What changed in this filing

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Item 1. Financial Statements

2025-03-21 compared with 2024-12-20 · 197 added, 150 removed, 717 unchanged (33% of the section changed)

3 unchanged sentences

(Dollar amounts in millions, except per share data)

Three months ended Six months ended

November 30, November 30,

Three months ended Nine months ended

February 28, February 29, February 28, February 29,

2025 2024 2025 2024

19 unchanged sentences

(Dollar amounts in millions)

Three months ended Six months ended

November 30, November 30,

Three months ended Nine months ended

February 28, February 29, February 28, February 29,

2025 2024 2025 2024

9 unchanged sentences

(Dollar amounts in millions, except per share data)

November 30, 2024 May 31, 2024 November 30, 2023

February 28, 2025 May 31, 2024 February 29, 2024

(unaudited) (audited) (unaudited)

4 unchanged sentences

Income tax receivable 51.6 15.2 29.9

Tax credit receivable

Prepaid expenses and other current assets 64.2 48.8 52.9

27 unchanged sentences

Operating lease liabilities 84.4 89.2 79.4

Film related obligations 13.3 — —

Other noncurrent liabilities 43.9 29.2 29.7

6 unchanged sentences

Class A Stock, $ 0.01 par value:

Authorized, 3.2 , 3.2 , and 4.0 shares, respectively;

Issued and Outstanding, 0.8 , 0.8 , and 1.7 shares, respectively

Authorized, 3.2 shares;

Issued and Outstanding, 0.8 shares

Common Stock, $ 0.01 par value:

47 unchanged sentences

Balance at November 30, 2023 1.7 $ 0.0 28.2 $ 0.4 $ 630.8 $ ( 53.5 ) $ 1,026.0 $ ( 524.6 ) $ 1,079.1 $ — $ 1,079.1

Net Income (loss) — — — — — — ( 26.5 ) — ( 26.5 ) — ( 26.5 )

Foreign currency translation adjustment — — — — — ( 0.4 ) — — ( 0.4 ) — ( 0.4 )

Pension and post-retirement adjustments (net of tax of $ 0.1 )

— — — — — 0.2 — — 0.2 — 0.2

Stock-based compensation — — — — 2.3 — — — 2.3 — 2.3

Proceeds pursuant to stock-based compensation plans — — — — 2.5 — — — 2.5 — 2.5

Purchases of treasury stock at cost — — ( 1.4 ) — — — — ( 54.2 ) ( 54.2 ) — ( 54.2 )

Treasury stock issued pursuant to equity-based plans — — 0.1 — ( 4.0 ) — — 4.6 0.6 — 0.6

Dividends ($ 0.20 per share)

— — — — — — ( 6.0 ) — ( 6.0 ) — ( 6.0 )

Other (share conversion)

( 0.9 ) — 0.9 — ( 28.6 ) — — 28.6 — — —

Balance at February 29, 2024 0.8 $ 0.0 27.8 $ 0.4 $ 603.0 $ ( 53.7 ) $ 993.5 $ ( 545.6 ) $ 997.6 $ — $ 997.6

Class A Stock Common Stock Additional Paid-in Capital Accumulated

30 unchanged sentences

Balance at November 30, 2024 0.8 $ 0.0 27.3 $ 0.4 $ 603.5 $ ( 55.8 ) $ 998.7 $ ( 560.8 ) $ 986.0 $ — $ 986.0

Net Income (loss) — — — — — ( 3.6 ) — ( 3.6 ) ( 3.6 )

Foreign currency translation adjustment — — — — — ( 8.0 ) — — ( 8.0 ) — ( 8.0 )

Pension and post-retirement adjustments (net of tax of $ 0.1 )

— — — — — 0.1 — — 0.1 — 0.1

Stock-based compensation — — — — 2.4 — — — 2.4 — 2.4

Proceeds pursuant to stock-based compensation plans — — — — 0.1 — — — 0.1 — 0.1

Purchases of treasury stock at cost — — ( 1.5 ) — — — — ( 30.6 ) ( 30.6 ) — ( 30.6 )

Treasury stock issued pursuant to equity-based plans — — 0.1 — ( 0.7 ) — — 1.2 0.5 — 0.5

Dividends ($ 0.20 per share)

— — — — — — ( 5.6 ) — ( 5.6 ) — ( 5.6 )

Balance at February 28, 2025 0.8 $ 0.0 25.9 $ 0.4 $ 605.3 $ ( 63.7 ) $ 989.5 $ ( 590.2 ) $ 941.3 $ — $ 941.3

See accompanying notes

2 unchanged sentences

(Dollar amounts in millions)

Six months ended

November 30, November 30,

Nine months ended

February 28, February 29,

Cash flows - operating activities:

6 unchanged sentences

Amortization of prepublication costs 16.4 19.9

Amortization of production costs 6.4 —

Amortization of film and television programs

Depreciation and amortization 57.8 49.2

3 unchanged sentences

Income from equity-method investments ( 0.8 ) ( 0.1 )

Non cash write off related to asset impairments and write downs 0.4 0.5

Changes in assets and liabilities, net of amounts acquired:

1 unchanged sentence

Inventories ( 22.1 ) 36.7

Income tax receivable ( 36.0 ) ( 21.0 )

Tax credit receivable

Prepaid expenses and other current assets ( 13.8 ) ( 5.8 )

Investment in film and television programs

Income tax receivable ( 10.3 ) ( 2.7 )

Royalty advances ( 30.8 ) ( 1.5 )

Accounts payable ( 6.4 ) ( 44.6 )

Accrued income taxes 0.7 ( 10.8 )

Accrued royalties 30.8 22.3

1 unchanged sentence

Other accrued expenses ( 25.0 ) ( 15.3 )

Accrued income taxes 0.7 ( 10.6 )

Other, net 2.3 1.8

5 unchanged sentences

Purchase of noncontrolling interest — ( 2.1 )

Other ( 0.1 ) —

Net cash provided by (used in) investing activities ( 232.0 ) ( 69.5 )

Cash flows - financing activities:

Borrowings under lines of credit, credit agreement and revolving loan 251.5 27.1

Repayments of lines of credit, credit agreement and revolving loan ( 1.3 ) ( 26.8 )

Borrowings under lines of credit and long-term debt, net of debt issuance costs 303.1 52.9

Repayments of lines of credit and long-term debt ( 29.6 ) ( 27.5 )

Borrowings under film related obligations 14.8 —

Repayments of film related obligations ( 33.4 ) —

Repayment of capital lease obligations ( 0.9 ) ( 1.2 )

Repayments of capital lease obligations ( 1.4 ) ( 1.7 )

Reacquisition of common stock ( 40.0 ) ( 143.0 )

1 unchanged sentence

Payment of dividends ( 17.0 ) ( 18.9 )

Other ( 0.1 ) 0.1

Net cash provided by (used in) financing activities 197.6 ( 129.4 )

15 unchanged sentences

Accordingly, references in this document to fiscal 2025 relate to the twelve-month period ending May 31, 2025.

