McGraw Hill Tops FY2026 Targets, AI Products Drive Optimism

McGraw Hill (NYSE:MH) reported fiscal 2026 revenue of $2.1 billion, above the high end of its guided range. The company issued a fiscal 2027 outlook targeting modest revenue growth and higher recurring revenue. Margins are expected to expand further.

CFO Bob Sallmann said the results beat the company's expectations. He pointed to higher education and AI-enabled products as growth drivers. The company has been shifting toward digital subscriptions and away from textbook sales, a transition that has accelerated over the past two years.

The fiscal 2027 forecast calls for higher subscription revenue. Margins, which improved in fiscal 2026, are expected to expand further in the coming year, Sallmann said. The company did not provide specific earnings-per-share guidance, which is standard for its annual outlook.

Executives said the company's AI-enabled products, including adaptive learning platforms, are a central part of the growth strategy. McGraw Hill competes with Pearson and other publishers in the push to digital content and AI integration. The education sector is moving toward subscription models, and the company aims to capture that shift.

Margins improved in fiscal 2026, and Sallmann said he expects that trend to continue in fiscal 2027.