Educational Development Corporation Announces Fiscal 2027 Second Quarter and Year to Date Results

Pretax losses narrowed in both reporting periods, while net losses widened as prior-year tax benefits gave way to tax expenses.

Rhea-AI Summary

Educational Development Corporation (EDUC) reported fiscal 2027 second-quarter revenue of $4,070,300, down from the prior-year quarter ended August 31. For the three months ended August 31, 2026, revenue compared with $4,621,100 a year earlier. Pretax loss narrowed to $1,561,600 from $1,750,200, but net loss widened to $1,578,100 from $1,294,700. Diluted loss per share was $0.19 versus $0.15.

Six-month revenue fell to $8,826,100 from $11,727,500. Pretax loss narrowed to $2,940,700 from $3,199,500, while net loss widened to $2,973,700 from $2,369,900. Diluted loss per share was $0.35 versus $0.28. Average active PaperPie Brand Partners declined year over year in both periods. Cash fell from $1.3 million at February-end to $1.2 million at August-end. The company expects its cost-reduction plan to lower fiscal-year general and administrative expenses by over $1.2 million.

5 points · 1 major

MixediHow this balance works

How this balance works

Rhea-AI gives every point it takes from this document a weight. Minor counts 1, Moderate 3 and Major 9, so one Major point outweighs several Minor ones. The bar adds up the weights on each side, and when neither side holds more than 65% of the total the balance reads Mixed.

It reads the document as published, with the same rules for every company, and it does not look at what the market expected or at how the stock traded, so a point can be objectively good on a day the stock falls.

Rhea-AI Sentiment measures something else, the tone of the wording.

How the balance worksHow Sentiment works

0 major · 13 points

Hollow bars mark forward-looking points. How the balance works

Positive

• Major point. Forward-looking: it has not happened yet and may not happen.Cost-reduction plan is expected to lower fiscal-year general and administrative expenses by over $1.2 million.
• Moderate pointSecond-quarter pretax loss narrowed to $1,561,600 from $1,750,200 in the prior-year quarter.
• Moderate pointActive Brand Partners increased over 19%, from 4,300 to 5,100, through fiscal 2027’s first half.
• Minor pointSix-month pretax loss narrowed to $2,940,700 from $3,199,500 in the prior-year period.
• Minor pointSecond-quarter cash flow was positive, the company said.

Negative

• Moderate pointSecond-quarter revenue fell to $4,070,300 from $4,621,100 in the prior-year quarter.
• Moderate pointSecond-quarter net loss widened to $1,578,100 from $1,294,700 in the prior-year quarter.
• Moderate pointSecond-quarter average active PaperPie Brand Partners fell to 5,100 from 5,800 a year earlier.
• Minor pointSix-month revenue fell to $8,826,100 from $11,727,500 in the prior-year period.
• Minor pointSix-month net loss widened to $2,973,700 from $2,369,900 in the prior-year period.

8 minor points

• Minor pointSecond-quarter diluted loss per share widened to $0.19 from $0.15 in the prior-year quarter.
• Minor pointSix-month diluted loss per share widened to $0.35 from $0.28 in the prior-year period.
• Minor pointSix-month average active PaperPie Brand Partners fell to 5,200 from 6,800 a year earlier.
• Minor pointCash decreased to $1.2 million at August-end from $1.3 million at February-end.
• Minor pointFirst-quarter assets held for sale incurred a $100,000 one-time write-down.
• Minor pointSecond-quarter income tax expense was $16,500, versus a $455,500 benefit in the prior-year quarter.
• Minor pointSix-month income tax expense was $33,000, versus an $829,600 benefit in the prior-year period.
• Minor pointDeferred tax assets associated with pretax losses could not be realized this quarter.

News Explained

EDC says it has not realized deferred tax assets tied to pre-tax losses; if it confirms the improving business direction it describes, those assets could produce a tax gain of about $0.28 per share as of August 31, 2026, so that benefit is not yet reflected.