Certain prior period amounts have been reclassified to conform with the current year presentation.

Noncontrolling Interest

22 unchanged sentences

• Pension and postretirement benefit plans

• Uncertain tax positions

• The timing and amount of future income taxes and related deductions

SCHOLASTIC CORPORATION

1 unchanged sentence

(Dollar amounts in millions, except per share data)

• Uncertain tax positions

• The timing and amount of future income taxes and related deductions

• Inventory reserves

10 unchanged sentences

Except as set forth below, as of the date of this Quarterly Report on Form 10-Q there have been no material changes to the significant accounting policies described in the Company’s Annual Report for the fiscal year ended May 31, 2024.

The below significant accounting policies relate to the Company's entertainment business, which includes the operations of 9 Story Media Group Inc.

("9 Story") and Scholastic Entertainment Inc.

The below significant accounting policies relate to the Company's entertainment business, which includes the operations of 9 Story and Scholastic Entertainment Inc.

Refer to Note 7, "Acquisitions" for further details regarding the acquisition of 9 Story.

20 unchanged sentences

In November 2024, Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2024-03, "Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40) - Disaggregation of Income Statement Expenses." This ASU improves financial reporting by requiring that public business entities disclose additional information about specific expense categories in the notes to financial statements at interim and annual reporting periods.

This ASU is effective for the Company's fiscal year 2028, and interim periods starting in fiscal year 2029.

In January 2025, the FASB issued ASU 2025-01,""Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40) - Clarifying the Effective Date" to clarify the effective date of ASU 2024-03 for non-calendar year-end entities.

ASU 2024-03 is effective for the Company's fiscal year 2028, and interim periods starting in fiscal year 2029.

Early adoption is permitted.

4 unchanged sentences

This ASU is effective for the Company's fiscal year 2026.

Early adoption is permitted.

The amendments are to be applied prospectively, but may be applied retrospectively to all prior periods presented in the financial statements.

2 unchanged sentences

This ASU is effective for the Company's fiscal year 2025, and interim periods starting in fiscal year 2026.

Early adoption is permitted.

The amendments in this ASU are to be applied retrospectively to all prior periods presented in the financial statements.

6 unchanged sentences

The following table presents the Company’s segment revenues disaggregated by region and domestic channel:

Three months ended Six months ended

November 30, November 30,

Three months ended Nine months ended

February 28, February 29, February 28, February 29,

2025 2024 2025 2024

25 unchanged sentences

(1) The newly formed Entertainment segment includes the operations of SEI, which were included in the Children’s Book Publishing and Distribution segment in prior periods, and 9 Story.

The financial results for SEI for the three and six months ended November 30, 2023 have been reclassified to Entertainment to reflect this change.

The financial results for SEI for the three and nine months ended February 29, 2024 have been reclassified to Entertainment to reflect this change.

(2) Primarily includes foreign rights and certain product sales in the UK.

4 unchanged sentences

Estimated Returns

A liability for expected returns of $ 34.8 , $ 33.1 , and $ 37.7 is recorded within Other accrued expenses as of November 30, 2024, May 31, 2024, and November 30, 2023, respectively.

In addition, a return asset of $ 4.0 , $ 4.2 , and $ 5.4 is recorded within Prepaid expenses and other current assets as of November 30, 2024, May 31, 2024, and November 30, 2023, respectively, for the recoverable cost of product estimated to be returned by customers.

A liability for expected returns of $ 33.3 , $ 33.1 , and $ 38.3 is recorded within Other accrued expenses as of February 28, 2025, May 31, 2024, and February 29, 2024, respectively.

In addition, a return asset of $ 3.8 , $ 4.2 , and $ 4.4 is recorded within Prepaid expenses and other current assets as of February 28, 2025, May 31, 2024, and February 29, 2024, respectively, for the recoverable cost of product estimated to be returned by customers.

SCHOLASTIC CORPORATION

3 unchanged sentences

The following table presents further detail regarding the Company's contract liabilities as of the dates indicated:

November 30, 2024 May 31, 2024 November 30, 2023

February 28, 2025 May 31, 2024 February 29, 2024

Book fairs incentive credits $ 116.8 $ 114.2 $ 109.9

10 unchanged sentences

The Company's contract liabilities consist of advance billings and payments received from customers in excess of revenue recognized and revenue allocated to outstanding book fairs incentive credits.

Contract liabilities of $ 225.0 , $ 161.1 and $ 225.0 as of November 30, 2024, May 31, 2024 and November 30, 2023, respectively, are recorded within Deferred revenue on the Company's Condensed Consolidated Balance Sheets and are classified as short term, as substantially all of the associated performance obligations are expected to be satisfied, and related revenue recognized, within one year.

The remaining $ 5.9 , $ 6.5 and $ 9.5 of contract liabilities as of November 30, 2024, May 31, 2024 and November 30, 2023, respectively, are recorded within Other noncurrent liabilities on the Company's Condensed Consolidated Balance Sheet as the associated performance obligations are expected to be satisfied, and related revenue recognized, in excess of one year.

The Company recognized revenue which was included in the opening Deferred revenue balance in the amount of $ 41.9 and $ 71.1 for the three and six months ended November 30, 2024, respectively, and $ 48.4 and $ 80.7 for the three and six months ended November 30, 2023, respectively.

Contract liabilities of $ 205.2 , $ 161.1 and $ 193.8 as of February 28, 2025, May 31, 2024 and February 29, 2024, respectively, are recorded within Deferred revenue on the Company's Condensed Consolidated Balance Sheets and are classified as short term, as substantially all of the associated performance obligations are expected to be satisfied, and related revenue recognized, within one year.

