Wiley Posts 2% Revenue Gain in Fiscal Q1

Key Points

• Adjusted revenue rose 2% to $396.8 million after lapping a large prior-year artificial intelligence (AI) deal.

• Research segment revenue grew 6%, driven by strong demand for AI licensing and open access publishing.

• Margins compressed compared to the prior year, with adjusted EBITDA margin falling to 17.8% (non-GAAP).

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John Wiley & Sons (NYSE:WLY), a global research and learning publisher now focused on digital content and services, reported earnings for the fiscal first quarter ended July 31, 2025 on September 4, 2025. The company posted adjusted revenue of $396.8 million, up 2% from the prior year, with adjusted earnings per share (EPS) of $0.49 (non-GAAP)—exceeding expectations after management previously flagged a tough prior-year comparison. The Research segment led with AI and open access growth offsetting planned Learning declines. However, margin fell to 17.8 % from 18.6 %. The quarter tracked in line with full-year goals, though cash flow and profit margin improvement remain key areas to watch going forward.

Company Overview and Success Factors

John Wiley & Sons publishes and licenses a wide range of academic and professional research journals, digital learning platforms, and educational content. The business now generates the majority of its revenue from digital and online products—83% of Adjusted Revenue in FY2025, with a significant share coming from recurring subscriptions and institutional partnerships. Its Research segment delivers digital publishing services and platform licensing for universities, libraries, and corporate users worldwide, while its Learning segment focuses on higher education and professional skills content.

The company’s recent focus has been on accelerating digital transformation, expanding recurring revenue streams, and growing its global partnerships. Key success factors for Wiley today include: keeping a high proportion of revenue tied to digital and recurring revenue models, maintaining strong partnerships with professional societies for journal content, expanding into new global markets, and capitalizing on rapid growth in open access and AI-related publishing.

Quarter Highlights: Revenue, Segment Trends, and Strategic Moves

Adjusted revenue rose 2% to $396.8 million, modestly above the prior year as the business lapped a large $16 million AI licensing deal recognized in the prior year. Overall growth was predominantly driven by the Research segment. This segment delivered a 6% revenue increase, supported by a surge in AI licensing revenue (up to $16 million versus $1 million prior year) as well as strong demand for open access publishing services. Management highlighted article submissions and published outputs rising by 25% and 13%, respectively.

Conversely, the Learning segment saw revenue fall 7% year over year to $115.1 million. This decline reflected both a planned drop in AI license revenue (down to $13 million) and continued weakness in the Professional education sub-segment, which management described as “market-related softness.” Academic Learning revenue also fell 7%. Despite these top-line pressures, Learning managed to slightly expand its adjusted EBITDA margin to 27.4%, indicating improved cost management even as sales declined.

Adjusted EBITDA margin contracted to 17.8% from 18.6% (non-GAAP). The Research segment’s Adjusted EBITDA margin compressed by 1.0 percentage point, due in part to increased royalty payments tied to AI deals and timing of certain costs. Corporate expenses rose 4% on an adjusted basis as the company wrapped up strategic consulting and began ramping up modernization efforts, though management expects these costs to abate from the next quarter onward as cost-saving programs take full effect.

Wiley executed a major AI licensing agreement, including one described as a “landmark” project with a large technology company, and launched a strategic partnership with software company Anthropic to integrate more AI capabilities into its publishing platforms. These partnerships are designed to support digital transformation and diversify revenue sources. On the capital allocation front, Wiley returned $32 million to shareholders through dividends and buybacks (including a newly-boosted $250 million share repurchase program), following the full receipt and application of $120 million in proceeds from divested university services assets. Net debt to EBITDA improved to 1.9x from 2.0x in the year-ago period. The company raised its quarterly dividend for the 32nd consecutive year.

Looking Ahead: Guidance and What to Watch

Management reaffirmed its full-year Adjusted (non-GAAP) outlook. It continues to guide for “low to mid-single digit” adjusted revenue growth, a step up in Adjusted EBITDA margin to between 25.5% and 26.5%, and adjusted EPS in the range of $3.90 to $4.35. Free cash flow (non-GAAP) is expected to reach approximately $200 million. Leadership cited strong recurring revenue models, expanding open access programs, and anticipated cost savings as key drivers supporting these goals.

For investors, critical items to monitor in the coming quarters include progress toward margin improvement, execution of cost cuts as flagged by management, and the mix and timing of AI licensing revenue. However, with article submissions and output growing by 25% and 13%, respectively, Wiley’s Research pipeline appears well-positioned. Also, cash flow performance will be in focus after this period’s typical first-quarter outflow. The quarterly dividend was raised for the 32nd consecutive year.

Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.

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