Press Release: Houghton Mifflin Harcourt Reports Significant Revenue Growth in Q2 Earnings Report
Also in the second quarter, HMH launched subscription-based, at-home learning tool Go Math! Academy. Based on the success of this product, HMH plans to extend the consumer-focused Academy product line to other subject areas.
HMH also announced a strategic collaboration with Microsoft Corp. to optimize core K-12 education content for the Windows 8 operating system, providing an even greater level of choice and access to students and educators across a broad range of devices. This partnership includes the development a new eTextbook reader application for Windows 8.
Second Quarter 2014 Unaudited Financial Results
Net Sales: HMH reported total net sales of $402 million for the quarter ended June 30, 2014, $39 million or 11% higher than the $363 million reported in second quarter of 2013. This increase was driven by a 13%, or $41 million, year-over-year rise in the Company's Education sales to $365 million from $324 million, as domestic education basal sales grew $47 million on increased adoptions primarily in Texas, and to a lesser extent, California and Florida. Deferred revenue increased $114 million for the three months ended June 30, 2014 from March 31, 2014, primarily due to higher digital components and print workbooks associated with the increased adoption sales. Additionally, assessment sales increased by $5 million following the launch of a new edition of the Woodcock Johnson product. This growth was slightly offset by $6 million and $5 million declines in professional services and international sales, respectively.
Within HMH's Trade Publishing division, net sales in the second quarter of 2014 declined 5%, or $2 million, to $37 million from $39 million as the prior year benefitted from strong net sales of backlist titles associated with the theatrical releases of the movies The Hobbit and Life of Pi along with strong front list titles such as Francona and How Children Succeed which did not occur in the current period.