The remaining $ 5.1 , $ 6.5 and $ 6.3 of contract liabilities as of February 28, 2025, May 31, 2024 and February 29, 2024, respectively, are recorded within Other noncurrent liabilities on the Company's Condensed Consolidated Balance Sheet as the associated performance obligations are expected to be satisfied, and related revenue recognized, in excess of one year.

The Company recognized revenue which was included in the opening Deferred revenue balance in the amount of $ 35.1 and $ 106.2 for the three and nine months ended February 28, 2025, respectively, and $ 33.0 and $ 113.7 for the three and nine months ended February 29, 2024, respectively.

Allowance for Credit Losses

12 unchanged sentences

Balance as of November 30, 2024 $ 14.9

Provision (benefit) 0.9

Write-offs and other ( 1.9 )

Balance as of February 28, 2025 $ 13.9

SCHOLASTIC CORPORATION

13 unchanged sentences

The following table sets forth the Company's revenue and operating income (loss) by segment for the periods indicated:

Three months ended Six months ended

November 30, November 30,

Three months ended Nine months ended

February 28, February 29, February 28, February 29,

2025 2024 2025 2024

17 unchanged sentences

(1) The newly formed Entertainment segment includes the operations of SEI, which were included in the Children’s Book Publishing and Distribution segment in prior periods, and 9 Story.

The financial results for SEI for the three and six months ended November 30, 2023 have been reclassified to Entertainment to reflect this change.

The financial results for SEI for the three and nine months ended February 29, 2024 have been reclassified to Entertainment to reflect this change.

(2) Overhead includes all domestic corporate amounts not allocated to segments, including expenses and costs related to the management of corporate assets and rental income related to leased space in the Company's headquarters.

The following table summarizes the carrying value of the Company's debt, excluding film related obligations, as of the dates indicated:

November 30, 2024 May 31, 2024 November 30, 2023

February 28, 2025 May 31, 2024 February 29, 2024

US Revolving Credit Agreement $ 275.0 $ — $ 25.0

3 unchanged sentences

Total long-term debt $ 275.0 $ — $ —

The following table sets forth the maturities of the carrying values of the Company's debt obligations, excluding film related obligations, as of November 30, 2024 for the twelve month periods ended November 30:

The following table sets forth the maturities of the carrying values of the Company's debt obligations, excluding film related obligations, as of February 28, 2025 for the twelve month periods ended February 28:

Total Debt $ 280.8

7 unchanged sentences

• the extension of the maturity date to November 26, 2029.

The Company incurred debt issuance costs of $ 1.6 in connection with the Amendment which are amortized over the term of the Credit Agreement.

The current portion of these costs is recorded within Prepaid expenses and other current assets and the noncurrent portion is recorded within Other assets and deferred charges on the Company's Condensed Consolidated Balance Sheet.

The Credit Agreement provides for a $ 400.0 unsecured revolving credit facility and allows the Company to borrow, repay or prepay and reborrow at any time prior to the November 26, 2029 maturity date.

The Credit Agreement also provides an unlimited basket for permitted payments of dividends and other distributions in respect of capital stock so long as the Corporation’s pro forma Consolidated Net Leverage Ratio, as defined, is not in excess of 2.75 :1.

Under the Credit Agreement, interest on (i) Base Rate Advances (as defined in the Credit Agreement) is due and payable in arrears quarterly on the last day of each February, May, August and November, and (ii) Term SOFR Advances (as defined in the Credit Agreement) is due and payable in arrears on the last day of the interest period (defined as the period commencing on the date of the advance and ending on the last day of the period selected by the Borrowers at the time each advance is made).

1 unchanged sentence

• a Base Rate Advance equal to the higher of (i) the prime rate, (ii) the prevailing Federal Funds rate plus 0.50 % or (iii) the Term SOFR Rate plus 1.00 % plus, in each case, an applicable margin ranging from 0.625 % to 0.875 %, as determined by the Company’s prevailing Consolidated Net Leverage Ratio (as defined in the Credit Agreement);

• a Term SOFR Advance equal to the Term SOFR rate plus an applicable margin ranging from 1.625 % to 1.875 %, as determined by the Company’s prevailing Consolidated Net Leverage Ratio.

As of November 30, 2024, the applicable margin on Base Rate Advances was 0.625 % and the applicable margin on SOFR Advances was 1.625 %.

• a Term SOFR Advance equal to the Term SOFR rate plus an applicable margin ranging from 1.625 % to 1.875 %, as determined by the Company’s prevailing Consolidated Net Leverage Ratio (as defined in the Credit Agreement).

As of February 28, 2025, the applicable margin on Base Rate Advances was 0.75 % and the applicable margin on SOFR Advances was 1.75 %.

The Credit Agreement provides for payment of a commitment fee in respect of the aggregate unused amount of revolving credit commitments ranging from 0.20 % to 0.30 % per annum based upon the Corporation’s then prevailing Consolidated Net Leverage Ratio.

As of November 30, 2024, the commitment fee rate was 0.20 %.

As of February 28, 2025, the commitment fee rate was 0.25 %.

A portion of the revolving credit facility, up to a maximum of $ 50.0 , is available for the issuance of letters of credit.

1 unchanged sentence

The Credit Agreement has an accordion feature which permits the Company, provided certain conditions are satisfied, to increase the facility by up to an additional $ 150.0 .

As of November 30, 2024, the Company had outstanding borrowings of $ 250.0 under the Credit Agreement at a weighted average interest rate of 6.8 %.

As of February 28, 2025, the Company had outstanding borrowings of $ 275.0 under the Credit Agreement at a weighted average interest rate of 6.1 %.

While this obligation is not due until the November 26, 2029 maturity date, the Company may, from time to time, make payments to reduce this obligation when cash from operations becomes available for this purpose.

No borrowings were outstanding under the Credit Agreement as of November 30, 2023.

As of February 29, 2024, outstanding borrowings under the Credit Agreement were $ 25.0 at a weighted average interest rate of 6.8 %.

The Credit Agreement contains certain financial covenants related to leverage and interest coverage ratios (as defined in the Credit Agreement), limitations on the amount of dividends and other distributions, and other limitations on fundamental changes to the Company or its business.

The Company was in compliance with required covenants for all periods presented.

At November 30, 2024, the Company had open standby letters of credit totaling $ 4.0 issued under certain credit lines, including $ 0.4 under the Credit Agreement and $ 3.6 under the domestic credit lines discussed below.

