Q4 2024 John Wiley & Sons Inc Earnings Call
Operator: Good morning, and welcome to Wiley's Q4 Fiscal 2024 Earnings Call. As a reminder, this conference is being recorded. At this time, I'd like to introduce Wiley's Vice President of Investor Relations, Brian Campbell. Please go ahead.
Good morning, and welcome to why at least Q4 fiscal 'twenty 'twenty four earnings call. As a reminder, this conference is being recorded at this time I'd like to introduce why at least Vice President of Investor Relations. Brian Campbell. Please go ahead.
Brian Campbell: Thank you and welcome everyone. With me today are Matt Kissner, Wiley's Interim President and CEO, Christina Van Tassel, Executive Vice President and CFO, and Jay Flynn, Executive Vice President and General Manager of Research and Learning. Note that our comments and responses reflect management's views as of today and will include forward-looking statements. However, actual results may differ materially from those statements. The company does not undertake any obligation to update them to reflect subsequent events or circumstances.
Brian Campbell: Thank you and welcome everyone with me today are Matt kitchen, why these interim president and CEO, Kristina Vantassel Executive Vice President and CFO, and Jason <unk> Executive Vice President General manager of research and learning.
Speaker Change: Note that our comments and responses reflect management's views as of today and will include forward looking statements.
Speaker Change: Actual results may differ materially from those statements.
Speaker Change: The company does not undertake any obligation to update them to reflect subsequent events or circumstances.
Speaker Change: Also Wiley provides non-GAAP measures as a supplement to evaluate underlying operating profitability and performance trends.
Speaker Change: These measures do not have standardized meanings prescribed by U S. GAAP and therefore may not be comparable to similar measures used by other companies nor should they be viewed as alternatives to measures under GAAP.
Speaker Change: Unless otherwise noted we will refer to non-GAAP metrics on the call and balances are on a year over year basis, and will exclude held for sale assets and the impact of currency.
Speaker Change: Additional information is included in our filings with the SEC.
Speaker Change: A copy of this presentation and transcript will be available on our Investor relations webpage at investors that Wiley Dot com.
Brian Campbell: Also, Wiley provides non-GAAP measures as a supplement to evaluate underlying operating profitability and performance trends. However, these measures do not have standardized meanings prescribed by U.S. GAAP and therefore may not be comparable to similar measures used by other companies, nor should they be viewed as alternatives to measures under GAAP. Unless otherwise noted, we will refer to non-GAAP metrics on the call, and variances are on a year-over-year basis and will exclude held-for-sale assets and the impact of currency.
Speaker Change: I'll now turn the call over to my kitchen.
Brian Campbell: Additional information is included in our filings with the SEC. A copy of this presentation and transcript will be available on our Investor Relations webpage at investors.wiley.com. I'll now turn the call over to Matt Kissner. Thank you, Brian, and thank you, everyone, for joining us today.
Thank you, Brian and thank you everyone for joining us today.
Matthew S. Kissner: What a difference a year makes. Today we look forward with renewed confidence and optimism as a leaner and stronger Wiley. We are executing with much greater discipline and rigor. We have met and exceeded our stated commitments. And we are seeing strong momentum in our businesses and value creation activities. I'll start by reviewing how we did against our objectives and provide an update on the emerging and exciting Gen-AI opportunities in front of us.
Speaker Change: What a difference a year makes today, we look forward with renewed confidence and optimism.
unknown: As a leaner and stronger wildly.
Speaker Change: We are executing with much greater discipline and rigor, we have met and exceeded our stated commitments.
Speaker Change: And we are seeing strong momentum in our businesses and value creation activities.
Speaker Change: I'll start by reviewing how we did against our objectives and provide an update on the emerging and exciting Jan AI opportunities in front of us.
Matthew S. Kissner: I'll walk through our fourth quarter and full year performance, and then review our momentum heading into Fiscal 25. Christina will walk through our value creation plan progress, reinvestments, Segment Performance, and Fiscal 25 Outlook. After the presentation, we'll open it up for questions. Jay Flynn will be joining us as well.
