JOHN WILEY & SONS, INC.

On a constant currency basis, adjusted unallocated corporate expenses of$40.7 million on an Adjusted EBITDA basis increased 4% as compared with the prior year. This was primarily due to an increase in costs related to strategic consulting projects, which are now complete, of approximately $3.6 million and, to a lesser extent, an increase in enterprise modernization costs, partially offset by lower employee costs.

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LIQUIDITY AND CAPITAL RESOURCES

Principal Sources of Liquidity

We believe that our operating cash flow, together with our revolving credit facilities and other available debt financing, will be adequate to meet our operating, investing, and financing needs in the next twelve months. Operating cash flow provides the primary source of cash to fund operating needs and capital expenditures. Excess operating cash is used to fund shareholder dividends and share repurchases. Other discretionary uses of cash flow include investments and acquisitions to complement and grow our portfolio of businesses. As necessary, we may supplement operating cash flow with debt to fund these activities. The overall cash position of the Company reflects our durable business results and a global cash management strategy that considers liquidity management, economic factors and tax considerations. Our cash and cash equivalents are maintained at a number of financial institutions. To mitigate the risk of uninsured balances, we select financial institutions based on their credit ratings and financial strength, and we perform ongoing evaluations of these institutions to limit our concentration risk exposure to any financial institution.

As of July 31, 2025, we had cash and cash equivalents of $81.9 million, of which approximately all was located outside the US. Maintenance of these cash and cash equivalent balances outside the US does not have a material impact on the liquidity or capital resources of our operations. We intend to repatriate earnings from our non-US subsidiaries, and to the extent we repatriate these funds to the US, we may be required to pay taxes in various US state and local jurisdictions and withholding or similar taxes in applicable non-US jurisdictions in the periods in which such repatriation occurs. Accordingly, as of July 31, 2025 we have recorded a deferred tax liability of approximately $2.0 million related to the estimated taxes that would be incurred upon repatriating certain non-US earnings to the US.

On November 30, 2022, we entered into the second amendment to the Third Amended and Restated Credit Agreement (collectively, the Amended and Restated CA). See Note 15, “Debt and Available Credit Facilities” for more details on the amendment. The Amended and Restated CA provided for senior unsecured credit facilities comprised of the following (i) a five-year revolving credit facility in an aggregate principal amount up to $1.115 billion which matures November 2027, (ii) a five-year term loan A facility consisting of $200 million which matures November 2027, and (iii) $185 million aggregate principal amount revolving credit facility which matured in May 2024.

As of July 31, 2025, we had approximately $828.3 million of debt outstanding, net of unamortized issuance costs of $0.4 million, and approximately $469.4 million of unused borrowing capacity under our Amended and Restated CA and other facilities. Our Amended and Restated CA contains certain restrictive covenants related to our consolidated leverage ratio and interest coverage ratio, which we were in compliance with as of July 31, 2025.

Analysis of Historical Cash Flows

The following table shows the changes in our Unaudited Condensed Consolidated Statements of Cash Flows.

Cash flow from operations is seasonally a use of cash in the first half of Wiley’s fiscal year principally due to the timing of collections for annual Journal Subscriptions and Transformational Agreements, which typically occurs in the beginning of the second half of our fiscal year.

Free cash flow less product development spending helps assess our ability, over the long term, to create value for our shareholders, as it represents cash available to repay debt, pay common dividends, and fund share repurchases, and acquisitions. Below are the details of Free cash flow less product development spending.

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Free Cash Flow Less Product Development Spending:

Net Cash Used In Operating Activities

The following is a summary of the $3.7 million change in Net cash used in operating activities for the three months ended July 31, 2025 compared with the three months ended July 31, 2024 (amounts in millions).

The unfavorable change in accounts receivable, net and contract liabilities was primarily due to lower revenue and the timing of invoicing and collections with customers.

The unfavorable change in accounts payable and accrued royalties was primarily due to the timing of payments.

The favorable changes in other assets and liabilities was due to employee related costs primarily due to lower payments for annual incentive compensation in fiscal year 2026 related to the prior fiscal year, cash received of $4.2 million for the interest receivable portion of the Seller Note related to the Sale Agreement in fiscal year 2026, and other working capital changes. This was partially offset by higher income tax payments, net, and costs related to cloud computing arrangements primarily associated with targeted enterprise modernization work in fiscal year 2026. These cloud computing costs are capitalizable and amortized but included in cash flow from operations rather than cash flow from investing activities.

Our negative working capital (current assets less current liabilities) was $228.5 million and $381.0 million as of July 31, 2025 and April 30, 2025, respectively. This $152.5 million change in negative working capital was primarily due to the seasonality of our business. The primary driver of the negative working capital is the benefit realized from unearned contract liabilities related to subscriptions for which cash has been collected in advance. The contract liabilities will be recognized as revenue when the products are shipped or made available online to the customers over the term of the subscription. Current liabilities as of July 31, 2025 and as of April 30, 2025 includes $361.7 million and $462.7 million, respectively, primarily related to deferred subscription revenue for which cash was collected in advance.

Cash collected in advance for subscriptions is used by us for a number of purposes, including funding operations, capital expenditures, acquisitions, debt repayments, dividend payments, and share repurchases.

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Net Cash Provided By (Used In) Investing Activities

Net cash provided by investing activities for the three months ended July 31, 2025 was $98.9 million compared to net cash used in investing activities of $23.8 million in the prior year. The increase in net cash provided by investing activities was primarily due to the $115.3 million in cash received in fiscal year 2026 as a result of the Sale Agreement. See Note 3, "Divestitures" for further details.

Net Cash (Used In) Provided By Financing Activities

Net cash used in financing activities was $16.9 million for the three months ended July 31, 2025 compared to net cash provided by financing activities of $101.6 million for the three months ended July 31, 2024. This change was due to lower net borrowings in fiscal year 2026 of $113.2 million.

In the three months ended July 31, 2025, we increased our quarterly dividend to shareholders to $1.42 per share annualized versus $1.41 per share annualized in the prior year.

During the three months ended July 31, 2025, our Board of Directors approved an additional share repurchase program of $250 million of Class A or B Common Stock. No share repurchases were made under this program during the three months ended July 31, 2025. This share repurchase program is in addition to the share repurchase program approved by our Board of Directors during the year ended April 30, 2020 of $200 million of Class A or B Common Stock. As of July 31, 2025, we had authorization from our Board of Directors to repurchase up to $43.4 million that was remaining under this program. During the three months ended July 31, 2025 and 2024, we repurchased $14.0 million and $12.5 million, respectively, under this program.

The following table summarizes the shares repurchased of Class A and Class B Common Stock (shares in thousands):

The total amount repurchased and the average price per share excludes excise taxes payable on share repurchases and may differ from the share repurchases reflected in Purchases of treasury shares in our Unaudited Condensed Consolidated Statements of Cash Flows. For the three months ended July 31, 2025, the total amount repurchased and the total shares repurchased includes unsettled purchases, and such amount differs from the amount reflected in Purchases of treasury shares in our Unaudited Condensed Consolidated Statements of Cash Flows.

ACCOUNTING STANDARDS UPDATE

We are required to prepare our Unaudited Condensed Consolidated Financial Statements in accordance with the Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) which is the source for all authoritative US GAAP. The FASB ASC is subject to updates by the FASB, which are known as Accounting Standards Updates (ASU). See Note 2, "Recent Accounting Standards" of Part I, Item 1, "Notes to Unaudited Condensed Consolidated Financial Statements" for further information.