At February 28, 2025, the Company had open standby letters of credit totaling $ 4.0 issued under certain credit lines, including $ 0.4 under the Credit Agreement and $ 3.6 under the domestic credit lines discussed below.

Unsecured Lines of Credit

As of November 30, 2024, the Company’s domestic credit lines available under unsecured money market bid rate credit lines totaled $ 10.0 .

There were no outstanding borrowings under these credit lines as of November 30, 2024, May 31, 2024 and November 30, 2023.

As of November 30, 2024, availability under these unsecured money market bid rate credit lines totaled $ 6.4 , excluding commitments of $ 3.6 .

As of February 28, 2025, the Company’s domestic credit lines available under unsecured money market bid rate credit lines totaled $ 10.0 .

There were no outstanding borrowings under these credit lines as of February 28, 2025, May 31, 2024 and February 29, 2024.

As of February 28, 2025, availability under these unsecured money market bid rate credit lines totaled $ 6.4 , excluding commitments of $ 3.6 .

All loans made under these credit lines are at the sole discretion of the lender and at an interest rate and term agreed to at the time each loan is made, but not to exceed 365 days.

These credit lines may be renewed, if requested by the Company, at the option of the lender.

As of November 30, 2024, the Company had various local currency international credit lines totaling $ 16.9 underwritten by banks primarily in the United States and the United Kingdom.

Outstanding borrowings under these facilities were $ 6.2 at November 30, 2024 at a weighted average interest rate of 4.2 %, compared to outstanding borrowings of $ 6.0 at May 31, 2024 at a weighted average interest rate of 4.5 %, and $ 6.3 at November 30, 2023 at a weighted average interest rate of 3.9 %.

As of November 30, 2024, the amounts available under these facilities totaled $ 10.7 .

As of February 28, 2025, the Company had various local currency international credit lines totaling $ 15.6 underwritten by banks primarily in the United States and the United Kingdom.

Outstanding borrowings under these facilities were $ 5.8 at February 28, 2025 at a weighted average interest rate of 4.9 %, compared to outstanding borrowings of $ 6.0 at May 31, 2024 at a weighted average interest rate of 4.5 %, and $ 6.5 at February 29, 2024 at a weighted average interest rate of 3.8 %.

As of February 28, 2025, the amounts available under these facilities totaled $ 9.8 .

These credit lines are typically available for overdraft borrowings or loans up to 364 days and may be renewed, if requested by the Company, at the sole option of the lender.

1 unchanged sentence

The Company's entertainment business enters into credit facilities with third-party banks to obtain interim financing for certain productions.

The interim production credit facilities are secured by an assignment and direction of specific production financing including tax credits and license contract receivables and have varying maturity dates between December 31, 2024 and June 30, 2028.

Interest is charged at rates ranging from the bank prime rate plus 0.75 % for Canadian dollar loans, SOFR plus 3.0 % or U.S.

Base Rate plus 0.75 % for U.S.

dollar loans and Euribor plus 2.0 % for Euro loans.

As of November 30, 2024, outstanding borrowings under these facilities were $ 21.6 at a weighted average interest rate of 6.9 %, of which $ 8.3 were classified as current obligations.

The interim production credit facilities are secured by an assignment and direction of specific production financing including tax credits and license contract receivables and are due on demand.

As of February 28, 2025, interest is charged at the following rates:

• the bank prime rate plus a margin ranging from 0.50 % to 0.75 % for Canadian dollar loans;

• SOFR plus a margin ranging from 2.25 % to 3.00 % for U.S.

dollar loans;

• Euribor plus 2.00 % for Euro loans.

As of February 28, 2025, outstanding borrowings under these facilities were $ 18.8 at a weighted average interest rate of 6.3 % .

COMMITMENTS AND CONTINGENCIES

8 unchanged sentences

The following table summarizes the reconciliation of the numerators and denominators for the basic and diluted earnings (loss) per share computation for the periods indicated:

Three months ended Six months ended

November 30, November 30,

Three months ended Nine months ended

February 28, February 29, February 28, February 29,

2025 2024 2025 2024

8 unchanged sentences

1.9 1.1 1.7 0.7

* The Company experienced a net loss for the six months ended November 30, 2024 and therefore did not report any dilutive share impact.

* The Company experienced a net loss for the three and nine months ended February 28, 2025 and therefore did not report any dilutive share impact.

The following potential common shares were excluded from the loss per diluted share computation:

outstanding options and restricted stock units of 2.7 million and 0.5 million, respectively.

The following table sets forth options outstanding pursuant to stock-based compensation plans as of the dates indicated:

November 30, 2024 November 30, 2023

Options outstanding pursuant to stock-based compensation plans (in millions) 2.8 3.1

As of November 30, 2024, $ 76.6 remained available for future purchases of common shares under the repurchase authorization of the Board of Directors (the "Board") in effect on that date.

See Note 12, "Treasury Stock", for a more complete description of the Company’s share buy-back program.

SCHOLASTIC CORPORATION

1 unchanged sentence

(Dollar amounts in millions, except per share data)

The following table sets forth options outstanding pursuant to stock-based compensation plans as of the dates indicated:

February 28, 2025 February 29, 2024

Options outstanding pursuant to stock-based compensation plans (in millions)

As of February 28, 2025, $ 46.6 remained available for future purchases of common shares under the repurchase authorization of the Board of Directors (the "Board") in effect on that date.

See Note 12, "Treasury Stock", for a more complete description of the Company’s share buy-back program and Note 18, "Subsequent Events" for additional Board authorization for common share repurchases.

9 Story Acquisition

On June 20, 2024, the Company completed the acquisition of 100 % of the economic interests in the form of non-voting shares and 25 % of the voting shares of 9 Story Media Group Inc.

("9 Story"), a leading independent creator, producer and distributor of premium children’s content based in Toronto, Canada, with studios or offices in New York, United States, Dublin, Ireland and Bali, Indonesia.

On June 20, 2024, the Company completed the acquisition of 100 % of the economic interests in the form of non-voting shares and 25 % of the voting shares of 9 Story, a leading independent creator, producer and distributor of premium children’s content based in Toronto, Canada, with studios or offices in New York, United States, Dublin, Ireland and Bali, Indonesia.

The aggregate purchase price was $ 193.7 , subject to further adjustment based on the final determination of purchase price adjustments, and was funded through borrowings under the U.S.

