Scholastic Swings to $62.5M Profit in Q3 FY2026 Amid Asset Sale Gains

Scholastic Corporation (NASDAQ: SCHL), a children's book publisher and educational media company, reported net income of $62.5 million for the quarter ending February 28, 2026, a sharp reversal from a net loss of $3.6 million in the same period a year earlier. Read more earnings reports.

Revenue for the fiscal third quarter declined 1.9% to $329.1 million from $335.4 million in the prior-year period. For the nine months ending February 28, revenue fell 1.0% to $1.11 billion from $1.12 billion.

The company's operating loss narrowed to $26.9 million from $23.9 million in the year-ago quarter. For the nine-month period, the operating loss improved to $36.2 million from $37.7 million.

Cost of goods sold decreased to $150.3 million from $154.6 million in the third quarter. Selling, general, and administrative expenses rose to $192.8 million from $187.5 million.

The company recorded a tax expense of $29.3 million in the quarter, a swing from a $24.8 million tax benefit a year earlier. Nine-month tax expense totaled $23.4 million compared to a $32.9 million benefit in the prior year.

Cash from operations turned negative at $39.1 million for the nine months, down from positive $17.3 million a year earlier. Cash from investing activities surged to $406.0 million, compared to a use of $232.0 million in the prior year, reflecting asset sales. Cash used in financing activities totaled $386.9 million versus cash provided of $197.6 million.

Total assets stood at $1.78 billion as of February 28, 2026, down from $1.95 billion at May 31, 2025. The company eliminated its long-term debt, which had been $250.0 million at fiscal year-end 2025.

Inventory increased to $282.5 million from $250.2 million at the prior fiscal year-end. Accounts receivable fell to $248.3 million from $273.4 million. Cash and cash equivalents totaled $104.6 million, down from $124.0 million.

Stockholders' equity decreased to $871.9 million from $946.5 million at May 31, 2025. Treasury stock increased to $730.2 million from $619.2 million, reflecting share repurchases. Retained earnings rose to $1.03 billion from $999.7 million.

The company reported diluted earnings per share of $2.55 for the quarter, compared to a loss of $0.13 per share a year earlier. For the nine months, diluted EPS reached $1.87 versus a loss of $0.61 per share.

Weighted average diluted shares outstanding decreased to 24.5 million from 27.8 million in the year-ago quarter, reflecting the impact of share buybacks.

Financial Summary