Educational Development Corporation Announces Fiscal 2026 Third Quarter and Year to Date Results

Rhea-AI Summary

Educational Development Corporation (NASDAQ: EDUC) reported fiscal 2026 third quarter results for the period ended November 30, 2025. Net revenues were $7.0M vs $11.1M a year earlier; net income was $7.8M and EPS was $0.91 diluted. Earnings before taxes were $10.6M, which includes a $12.2M gain on the sale-leaseback of the company headquarters and warehouse (Hilti Complex). The Hilti Complex sale price was $32.2M; proceeds repaid term and revolving loans. Management said the transaction and lease will improve annual cash flow by about $1.0M and retained adjacent 17-acre land valued at $2.0M. Cash at quarter end was $3.4M, and inventory was reduced by $1.5M. Average active PaperPie Brand Partners fell to 5,100 from 12,400 year-over-year.

Positive

• One-time gain of $12.2M from sale-leaseback boosting reported earnings
• Proceeds used to pay off term and revolving loans, eliminating related debt service
• Expected annual cash flow improvement of approximately $1.0M
• Reduced inventory by $1.5M and quarter-end cash of $3.4M

Negative

• Net revenues down ~36% to $7.0M in the quarter versus prior year
• Average active PaperPie Brand Partners declined from 12,400 to 5,100
• Excluding sale gain, loss before income taxes was $1.6M for the quarter

Key Figures

Q3 net revenues $7,007,800 vs $11,052,100 Fiscal 2026 Q3 vs prior-year Q3

Q3 net income $7,802,100 vs $(835,700) Fiscal 2026 Q3 vs prior-year Q3

Q3 diluted EPS $0.91 vs $(0.10) Fiscal 2026 Q3 vs prior-year Q3

YTD net revenues $18,735,300 vs $27,554,700 Nine months ended Nov 30, 2025 vs 2024

YTD net income $5,432,200 vs $(3,918,100) Nine months ended Nov 30, 2025 vs 2024

Hilti Complex sale price $32,200,000 Strategic sale and leaseback completed in Q3 FY26

Quarter-end cash $3,400,000 Cash on balance sheet at Nov 30, 2025

Avg active Brand Partners 5,100 vs 12,400 Average active PaperPie Brand Partners in Q3 vs prior-year Q3

Market Reality Check

$1.42 Last Close

Volume Volume 40,096 is 1.98x the 20-day average of 20,210 shares. high

Technical Price $1.43 is trading above the 200-day MA of $1.31 and about 25% below the 52-week high of $1.91.

Peers on Argus 1 Up

EDUC was flat pre-news, while peers were mixed: TNMG -1.86%, LEE -3.20%, DALN +0.06%, SCHL +1.10%, GCI -1.09%. Movement appears stock-specific rather than a broad publishing-sector move.

Historical Context

Date	Event	Sentiment	Move	Catalyst
Oct 28	Sale completion	Positive	-1.3%	Closed Hilti Complex sale for $32.2M and repaid all bank debt.
Oct 09	Earnings results	Neutral	+5.9%	Reported Q2 revenue decline but narrower net loss and sale progress.
Oct 06	Contract amendment	Positive	+4.5%	Amended Hilti sale contract to $32.2M and received buyer notice to proceed.
Sep 10	Earnings call notice	Neutral	-1.4%	Scheduled FY26 Q2 earnings call with management to discuss results.
Aug 21	Sale-leaseback deal	Positive	+2.9%	Announced sale-leaseback agreement of Hilti Complex to repay term and revolver loans.

Pattern Detected

Most prior announcements, especially around the Hilti Complex sale, saw price moves generally aligning with the positive tone, with one notable divergence on transaction completion.

Recent Company History

Over the last six months, EDUC has focused on monetizing its Hilti Complex and managing operating losses. Announcements on the initial sale-leaseback agreement, contract amendment, and buyer’s intent to proceed all highlighted using proceeds to repay bank debt and improve cash flow, with mostly positive price reactions. Completion of the sale for $32.2M eliminated bank borrowings but saw a modest negative move. Earlier, Q2 results showed declining revenues but narrowing losses. Today’s Q3 release formalizes the sale impact, shows a swing to profitability, and updates liquidity and inventory reduction efforts.

Market Pulse Summary

This announcement details fiscal 2026 Q3 and year-to-date results, highlighting a major swing to profitability largely from the Hilti Complex sale for $32.2M, repayment of term and revolving loans, and improved liquidity with $3.4M in cash. At the same time, net revenues fell and average active Brand Partners declined, underscoring pressure on the core PaperPie business. Investors may watch upcoming quarters for revenue trends, consultant growth, and whether inventory reductions and new title purchases translate into sustainable operating cash flow.

