SCHOLASTIC CORP
For the period ended May 31, 2026. Filed Jul 24, 2026.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2026 · Filed Jul 24, 2026
SCHL$37.20+0.9%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2025-05-31; filed 2025-07-25.
0000866729-25-000020
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2026-05-31; filed 2026-07-24.
0000866729-26-000018
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 96 previous paragraphs and 92 current paragraphs.
39 unchanged; 22 reworded; 31 added; 34 removed; 1 previous and 0 current paragraphs rearranged.
Tables are not compared: 7 previous and 7 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (31)
Current report
Fiscal 2026 reflected the continued execution of the Company's multi-year transformation strategy, focused on strengthening its organizational structure, enhancing operating efficiency, optimizing its portfolio, and improving capital allocation. Growth in Book Fairs, driven by increases in both fair count and revenue per fair, as well as higher Entertainment revenues, substantially offset declines in trade channel revenues resulting from the challenging prior-year publishing comparisons and lower Education revenues attributable to the continued funding volatility. Despite the overall decline in revenues, operating income remained relatively consistent with the prior year as the Company continued to execute disciplined cost management initiatives and realize operational efficiencies. Additionally, following the completion of the sale-leaseback transactions, the Company returned more than $285 million of capital to shareholders through share repurchases, including a modified Dutch auction tender offer, and the payment of cash dividends.
Current report
Looking ahead to fiscal 2027, the Company intends to focus its School Reading Events business on increasing fair count, while further simplifying the Book Clubs program and improving execution to enhance engagement with teachers and families. The Company also expects to benefit from a strong global publishing pipeline, including the release of the next title in the best-selling Dog Man series in November and new publishing related to the new Harry Potter series on HBO, as well as new titles in The Baby-Sitters Club, Wings of Fire, and I Survived franchises. In addition, a new Clifford the Big Red Dog animated series is expected to premiere on PBS KIDS in 2027. Within Education, school and district funding conditions are expected to remain volatile, particularly in supplemental curriculum. The Company intends to build on its core literacy strengths to position the business for a return to growth as its strategy advances and market conditions stabilize. Overall, the Company remains focused on executing its strategic priorities, maintaining disciplined cost management, and making targeted investments in areas with the greatest potential to drive long-term growth, strengthen engagement with children, families, and educators, and enhance shareholder value.
Current report
Revenues from operations for the fiscal year ended May 31, 2026 decreased by $43.6 million, or 3%, to $1,581.9 million, compared to $1,625.5 million in the prior fiscal year.
Current report
Children’s Book Publishing and Distribution segment revenues were consistent with the prior fiscal year, increasing by $0.3 million. Increased revenues from School Reading Events, primarily driven by higher fair count, were substantially offset by lower trade channel revenues, as the prior year benefited from increased sales related to the release of Suzanne Collins’Sunrise on the Reaping, as well as lower book clubs channel revenues due to reduced sponsor participation.
Current report
Education segment revenues decreased by $42.2 million, primarily driven by lower sales of supplemental curriculum products due to the continued challenging funding environment for schools and school districts, coupled with lower subscription revenues from Magazines+ and lower revenues from sponsored programs.
Current report
Entertainment segment revenues increased by $4.7 million, reflecting increased revenues from production services.
Current report
International segment revenues decreased by $2.4 million, primarily driven by lower trade channel revenues in Canada and the U.K., partially offset by increased trade and education sales in Asia and higher trade channel revenues in Australia, as well as favorable foreign currency exchange of $6.3 million.
Current report
Rental income, included in the Overhead segment, decreased by $4.0 million compared to the prior fiscal year, primarily as a result of the sale-leaseback of the Company’s headquarters in New York City in fiscal 2026, after which the Company no longer owned the underlying leasable space.
Current report
Cost of goods sold as a percentage of revenues for the fiscal year ended May 31, 2026 was 43.6%, compared to 44.2% in the prior fiscal year. The decrease was primarily driven by lower product costs in the Educationand International segments, reflecting the mix of products sold during the year ended May 31, 2026, as well as lower royalty costs in the U.S. trade channel due to a shift in sales mix toward titles with lower royalty rates. In addition, Cost of goods sold was favorably impacted by tariff mitigation actions and tariff refunds received during fiscal 2026. These improvements were partially offset by higher shipping and postage costs associated with sponsored programs in Education and higher fulfillment costs in Canada.
Current report
Selling, general and administrative expenses for the fiscal year ended May 31, 2026 were $807.2 million, compared to $822.3 million in the prior fiscal year. The $15.1 million decrease was primarily attributable to lower employee-related and external labor costs resulting from the Company's prior reorganization efforts and cost-saving initiatives, as well as reduced spending on general overhead expenses. These decreases were partially offset by higher severance expense of $4.6 million related to cost-saving initiatives in the year ended May 31, 2026 and higher rent expense of $8.4 million resulting from the sale and leaseback of the Company's New York City headquarters. The Company expects rental expense to increase in fiscal 2027 compared to fiscal 2026, primarily due to the recognition of a full year of expense associated with the Company's leased headquarters and primary distribution facilities.
Current report
Depreciation and amortization expenses for the fiscal year ended May 31, 2026 were $58.8 million, compared to $65.7 million in the prior fiscal year. The $6.9 million decrease was primarily attributable to the sale of the Company's headquarters in New York City and distribution center in Jefferson City, Missouri during fiscal 2026.
Current report
Interest expense for the fiscal year ended May 31, 2026 was $14.1 million, compared to $18.2 million in the prior fiscal year. The decrease was due to repayments of borrowings under the U.S. Credit Agreement during the year ended May 31, 2026.
Current report
Loss on sale of investments for the fiscal year ended May 31, 2026 was $17.2 million. During fiscal 2026, the Company sold its 26.2% equity interest in a U.K.-based children’s book publishing business, resulting in the loss.
Current report
Gain on sale and leaseback transactions for fiscal year ended May 31, 2026 was $99.7 million. During fiscal 2026, the Company completed sale and leaseback transactions related to its headquarters in New York City and primary distribution center in Jefferson City, Missouri, resulting in a pre-tax gain of $99.7 million.
Current report
Revenues for the fiscal year ended May 31, 2026 increased by $0.3 million to $964.2 million, compared to $963.9 million in the prior fiscal year. Higher revenues from School Reading Events of $20.6 million were substantially offset by a $20.3 million decrease in trade channel revenues. Within School Reading Events, book fairs channel revenues increased by $27.7 million, primarily driven by higher fair count as well as higher revenue per fair and increased redemptions of book fair incentive program credits. This increase was partially offset by lower book clubs channel revenues of $7.1 million primarily due to lower sponsor participation. Within the trade channel, the year-over-year revenue decline was attributable to elevated sales in the prior fiscal year following the release of Sunrise on the Reapingby Suzanne Collins. This decline was partially offset by higher sales of backlist titles from The Hunger Games and other bestselling series.
