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McGraw Hill Raises Outlook as Recurring and Digital Gains Counter K‑12 Slowdown

The report triggered a sharp rally before a modest after-hours pullback.

Overview

  • Fiscal Q2 revenue fell 2.8% to $669.2 million and GAAP net income declined 21.1% to $105.3 million, which the company tied to a smaller K-12 market.
  • Recurring revenue rose 6.5% to $422.4 million and digital revenue increased 7.6% to $352.2 million.
  • GAAP gross profit margin expanded by 150 basis points to 79.2% and adjusted EBITDA margin improved by 60 basis points to 42.8%.
  • Management raised fiscal 2026 revenue guidance to $2.031–$2.061 billion from a prior $1.986–$2.046 billion range.
  • Shares jumped 23.92% during regular trading on Wednesday, then slipped 0.92% after hours to $13.96.