6 unchanged sentences

As the Company finalizes the fair value of assets acquired and liabilities assumed, additional purchase price adjustments may be recorded during the measurement period.

Refer to Note 8, Goodwill and Other Intangibles, for details regarding measurement period adjustments recorded during the six months ended November 30, 2024.

Refer to Note 8, Goodwill and Other Intangibles, for details regarding measurement period adjustments recorded during the nine months ended February 28, 2025.

The following table summarizes the preliminary purchase price allocation of fair values of the assets acquired and liabilities assumed at the date of acquisition, inclusive of measurement period adjustments:

SCHOLASTIC CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – UNAUDITED

(Dollar amounts in millions, except per share data)

Cash and cash equivalents $ 17.5

21 unchanged sentences

(2) Includes $ 31.9 of receivables related to government tax incentives.

The intangible assets acquired include intellectual property ("IP") related to 9 Story's existing and recognized program titles, customer contracts/relationships related to licensing, distribution and service arrangements, the trade names associated with 9 Story and Brown Bag Films, its animation studio, and internally developed

SCHOLASTIC CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – UNAUDITED

(Dollar amounts in millions, except per share data)

The intellectual property and customer contracts/relationships were valued using the multi-period excess earnings valuation method and are being amortized over 10 years, with the exception of contracts/relationships for service arrangements which are being amortized over 5 years.

5 unchanged sentences

The goodwill and intangible assets acquired were allocated to the Entertainment segment.

The financial results of 9 Story, since the date of acquisition, were included in the Company's Condensed Consolidated Financial Statements as of November 30, 2024.

9 Story contributed total revenue of $ 31.9 and net loss of $ 4.2 from the date of acquisition on June 20, 2024 through November 30, 2024.

The financial results of 9 Story, since the date of acquisition, were included in the Company's Condensed Consolidated Financial Statements as of February 28, 2025.

9 Story contributed total revenue of $ 44.2 and net loss of $ 8.3 from the date of acquisition on June 20, 2024 through February 28, 2025.

The operations of 9 Story are reported in the Entertainment segment.

The following table summarizes the unaudited pro-forma consolidated results of operations for the three and six months ended November 30, 2024 and 2023 as if the acquisition had occurred on June 1, 2023, the beginning of fiscal 2024:

Three months ended Six months ended

November 30, November 30,

The following table summarizes the unaudited pro-forma consolidated results of operations for the three and nine months ended February 28, 2025 and February 29, 2024 as if the acquisition had occurred on June 1, 2023, the beginning of fiscal 2024:

Three months ended Nine months ended

February 28, February 29, February 28, February 29,

2025 2024 2025 2024

2 unchanged sentences

Net income (loss) ( 3.6 ) ( 29.3 ) ( 19.1 ) ( 34.2 )

SCHOLASTIC CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – UNAUDITED

(Dollar amounts in millions, except per share data)

The unaudited pro-forma consolidated results above are based on the historical financial statements of the Company and 9 Story and are not necessarily indicative of the results of operations that would have been achieved if the acquisition was completed at the beginning of fiscal 2024 and are not indicative of the future operating results of the combined entities.

2 unchanged sentences

The pro-forma consolidated results of operations also include the effects of purchase accounting adjustments, including amortization charges related to the finite-lived intangible assets acquired, fair value adjustments relating to leases and fixed assets, and the related tax effects assuming that the business combination occurred on June 1, 2023.

The Company incurred acquisition‑related costs of $ 0.4 and $ 2.1 for the three and six months ended November 30, 2024, respectively, which were included in Selling, general and administrative costs in the Condensed Consolidated Statement of Operations.

The Company incurred acquisition‑related costs of $ 0.5 and $ 2.6 for the three and nine months ended February 28, 2025, respectively, which were included in Selling, general and administrative expenses in the Condensed Consolidated Statement of Operations.

Purchase of Noncontrolling Interest

6 unchanged sentences

The Company monitors impairment indicators in light of changes in market conditions, near and long-term demand for the Company’s products and other relevant factors.

SCHOLASTIC CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – UNAUDITED

(Dollar amounts in millions, except per share data)

The following table summarizes the activity in Goodwill for the periods indicated:

November 30, 2024 May 31, 2024 November 30, 2023

February 28, 2025 May 31, 2024 February 29, 2024

Gross beginning balance $ 172.4 $ 172.3 $ 172.3

10 unchanged sentences

There were no impairment charges related to Goodwill in any of the periods presented.

SCHOLASTIC CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – UNAUDITED

(Dollar amounts in millions, except per share data)

The following table summarizes the activity in Other intangible assets for the periods indicated:

November 30, 2024 May 31, 2024 November 30, 2023

February 28, 2025 May 31, 2024 February 29, 2024

Beginning balance - Other intangibles subject to amortization $ 8.2 $ 7.8 $ 7.8

13 unchanged sentences

In fiscal 2023, the Company acquired Learning Ovations, Inc., a U.S.-based education technology business, which resulted in the recognition of $ 4.1 of amortizable intangible assets.

During fiscal 2024, the Company assessed the recoverability of these assets as impacted by the shift to the science of reading based approach to literacy instruction within the education market.

During fiscal 2024, the Company assessed the recoverability of these assets which was impacted by the shift to an evidenced-based approach to literacy instruction within the education market.

An asset impairment of $ 3.1 was recognized in the fourth quarter of fiscal 2024.

There were no impairment charges related to Other intangible assets in the nine months ended February 28, 2025 and February 29, 2024.

Other intangible assets with indefinite lives consist principally of trademark and trade name rights.

2 unchanged sentences

The weighted-average remaining useful lives of all amortizable intangible assets is approximately 8.6 years.

There were no impairment charges related to Other intangible assets in the six months ended November 30, 2024 and November 30, 2023.

SCHOLASTIC CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – UNAUDITED

(Dollar amounts in millions, except per share data)

Investments are included in Other assets and deferred charges on the Condensed Consolidated Balance Sheets.

The following table summarizes the Company’s investments as of the dates indicated:

November 30, 2024 May 31, 2024 November 30, 2023 Segment

February 28, 2025 May 31, 2024 February 29, 2024 Segment

Equity method investments $ 31.6 $ 31.5 $ 30.8 International

8 unchanged sentences

The Company acquired investments of $ 0.9 as part of the 9 Story acquisition which are included in the Entertainment segment.

Included in these acquired investments, the Company acquired a 50 % ownership interest in certain animated television production companies.

