenses for the nine months ended January 31, 2025, decreased by $43.8 million, or 6%, compared to the prior year [222]. Profitability and Income - Operating income for the three months ended January 31, 2025, was $51.8 million, a significant increase from the prior year operating loss of $46.4 million [181]. - Adjusted Operating Income for the Research segment increased by 15% to $65.67 million for the three months ended January 31, 2025 [202]. - Adjusted Operating Income for the nine months ended January 31, 2025, was $161.6 million, an increase of 38% compared to the prior year [221]. - Adjusted EBITDA for the same period was $93.9 million, reflecting a 4% increase compared to the prior year [185]. - Adjusted EBITDA for the nine months ended January 31, 2025, increased by 12% compared to the prior year, primarily due to an increase in Adjusted Revenue [235]. Impairments and Losses - The company recorded a goodwill impairment of $81.7 million in the prior year, which impacted the current operating results positively [171][181]. - The total pretax loss on the sale of Wiley Edge was $34.2 million, with a net loss of $15.6 million recognized in the three months ended January 31, 2025 [191]. - The company recorded a goodwill impairment of $108.4 million for the nine months ended January 31, 2024 [224]. - For the nine months ended January 31, 2025, the net loss on sale of businesses, assets, and impairment charges related to assets held-for-sale was $9.76 million, a significant improvement from a loss of $179.75 million in the same period of 2024 [242]. Taxation - The US GAAP effective tax rate for the three months ended January 31, 2025 was 222.9%, compared to (1.4)% for the same period in 2024, primarily due to US ordinary losses with no tax benefit recognized [198]. - The Non-GAAP Adjusted Effective Tax Rate was 21.6% for the three months ended January 31, 2025, down from 25.5% in the same period of 2024 [199]. - The US GAAP effective tax rate for the nine months ended January 31, 2025, was 82.3%, significantly higher than 6.4% for the same period in 2024, primarily due to ordinary losses with no tax benefit recognized [251]. - The Non-GAAP Adjusted Effective Tax Rate was 22.7% for the nine months ended January 31, 2025, down from 24.4% in the prior year, primarily due to the mix of income and a discrete item related to the release of a tax reserve [252]. Cash Flow and Debt - As of January 31, 2025, the company had cash and cash equivalents of $104.5 million, with approximately all located outside the US [268]. - The company had approximately $887.2 million of debt outstanding as of January 31, 2025, with $415.6 million of unused borrowing capacity under its credit facilities [270]. - Net cash provided by operating activities increased to $52.3 million for the nine months ended January 31, 2025, compared to $24.4 million for the same period in 2024 [272]. - Free cash flow less product development spending was $(1.15) million for the nine months ended January 31, 2025, an improvement from $(45.25) million in the prior year [274]. - Net cash used in investing activities decreased to $69.7 million for the nine months ended January 31, 2025, compared to $78.5 million in the prior year [280]. Foreign Currency and Translation - The company recorded foreign currency translation losses of approximately $(32.2) million during the three months ended January 31, 2025, primarily due to fluctuations in the US dollar relative to the British pound sterling [290]. - Foreign currency translation losses for the three months ended January 31, 2025, were approximately $(32.2) million, primarily due to fluctuations against the British pound sterling [290]. - During the nine months ended January 31, 2025, foreign currency translation gains were approximately $10.7 million, mainly from fluctuations against the euro [290]. Other Financial Metrics - Diluted loss per share for the three months ended January 31, 2025 was $(0.43), an improvement from $(2.08) per share in the same period of 2024 [200]. - Diluted earnings per share for the nine months ended January 31, 2025, was $0.29, a recovery from a loss per share of $(4.10) in the prior year [253]. - Subscription agents account for approximately 16% of total annual consolidated revenue, with no single group exceeding 10% [295]. - The top 10 book customers represent about 13% of total consolidated revenue and approximately 34% of accounts receivable as of January 31, 2025 [296]. - A one percent change in the estimated sales return rate could impact net income by approximately $0.9 million [294].
John Wiley & Sons(WLYB) - 2025 Q3 - Quarterly Report