Key Terms

triple-net lease financial

"executed separate Triple-Net Lease (the "Lease") for its occupied space"

A triple-net lease is a rental agreement where the tenant pays the base rent plus the property's operating expenses—typically taxes, insurance, and maintenance—so the landlord receives mostly a steady, predictable cash payment. For investors, it matters because it can act like a low-maintenance, bond-like income stream with clearer expense exposure, but returns depend on the tenant’s financial strength and long-term ability to cover those extra costs.

term loans financial

"proceeds from the sale were utilized to pay off the Term Loans and Revolving Loan"

Term loans are long-term bank or lender loans with a set repayment schedule and fixed end date, similar to a mortgage or car loan for a business. They matter to investors because they create predictable interest payments and principal obligations that affect a company’s cash flow, credit risk and capacity to fund growth or return money to shareholders; heavier or expensive term loans can raise default risk and reduce future flexibility.

revolving loan financial

"pay off the Term Loans and Revolving Loan outstanding in the Credit Agreement"

A revolving loan is a credit line a company can draw, repay, and draw again up to a set limit during the loan term — like a corporate credit card where interest is charged only on the amount used. It matters to investors because it supplies flexible short-term cash for operations or growth but can raise borrowing costs and leverage; reductions in the available limit or tighter terms can signal liquidity stress or increase financial risk.

credit agreement financial

"outstanding in the Credit Agreement with the Company's Bank"

A credit agreement is a written loan contract between a borrower and a bank or other lender that lays out how much money can be borrowed, the interest rate, repayment schedule, fees, and the rules the borrower must follow. For investors, it matters because those terms affect a company’s cash costs, borrowing flexibility and risk of default — similar to how a mortgage’s rules determine a homeowner’s monthly budget and freedom to make changes.

AI-generated analysis. Not financial advice.

Tulsa, Oklahoma--(Newsfile Corp. - January 8, 2026) - Educational Development Corporation (NASDAQ: EDUC) ("EDC", or the "Company"), a publishing company specializing in books and educational products for children, today reports financial results for the fiscal third quarter ended November 30, 2025.

Third Quarter Summary Compared to the Prior Year Third Quarter

• Net revenues were $7.0 million compared to $11.1 million.

• Average active PaperPie Brand Partners totaled 5,100 compared to 12,400.

• Earnings (loss) before income taxes were $10.6 million, compared to $(1.1) million. Excluding the gain on the building sale of $12.2 million, loss before income taxes were $(1.6) million.

• Net earnings (loss) totaled $7.8 million, compared to $(0.8) million.

• Earnings (loss) per share totaled $0.91 compared to $(0.10) on a fully diluted basis.

Year-to-Date Summary Compared to the Prior Year

• Net revenues of $18.7 million, compared to $27.6 million.

• Average active PaperPie Brand Partners totaled 6,200 compared to 13,300.

• Earnings (loss) before income taxes of $7.4 million, compared to $(5.3) million. Excluding the gain on the building sale of $12.2 million, loss before income taxes were $(4.8) million.

• Net earnings (loss) totaled $5.4 million, compared to $(3.9) million.

• Earnings (loss) per share totaled $0.63 compared to $(0.47) on a fully diluted basis.

Per Craig White, Chief Executive Officer, "During the third quarter we completed the strategic sale and lease back of the Company's headquarters and distribution warehouse (the "Hilti Complex") to 10Mark 10K Industrial, LLC. The agreed upon sale price of the Hilti Complex per the executed Contract totaled $32,200,000. This was a major accomplishment for the Company as the proceeds from the sale were utilized to pay off the Term Loans and Revolving Loan outstanding in the Credit Agreement with the Company's Bank. At closing, EDC assigned the existing third-party tenant leases to the Buyer and executed separate Triple-Net Lease (the "Lease") for its occupied space in the Hilti Complex. With no remaining principal and interest payments, offset by our new lease and rental income from past tenants, our annual cash flow generation will immediately improve by approximately $1.0 million. In addition, the sale helps us realign with our core goals of returning to cash flow positive, get back to purchasing new titles and content for our consultants, and ultimately focus on the growth of our PaperPie division. Lasty, we retained the 17-acre tract of excess land adjacent to the complex, valued at $2.0 million, further enhancing our balance sheet."

"Operationally, during the third quarter, we reduced our overall inventory levels by $1.5 million and increased our cash position. At the end of the quarter, we had $3.4 million of cash on our balance sheet, which provides the liquidity necessary to take us into fiscal 2027. Subsequent to quarter end, we began a strategic and conservative purchase plan to bring in new titles which we expect will energize our sales force and allow us to execute our strategic growth plan. We are excited about where we are today and are glad to put the past several years of operating under bank restrictions behind us. I would like to thank our stakeholders for your ongoing support including our Brand Partners, Customers, Employees vendors and shareholders."

