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Franklin Covey (FC) investor relations material
Franklin Covey Q1 2026 earnings summary
Complete event summary combining all related documents: earnings call transcript, report, and slide presentation.Executive summary
Q1 FY2026 revenue was $64.0 million, down from $69.1 million in Q1 FY2025, reflecting macroeconomic headwinds, lower deferred revenue, and canceled U.S. government contracts.
Net loss for Q1 FY2026 was $3.3 million, or $(0.27) per share, compared to net income of $1.2 million, or $0.09 per share, in the prior year.
Adjusted EBITDA was $3.7 million, down from $7.7 million in the prior year, with free cash flow negative $3.7 million versus $11.4 million last year.
Strong growth in Enterprise North America invoiced amounts, up 7% (13% excluding government), signals positive momentum from new go-to-market strategy.
Deferred subscription revenue increased 5% year-over-year to $100.2 million, and liquidity remains strong at $80 million, including $17.5 million in cash and no drawdowns on a $62.5 million credit facility.
Financial highlights
Gross profit margin for Q1 FY2026 was 75.5%, down from 76.3% in Q1 FY2025, with gross profit at $48.4 million.
Operating SG&A was $44.7 million, flat year-over-year, but as a percentage of revenue increased to 69.8% from 65.2%.
Adjusted EBITDA margin dropped to 5.7% from 11.1% year-over-year.
Cash provided by operating activities was $0.1 million, down from $14.1 million in the prior year.
Free cash flow for Q1 FY2026 was negative $3.7 million, compared to $11.4 million in Q1 FY2025.
Outlook and guidance
Full-year FY2026 revenue guidance reaffirmed at $265–$275 million, with Adjusted EBITDA expected between $28–$33 million.
Growth in invoiced amounts in FY2026 is expected to drive accelerated reported revenue, Adjusted EBITDA, and free cash flow in FY2027.
Approximately 45–50% of revenue and 25–30% of Adjusted EBITDA will be recognized in the first half, reflecting seasonality and timing of Education contracts.
Margin expansion anticipated in the second half as cost savings and operating leverage build.
Management expects improved cash flows and revenue growth in future quarters as transformation investments in North America gain traction.
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