Included in these acquired investments, the Company acquired a 50 % ownership

SCHOLASTIC CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – UNAUDITED

(Dollar amounts in millions, except per share data)

interest in certain animated television production companies.

These joint venture investments are accounted for using the equity method of accounting.

2 unchanged sentences

There have been no impairments or adjustments to the carrying value of the investment.

Income from equity investments is reported in Selling, general and administrative expenses in the Condensed Consolidated Statements of Operations and totaled $ 0.6 and $ 0.8 for the three and six months ended November 30, 2024, respectively, and $ 0.1 and $ 0.3 for the three and six months ended November 30, 2023, respectively.

SCHOLASTIC CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – UNAUDITED

(Dollar amounts in millions, except per share data)

Income from equity investments is reported in Selling, general and administrative expenses in the Condensed Consolidated Statements of Operations and totaled a loss of less than $ 0.1 and income of $ 0.8 for the three and nine months ended February 28, 2025, respectively, and a loss of $ 0.2 and income of $ 0.1 for the three and nine months ended February 29, 2024, respectively.

The Company received dividends of $ 1.3 in the three and nine months ended February 29, 2024.

The Company did not receive any dividends in the nine months ended February 28, 2025.

EMPLOYEE BENEFIT PLANS

2 unchanged sentences

Three months ended Three months ended

November 30, November 30,

February 28, February 29, February 28, February 29,

2025 2024 2025 2024

6 unchanged sentences

UK Pension Plan US Postretirement Benefits

Six months ended Six months ended

November 30, November 30,

Nine months ended Nine months ended

February 28, February 29, February 28, February 29,

2025 2024 2025 2024

9 unchanged sentences

The Company’s funding practice with respect to the UK Pension Plan is to contribute on an annual basis at least the minimum amounts required by applicable law.

For the six months ended November 30, 2024, the Company contributed $ 0.7 to the UK Pension Plan.

For the nine months ended February 28, 2025, the Company contributed $ 1.0 to the UK Pension Plan.

The Company expects, based on actuarial calculations, to contribute cash of approximately $ 1.3 to the UK Pension Plan for the fiscal year ending May 31, 2025.

SCHOLASTIC CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – UNAUDITED

(Dollar amounts in millions, except per share data)

STOCK-BASED COMPENSATION

The following table summarizes stock-based compensation expense included in Selling, general and administrative expenses for the periods indicated:

Three months ended Six months ended

November 30, November 30,

Three months ended Nine months ended

February 28, February 29, February 28, February 29,

2025 2024 2025 2024

4 unchanged sentences

Total stock-based compensation expense $ 2.4 $ 2.3 $ 6.7 $ 8.7

SCHOLASTIC CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – UNAUDITED

(Dollar amounts in millions, except per share data)

During the second quarter of fiscal 2025, the Company granted performance-based restricted stock units to certain officers and senior management.

1 unchanged sentence

The following table sets forth Common Stock issued pursuant to stock-based compensation plans for the periods indicated:

Three months ended Six months ended

November 30, November 30,

Three months ended Nine months ended

February 28, February 29, February 28, February 29,

2025 2024 2025 2024

8 unchanged sentences

Less repurchases made under these authorizations ( 74.2 )

Remaining Board authorization at November 30, 2024 $ 76.6

Remaining Board authorization at November 30, 2024 represents the amount remaining under the Board authorization for Common share repurchases announced on December 13, 2023 and the additional $ 54.6 Board authorization for Common share repurchases announced on March 20, 2024, which is available for further repurchases, from time to time as conditions allow, on the open market or through privately negotiated transactions.

Repurchases of the Company's Common Stock were $ 5.0 and $ 10.0 during the three and six months ende d November 30, 2024, respectively.

Remaining Board authorization at February 28, 2025 $ 46.6

Remaining Board authorization at February 28, 2025 represents the amount remaining under the Board authorization for Common share repurchases announced on March 20, 2024, which is available for further repurchases, from time to time as conditions allow, on the open market or through privately negotiated transactions.

See Note 18, "Subsequent Events", for additional Board authorization for common share repurchases.

Repurchases of the Company's Common Stock were $ 30.6 and $ 40.6 , including excise tax on share repurchases, during the three and nine months ende d February 28, 2025, respectively.

The Company's repurchase program may be suspended at any time without prior notice.

4 unchanged sentences

The following tables summarize the activity in Accumulated other comprehensive income (loss), net of tax, by component, for the periods indicated:

Three months ended November 30, 2024

Three months ended February 28, 2025

Foreign currency translation adjustments Retirement benefit plans Total

Beginning balance at September 1, 2024 $ ( 38.7 ) $ ( 5.4 ) $ ( 44.1 )

Beginning balance at November 30, 2024

$ ( 50.6 ) $ ( 5.2 ) $ ( 55.8 )

Other comprehensive income (loss) before reclassifications ( 8.0 ) — ( 8.0 )

Less amount reclassified from Accumulated other comprehensive income (loss):

Amortization of net actuarial loss (net of tax of $ 0.0 )

Amortization of net actuarial (gain) loss (net of tax of $ 0.0 )

Amortization of prior service (credit) cost (net of tax of $ 0.1 )

1 unchanged sentence

Other comprehensive income (loss) ( 8.0 ) 0.1 ( 7.9 )

Ending balance at November 30, 2024 $ ( 50.6 ) $ ( 5.2 ) $ ( 55.8 )

Three months ended November 30, 2023

Ending balance at February 28, 2025 $ ( 58.6 ) $ ( 5.1 ) $ ( 63.7 )

Three months ended February 29, 2024

Foreign currency translation adjustments Retirement benefit plans Total

Beginning balance at September 1, 2023 $ ( 48.2 ) $ ( 5.6 ) $ ( 53.8 )

Beginning balance at November 30, 2023

$ ( 48.0 ) $ ( 5.5 ) $ ( 53.5 )

Other comprehensive income (loss) before reclassifications ( 0.4 ) — ( 0.4 )

Less amount reclassified from Accumulated other comprehensive income (loss):

Amortization of net actuarial loss (net of tax of $ 0.0 )

Amortization of net actuarial (gain) loss (net of tax of $ 0.0 )

Amortization of prior service (credit) cost (net of tax of $ 0.1 )

1 unchanged sentence

Other comprehensive income (loss) ( 0.4 ) 0.2 ( 0.2 )

