November 12, 2025
Columbus, Ohio — McGraw Hill, Inc. NYSE:MH raised its full‑year outlook after reporting a back‑to‑school quarter that leaned on digital momentum and subscription strength, even as the K‑12 market cycled through a predictably smaller adoption year. The company posted fiscal Q2 2026 results (three months ended Sept. 30, 2025) this morning and hosted its earnings webcast at 8:30 a.m. ET.
The headlines
- Revenue: $669.2 million, down 2.8% year over year on a lighter K‑12 adoption cycle.
- GAAP EPS (diluted):$0.57; Adjusted EPS (diluted): $1.40.
- Adjusted EBITDA: $286.4 million; margin 42.8% (+60 bps YoY).
- Recurring (“re‑occurring”) revenue: $422.4 million, +6.5% YoY; Digital revenue: $352.2 million, +7.6% YoY. investors.mheducation.com
- RPO (backlog): $1.91 billion as of Sept. 30, 2025.
Guidance goes up
Management raised FY2026 guidance across the board. Revenue is now projected at $2.031–$2.061 billion (prior $1.986–$2.046 billion), and Adjusted EBITDA at $702–$722 million (prior $663–$703 million). Recurring revenue guidance ticked up to $1.504–$1.524 billion (prior $1.477–$1.517 billion).
Segment picture: Higher Ed offsets K‑12 lull
- Higher Education: Revenue $213.0 million (+14.0% YoY). Digital revenue rose 18.4%, and U.S. market share reached a record 30% on an LTM basis, up 160 bps year over year, aided by Inclusive Access sales up 37%.
- K‑12: Revenue $359.1 million (–11.2% YoY) on a smaller state adoption calendar, partially cushioned by growth in recurring revenue (+2.8%). Management said it is well‑positioned for growth in FY2027, noting approval in the California math adoption.
- Global Professional & International: Professional showed resilience with recurring gains in medical and engineering; International declines narrowed as the digital shift continues.
AI push, product pipeline, and platform usage
McGraw Hill highlighted expanding AI‑powered solutions, including new tools for educators and learners, continued uptake of McGraw Hill Plus, and progress with ALEKS (including ALEKS Adventure for K‑3 and ALEKS Calculus globally). The company said its internal AI content platform, Scribe, recouped its initial investment within a year; AI Reader logged 11 million learning interactions in the quarter.
Debt reduction and lower interest costs
On balance‑sheet actions, McGraw Hill reduced its term‑loan spread by 50 bps and prepaid $150 million of principal in October, bringing year‑to‑date gross debt reduction to $542 million and yielding over $40 million in annualized cash interest savings, according to today’s release and the accompanying SEC filing.
Market reaction
Shares of McGraw Hill surged in late‑morning trading as investors digested stronger profitability metrics and the guidance raise; early reports cited an intraday gain of roughly ~19%. (Real‑time prices may vary.)
What management said
CEO Simon Allen framed the quarter as proof of “market share gains and the expansion of AI‑powered tools,” emphasizing personalized learning at scale across the company’s portfolio. CFO Bob Sallmann underscored scalability, recurring revenue, and a stronger balance sheet positioning McGraw Hill “to deliver sustained value” while continuing to invest. (Statements summarized from the company’s press release.) investors.mheducation.com+1
Key numbers at a glance (Fiscal Q2 2026)
- Revenue: $669.2M (vs. $688.6M LY)
- Gross margin:79.2% (up ~150 bps YoY)
- GAAP net income:$105.3M (vs. $133.4M LY)
- Adjusted EBITDA:$286.4M (margin 42.8%)
- GAAP EPS (diluted):$0.57; Adjusted EPS (diluted):$1.40
- Recurring revenue mix:63% of consolidated revenue
- Digital revenue:$352.2M (+7.6% YoY)
- RPO:$1.9136B
(All figures from McGraw Hill’s Nov. 12, 2025 press materials.)
Context: A newly public McGraw Hill
McGraw Hill returned to the public markets this summer, raising ~$415 million in its July IPO and listing on the NYSE under “MH.” Platinum Equity remains the majority shareholder. Reuters
What’s next
- Execution on AI road map: Watch adoption and usage trends for new AI tools across K‑12 and Higher Ed in the second semester.
- K‑12 adoption cycle: The company points to a bigger adoption opportunity in FY2027, including California math.
- Leverage and cash interest: Continued deleveraging and refinancing tailwinds could further reduce interest expense into FY2026–FY2027.
Earnings call & filings
McGraw Hill’s Q2 FY2026 press release and Form 8‑K were filed this morning; management hosted its webcast at 8:30 a.m. ET. Investors can find the materials on the company’s IR site and in the SEC archive.
Editorial note
This article focuses on news from Nov. 12, 2025: McGraw Hill’s fiscal Q2 2026 results, raised guidance, balance‑sheet actions, and same‑day market reaction. For background on July’s IPO and ownership structure, see the Reuters coverage linked above.
Sources: McGraw Hill investor news release and financial tables; SEC Form 8‑K; contemporaneous market coverage.
Forward‑looking statements are management’s current expectations and are subject to risks and uncertainties as described by the company.
