Scholastic Corporation · Q3 2023 earnings

Briefing

Scholastic's Q3 2023 results were impacted by short-term headwinds in domestic and international markets, leading to sales declines and higher losses, while the Children’s Books segment sustained growth and outperformed the overall retail children’s book market.

Scholastic reported a decrease in revenues to $324.9 million, reflecting softening retail demand for children’s books. The Children’s Book Publishing and Distribution segment revenues grew due to strong performance in the Book Fairs channel. Operating loss increased to $27.7 million. The company updated its fiscal year 2023 outlook, expecting Adjusted EBITDA of $175 million to $185 million and revenue growth of approximately 4%.

• Revenues decreased to $324.9 million, impacted by softening retail demand.
• Children’s Book Publishing and Distribution segment revenues grew, driven by Book Fairs.
• Operating loss increased to $27.7 million.
• Fiscal 2023 outlook updated with Adjusted EBITDA expected between $175 million and $185 million, and revenue growth of approximately 4%.

Headline financials

Revenue & EPS history

The Company has updated its guidance for fiscal year 2023 and now expects Adjusted EBITDA of $175 million to $185 million (compared to a range of $195 to $205 million, previously). Full-year revenue is expected to grow approximately 4% (compared to a range of 8% to 10%, previously), as the Company takes additional steps to manage spending and preserve margins in line with its updated outlook.