Current report
Cost of goods sold for the fiscal year ended May 31, 2026 was $393.5 million, or 40.8% of revenues, compared to $410.2 million, or 42.6% of revenues, in the prior fiscal year. The decrease in Cost of goods sold as a percentage of revenues was primarily attributable to lower royalty costs in the trade channel, driven by a shift in sales mix toward titles with lower royalty rates during the fiscal year ended May 31, 2026. In addition, Cost of goods sold was favorably impacted by improved inventory utilization in the book clubs channel, resulting in lower excess and obsolete inventory, as well as tariff mitigation actions and tariff refunds received during fiscal 2026.
Current report
Other operating expenses were $426.4 million for the fiscal year ended May 31, 2026, compared to $422.4 million in the prior fiscal year. The $4.0 million increase in Other operating expenses was primarily due to inflationary pressures on employee-related and general expenses, largely within the book fairs channel. The Company expects Other operating expenses to increase in fiscal 2027 compared to fiscal 2026, primarily due to the recognition of a full year of rental expense associated with the Company's leased headquarters and primary distribution facilities.
Current report
Asset impairments were $1.4 million for the fiscal year ended May 31, 2026, compared to $0.6 million in the prior fiscal year. In fiscal 2026, the Company recognized asset impairments of $0.8 million related to a certain product that is no longer being sold and $0.6 million related to inventory destroyed in a warehouse fire. In fiscal 2025, the Company recognized an asset impairment of $0.6 million related to certain digital products. Refer to Note 5, "Asset Write Down," of Notes to the Consolidated Financial Statements in Item 8, "Consolidated Financial Statements and Supplementary Data" for further details.
Current report
Segment operating income for the fiscal year ended May 31, 2026 was $142.9 million, compared to $130.7 million in the prior fiscal year. The $12.2 million increase in operating income was primarily attributable to favorable cost of goods sold, driven by lower royalty costs in the trade channel as well as improved inventory utilization in the book clubs channel, which resulted in lower excess and obsolete inventory. This was partially offset by higher employee-related and general expenses in the book fairs channel due to inflationary pressures.
Current report
EDUCATION
Current report
Revenues for the fiscal year ended May 31, 2026 decreased by $42.2 million to $267.6 million, compared to $309.8 million in the prior fiscal year. The decrease in segment revenues was primarily driven by lower sales of supplemental curriculum products due to the continued challenging funding environment for schools and school districts, coupled with lower subscription revenues from Magazines+ and lower revenues from sponsored programs.
Current report
Cost of goods sold for the fiscal year ended May 31, 2026 was $104.1 million, or 38.9% of revenues, compared to $122.8 million, or 39.6% of revenues, in the prior fiscal year. Cost of goods sold as a percentage of revenues benefited from lower product costs driven by the mix of products sold during the year ended May 31, 2026, combined with improved inventory utilization, resulting in lower excess and obsolete inventory. These benefits were partially offset by higher shipping and postage costs associated with sponsored programs.
Current report
Other operating expenses were $163.3 million for the fiscal year ended May 31, 2026, compared to $180.1 million in the prior fiscal year. The $16.8 million decrease in Other operating expenses was primarily attributable to lower employee-related and external labor costs, as well as reduced general overhead spending.
Current report
Segment operating loss for the fiscal year ended May 31, 2026 was $4.1 million, compared to operating income of $6.3 million in the prior fiscal year. The overall decline of $10.4 million was driven by lower revenues, primarily reflecting the continued challenging funding environment for schools and school districts, as well as asset impairment charges recognized during the year ended May 31, 2026. This decline was partially offset by lower employee-related and external labor costs, as well as reduced general overhead spending.
Current report
Revenues for the fiscal year ended May 31, 2026 increased by $4.7 million to $65.7 million, compared to $61.0 million in the prior fiscal year period. The increase in segment revenues was primarily driven by higher revenues from production services.
Current report
Cost of goods sold for the fiscal year ended May 31, 2026 was $37.9 million, or 57.7% of revenues, compared to $33.4 million, or 54.8% of revenues, in the prior fiscal year. The increase was primarily driven by the revenue mix, with an increase in production services revenue, which generally carries higher associated costs.
Current report
Other operating expenses for the fiscal year ended May 31, 2026 were $38.7 million, compared to $39.2 million in the prior fiscal year. The $0.5 million decrease in Other operating expenses was primarily attributable to lower severance expense from cost-saving initiatives and the absence of acquisition-related costs incurred in the prior fiscal year in connection with the acquisition of 9 Story. These decreases were partially offset by increased employee-related costs.
Current report
Other operating expenses were $115.8 million for the fiscal year ended May 31, 2026, compared to $120.2 million in the prior fiscal year. Other operating expenses decreased by $4.4 million, primarily due to lower employee-related costs in Asia, Canada, the U.K., and certain overhead functions resulting from operational efficiencies and prior cost-saving initiatives, including a $2.1 million decrease in severance expense related to such initiatives.
Current report
Segment operating income for the fiscal year ended May 31, 2026 was $6.4 million, compared to an operating loss of $1.0 million in the prior fiscal year. The $7.4 million improvement was primarily driven by lower employee-related costs, including lower severance expense, primarily in Asia, resulting from operational efficiencies and prior cost-saving initiatives, as well as improved margins in Australia, reflecting lower product costs due to the mix of products sold in fiscal 2026. Operating income also benefited from the absence of asset impairment charges that were recognized in the prior fiscal year.
Current report
Unallocated overhead expense for the fiscal year ended May 31, 2026 increased by $5.8 million to $113.9 million, compared to $108.1 million in the prior fiscal year. The increase was primarily attributable to the $7.2 million impact of sale and leaseback transactions completed during the third quarter of fiscal 2026, which resulted in lower rental income and higher rent expense, partially offset by lower depreciation expense. In addition, the Company incurred $7.9 million of higher severance expense related to cost-savings initiatives, which was partially offset by lower employee-related costs resulting from reorganization efforts implemented in prior periods. The Company expects rental expense to increase in fiscal 2027 compared to fiscal 2026, primarily due to the recognition of a full year of expense associated with the Company's leased headquarters facility.
Current report
Cash provided by investing activities was $405.8 million for the fiscal year ended May 31, 2026, compared to cash used in investing activities of $252.9 million for the prior fiscal year, representing an increase in cash provided by investing activities of $658.7 million. This increase was primarily driven by $452.4 million of pre-tax net proceeds from sale and leaseback transactions related to the Company's New York City headquarters and Jefferson City, Missouri primary distribution center, as well as $19.4 million of net proceeds from the sale of the Company's 26.2% equity interest in a U.K.-based children’s book publishing business. The increase was also attributable to the absence of the $176.2 million cash outflow incurred in the prior fiscal year in connection with the acquisition of 9 Story, as well as lower capital and prepublication expenditures of $10.4 million.
