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Jun 30, 2025
McGraw Hill Inc Q1 2026 Earnings Report
Key Takeaways
McGraw Hill's Q1 FY2026 results showed a modest net profit of $502K, with strong performance in digital and higher education segments boosting revenue to $535.7M. Adjusted EBITDA rose to $191.4M as margin improvements and cost control initiatives took effect.
Revenue rose 2.4% YoY to $535.7M, driven by digital and re-occurring growth
Net income reached $502K vs. a $9.4M loss YoY
Adjusted EBITDA grew 7.2% YoY to $191.4M with a 35.7% margin
Cash flow from operations was negative $96.7M, impacted by working capital timing
Revenue by Segment
Forward Guidance
For FY2026, McGraw Hill expects revenue between $1.986B and $2.046B and adjusted EBITDA between $663M and $703M, positioning for strong FY2027 growth.
Positive Outlook
- Digital and re-occurring revenue up 7.2% and 7.1% YoY respectively
- Gross margin rose to 77.0% due to digital mix
- Adjusted EBITDA margin expanded to 35.7%
- IPO proceeds strengthened balance sheet
- Positioned for growth in FY2027 with CA math approval and core literacy pilot
Challenges Ahead
- Cash flow from operations was negative at -$96.7M
- Print revenue declined YoY across segments
- International segment revenue fell 11.7% YoY
- Interest expense remained high at $58.8M
- Free cash flow remained negative in Q1
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Key Statistics
Market Cap
$2.82B
P/E Ratio
N/A
Sector
N/A
Industry
N/A
52-Week High
$18
52-Week Low
$10.8
Adjusted EBITDA
$191M
Net interest expense
$58.8M
Depreciation & amortization
$87.9M
Op. & admin expenses
$242M
Adj. R&D expenses
$65.2M
Historical Earnings Impact
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Avg. Return Before/After Earnings
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