John Wiley & Sons, Inc. (NYSE:WLY) is a global leader in academic publishing, providing educational materials, scholarly research, and professional development resources. With a rich history spanning over two centuries, the company has established itself as a trusted authority in the creation and application of knowledge, serving researchers, learners, innovators, and leaders worldwide.
Fiscal Year 2024 Performance
In the fiscal year 2024, John Wiley & Sons reported annual revenue of $1,872,987,000 and an annual net income of -$200,319,000. The company's annual operating cash flow stood at $207,638,000, while its annual free cash flow reached $104,111,000. These financial results reflect the company's ability to navigate a dynamic market landscape, while also highlighting the strategic initiatives undertaken to position Wiley for long-term success.
Segmental Performance
John Wiley & Sons operates through two primary segments: Research and Learning. The Research segment, which includes the company's publishing and content platforms, as well as related services, generated revenue of $771,673,000 in the nine months ended January 31, 2024. This segment faced some headwinds, including the carryover impact of the Hindawi publishing disruption and softer market conditions in the corporate offerings. However, the company is seeing strong momentum in its core open access publishing program and institutional models, with open access article output growth of approximately 10% year-over-year.
The Learning segment, which encompasses the company's academic and professional publishing, as well as assessment services, delivered a strong performance, with revenue of $404,594,000 in the nine months ended January 31, 2024. This segment benefited from continued growth in digital content and courseware, as well as a favorable shift in the higher education market, with undergraduate enrollment increasing for the first time since the pandemic.
Recent Developments
Navigating the AI Frontier
John Wiley & Sons has emerged as an early beneficiary of the rise of generative artificial intelligence (GenAI). The company's high-quality content in science, learning, and innovation has become increasingly valuable for training and fine-tuning large language models and applications. In the third quarter of fiscal year 2024, Wiley executed a $23 million licensing project with a large tech company for its previously published learning content, and followed up with a $21 million project with another tech company for a mix of learning and research content to be recognized in fiscal year 2025.
These deals represent the first stage of Wiley's GenAI strategy, which involves content licensing and providing limited access to select content for model training purposes. The company is also exploring the second stage of developing new business models around content application, where Wiley can embed its content into GenAI applications for various industries, such as pharmaceuticals, healthcare, and financial services.
In addition to content licensing and application, Wiley is leveraging AI-based tools to transform its publishing processes, shortening authoring time, increasing editorial productivity, and streamlining content workflows. The company has already deployed AI into its research platform, using it to safeguard research integrity at the point of article submission.
Outlook
Fiscal Year 2025 Outlook
Looking ahead to fiscal year 2025, John Wiley & Sons is projecting revenue in the range of $1.65 billion to $1.69 billion, representing a top-line growth of 2% to 4%. This guidance includes the recognition of the $21 million GenAI content rights project, but does not reflect any additional GenAI content licensing deals.
The company's adjusted EBITDA is expected to be in the range of $385 million to $410 million, translating to a margin of 23% to 24%. This performance is expected to be driven by a combination of revenue growth and continued cost savings, partially offset by reinvestments in research, GenAI, and infrastructure modernization.
Adjusted earnings per share (EPS) is projected to be in the range of $3.25 to $3.60, reflecting growth of 17% to 29%. This growth is primarily driven by higher expected adjusted operating income and accrued interest income from divestitures, partially offset by higher interest and tax expenses.
Free cash flow is anticipated to be approximately $125 million, up from $114 million in the prior year, due to improved working capital and lower restructuring payments, partially offset by higher capital expenditures and incentive compensation payments.
Fiscal Year 2026 and Beyond
Looking further ahead, John Wiley & Sons has set its sights on continued growth and margin expansion. For fiscal year 2026, the company is targeting low- to mid-single-digit revenue growth, driven by the core drivers in publishing and solutions, as well as the ongoing GenAI opportunities.
The company's adjusted EBITDA margin is expected to grow to 24% to 25%, fueled by high-quality revenue growth and the realization of the remaining value creation plan savings. Free cash flow is projected to rise to $200 million, as capital expenditures return to more normalized levels and restructuring payments taper off.
Beyond fiscal year 2026, Wiley is focused on delivering strong, consistent revenue growth at or above market growth, continued margin expansion from greater publishing scale and efficiency, and further free cash flow acceleration as cash earnings expand and capital expenditures normalize.
Conclusion
John Wiley & Sons has navigated a transformative year, simplifying its portfolio, streamlining operations, and positioning itself for long-term success. The company's relentless execution, disciplined cost management, and strategic investments in research, learning, and GenAI have laid the foundation for sustainable growth and margin expansion.
As the world continues to evolve, John Wiley & Sons remains at the forefront of the knowledge economy, enabling the creation and application of new insights across critical domains. With a strong competitive position, a diversified revenue stream, and a clear vision for the future, the company is well-equipped to navigate the changing landscape and deliver value to its shareholders.