Financial Data and Key Metrics Changes - The company reported a strong adjusted EBITDA growth of 8% and an adjusted operating margin expansion of 250 basis points to 18.8% [24][31] - Free cash flow was a use of $108 million, representing a 17% improvement from the prior year [29] - Net debt to EBITDA improved to 2.0 times, down from 2.2 times in the prior year [31] Business Line Data and Key Metrics Changes - Research publishing experienced a 7% revenue growth driven by worldwide demand, with a 220 basis point improvement in EBITDA margin to 33.5% [6][24] - Learning segment revenue declined by 11%, primarily due to headwinds in professional and academic sectors, with professional books down 16% [27] - Author-funded open access grew by 28%, contributing to the overall strength in research [9][24] Market Data and Key Metrics Changes - The company noted strong demand for research across all regions, with double-digit submissions growth in China, India, Japan, the U.K., Germany, and the U.S. [9][12] - Corporate R&D spending represents a significant future growth opportunity, currently making up only 10% of the company's revenue base [17] Company Strategy and Development Direction - The company aims to lead in research and capitalize on AI growth, integrating scientific research into new technologies [5][9] - Strategic partnerships with AI innovators like AWS and Anthropic are being leveraged to enhance growth opportunities [10][15] - The focus is on operational excellence, with initiatives to reduce corporate costs and improve margins [28] Management's Comments on Operating Environment and Future Outlook - Management acknowledged challenges in the learning segment due to external factors, including changes in inventory management from Amazon and soft consumer spending [8][41] - The outlook for learning revenue is expected to decline for the full year, but declines are anticipated to moderate in the second half [9][31] - The company reaffirmed guidance for adjusted EBITDA margin and adjusted EPS while narrowing revenue outlook to the lower end of the range [31] Other Important Information - The company increased share repurchases by 69% to $21 million this quarter, with a current yield of around 3.9% [7][30] - The company is actively pursuing acquisitions of high-impact journals to strengthen its portfolio [30] Q&A Session Summary Question: Research revenue growth and potential upside - Management expressed optimism about maintaining growth at the top end of market expectations, driven by strong article submissions [36][37] Question: AI licensing revenue and pipeline opportunities - The company confirmed a $6 million licensing deal with an existing LLM customer, indicating ongoing demand for AI training [37][38] Question: Decline in learning segment and inventory management impact - Management noted that the decline is primarily cyclical rather than structural, with expectations for normalization in the second half [41][42] Question: Share buybacks and capital allocation strategy - The company emphasized a disciplined approach to capital allocation, balancing share buybacks with maintaining leverage ratios [44][45]

Financial Performance - Adjusted revenue decreased by 1% to $422 million, but excluding divestitures and foreign exchange impacts, the decrease was driven by an 11% decline in Learning, offset by 5% growth in Research [38, 41] - Adjusted EPS increased by 12% to $1.10, driven by a 14% increase in Adjusted Operating Income [38, 41] - Adjusted EBITDA increased by 8% to $115 million, with the Adjusted EBITDA margin up 240 basis points to 273% [38, 41] Segment Performance - Research revenue increased by 5%, with Research Publishing up 7% and Research Solutions down 5% [41, 14, 42] - Learning revenue decreased by 11%, with Academic down 8% and Professional down 16% [41, 45] AI Initiatives - Secured a $6 million LLM training licensing agreement in Q2, bringing year-to-date AI revenue to $35 million [14] - Launched the AI Gateway, a content enrichment and distribution platform, and have over 30 publisher partners for the Nexus content licensing service [8, 14, 25] Operational Efficiency and Capital Allocation - Corporate expenses reduced by 18% in Q2 [8, 14, 52] - Share repurchases increased by 69% to $21 million in Q2, with a total of $73 million returned to shareholders YTD through dividends and repurchases [8, 54] Outlook - The company is on track to deliver full year Free Cash Flow outlook of $200M [56]