John Wiley & Sons (WLY) Q1 2027 earnings summary

Executive summary

• Q1 2027 revenue was $386 million, down 3% year-over-year, with operating income at $3 million and adjusted EPS at $0.44, both down due to restructuring and Emerald acquisition costs.

• Research segment grew 4% to $293 million, driven by strong publishing demand, Emerald acquisition, and AI revenue of $14 million.

• Learning segment revenue fell 19% to $93 million, impacted by prior-year AI licensing comparisons and market softness.

• Emerald Publishing acquisition completed ahead of schedule, contributing $13 million to revenue and expected to deliver $30 million in cost synergies.

• Dividend increased for the 33rd consecutive year, with $33 million returned to shareholders through dividends and buybacks.

Financial highlights

• Consolidated revenue declined 3% year-over-year to $386 million; operating income dropped to $3 million from $31 million.

• Adjusted EBITDA was $68 million, down 4% year-over-year; adjusted operating income was $31 million, down 9%.

• Net loss was $11.7 million, or $(0.23) per share, compared to net income of $11.7 million, or $0.22 per share, last year.

• Free cash flow usage improved to $(70) million from $(100) million year-over-year.

• Net debt-to-EBITDA ratio increased to 2.7x from 1.9x due to the Emerald acquisition.

Outlook and guidance

• Fiscal 2027 outlook reaffirmed: organic revenue growth expected in the low- to mid-single digits, driven by Research and AI/data analytics.

• Adjusted EBITDA margin projected at 26.5%–27.5%; adjusted EPS expected between $4.60 and $5.05, including $0.10 from Emerald.

• Free cash flow forecasted at $205 million, with Emerald expected to be accretive to EPS by $0.10 but dilutive to free cash flow by $15 million in FY27.

• AI revenue on track for over $50 million in fiscal 2027, with recurring AI revenue expected to grow 2x-3x year-over-year.

• Global Restructuring Program expected to yield $125 million in annualized cost savings, with $120 million anticipated in FY2027.