Scholastic completed an eventful fiscal year ended May 31, 2025 with total revenue rising 2%, to $1.62 billion, operating income increasing 9%, to $15.8 million, and adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) up 6%, to $145.4 million. The children’s publisher attributed the improved bottomline to measures that controlled the increase in costs that offset modest revenue growth.
Scholastic has often had trouble getting all its operating divisions to grow at the same time and that was the case again in fiscal 2025. The sore spot this year was the company’s educational solutions division, where sales fell 12%, to $309.8 million.
In prepared remarks, CEO Peter Warwick said that Scholastic is “taking important steps to reposition the business for profitable growth amid a challenging supplemental curriculum market.” Warwick added that there is currently a new leadership team in place charged with creating new products that “better align with the evolving needs of educators, schools, and families.” He also acknowledged the division is operating in an environment where there is “near-term uncertainty about school funding.”
Scholastic’s biggest segment, the children’s book publishing and distribution division, eked out a small increase with sales rising 1%, to $963.9 million. Book fairs and the trade divisions both had 1% increases, with sales of $548.3 million and $351.4 million, respectively. Book club revenue rose 1.5%, to $64.2 million.
Toward the end of the fiscal year, Scholastic combined its trade publishing, book fairs, and book clubs businesses into the Scholastic Children’s Book Group under the direction of Sasha Quinton.
The objective of the restructuring, Scholastic said, is to bolster the company’s “360-degree” IP creation strategy to deliver its content in as many formats and platforms as possible. A key part of that strategy is the 2024 acquisition of 9 Story Media Group, which comprises the heart of Scholastic’s entertainment group. Sales in the group for the first full year 9 Story was part of Scholastic were $59.1 million.
Sales in the international division increased 2%, to $279.6 million.
In previous earnings reports, Scholastic executives had said they didn’t expect higher tariffs to impact earnings in fiscal 2025 because almost all their inventory had already been paid for. That will shift slightly in the current fiscal year with the company anticipating approximately $10 million in additional costs related to higher tariffs.
Still, Scholastic is expecting adjusted EBITDA to be $160 million to $170 million compared to $145.4 million in fiscal 2025. Revenue is expected to grow 2% to 4% in fiscal 2026. One wildcard for the current fiscal year is the June announcement that Scholastic is exploring the sale of its real estate holdings, including the sale of its New York City headquarters. If a sale were to take place in the current fiscal year it could provide additional cash to the company.