EDUCATIONAL DEVELOPMENT CORPORATION
CONDENSED STATEMENTS OF OPERATIONS (UNAUDITED)

		Three Months Ended November 30,								Nine Months Ended November 30,
		2025				2024				2025				2024
NET REVENUES		$	7,007,800			$	11,052,100			$	18,735,300			$	27,554,700
EARNINGS (LOSS) BEFORE INCOME TAXES			10,642,700				(1,111,900	)			7,443,200				(5,325,000	)
INCOME TAX (BENEFIT)			2,840,600				(276,200	)			2,011,000				(1,406,900	)
NET INCOME (LOSS)		$	7,802,100			$	(835,700	)		$	5,432,200			$	(3,918,100	)
WEIGHTED AVERAGE NUMBER OF COMMON AND EQUIVALENT SHARES OUTSTANDING
Basic			8,576,197				8,273,402				8,580,866				8,270,797
Diluted			8,576,197				8,273,402				8,580,866				8,270,797

 

Fiscal 2026 Third Quarter Earnings Call

Date: Thursday, January 08, 2026
Time: 3:30 PM CT (4:30 PM ET)
Dial-in number: (800) 717-1738
Conference ID: 60621

The conference call will be broadcast live and audio replays will be available following the event at www.edcpub.com/investors.

About Educational Development Corporation (EDC)

EDC began as a publishing company specializing in books for children. EDC is the owner and exclusive publisher of Kane Miller Books ("Kane Miller"); Learning Wrap-Ups, maker of educational manipulatives; and SmartLab Toys, maker of STEAM-based toys and games. EDC is also the exclusive United States MLM distributor of Usborne Publishing Limited ("Usborne") children's books. EDC-owned products are sold via 4,000 retail outlets and EDC and Usborne products are offered by independent brand partners who hold book showings through social media, book fairs with schools and public libraries, in individual homes, as well as other in-person events and internet sales.

Contact:
Educational Development Corporation
Craig White, (918) 622-4522

Cautionary Statement for the Purpose of the "Safe Harbor" Provision of the Private Securities Litigation Reform Act of 1995.

The information discussed in this Press Release includes "forward-looking statements." These forward-looking statements are identified by their use of terms and phrases such as "may," "expect," "estimate," "project," "plan," "believe," "intend," "achievable," "anticipate," "continue," "potential," "should," "could," and similar terms and phrases. Although we believe that the expectations reflected in these forward-looking statements are reasonable, they do involve certain assumptions, risks and uncertainties and we can give no assurance that such expectations or assumptions will be achieved. Known and unknown risks, uncertainties and other factors may cause our actual results, performance, or achievements to be materially different from any future results, performance or achievements expressed or implied by forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, our success in recruiting and retaining new brand partners, our ability to locate and procure desired books, our ability to ship the volume of orders that are received without creating backlogs, our ability to obtain adequate financing for working capital and capital expenditures, economic and competitive conditions, regulatory changes and other uncertainties, cybersecurity threats and incidents, the COVID-19 pandemic, as well as those factors discussed in our Annual Report on Form 10-K for the year ended February 28, 2025, all of which are difficult to predict. In light of these risks, uncertainties and assumptions, the forward-looking events discussed may not occur. All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by the cautionary statements in this paragraph and elsewhere in our Annual Report on Form 10-K for the year ended February 28, 2025 and speak only as of the date of this Press Release. Other than as required under the securities laws, we do not assume a duty to update these forward-looking statements, whether as a result of new information, subsequent events or circumstances, changes in expectations or otherwise.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/279862

FAQ

What did EDUC report for fiscal Q3 2026 net revenues and EPS?

EDUC reported $7.0M in net revenues and $0.91 diluted EPS for the quarter ended November 30, 2025.

How did the Hilti Complex sale affect EDUC's balance sheet and cash flow?

The Hilti Complex sold for $32.2M, generated a $12.2M gain, paid off term and revolver loans, and management expects ~$1.0M annual cash flow improvement.

What were EDUC's PaperPie Brand Partner trends in Q3 2026?

Average active PaperPie Brand Partners declined to 5,100 in the quarter from 12,400 a year earlier.

What is EDUC's cash and inventory position at the end of Q3 2026?

At quarter end EDUC reported $3.4M cash and said it reduced inventory by $1.5M during the quarter.

Did EDUC remove debt when closing the sale-leaseback?

Yes; sale proceeds were used to pay off the term loans and revolving loan outstanding under the company's credit agreement.