Removed paragraphs (34)
Previous report
During fiscal 2025, the Company successfully integrated 9 Story into its Entertainment segment, which significantly contributed to the Company's revenue growth year over year. Fiscal 2025 results also reflected new releases in the Company's bestselling series, including Sunrise on the Reaping, the latest installment in Suzanne Collins’Hunger Games series and Dav Pilkey's Dog Man #13: Big Jim Begins, which benefited the Company's trade channels globally and helped to offset softness in the overall retail market. Education Solutions continued to be negatively impacted by the continuing headwinds in the supplemental curriculum market and the Company is repositioning the business focused on long-term growth and improved profitability under its new leadership. Operating income in fiscal 2025 was $15.8 million compared to $14.5 million in the prior fiscal year, representing an increase of $1.3 million, as the Company successfully executed on a cost management strategy.
Previous report
During fiscal 2026, the Company expects to continue to expand the reach and monetization of Scholastic’s intellectual property, which includes the release of the next title in the best-selling Dog Man series and a growing slate of content development and production commitments. While there continues to be significant near-term uncertainty about school funding, the Company is focusing its product development and go-to-market strategies in Education Solutions to better align with the evolving needs of educators, schools, and families. The Company has also made progress on its strategic and operational initiatives, which include streamlining the Company's organizational structure, strengthening leadership, reducing costs and evaluating options to optimize its real estate assets, all of which are intended to enhance the Company's ability to drive long-term growth and deliver greater value to shareholders.
Previous report
Business combinations:
Previous report
The Company allocates the purchase price in a business combination to the underlying tangible and identifiable intangible assets acquired and liabilities assumed based on their estimated fair values, with any excess recorded as goodwill. Determining the fair value of assets acquired and liabilities assumed requires judgment and often involves the use of significant estimates and assumptions, including assumptions with respect to future cash flows, discount rates, estimated useful lives and market multiples, among other items.
Previous report
With respect to the 9 Story acquisition, the Company was required to make significant judgments and estimates, particularly in the identification and valuation of identifiable intangible assets. The Company utilized a third-party valuation specialist in determining the fair values. The assets acquired primarily include intellectual property ("IP") related to 9 Story's existing and recognized program titles, customer contracts/relationships related to licensing, distribution and service arrangements, and the trade names associated with 9 Story and Brown Bag Films, its animation studio. The intellectual property and customer contracts/relationships were valued using the multi-period excess earnings valuation method and the tradename was valued using the relief-from-royalty valuation method. The significant underlying assumptions used in these methods included the projected revenue and revenue attributable to the individual intangible assets, as well as the discount and royalty rate. These assumptions are inherently subjective and sensitive to changes in market conditions and the future performance of the acquired business. Refer to Note 11, "Acquisitions," of Notes to Consolidated Financial Statements in Item 8, “Consolidated Financial Statements and Supplementary Data” for further details regarding this acquisition.
Previous report
(2) The Entertainment segment includes the operations of Scholastic Entertainment Inc. ("SEI"), which were included in the Children’s Book Publishing and Distribution segment in prior periods, and 9 Story, as acquired on June 20, 2024. The financial results for SEI for the prior fiscal year presented have been reclassified to Entertainment to reflect this change.
Previous report
Revenues from operations for the fiscal year ended May 31, 2025 increased by $35.8 million, or 2.3%, to $1,625.5 million, compared to $1,589.7 million in the prior fiscal year. Children’s Book Publishing and Distribution, Entertainmentand International segment revenues increased $10.6 million, $59.1 million and $6.0 million, respectively, partially offset by lower revenues from the Education Solutions segment of $41.4 million.
Previous report
Children’s Book Publishing and Distribution segment revenues increased $10.6 million, primarily driven by the school reading events business on higher fair count in the book fairs channel and higher revenue per sponsor in the book clubs channel. Trade channel revenues were relatively consistent with the prior year as increased sales from the Hunger Games and Dog Manseries, driven by the latest releases, Sunrise on the Reapingand Dog Man #13: Big Jim Begins, respectively, were largely offset by lower sales of backlist titles reflecting continued softness in the retail book market.
Previous report
Education Solutions segment revenues decreased $41.4 million, primarily driven by the continued impact of market conditions as school districts focus on adopting and implementing new evidence-based core programs and decrease spending on supplemental materials.
Previous report
Entertainment segment revenues increased $59.1 million, reflecting the addition of 9 Story.
Previous report
International segment revenues increased $6.0 million, primarily driven by increased revenues from the Company's Major Markets, which benefited from the new releases in the Hunger Games and Dog Manseries. International segment revenues were also impacted by unfavorable foreign currency exchange of $1.6 million.
Previous report
Cost of goods sold as a percentage of revenue for the fiscal year ended May 31, 2025 was 44.2%, compared to 44.4% in the prior fiscal year. Cost of goods sold benefited from favorable product mix in the trade channels, driven in particular by the higher priced hardcover sales of Sunrise on the Reaping. This was largely offset by higher royalty costs as a result of an increase in the mix of higher-royalty bearing titles sold in the fiscal year ended May 31, 2025 and the addition of production costs as a result of the 9 Story acquisition. The Company expects cost of good sold to increase in fiscal 2026 due to the newly imposed tariffs.
Previous report
Selling, general and administrative expenses for the fiscal year ended May 31, 2025 were $822.3 million, compared to $803.0 million in the prior fiscal year. The $19.3 million increase was primarily attributable to the addition of 9 Story, which resulted in higher operating expenses in the period ended May 31, 2025, partially offset by lower commission expense and external labor costs within Education Solutions. In addition, amortization expense related to cloud computing arrangements for the fiscal year ended May 31, 2025 increased by $2.5 million compared to the prior fiscal year as a result of new assets placed into service.
Previous report
Depreciation and amortization expenses for the fiscal year ended May 31, 2025 were $65.7 million, compared to $57.1 million in the prior fiscal year. The $8.6 million increase in Depreciation and amortization was primarily driven by the intangible assets acquired as a result of the 9 Story acquisition. The Company also continues to shift spending to cloud computing arrangements in which the amortization expense is included in Selling, general and administrative expenses rather than Depreciation and amortization.
