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Aug 31, 2025
Scholastic Q1 2026 Earnings Report
Scholastic reported a seasonal net loss as expected, with stronger Book Fair performance and improved Adjusted EBITDA.
Key Takeaways
Scholastic's Q1 FY26 results showed a typical seasonal loss, driven by a downturn in Education Solutions, but mitigated by strong performance in Book Fairs and franchise titles. Adjusted EBITDA improved year-over-year.
Revenue declined 5% YoY to $225.6 million, primarily due to lower Education Solutions sales.
Net loss widened to $71.1 million, compared to $62.5 million a year ago.
Adjusted EBITDA improved by 8%, driven by cost reductions and strong Book Fair engagement.
The company affirmed its full-year fiscal 2026 guidance, citing progress on strategic initiatives and capital optimization.
Revenue by Segment
Revenue by Geographic Location
Forward Guidance
The company reaffirmed its fiscal 2026 guidance, pointing to progress in IP expansion, real estate monetization plans, and improved operating efficiency.
Positive Outlook
- Strong early bookings and host engagement for Fall Book Fairs.
- Successful franchises like Hunger Games and Wings of Fire continue to perform well.
- New initiatives like the Scholastic streaming app aim to expand digital IP monetization.
- Adjusted EBITDA improved 8% despite lower top-line results.
- Real estate sale-leaseback opportunities could enhance liquidity.
Challenges Ahead
- Education segment heavily impacted by volatile funding and delayed school purchases.
- Net cash used in operations increased significantly YoY.
- Free cash flow declined 46% YoY to -$100.2M.
- Net debt rose by over $90M compared to the prior year.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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