Ending balance at November 30, 2023 $ ( 48.0 ) $ ( 5.5 ) $ ( 53.5 )

Six months ended November 30, 2024

Ending balance at February 29, 2024 $ ( 48.4 ) $ ( 5.3 ) $ ( 53.7 )

Nine months ended February 28, 2025

Foreign currency translation adjustments Retirement benefit plans Total

2 unchanged sentences

amount reclassified from Accumulated other comprehensive income (loss)

Amortization of net actuarial loss (net of tax of $ 0.0 )

Amortization of net actuarial (gain) loss (net of tax of $ 0.0 )

Amortization of prior service (credit) cost (net of tax of $ 0.2 )

1 unchanged sentence

Other comprehensive income (loss) ( 11.7 ) 0.5 ( 11.2 )

Ending balance at November 30, 2024 $ ( 50.6 ) $ ( 5.2 ) $ ( 55.8 )

Six months ended November 30, 2023

Ending balance at February 28, 2025 $ ( 58.6 ) $ ( 5.1 ) $ ( 63.7 )

Nine months ended February 29, 2024

Foreign currency translation adjustments Retirement benefit plans Total

2 unchanged sentences

amount reclassified from Accumulated other comprehensive income (loss)

Amortization of net actuarial loss (net of tax of $ 0.0 )

Amortization of net actuarial (gain) loss (net of tax of $ 0.0 )

Amortization of prior service (credit) cost (net of tax of $ 0.2 )

1 unchanged sentence

Other comprehensive income (loss) 1.6 0.5 2.1

Ending balance at November 30, 2023 $ ( 48.0 ) $ ( 5.5 ) $ ( 53.5 )

Ending balance at February 29, 2024 $ ( 48.4 ) $ ( 5.3 ) $ ( 53.7 )

SCHOLASTIC CORPORATION

2 unchanged sentences

The following table presents the impact on earnings of reclassifications out of Accumulated other comprehensive income (loss) for the periods indicated:

Three months ended Six months ended Condensed Consolidated Statements of Operations line item

November 30, November 30, November 30, November 30,

Three months ended Nine months ended Condensed Consolidated Statements of Operations line item

February 28, February 29, February 28, February 29,

2025 2024 2025 2024

33 unchanged sentences

The accounting estimates used to compute the provision for income taxes may change as new events occur, additional information is obtained or as the result of new judicial interpretations or regulatory or tax law changes.

The Company's interim effective tax rate, inclusive of discrete items, for the three and six month periods ended November 30, 2024 was 30.3 % and 37.2 %, respectively, compared to 24.2 % and 22.9 %, respectively, for the prior fiscal year period.

The interim effective tax rate for the six months ended November 30, 2024 varies from the statutory rate primarily due to expected state and local income tax and non-deductible compensation for covered executive employees.

The Company's interim effective tax rate, inclusive of discrete items, for the three and nine month periods ended February 28, 2025 was 87.3 % and 65.5 %, respectively, compared to 23.4 % and 23.5 %, respectively, for the prior fiscal year period.

The interim effective tax rate for the nine months ended February 28, 2025 varies from the statutory rate primarily due to the expected state and local income tax and non-deductible compensation for covered executive employees.

Due to the seasonal nature of the business, the tax benefit on the operating loss for the nine months ended February 28, 2025 will be impacted by the Company's typically profitable fourth fiscal quarter.

The Company, including its domestic subsidiaries, files a consolidated U.S.

20 unchanged sentences

The Company marks-to-market these instruments and records the changes in the fair value of these items in Selling, general and administrative expenses and recognizes the unrealized gain or loss in Other current assets or Other current liabilities.

The notional values of the contracts were $ 22.8 as of November 30, 2024 and November 30, 2023.

A net unrealized gain of $ 0.6 and $ 0.3 was recognized for the six months ended November 30, 2024 and November 30, 2023, respectively.

The notional values of the contracts were $ 22.8 as of February 28, 2025 and

SCHOLASTIC CORPORATION

1 unchanged sentence

(Dollar amounts in millions, except per share data)

February 29, 2024.

A net unrealized gain of $ 0.9 and $ 0.2 was recognized for the nine months ended February 28, 2025 and February 29, 2024, respectively.

OTHER ACCRUED EXPENSES

Other accrued expenses consisted of the following as of the dates indicated:

November 30, 2024 May 31, 2024 November 30, 2023

February 28, 2025 May 31, 2024 February 29, 2024

Accrued payroll, payroll taxes and benefits $ 28.0 $ 32.9 $ 32.7

6 unchanged sentences

SUBSEQUENT EVENTS

On December 11, 2024, the Board declared a quarterly cash dividend of $ 0.20 per share on the Company’s Class A and Common Stock for the third quarter of fiscal 2025.

The dividend is payable on March 14, 2025 to shareholders of record as of the close of business on January 31, 2025.

On March 19, 2025, the Board declared a quarterly cash dividend of $ 0.20 per share on the Company’s Class A and Common Stock for the fourth quarter of fiscal 2025.

The dividend is payable on June 16, 2025 to shareholders of record as of the close of business on April 30, 2025.

On March 19, 2025, the Board also authorized an increase of $ 53.4 for Common share repurchases under the Company's share buy-back program, resulting in a current Board authorization of $ 100.0 , which includes $ 46.6 remaining from the previous Board authorization.

SCHOLASTIC CORPORATION

1 unchanged sentence

Overview and Outlook

Revenues for the second quarter ended November 30, 2024 were $544.6 million, compared to $562.6 million in the prior fiscal year quarter, a decrease of $18.0 million or 3%.

The Company reported net income per diluted share of Class A and Common Stock of $1.71 in the second quarter of fiscal 2024, compared to a net income per diluted share of $2.45 in the prior fiscal year quarter.

During the second fiscal quarter, the Children's Book Publishing and Distribution segment's results reflected timing-related revenue declines, related to the trade publishing plan and book fair deliveries, compared to the prior year period.

Education Solutions continued to be negatively impacted as school districts focus on adopting and implementing new core programs which resulted in a continued decline in spending on supplemental materials.

The Company is developing new supplemental products for schools, which are expected to launch in time for the 2025/2026 school years.

Within the Entertainment segment, the Company benefited from the addition of 9 Story and continued to execute on an integrated development and production slate, including digital-first growth opportunities, and expanded the reach and monetization of Scholastic IP on advertising-supported distribution platforms leveraging 9 Story’s capabilities.