Previous report
Interest expense for the fiscal year ended May 31, 2025 was $18.2 million, compared to $1.9 million in the prior fiscal year. The increase in interest expense was due to borrowings under the U.S. Credit Agreement incurred during the first quarter of fiscal 2025 to fund the 9 Story acquisition. The Company expects to maintain these borrowings into the next fiscal year resulting in comparable to slightly higher interest expense in fiscal 2026. Any potential asset monetization strategies executed by the Company could result in repayments of the outstanding borrowings and reduce interest expense.
Previous report
Revenues for the fiscal year ended May 31, 2025 increased by $10.6 million to $963.9 million, compared to $953.3 million in the prior fiscal year. The increase in segment revenues was primarily driven by increased revenues from School Reading Events of $8.2 million. Book fairs channel revenues increased $6.7 million, driven by higher fair count, partially offset by slightly lower revenue per fair as compared to the prior year. Book clubs channel revenues increased $1.5 million as a result of higher revenue per sponsor and an increase in events. Trade channel revenues were relatively consistent with the prior year, increasing $2.4 million, or 1%, as increased sales from the Hunger Games and Dog Manseries, driven by the latest releases, Sunrise on the Reapingand Dog Man #13: Big Jim Begins, respectively, were largely offset by lower sales of backlist titles reflecting continued softness in the retail book market. The retail book market is expected to remain soft in fiscal 2026 and, similar to fiscal 2025, the Company is anticipating its proprietary school market channels to outpace this softness.
Previous report
Cost of goods sold for the fiscal year ended May 31, 2025 was $410.2 million, or 42.6% of revenues, compared to $412.0 million, or 43.2% of revenues, in the prior fiscal year. The improvement in Cost of goods sold as a percentage of revenues was primarily attributable to the mix of product sold in the trade channel in fiscal 2025, driven in particular by the higher priced hardcover sales of Sunrise on the Reaping, partially offset by higher royalty costs as a result of an increase in the mix of higher-royalty bearing titles sold in the fiscal year ended May 31, 2025. In addition, the book fairs channel had lower excess inventory reserves as a result of better inventory utilization. The Company expects an increase in cost of product as a result of increased tariffs, especially in the book fairs channel beginning in the peak selling season in the upcoming second fiscal quarter.
Previous report
Other operating expenses were $422.4 million for the fiscal year ended May 31, 2025, compared to $417.5 million in the prior fiscal year. The $4.9 million increase in Other operating expenses was primarily attributable to the book fairs channel to support the increased fair count, in addition to inflationary pressures.
Previous report
Segment operating income for the fiscal year ended May 31, 2025 was $130.7 million, compared to $123.3 million in the prior fiscal year. The $7.4 million increase in operating income was attributable to higher revenues, primarily from School Reading Events, driven by higher fair count in the book fairs channel, coupled with favorable cost of product in the trade channel driven by higher margins on Sunrise on the Reaping. This was partially offset by increased operating costs in the book fairs channel to support the increased fair count.
Previous report
EDUCATION SOLUTIONS
Previous report
Revenues for the fiscal year ended May 31, 2025 decreased by $41.4 million to $309.8 million, compared to $351.2 million in the prior fiscal year. The decrease in segment revenues was primarily driven by the continued impact of market conditions as school districts focus on adopting and implementing new evidence-based core programs and decrease spending on supplemental materials. In addition, subscription revenues from Magazines+ and revenues from community literacy programs decreased from the prior fiscal year. Partially offsetting the decline, the segment benefited from increased revenues from sponsored programs as a result of an increase in participants and increased sales of the Company's Ready4Reading TM phonics curriculum. The Company expects the revenues to remain consistent in fiscal 2026 due to the on-going headwinds in the education market.
Previous report
Cost of goods sold for the fiscal year ended May 31, 2025 was $122.8 million, or 39.6% of revenue, compared to $137.6 million, or 39.2% of revenue, in the prior fiscal year. Cost of goods sold as a percentage of revenues was impacted by higher outbound freight costs related to sponsored programs, which was largely offset by lower prepublication amortization as a result of the impairment of certain education products in fiscal 2024.
Previous report
Other operating expenses were $180.1 million for the fiscal year ended May 31, 2025, compared to $191.7 million in the prior fiscal year. The $11.6 million decrease in Other operating expenses was primarily attributable to lower commission expense driven by the lower revenues, in addition to lower external labor and marketing costs.
Previous report
Segment operating income for the fiscal year ended May 31, 2025 was $6.3 million, compared to $15.8 million in the prior fiscal year. The $9.5 million decrease in operating income was attributable to lower revenues, primarily due to continued market conditions which resulted in decreased spending on supplemental materials. This was partially offset by lower external labor and marketing costs and lower impairment expense in the fiscal year ended May 31, 2025.
Previous report
NM Not meaningful
Previous report
Revenues for the fiscal year ended May 31, 2025 were $61.0 million compared to $1.9 million in the prior fiscal year period. The increase reflected the addition of 9 Story from the date of acquisition on June 20, 2024 through May 31, 2025 in which a majority of the revenues were driven by production revenue related to episodic deliveries, production services provided to third parties and, to a lesser extent, revenues from royalties and distribution. Entertainment revenues have been negatively impacted by delays in production greenlights from major platforms which are expected to improve in fiscal 2026.
Previous report
Cost of goods sold for the fiscal year ended May 31, 2025 was $33.4 million, or 54.8% of revenues. Cost of goods sold primarily consists of production costs and amortization, participation expenses and interest on film related obligations.
Previous report
Other operating expenses for the fiscal year ended May 31, 2025 were $39.2 million, which included costs of $3.0 million related to the 9 Story acquisition and severance expense of $1.4 million related to cost-saving initiatives. Other operating expenses for the fiscal year ended May 31, 2024 were $13.0 million, which included transaction costs of $9.3 million related to the 9 Story acquisition.
Previous report
NM Not meaningful
Previous report
Other operating expenses were $120.2 million for the fiscal year ended May 31, 2025, compared to $117.2 million in the prior fiscal year. Other operating expenses increased $3.0 million primarily due to higher general overhead costs in the Major Markets, partially offset by lower costs in Asia driven by operational efficiencies as a result of the Company's reorganization efforts. In the fiscal year ended May 31, 2025, the Company incurred severance expense from its cost-saving initiatives and reorganization efforts in Asia, Canada and Australia of $2.8 million, compared to $2.7 million in the prior fiscal year related to reorganization efforts in Canada and its exit from the franchise business in China.
Previous report
Segment operating loss for the fiscal year ended May 31, 2025 was $1.0 million, compared to $6.9 million in the prior fiscal year. The $5.9 million improvement was primarily attributable to higher revenues in the Major Markets, coupled with favorable cost of product in the trade channels driven by higher margins on Sunrise on the Reaping. In addition, operating efficiencies in Canada and Asia drove improved profitability, coupled with lower trade sales returns in Canada. This improvement was partially offset by increased general overhead costs in the Major Markets in the fiscal year ended May 31, 2025.
