John Wiley & Sons(US:WLY)2025-09-04 15:00Financial Data and Key Metrics Changes - Adjusted revenue grew by 1% and adjusted EPS rose by 2%, while adjusted EBITDA decreased by 3% [35][36] - Free cash flow was a use of $100 million, an improvement from a use of $107 million last year [43] - The net debt to EBITDA ratio improved to 1.9 compared to 2.0 in the prior year period [45] Business Line Data and Key Metrics Changes - Research Publishing declined by 1% due to a tough comparison from the previous year, but Gold Open Access revenue grew by double digits [39][40] - Research Solutions grew by 44%, driven by the Nexus AI project [39] - Learning revenue declined by 8% due to lower AI revenue and market-related softness in professional publishing [40] Market Data and Key Metrics Changes - The academic market remains steady with no early signals of enrollment challenges, while professional publishing has encountered market headwinds [20] - The company reported strong growth in submissions and output, with submissions up 25% year-over-year [78] Company Strategy and Development Direction - The company is focusing on leading in research and driving above-market growth in submissions and output [11] - A strategic partnership with Anthropic was announced to enhance AI integration into scholarly research [7] - The company aims to define how the industry approaches knowledge licensing and partnership in the AI space [15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the full-year outlook, driven by research trends and AI momentum [18] - The company is monitoring corporate spending trends and expects cost savings to ramp up in Q2 [20][42] - Management noted that the first quarter is seasonally the smallest and does not reflect the overall year performance [78] Other Important Information - The company increased its annual dividend for the thirty-second consecutive year [7] - A new $250 million share repurchase authorization was approved, a 25% increase over the previous program [8][45] - The company received approximately $120 million in cash proceeds from the University Services divestiture, which will reduce debt [46] Q&A Session Summary Question: Can you provide more details about the agreement with Anthropic? - The partnership focuses on integrating high-quality content into research tools for students and researchers, enhancing AI safety and learning experiences [58][60] Question: How does the agreement affect investment in AI-related growth opportunities? - The agreement represents a first step in tighter content integration and is expected to lead to more projects in the future [63][64] Question: What is the revenue model for the Nexus project? - The revenue model is primarily to underpin the value of institutional library subscriptions and as a potential upsell vector [61] Question: What is the status of journal renewals for calendar 2025? - The renewal season is just beginning, and the outlook is positive with no current concerns [73][76] Question: Why did research publishing revenue decline despite increased submissions? - The decline is attributed to a tough comparison from the previous year and the seasonal nature of the business [78][81] Question: What is the outlook for professional publishing? - There has been softness in retail channels, but the company is monitoring the situation closely [86][88] Question: How will the Nexus-related revenue impact fiscal 2026 margin outlook? - The impact is expected to be de minimis, as the focus remains on the profitability of the core business [91]