Key Figures

Second-quarter net revenues: $4,070,300 vs. $4,621,100 Second-quarter loss before income taxes: $(1,561,600) vs. $(1,750,200) Second-quarter net loss: $(1,578,100) vs. $(1,294,700) +5 more

Second-quarter net revenues

$4,070,300 vs. $4,621,100

Three months ended August 31, 2026 vs. 2025

Second-quarter loss before income taxes

$(1,561,600) vs. $(1,750,200)

Three months ended August 31, 2026 vs. 2025

Second-quarter net loss

$(1,578,100) vs. $(1,294,700)

Three months ended August 31, 2026 vs. 2025

Second-quarter loss per share

$(0.19) vs. $(0.15)

Three months ended August 31, 2026 vs. 2025; diluted

Year-to-date net revenues

$8,826,100 vs. $11,727,500

Six months ended August 31, 2026 vs. 2025

Year-to-date loss before income taxes

$(2,940,700) vs. $(3,199,500)

Six months ended August 31, 2026 vs. 2025

Year-to-date net loss

$(2,973,700) vs. $(2,369,900)

Six months ended August 31, 2026 vs. 2025

Year-to-date loss per share

$(0.35) vs. $(0.28)

Six months ended August 31, 2026 vs. 2025; diluted

Historical Context

1 past event · Latest: Jul 09

1 event

1. Jul 09

   Earnings report

   24h Move

   -3.2%

   Q1 revenue and net loss worsened year over year despite lower pretax loss

24h Move is the share-price change in the day after each event; other market factors may also have contributed.

Key Terms

fully diluted basis, assets held for sale, deferred tax asset

3 terms

fully diluted basis financial

"on a fully diluted basis"

A fully diluted basis counts every share that could exist if all outstanding options, warrants, convertible securities and other rights were exercised or converted into common stock, showing the maximum number of shares outstanding. For investors this matters because it spreads ownership and earnings across that larger share count, like slicing a pie into every possible piece before deciding how big each investor’s slice will be, which affects per-share value and ownership percentage.

assets held for sale financial

"one-time write-down on our 'assets held for sale,'"

Assets held for sale are things a company has decided to sell and has reclassified on its balance sheet to show they are being marketed rather than used in daily operations — like putting a house on the market instead of living in it. This matters to investors because these items are measured based on expected sale proceeds (which can reveal likely gains or losses), stop being treated as regular operating assets, and signal upcoming cash inflows or a change in strategy that can affect the company’s financial health and stock value.

deferred tax asset financial

"the deferred tax asset associated with our pre-tax losses"

A deferred tax asset is an accounting recognition that a company expects to pay less tax in the future because of past losses or timing differences between accounting and tax rules; think of it as an IOU from the tax system that can reduce future tax bills. It matters to investors because it can boost future cash flow and reported profits if the company generates enough taxable income to use it, but its value depends on realistic prospects for future earnings.

AI-generated analysis. How Rhea-AI works. Not financial advice.

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Tulsa, Oklahoma--(Newsfile Corp. - October 14, 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 second quarter ended August 31, 2026.

Second Quarter Summary Compared to the Prior Year Second Quarter

• Net revenues were $4.1 million compared to $4.6 million.

• Average active PaperPie Brand Partners totaled 5,100 compared to 5,800.

• Loss before income taxes were $(1.6) million, compared to $(1.8) million.

• Net loss totaled $(1.6) million, compared to $(1.3) million.

• Loss per share totaled $(0.19) compared to $(0.15) on a fully diluted basis.

Year-to-Date Summary Compared to the Prior Year

• Net revenues of $8.8 million, compared to $11.7 million.

• Average active PaperPie Brand Partners totaled 5,200, compared to 6,800.

• Loss before income taxes were $(2.9) million, compared to $(3.2) million.

• Net loss totaled $(3.0) million, compared to $(2.4) million.

• Loss per share totaled $(0.35), compared to $(0.28) on a fully diluted basis.