Previous report
Unallocated overhead expense for the fiscal year ended May 31, 2025 increased by $1.6 million to $108.1 million, compared to $106.5 million in the prior fiscal year. The increase was primarily attributable to higher employee-related expenses driven by higher medical costs. This was partly offset by lower severance expense of $0.6 million related to the Company's cost-savings initiatives and lower impairment expense of $2.2 million. The Company early exited certain leased office space as part of the Company's efforts to rightsize office space in fiscal years 2025 and 2024, resulting in an impairment expense of $0.1 million and $2.3 million, respectively, related to the right-of-use assets associated with the operating leases. In addition, the Company recognized higher rental income of $1.5 million as a result of a new tenant leasing space in the Company's headquarters.
Previous report
Cash used in investing activities was $252.9 million for the fiscal year ended May 31, 2025, compared to cash used in investing activities of $89.7 million for the prior fiscal year, representing an increase in cash used in investing activities of $163.2 million. The increase in cash used was driven by the cash paid for the 9 Story acquisition of$176.2 million, net of cash acquired, during the fiscal year ended May 31, 2025, as compared to the prior fiscal year in which the Company acquired certain amortizable intangible assets related to educational programs and a U.S.-based children's book publishing business for $6.0 million and purchased the remaining noncontrolling interest related to Make Believe Ideas Limited for $2.1 million. This was partially offset by lower capital expenditures of$6.2 million.
Previous report
(3) Excludes expected Medicare Part D subsidy receipts.
Reworded paragraphs (22)
Previous wording
The Company categorizes its businesses into four reportable segments: Children’s Book Publishing and Distribution; Education Solutions; Entertainment; and International.
Current wording
The Company categorizes its businesses into four reportable segments: Children’s Book Publishing and Distribution; Education; Entertainment; and International.
Previous wording
Revenues from operations for the fiscal year ended May 31, 2025 increased by $35.8 million, or 2.3%, to $1,625.5 million, compared to $1,589.7 million in the prior fiscal year. The Company reported net loss per basic and diluted share of Class A and Common Stock of $0.07 for the fiscal year ended May 31, 2025, compared to net income per basic and diluted share of Class A and Common Stock of $0.41 and $0.40, respectively, in the prior fiscal year.
Current wording
Revenues from operations for the fiscal year ended May 31, 2026 decreased by $43.6 million, or 2.7%, to $1,581.9 million, compared to $1,625.5 million in the prior fiscal year. The Company reported net income per basic and diluted share of Class A and Common Stock of $2.39 and $2.34, respectively, for the fiscal year ended May 31, 2026, compared to net loss per basic and diluted share of Class A and Common Stock of $0.07 and $0.07, respectively, in the prior fiscal year.
Previous wording
The Company’s discussion and analysis of its financial condition and results of operations is based upon its Consolidated Financial Statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements involves the use of estimates and assumptions by management, which affects the amounts reported in the Consolidated Financial Statements and accompanying notes. The Company bases its estimates on historical experience, current business factors, future expectations and various other assumptions believed to be reasonable under the circumstances, all of which are necessary in order to form a basis for determining the carrying values of assets and liabilities. Actual results may differ from those estimates and assumptions. On an ongoing basis, the Company evaluates the adequacy of its reserves and the estimates used in calculations, including, but not limited to: collectability of accounts receivable; variable consideration related to anticipated returns; allocation of transaction price to contractual performance obligations; amortization periods; stock-based compensation expense; pension and other postretirement obligations; tax rates; recoverability of inventories; deferred income taxes and tax reserves; the timing and amount of future income taxes and related deductions; recoverability of prepublication costs; recoverability of investment in film and television programs; royalty advance reserves; customer reward programs; and the impairment assessment of long-lived assets, goodwill and other intangibles. For a complete description of the Company’s significant accounting policies, see Note 1, "Description of Business, Basis of Presentation and Summary of Significant Accounting Policies," of Notes to Consolidated Financial Statements in Item 8, “Consolidated Financial Statements and Supplementary Data.” The following policies and account descriptions include all those identified by the Company as critical to its business operations and the understanding of its results of operations:
Current wording
The Company’s discussion and analysis of its financial condition and results of operations is based upon its Consolidated Financial Statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements involves the use of estimates and assumptions by management, which affects the amounts reported in the Consolidated Financial Statements and accompanying notes. The Company bases its estimates on historical experience, current business factors, future expectations and various other assumptions believed to be reasonable under the circumstances, all of which are necessary in order to form a basis for determining the carrying values of assets and liabilities. Actual results may differ from those estimates and assumptions. On an ongoing basis, the Company evaluates the adequacy of its reserves and the estimates used in calculations, including, but not limited to: accounts receivable allowance for credit losses; variable consideration related to anticipated returns; allocation of transaction price to contractual performance obligations; pension and other postretirement obligations; inventory reserves; deferred income taxes and tax reserves; the timing and amount of future income taxes and related deductions; uncertain tax positions; expected economic life and recoverability of investment in film and television programs and prepublication costs; royalty advance reserves and royalty expense accruals; the impairment assessment of goodwill intangibles and other long-lived assets; and the incremental borrowing rate used to determine the present value of future lease payments and related lease liabilities. For a complete description of the Company’s significant accounting policies, see Note 1, "Description of Business, Basis of Presentation and Summary of Significant Accounting Policies," of Notes to Consolidated Financial Statements in Item 8, “Consolidated Financial Statements and Supplementary Data.” The following policies and account descriptions include all those identified by the Company as critical to its business operations and the understanding of its results of operations:
Previous wording
For sales that include a right of return, the Company estimates the transaction price and records revenues as variable consideration based on the amounts the Company expects to ultimately be entitled. In order to determine estimated returns, the Company utilizes historical return rates, sales patterns, types of products and expectations and recognizes a corresponding reduction to Revenues and Cost of goods sold. Management also considers patterns of sales and returns in the months preceding the fiscal year, as well as actual returns received subsequent to the fiscal year, available customer and market specific data and other return rate information that management believes is relevant. In addition, a refund liability is recorded within Other accrued expenses for the consideration to which the Company believes it will not ultimately be entitled and a return asset is recorded within Prepaid expenses and other current assets for the expected inventory to be returned. Actual returns could differ from the Company's estimate. A one percentage point change in the estimated reserve for returns rate would have resulted in an increase or decrease in operating income for the year ended May 31, 2025 of approximately $5.0 million.
