Shares of Scholastic Corporation (SCHL) plummeted 14.56% in Friday's pre-market trading following the release of disappointing fiscal first-quarter results for 2026. The children's book publisher and education company reported a wider loss and missed revenue estimates, triggering a significant sell-off.
Scholastic posted a loss of $71.1 million, or $2.83 per share, compared to a loss of $62.5 million, or $2.21 per share, in the same period last year. On an adjusted basis, the loss per share was $2.52, missing analyst estimates of $2.44. Revenue for the quarter fell 5% to $225.6 million, falling short of the expected $238.9 million. The company's Education Solutions segment was particularly hard hit, with revenue decreasing by 28% as schools delayed or reduced purchases due to uncertain federal and state funding.
Despite the weak quarter, Scholastic's CEO Peter Warwick expressed confidence in the company's long-term prospects, stating, "Scholastic made steady progress in the first quarter of fiscal 2026, advancing strategic initiatives across all segments." The company reaffirmed its full-year guidance, expecting revenue growth of 2% to 4% for fiscal 2026. However, investors seem to be focusing on the near-term challenges, as reflected in the significant stock price decline. The market's reaction underscores the ongoing volatility in the education sector and the impact of funding uncertainties on companies operating in this space.
Comments