Scholastic Shares Plunge 14% as Q2 Earnings and Revenue Fall Short of Expectations

NEW YORK - Shares of children's book publisher Scholastic Corporation (NASDAQ:SCHL) experienced a sharp decline of 14% following the company's announcement of financial second-quarter results that fell short of analyst expectations, resulting in a year-over-year decrease in revenue alongside a drop in publishing sales. The company reported adjusted earnings of $1.82 per share for the quarter ending November 30, significantly below analysts' expectations of $2.93. Revenue declined by 3% year-over-year to $544.6 million, falling short of the forecast of $587.06 million.

Scholastic attributed the revenue decline primarily to timing-related factors within its Children’s Book Publishing and Distribution segment, including this year's publishing schedule and fall fair bookings compared to the previous year. Revenue from Book Fairs dropped by 5% year-over-year to $231 million due to a decrease in the number of fairs held during the quarter.

President and CEO Peter Warwick stated, "As we mentioned when we announced our first-quarter earnings, the second-quarter results were lower than the previous year; this primarily reflects the timing of this year's publishing releases."

The company reaffirmed its guidance for fiscal year 2025, expressing confidence in its ability to navigate market conditions and execute its full-year plan. Scholastic also announced an increase in its revolving credit facility to $400 million.