Current wording
For sales that include a right of return, the Company estimates the transaction price and records revenues as variable consideration based on the amounts the Company expects to ultimately be entitled. In order to determine estimated returns, the Company utilizes historical return rates, sales patterns, types of products and expectations and recognizes a corresponding reduction to Revenues and Cost of goods sold. Management also considers patterns of sales and returns in the months preceding the fiscal year, as well as actual returns received subsequent to the fiscal year, available customer and market specific data and other return rate information that management believes is relevant. In addition, a refund liability is recorded within Other accrued expenses for the consideration to which the Company believes it will not ultimately be entitled and a return asset is recorded within Prepaid expenses and other current assets for the expected inventory to be returned. Actual returns could differ from the Company's estimate. A one percentage point change in the estimated reserve for returns rate would have resulted in an increase or decrease in operating income for the year ended May 31, 2026 of approximately $5.1 million.
Previous wording
(3) Represents rental income related to leased space in the Company's headquarters which was not allocated to a segment.
Current wording
(2) Represents rental income related to leased space in the Company's headquarters which was not allocated to a segment. As a result of the sale and leaseback transactions completed during the third quarter of fiscal 2026, the Company no longer owns the underlying leasable space. Refer to Note 4, "Sale and Leaseback Transactions", and Note 11, "Leases", of Notes to Consolidated Financial Statements in Item 8, “Consolidated Financial Statements and Supplementary Data” for further details.
Previous wording
Asset impairments and write downs for the fiscal year ended May 31, 2025 were $2.9 million, compared to $10.0 million in the prior year. In fiscal 2025, the Company recognized asset impairments of $1.2 million related to certain digital products in Children's Book Publishing and Distribution and Education Solutions, $1.1 million related to certain inventory and other assets in Asia, and $0.6 million related to the early exit of leased office space in the U.S., Canada and Ireland. In fiscal 2024, the Company recognized asset impairments of $6.1 million related to certain education products as a result of the shift to evidence-based approaches to literacy instruction in the education market and $3.9 million related to the early exit of leased office space in the U.S. and Canada.
Current wording
Asset impairments and write downs for the fiscal year ended May 31, 2026 were $10.9 million, compared to $2.9 million in the prior year. In fiscal 2026, the Company recognized impairments of $4.3 million related to certain products within the Education segment and $5.2 million within the Entertainment segment, primarily related to certain film and television programs in development. In addition, the Company recognized impairments of $1.4 million within the Children's Book Publishing and Distribution segment related to a product that is no longer being sold and inventory destroyed in a warehouse fire. In fiscal 2025, the Company recognized impairments of $1.2 million related to certain digital products in Children's Book Publishing and Distribution and Education, $1.1 million related to certain inventory and other assets in Asia, and $0.6 million related to the early exit of leased office space in the U.S., Canada and Ireland.
Previous wording
Interest income for the fiscal year ended May 31, 2025 was $2.2 million, compared to $4.6 million in the prior fiscal year. The decrease in interest income was attributable to lower average short term investment balances as compared to the prior fiscal year. The Company invests excess cash in short term investments which earn competitive interest rates that change directionally in relation to the Federal Funds rate.
Current wording
Interest income for the fiscal year ended May 31, 2026 was $2.9 million, compared to $2.2 million in the prior fiscal year. The increase was attributable to higher average short term investment balances during the year ended May 31, 2026, primarily reflecting the net proceeds received from the sale and leaseback transactions. The Company invests excess cash in short term investments that earn competitive interest rates, which generally move in line with changes in the Federal Funds rate.
Previous wording
The Company’s effective tax rate for the fiscal year ended May 31, 2025 was (46.2)%, compared to 25.3% in the prior fiscal year. The effective tax rate varies from the statutory rate primarily due to expected state and local income taxes and non-deductible compensation for covered executive employees. The tax provision on the global consolidated loss before income taxes was due to the Company's domestic taxable income generating tax expense.
Current wording
The Company’s effective tax rate for the fiscal year ended May 31, 2026 was 33.4%, compared to 46.2% in the prior fiscal year. The Company's effective tax rate differed from the statutory rate primarily due to higher state and local income taxes attributable to the tax gain on the sale-leaseback transactions and non-deductible compensation for covered executive employees.
Previous wording
Net loss for fiscal 2025 was $1.9 million compared to net income of $12.1 million in fiscal 2024, a decrease of $14.0 million. The basic and diluted loss per share of Class A Stock and Common Stock was $0.07 in fiscal 2025, compared to basic and diluted income per share of Class A Stock and Common Stock of $0.41 and $0.40, respectively, in fiscal 2024. Outstanding shares decreased 11% from 28.2 million to 25.0 million as of May 31, 2025 which is expected to benefit earnings per share calculations in fiscal 2026.
Current wording
Net income for fiscal 2026 was $56.7 million compared to net loss of $1.9 million in fiscal 2025, an improvement of $58.6 million. The basic and diluted earnings per share of Class A Stock and Common Stock was $2.39 and $2.34, respectively, in fiscal 2026, compared to basic and diluted loss per share of Class A Stock and Common Stock of $0.07 and $0.07, respectively, in fiscal 2025. Outstanding shares decreased 25% from 25.0 million to 18.7 million as of May 31, 2026 which is expected to benefit earnings per share calculations in fiscal 2027.
Previous wording
Asset impairments were $0.6 million for the fiscal year ended May 31, 2025, compared to $6.1 million in the prior fiscal year. In fiscal 2025, the Company recognized an asset impairment of $0.6 million related to certain digital products. In fiscal 2024, the Company recognized an asset impairment of $6.1 million related to certain education products that were not aligned with evidence-based approaches to literacy instruction.
Current wording
Asset impairments were $4.3 million for the fiscal year ended May 31, 2026, compared to $0.6 million in the prior fiscal year. In fiscal 2026, the Company recognized asset impairments of $4.3 million related to certain education products that were no longer being sold or developed. In fiscal 2025, the Company recognized asset impairments of $0.6 million related to certain digital products that were no longer being sold. Refer to Note 5, "Asset Write Down," of Notes to the Consolidated Financial Statements in Item 8, "Consolidated Financial Statements and Supplementary Data" for further details.
Previous wording
The Entertainment segment includes the operations of 9 Story, as acquired on June 20, 2024, and Scholastic Entertainment Inc. ("SEI"). SEI was reported in the Children's Book Publishing and Distribution segment in prior periods. The financial results for SEI for fiscal 2024 have been reclassified to Entertainment to reflect this change. Refer to Note 11, "Acquisitions," of Notes to the Consolidated Financial Statements in Item 8, "Consolidated Financial Statements and Supplementary Data" for further details regarding the acquisition of 9 Story.
Current wording
The Entertainment segment includes the operations of 9 Story, as acquired on June 20, 2024, and Scholastic Entertainment Inc. ("SEI"). Refer to Note 12, "Acquisitions," of Notes to the Consolidated Financial Statements in Item 8, "Consolidated Financial Statements and Supplementary Data" for further details regarding the acquisition of 9 Story.
