Wiley acquires Emerald Publishing for $452M, reports record margins and 55% FCF growth

Wiley acquired Emerald Publishing for $452 million (£337M) on June 1, 2026. The transaction is valued at approximately 7x Adjusted EBITDA including anticipated cost synergies of approximately $30 million annually. Emerald is a leading independent research publisher in social sciences with 485 journals, generating $85M+ in projected FY2026 revenue with 37-38% Adjusted EBITDA margin. The acquisition expands Wiley's journal portfolio to approximately 2,500 titles and establishes category leadership in economics, business, finance, and social sciences. Management expects the deal to be accretive to Adjusted EPS in year one and Free Cash Flow in year two, with ROIC above the weighted average cost of capital by year two. Note: these figures were previously disclosed in the company's Jun 2, 2026 8-K.

For fiscal year 2026 ended April 30, Wiley reported Adjusted Revenue of $1,677 million (flat year-over-year, up 1% including currency impact). GAAP EPS increased $2.63 to $4.16, while Adjusted EPS grew 15% to $4.19. Adjusted EBITDA rose 10% to $440 million with margin expanding 220 basis points to 26.2%. Free Cash Flow surged 55% to $195 million with a 44% conversion ratio. The company returned a record $174 million to shareholders including $100 million in share repurchases. Performance was driven by mid-single digit growth in Research (up 4%) offset by market-related challenges in Learning (down 7%).

For fiscal 2027, Wiley expects low to mid single digit organic revenue growth (excluding the Emerald acquisition impact of $78 million and foreign exchange), with Research growing mid-single digits. Adjusted EBITDA margin is projected at 26.5% to 27.5%, up from 26.2% in FY2026. Adjusted EPS guidance is $4.60 to $5.05, representing growth from $1,677 in FY2026, with the Emerald acquisition expected to contribute approximately $0.10 accretion. Free Cash Flow is expected at $205 million, up from $195 million, though the Emerald acquisition will be dilutive by $15 million in year one. The outlook reflects continued strength in Research, improvement in Learning, and ongoing demand for Wiley's content in AI applications.

Wiley's AI and data analytics revenue grew 23% to $1,677 in FY2026, with recurring revenue rapidly scaling from an $8 million base. Lifetime AI revenue has reached $110 million. The company now serves 19 corporate subscription customers including 7 of the top 10 pharmaceutical companies, has 4 LLM training customers, and 41 publisher partners in its Nexus AI licensing service. For FY2027, management expects recurring AI revenue to grow 2-3x from the $8 million base, driven by multi-year partnerships and increased corporate momentum. Strategic partnerships announced include collaborations with IQVIA, OpenEvidence, AWS, Anthropic, and Microsoft to integrate Wiley's research content into AI platforms and clinical workflows.

Wiley appointed Jessica Kowalski as Executive Vice President and General Manager of Research to lead the company's next phase of AI-enabled research publishing. Kowalski brings over two decades of experience in knowledge, data, research publishing, and AI-enabled businesses at global scale. She joins from Microsoft where she held full P&L accountability for a large-scale global AI, data, and cloud services business, and previously led data and analytics partnerships at Amazon Web Services. She spent 11 years at RELX in senior positions at Elsevier and LexisNexis, where she was central to transforming the business from a content-centric publisher into an information analytics company.

Wiley reported flat revenue of $65 million for fiscal 2026, but operating income rose 25% to $277 million and diluted EPS increased from $1.53 to $4.16. On an adjusted basis, operating margin expanded 260 basis points to a record 17.7%, and adjusted EBITDA margin improved 220 basis points to 26.2%, driven by cost discipline and efficiency gains. Research segment growth offset weakness in Learning.

Wiley acquired Emerald Publishing after the fiscal year-end to expand its Research segment and strengthen its content position for AI applications. The FY2027 outlook indicates Emerald will contribute $78 million in revenue (11 months), be accretive to adjusted EPS by approximately $0.10, but dilutive to free cash flow by $15 million in the first year, with free cash flow accretion expected in FY2028.

Operating cash flow increased 29% to $261 million and free cash flow rose 55% to $195 million, driven by higher earnings and lower capital expenditures. Wiley returned a record $174 million to shareholders, including $100 million in share repurchases (up from $60 million prior year) and raised its dividend for the 32nd consecutive year. Net debt-to-EBITDA improved to 1.4x from 1.8x.

Wiley issued FY2027 guidance projecting low-to-mid single digit organic revenue growth (mid-single digit in Research), adjusted EBITDA margin of 26.5% to 27.5% (up from 26.2%), adjusted EPS of $4.60 to $5.05 (up from $4.19), and free cash flow of $205 million (up from $195 million). The Emerald acquisition will add $78 million in revenue and $0.10 to adjusted EPS but will be $15 million dilutive to free cash flow in year one.