Per Craig White, Chief Executive Officer, "During the first two quarters we ran several product and recruiting promotions to increase our Brand Partner headcount to increase sales. I am happy to say that we were successful in both areas, which helped turn excess inventory into cash. Although our cash position decreased slightly from $1.3 million at the end of February to $1.2 million at the end of August, I am proud that we were able to generate positive cash flow even during our slowest quarter of the year. I am also pleased to see our Brand Partner numbers starting to trend up. Through the first half of fiscal 2027 our Active Brand Partners increased by over 19%, from 4,300 to 5,100. This remains our primary focus as we work diligently to further strengthen and build our Brand Partner levels, which will have a direct impact on sales growth.

"Our loss before taxes this quarter and year to date, were better than last year on reduced revenue levels. These results were possible due to our continued focus on reducing expenses. At the beginning of the year, we implemented a cost reduction plan, which is expected to reduce our overall general and administrative expenses during the fiscal year by over $1.2 million. In addition, during the first quarter of this fiscal year, we made a $100,000 one-time write-down on our 'assets held for sale,' which includes our legacy pick & pack distribution system that we are marketing for sale. Even with this adjustment at the beginning of the year, our losses before taxes are less than the previous year.

"Just like the previous quarter, our earnings per share were lower this quarter as we were not able to realize the deferred tax asset associated with our pre-tax losses. We are optimistic that as our Brand Partner levels increase along with increasing sales, we will return to profitability. Once we have affirmation of this direction, these deferred tax assets will become realizable resulting in a tax gain of approximately $0.28 per share as of August 31, 2026," concluded Mr. White.

EDUCATIONAL DEVELOPMENT CORPORATION
CONDENSED STATEMENTS OF OPERATIONS (UNAUDITED)

	Three Months Ended August 31,						Six Months Ended August 31,
	2026			2025			2026			2025
NET REVENUES	$	4,070,300		$	4,621,100		$	8,826,100		$	11,727,500
LOSS BEFORE INCOME TAXES		(1,561,600	)		(1,750,200	)		(2,940,700	)		(3,199,500	)
INCOME TAX EXPENSE (BENEFIT)		16,500			(455,500	)		33,000			(829,600	)
NET LOSS	$	(1,578,100	)	$	(1,294,700	)	$	(2,973,700	)	$	(2,369,900	)
LOSS PER SHARE	$	(0.19	)	$	(0.15	)	$	(0.35	)	$	(0.28	)
WEIGHTED AVERAGE NUMBER OF COMMON AND EQUIVALENT SHARES OUTSTANDING
Basic		8,520,529			8,583,201			8,515,947			8,583,201
Diluted		8,520,529			8,583,201			8,515,947			8,583,201

 

Fiscal 2027 Second Quarter Earnings Call
Date: Wednesday, October 14, 2026
Time: 3:30 PM CT (4:30 PM ET)
Dial-in number: (800) 717-1738
Conference ID: 19822

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, 2026, 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, 2026 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/319055

FAQ

AI-generated questions and answers. How Rhea-AI works. Not financial advice.

What were EDUC’s fiscal 2027 second-quarter revenue and earnings?

Educational Development Corporation reported revenue of $4,070,300 and a net loss of $1,578,100 for the three months ended August 31, 2026. The prior-year quarter had revenue of $4,621,100 and a net loss of $1,294,700. Diluted loss per share widened to $0.19 from $0.15.

What were EDUC’s fiscal 2027 first-half results?

For the six months ended August 31, 2026, Educational Development Corporation reported revenue of $8,826,100 and a net loss of $2,973,700. Revenue was $11,727,500 and net loss was $2,369,900 in the prior-year period. Diluted loss per share widened to $0.35 from $0.28.

What would allow EDUC to realize its deferred tax assets?

The company expects its deferred tax assets to become realizable once it has affirmation of a return toward profitability as Brand Partner levels and sales increase. It estimated the resulting tax gain at approximately $0.28 per share as of August 31, 2026; that gain has not been realized.

What assets did EDUC write down in fiscal 2027?

Educational Development Corporation recorded a $100,000 one-time write-down on assets held for sale during the first quarter. Those assets include its legacy pick-and-pack distribution system, which it is marketing for sale.