Previous wording
Asset impairments were $0.6 million for the fiscal year ended May 31, 2025, compared to $0.5 million in the prior fiscal year. In fiscal 2025, the Company recognized an asset impairment of $0.6 million related to certain digital products. In fiscal 2024, the Company early exited leased office space, as a result of which the Company recognized an impairment expense of $0.5 million, primarily related to the right-of-use asset associated with the operating lease.
Current wording
Asset impairments and write downs for the fiscal year ended May 31, 2026 were $5.2 million, compared to $0.5 million in the prior fiscal year. During fiscal 2026, the Company recognized asset impairments of $4.9 million related to certain film and television programs in development and $0.3 million related to its ownership interest in a children's book publishing business located in the UK. During fiscal 2025, the Company early exited certain leased office space as a result of which the Company recognized an impairment expense of $0.5 million, primarily related to the right-of-use asset associated with the operating leases. Refer to Note 5, "Asset Write Down," of Notes to the Consolidated Financial Statements in Item 8, "Consolidated Financial Statements and Supplementary Data" for further details.
Previous wording
Segment operating loss for the fiscal year ended May 31, 2025 was$12.1 million compared to $11.2 million in the prior fiscal year.
Current wording
Segment operating loss for the fiscal year ended May 31, 2026 was $16.1 million compared to $12.1 million in the prior fiscal year. The $4.0 million increase in operating loss was primarily attributable to asset impairment charges recognized during the year ended May 31, 2026.
Previous wording
Revenues for the fiscal year ended May 31, 2025 increased by $6.0 million to $279.6 million compared to $273.6 million in the prior fiscal year. Local currency revenues in the Company's ongoing foreign operations increased $7.6 million when compared to the prior fiscal year, excluding unfavorable foreign exchange impact of $1.6 million. In the UK, local currency revenues increased $8.4 million, driven by higher trade channel sales which benefited from several current year releases including the latest Hunger Games title, Sunrise of the Reaping, Jonty Gentoo: The Adventures of a Penguin by Julia Donaldson and Axel Scheffler and Dog Man #13: Big Jim Begins by Dav Pilkey, in addition to higher book fairs channel sales driven by higher fair count. In Canada, local currency revenues increased $4.2 million, primarily driven by higher sales from the trade channel, which benefited from the new releases in the Hunger Games and Dog Man series and lower sales returns from its major customers, coupled with higher sales from the book clubs channel. In Australia and New Zealand, local currency revenues increased $1.9 million, driven by increased sales of education products in New Zealand and higher trade channel sales in both markets, partially offset by lower school channel revenues in Australia. The increase in revenues from the Major Markets was partly offset by lower local currency revenues in Asia of $5.5 million. This was primarily attributable to lower sales within the trade and education channels, partially offset by growth in India. Export channel sales also decreased $1.4 million as compared to the prior fiscal year.
Current wording
Revenues for the fiscal year ended May 31, 2026 decreased by $2.4 million to $277.2 million compared to $279.6 million in the prior fiscal year. Local currency revenues in the Company's ongoing foreign operations decreased by $8.7 million, excluding a favorable foreign exchange impact of $6.3 million. In Canada, local currency revenues decreased by $6.2 million, primarily driven by lower trade, book clubs and education channel revenues. In the U.K., local currency revenues decreased by $5.0 million, primarily reflecting lower trade channel sales. The declines in trade channel revenues in both Canada and the U.K. were due, in part, to increased sales in the prior fiscal year associated with the release of Suzanne Collins'Sunrise on the Reaping. In Australia and New Zealand, local currency revenues decreased by $0.4 million, driven by lower education sales in New Zealand, which were largely offset by higher trade channel sales in Australia. Export channel sales also decreased by $0.5 million compared to the prior fiscal year. These declines were partially offset by a $3.4 million increase in local currency revenues in Asia, primarily driven by increased trade and education sales, including growth in India.
Previous wording
Cost of goods sold for the fiscal year ended May 31, 2025 was $159.3 million, or 57.0% of revenues, compared to $162.2 million, or 59.3% of revenues, in the prior fiscal year. Cost of goods sold as a percentage of revenues decreased as a result of the mix of product sold in Canada and the U.K. in fiscal 2025, driven in particular by the higher priced hardcover sales of Sunrise on the Reaping. This was partially offset by increased fulfillment costs in Australia on lower revenues.
Current wording
Cost of goods sold for the fiscal year ended May 31, 2026 was $155.0 million, or 55.9% of revenues, compared to $159.3 million, or 57.0% of revenues, in the prior fiscal year. Cost of goods sold as a percentage of revenues decreased primarily due to lower product costs driven by the mix of products sold in Australia, Canada and the U.K. during the year ended May 31, 2026, partially offset by higher fulfillment costs in Canada.
Previous wording
Asset impairments and write downs were $1.1 million for the fiscal years ended May 31, 2025 and 2024. In fiscal 2025, the Company recognized an asset impairment of $1.1 million related to certain inventory and other assets that were not recoverable as a result of the reorganization in China. In fiscal 2024, the Company early exited certain leased office space in Canada as part of the Company's efforts to rightsize its real estate footprint to reduce occupancy costs, resulting in an impairment expense of $1.1 million related to the right-of-use assets associated with the operating leases.
Current wording
Asset impairments and write downs were $1.1 million for the fiscal years ended May 31, 2025. In fiscal 2025, the Company recognized an asset impairment of $1.1 million related to certain inventory and other assets that were not recoverable as a result of the reorganization in China.
Previous wording
Cash provided by operating activities was $124.2 million for the fiscal year ended May 31, 2025, compared to cash provided by operating activities of $154.6 million for the prior fiscal year, representing a decrease in cash provided by operating activities of $30.4 million. The decrease in cash provided was primarily driven by lower customer remittances, increased inventory purchases and royalty advance payments, as well as increased medical claim payments, interest payments related to the Company's borrowings and higher spending in Entertainment due to the acquisition of 9 Story in fiscal 2025. This was partially offset by lower tax payments and lower discretionary spending in the fiscal year ended May 31, 2025.
Current wording
Cash provided by operating activities was $50.9 million for the fiscal year ended May 31, 2026, compared to cash provided by operating activities of $124.2 million for the prior fiscal year, representing a decrease in cash provided by operating activities of $73.3 million. The decrease was primarily driven by higher net tax payments of $41.4 million, largely attributable to the gain recognized on the sale-leaseback transactions, as well as an additional contribution to the U.K. Pension Plan and higher severance and postage payments. In addition, the Company generated lower rental income from leasable space within its New York headquarters building, which was sold during fiscal 2026. These cash outflows were partially offset by lower royalty advance payments.
Previous wording
Cash provided by financing activities was $137.3 million for the fiscal year ended May 31, 2025, compared to cash used in financing activities of $176.1 million for the prior fiscal year, representing an increase in cash provided by financing activities of $313.4 million. The increase in cash provided was primarily attributable to net borrowings of $250 million under the U.S. Credit Agreement incurred during fiscal 2025 to fund the 9 Story acquisition. In addition, the Company repurchased common stock of $70.0 million, compared to repurchases of $158.2 million in the prior fiscal year, which also resulted in lower dividends of $2.1 million. This was partially offset by $18.3 million of net repayments of film related obligations in the fiscal year ended May 31, 2025.
Current wording
Cash used in financing activities was $446.0 million for the fiscal year ended May 31, 2026, compared to cash provided by financing activities of $137.3 million for the prior fiscal year, representing an increase in cash used by financing activities of $583.3 million. This change was primarily attributable to net repayments of $175.0 million under the U.S. Credit Agreement during fiscal 2026, compared to net borrowings of $250.0 million in the prior fiscal year to fund the acquisition of 9 Story. In addition, the Company repurchased $265.9 million of common stock, compared to $70.0 million in the prior fiscal year, and made higher net repayments of film obligations of $17.3 million. These uses of cash were partially offset by $17.4 million of higher proceeds from stock option exercises.
Previous wording
The Company’s cash and cash equivalents totaled $124.0 million at May 31, 2025 and $113.7 million at May 31, 2024. Cash and cash equivalents held by the Company’s U.S. operations totaled $48.7 million at May 31, 2025 and $54.9 million at May 31, 2024.
Current wording
The Company’s cash and cash equivalents totaled $134.9 million at May 31, 2026 and $124.0 million at May 31, 2025. Cash and cash equivalents held by the Company’s U.S. operations totaled $66.6 million at May 31, 2026 and $48.7 million at May 31, 2025.
Previous wording
The Company’s operating philosophy is to use cash provided by operating activities to create value by paying down debt, reinvesting in existing businesses and, from time to time, making acquisitions that will complement its portfolio of businesses or acquiring other strategic assets, as well as engaging in shareholder enhancement initiatives, such as share repurchases or dividend declarations. During fiscal 2025, the Company repurchased $70.0 million of its common stock on the open market. See Note 15, "Treasury Stock," of Notes to the Consolidated Financial Statements in Item 8, "Consolidated Financial Statements and Supplementary Data" for further details. Under the Company's open-market buy-back program, $70.0 million remained available for future purchases of common shares as of May 31, 2025.
Current wording
The Company’s operating philosophy is to use cash provided by operating activities to create value by paying down debt, reinvesting in existing businesses and, from time to time, making acquisitions that will complement its portfolio of businesses or acquiring other strategic assets, as well as engaging in shareholder enhancement initiatives, such as share repurchases or dividend declarations. During fiscal 2026, the Company repurchased $150.6 million of its common stock through open-market transactions and $113.4 million through a modified Dutch tender offer, in each case excluding taxes and fees. See Note 16, "Treasury Stock," of Notes to the Consolidated Financial Statements in Item 8, "Consolidated Financial Statements and Supplementary Data" for further details. Under the Company's share repurchase program, $183.0 million remained available for future purchases of Common Stock as of May 31, 2026.
Previous wording
The Company has maintained, and expects to maintain for the foreseeable future, sufficient liquidity to fund ongoing operations, including working capital requirements, pension contributions, postretirement benefits, debt service, planned capital expenditures and other investments, as well as dividends and share repurchases. As of May 31, 2025, the Company’s primary sources of liquidity consisted of cash and cash equivalents of $124.0 million, cash from operations and the Company's U.S. Credit Agreement. The Company expects the U.S. Credit Agreement to provide it with an appropriate level of flexibility to strategically manage its business operations. The U.S. Credit Agreement has a borrowing limit of $400 million and a maturity date of November 26, 2029. See Note 5, "Debt," of Notes to the Consolidated Financial Statements in Item 8, "Consolidated Financial Statements and Supplementary Data" for more information regarding the U.S. Credit Agreement. As of May 31, 2025, the Company's U.S. Credit Agreement, less borrowings of $250.0 million and commitments of $0.4 million, had $149.6 million of availability. Additionally, the Company has short-term credit facilities of $32.0 million, less current borrowings of $6.2 million and commitments of $3.6 million, resulting in $22.2 million of current availability under these facilities at May 31, 2025. Accordingly, the Company believes these sources of liquidity are sufficient to finance its currently anticipated ongoing operating needs, as well as its financing and investing activities.
Current wording
The Company has maintained, and expects to maintain for the foreseeable future, sufficient liquidity to fund ongoing operations, including working capital requirements, pension contributions, postretirement benefits, debt service, planned capital expenditures and other investments, as well as dividends and share repurchases. As of May 31, 2026, the Company’s primary sources of liquidity consisted of cash and cash equivalents of $134.9 million, cash from operations and the Company's U.S. Credit Agreement. The Company expects the U.S. Credit Agreement to provide it with an appropriate level of flexibility to strategically manage its business operations. The U.S. Credit Agreement has a borrowing limit of $400 million and a maturity date of November 26, 2029. See Note 6, "Debt," of Notes to the Consolidated Financial Statements in Item 8, "Consolidated Financial Statements and Supplementary Data" for more information regarding the U.S. Credit Agreement. As of May 31, 2026, the Company's U.S. Credit Agreement, less borrowings of $75.0 million and commitments of $0.4 million, had $324.6 million of availability. Additionally, the Company has short-term credit facilities of $36.1 million, less current borrowings of $5.5 million and commitments of $5.0 million, resulting in $25.6 million of current availability under these facilities at May 31, 2026. Accordingly, the Company believes these sources of liquidity are sufficient to finance its currently anticipated ongoing operating needs, as well as its financing and investing activities.
Previous wording
The following table summarizes, as of May 31, 2025, the Company’s contractual cash obligations by future period (see Notes 5, 6, 10 and 16 of Notes to Consolidated Financial Statements in Item 8, “Consolidated Financial Statements and Supplementary Data”):
Current wording
The following table summarizes, as of May 31, 2026, the Company’s contractual cash obligations by future period (see Notes 6, 7, 11 and 17 of Notes to Consolidated Financial Statements in Item 8, “Consolidated Financial Statements and Supplementary Data”):
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
Asset impairments for the fiscal year ended May 31, 2025 were$0.5 million. The Company early exited certain leased office space as a result of which the Company recognized an impairment expense of$0.5 million in fiscal 2025, primarily related to the right-of-use asset associated with the operating leases.