During the remainder of fiscal 2025, revenues are expected to benefit from new releases, including the thirteenth book in Dav Pilkey’s global best-selling series, Dog Man:

Big Jim Begins , which was released in December, and the fifth book in Suzanne Collins’ Hunger Games ® series, Sunrise on the Reaping, which is expected to be released in March 2025.

Fair count for the fall season, which includes June through December, is expected to exceed the prior year period, and full year fair count is expected to achieve 90,000 fairs in fiscal 2025.

The Company's Entertainment segment continues to execute on company-wide synergies which are expected to benefit this segment in fiscal 2026 and beyond.

Revenues for the third quarter ended February 28, 2025 were $335.4 million, compared to $323.7 million in the prior fiscal year quarter, an increase of $11.7 million or 4%.

The Company reported net loss per diluted share of Class A and Common Stock of $0.13 in the third quarter of fiscal 2025, compared to $0.91 in the prior fiscal year quarter.

During the third fiscal quarter, revenue growth was primarily driven by the contribution of 9 Story within the Entertainment segment.

Despite increasing pressure on consumer spending which impacted the Children's Book Publishing and Distribution segment, revenues from School Reading Events increased over the prior year quarter while trade channel revenues remained consistent.

The trade channel benefited from the release of the thirteenth book in Dav Pilkey’s global best-selling series, Dog Man ® :

Big Jim Begins , which also drove higher sales of backlist titles in the series, the benefit of which was offset by the general softness in the retail book market.

While Education Solutions continued to be negatively impacted by the continued decline in spending on supplemental materials, the Company expects to launch new supplemental products over the summer for the next school year.

Operating loss improved 32%, reflecting a reduction in discretionary overhead expenses and the higher revenues in the Children’s Book Publishing and Distribution segment, which more than offset the impact of lower sales in Education Solutions.

For the remainder of fiscal 2025, the Company expects increasing spending headwinds to continue to impact the trade channel resulting in softness in the retail book market as well as participation at book fairs.

The Company expects new releases to benefit the trade channel in the fourth fiscal quarter, including the recently released fifth book in Suzanne Collins’ Hunger Games ® series, Sunrise on the Reaping.

Within the Entertainment segment, delays in production greenlights from major platforms are expected to impact production work in the near-term, however the Company remains focused on production and development work for video-on-demand platforms and making progress on Company-wide synergies which are expected to benefit the Entertainment segment in fiscal 2026 and beyond.

Results of Operations

Revenues for the quarter ended November 30, 2024 decreased by $18.0 million to $544.6 million, compared to $562.6 million in the prior fiscal year quarter.

Within the Children's Book Publishing and Distribution segment, revenues decreased by $25.4 million, primarily driven by lower trade channel revenues which reflected the timing of new releases, coupled with lower revenues from the book fairs channel as more fairs shifted into December than in the prior fiscal year quarter.

In the Education Solutions segment, revenues decreased by $9.8 million primarily due to the continued decline in spending on supplemental materials, coupled with lower subscription revenues from Magazines+ TM and lower revenues from sponsored programs.

In local currency, the International segment revenues decreased by $1.7 million, primarily reflecting lower sales in Australia due to softness in the retail market.

International segment revenues benefited from favorable foreign exchange of $1.9 million in the quarter ended November 30, 2024.

Partially offsetting the overall decrease in revenues, revenues from the Entertainment segment increased $16.4 million, reflecting the addition of 9 Story.

Revenues for the six months ended November 30, 2024 decreased by $9.3 million to $781.8 million, compared to $791.1 million in the prior fiscal year period.

Revenues in the Children's Book Publishing and Distribution segment decreased by $22.4 million, primarily driven by lower trade channel revenues which reflected the timing of new releases, coupled with lower revenues from the book fairs channel as more fairs shifted into December than in the prior fiscal year period.

Revenues for the quarter ended February 28, 2025 increased by $11.7 million to $335.4 million, compared to $323.7 million in the prior fiscal year quarter.

Within the Children's Book Publishing and Distribution segment, revenues increased by $10.2 million, driven by increased revenues from School Reading Events as a result of higher fair count in the book fairs channel and higher revenue per sponsor and an increase in events in the book clubs channel.

Trade channel revenues were consistent with the prior year as increased sales from the Dog Man ® series, which included the latest release, Dog Man #13:

Big Jim Begins, were offset by lower sales of backlist titles due to softness in the retail book market.

In the Education Solutions segment, revenues decreased by $11.3 million primarily due to the continued decline in spending on supplemental materials, coupled with lower subscription revenues from Magazines+ TM .

In the Entertainment segment, revenues increased by $12.3 million, reflecting the addition of 9 Story.

In local currency, International segment revenues increased by $2.9 million, primarily reflecting higher sales in Canada, the U.K.

and New Zealand.

International segment revenues were impacted by unfavorable foreign exchange of $2.7 million in the quarter ended February 28, 2025.

Revenues for the nine months ended February 28, 2025 increased by $2.4 million to $1,117.2 million, compared to $1,114.8 million in the prior fiscal year period.

The overall increase in revenues was attributable to the Entertainment segment, which increased $44.9 million, reflecting the addition of 9 Story.

Revenues in the Children's Book Publishing and Distribution segment decreased by $12.2 million, primarily driven by lower trade channel revenues which reflected the timing of new releases and softness in the retail book market, partially offset by increased revenues from School Reading Events as a result of higher revenue per sponsor and an increase in events in the book clubs channel.

In the Education Solutions segment, revenues decreased by $31.4 million primarily due to the continued decline in spending on supplemental materials and lower subscription revenues from Magazines+.

In local currency, the International segment revenues decreased by $1.9 million, primarily reflecting lower sales in Australia due to softness in the retail market, partly offset by higher revenues in the U.K.

International segment revenues benefited from favorable foreign exchange of $1.7 million in the period ended November 30, 2024.

Partially offsetting the overall decrease in revenues, revenues from the Entertainment segment increased $32.6 million, reflecting the addition of 9 Story.

In local currency, International segment revenues increased by $1.0 million, primarily reflecting increased sales in Canada, the U.K.

and New Zealand, partly offset by lower sales in Australia due to softness in the retail market.

International segment revenues were impacted by unfavorable foreign exchange of $1.0 million in the period ended February 28, 2025.

SCHOLASTIC CORPORATION

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements