Wiley (NYSE: WLY) reported fiscal 2027 first-quarter revenue of $386.4 million, down 3% from $396.8 million a year earlier, while GAAP diluted EPS swung to a loss of $0.23 from earnings of $0.22. Research growth and the Emerald contribution partly offset Learning weakness and a difficult prior-year AI licensing comparison, but restructuring and acquisition-related costs placed heavier pressure on GAAP profit. The quarter ended July 31, 2026, and the results were released on September 3, 2026.

Core Financial Results

Consolidated revenue declined 3% both as reported and at constant currency. GAAP operating income fell sharply because Wiley recorded $16.5 million of restructuring charges, up from $3.0 million, as well as $11.0 million of acquisition and integration costs related to Emerald.

Adjusted results showed a smaller decline but still reflected the lower revenue and an unfavorable business mix. Higher net interest expense associated with the acquisition also weighed on adjusted EPS.

The gap between GAAP and adjusted earnings was primarily associated with restructuring, Emerald acquisition and integration costs, and amortization of acquired intangible assets. Adjusted profitability nevertheless declined because operational cost savings did not fully offset the revenue mix pressure.

Business and Segment Performance

Research expanded, while Learning contracted across both Academic and Professional offerings. The difference was even more pronounced in segment profitability, with Research’s adjusted EBITDA growth contrasting with a 55% reported decline in Learning adjusted EBITDA.

Research Publishing revenue increased 12% at constant currency to $258.9 million. That growth included $13 million from two months of Emerald ownership, along with higher gold open-access and AI licensing revenue.

Research Solutions moved in the opposite direction, with revenue falling 30% at constant currency to $34.6 million. The main factor was an unusually difficult AI licensing comparison: related revenue in Research Solutions declined to $4 million from $16 million in the prior-year quarter.

Learning revenue fell 20% at constant currency. Academic and Professional revenue each declined 19% as reported, reflecting prior-year AI licensing revenue of $8 million and $5 million, respectively, as well as softer consumer and corporate spending. Wiley also noted that the first quarter is seasonally the lightest period for its Academic business.

Profitability, Cash Flow, and the Balance Sheet

Corporate cost reductions helped cushion the segment pressure. Corporate expenses on an adjusted EBITDA basis improved 19%, or approximately $8 million, to $33.1 million, driven by technology transformation and restructuring savings.

Operating cash use narrowed to $55 million from $85 million, while free cash flow use improved to $70 million from $100 million. Wiley attributed the improvement partly to recovering cash collections tied to late fourth-quarter renewal signings. The company normally uses cash during the first half of its fiscal year because collections for annual journal renewals are concentrated in the third and fourth quarters.

Cash and cash equivalents stood at $106.4 million at July 31, up from $75.6 million at April 30. However, net debt increased to $1.19 billion from $746 million a year earlier following the Emerald acquisition. The trailing net debt-to-EBITDA ratio rose to 2.7 times from 1.9 times, although Wiley calculated pro forma leverage of 2.1 times after including anticipated Emerald synergies.

Wiley allocated $33 million to dividends and share repurchases during the quarter. Share repurchases totaled $15 million, compared with $14 million a year earlier, and the company increased its dividend for a 33rd consecutive year.

Emerald Supports Research but Raises Near-Term Costs and Leverage

Wiley completed its acquisition of Emerald Publishing on June 1 for approximately $450 million in cash, net of cash acquired. Emerald contributed $13 million of revenue and $5 million of adjusted EBITDA during its first two months under Wiley, supporting the Research segment’s growth and margin expansion.

The transaction also explains several areas of near-term pressure. Wiley incurred $11.0 million of acquisition and integration costs, took on additional debt, and recorded interest expense of $13.9 million versus $11.0 million a year earlier. The company is targeting $30 million of cost synergies and valued the transaction at roughly seven times adjusted EBITDA on a synergized basis.

For fiscal 2027, Emerald is expected to contribute $78 million of revenue over 11 months and add approximately $0.10 to adjusted EPS. At the same time, it is expected to reduce free cash flow by $15 million during the first year, before becoming free-cash-flow accretive in fiscal 2028.

Fiscal 2027 Guidance

Wiley reaffirmed its full-year outlook, citing publishing and AI licensing pipelines as well as anticipated cost savings. The guidance continues to call for organic revenue growth and modest adjusted margin expansion despite the first-quarter decline.

Organic revenue guidance excludes Emerald and currency movements, while the other outlook metrics include Emerald. The free cash flow target incorporates the acquisition’s expected $15 million first-year dilution, capital spending of $80 million compared with $65 million in fiscal 2026, restructuring costs, and higher cash taxes.

Risks Investors Need to Watch

• AI licensing comparisons and timing: Wiley generated $14 million of AI licensing revenue in the quarter, but prior-year revenue of $29 million created a significant comparison headwind across both segments. Quarterly results remain sensitive to the timing and location of these agreements.
• Learning demand and profitability: Consumer and corporate spending softness contributed to a 19% reported revenue decline and a steep contraction in Learning’s adjusted EBITDA margin. Management expects demand to stabilize over the balance of the year, making that recovery important to the outlook.
• Emerald integration: The acquisition is already contributing to Research, but the full-year outlook depends partly on successful integration and delivery of $30 million in targeted synergies. Acquisition costs, higher interest expense, and increased leverage add execution pressure.
• Cash flow seasonality: First-half cash use depends on journal renewal collections arriving mainly in the third and fourth quarters. Reaching the $205 million full-year free cash flow target must also absorb higher capital spending, restructuring costs, taxes, and Emerald’s first-year dilution.

Summary

Wiley’s fiscal 2027 first quarter showed growth in Research and early contributions from Emerald, but these gains were outweighed at the consolidated level by weaker Learning revenue and difficult AI licensing comparisons. Restructuring and acquisition-related expenses drove the GAAP loss, while adjusted profitability declined more moderately and cash use improved. Execution against the reaffirmed outlook now depends on Learning stabilization, continued Research and AI activity, Emerald integration, cost savings, and the seasonal recovery in journal renewal collections.

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