I'll walk through our fourth quarter and full year performance and then review our momentum heading into fiscal 'twenty five.
Christina M. Van Tassell: Kristina will walk through our value creation plan progress Reinvestments segment performance and physical twenty-five outlook. After summarizing we'll open it up for questions <unk> will be joining us as well.
Speaker Change: Yeah.
Matthew S. Kissner: Wiley is enabling the creation of new knowledge and its application in critical areas of the global knowledge economy, such as science, medicine, technology, and engineering, as well as business, economics, and finance. As a knowledge company, Wiley has played a foundational role in everything from the Industrial Revolution to the Information Age. Now Wiley is beginning to play a critical role in the rise of artificial intelligence and machine learning. Our knowledge, content, tools, and services will remain as relevant as ever.
Speaker Change: While he is enabling the creation of new knowledge and its application in critical areas of the global knowledge economy in Science Medicine technology, and engineering and business Economics and finance.
Speaker Change: As our knowledge company Wily has played a foundational role in everything from the industrial Revolution to the information age.
Speaker Change: Now wildly is beginning to play a critical role in the rise of artificial intelligence and machine learning.
Speaker Change: Our knowledge content tools and services remain as relevant as ever.
Matthew S. Kissner: It's been a very eventful year for Wiley, and I'm proud to say that we finished strong. Research is seeing strong underlying momentum heading into fiscal 25 after some unusual challenges to start the year. Demand to publish and output are well ahead of expectation. Learning continues to outperform, driven by solid execution and favorable market conditions. Gen A.I.
Speaker Change: It's been a very eventful year for Wiley.
Speaker Change: And I'm proud to say that we finished strong.
Speaker Change: Research is seeing strong underlying momentum heading into fiscal 'twenty five after some unusual challenges to start the year.
Speaker Change: Demand to publish and output are well ahead of expectations.
Speaker Change: Learning continues to outperform driven by solid execution and favorable market conditions.
Matthew S. Kissner: Demand is accelerating. We've already executed two content rights projects for large tech companies. I'll talk more about this opportunity in a moment.
Speaker Change: <unk> demand is accelerating.
Speaker Change: We've already executed two content rights projects for large tech companies.
Speaker Change: I'll talk more about this opportunity in a moment.
Matthew S. Kissner: We're piloting Gen-AI productivity tools across the organization. We're deploying it in our research publishing platform and using it to drive publishing efficiency and detect research integrity issues. Today's Wiley is about execution, blocking and tackling, and creating meaningful shareholder value. To that end, we have closed on the sale of two of our three divestitures, and the third is in process. We further accelerated our $130 million cost-saving program, with 70% of it now active, and In Year Savings Higher Than Anticipated. Finally!
Speaker Change: We are piloting gen AI productivity tools across the organization, we are deploying it in a research publishing platform and using it to drive publishing efficiency and detect research integrity issues.
Speaker Change: Today's wiley is about execution, blocking and tackling and creating meaningful shareholder value.
Speaker Change: To that end, we have closed on the sale of two of our three divestitures and the third is in process.
Speaker Change: We further accelerated our $130 million cost savings program with 70% of it now action and in year savings higher than anticipated.
Speaker Change: Finally.
Matthew S. Kissner: We increased share repurchases in the second half of Fiscal 24 and rewarded shareholders with a dividend raise for the 30th consecutive year. We have more work to do, of course, to realize our full potential. And that work will never end. We are going to continue to deliver cost savings and efficiency gains above and beyond the $130 million program as we drive toward further margin expansion beyond fiscal 26. I am very pleased about our progress so far and very confident in our direction of travel.
Speaker Change: We increased share repurchases in the second half of fiscal 'twenty, four and rewarded shareholders with a dividend raise for the 30th consecutive year.
Speaker Change: We have more work to do of course to realize our full potential and that work will never end.
Speaker Change: We are going to continue to deliver cost savings and efficiency gains.
Speaker Change: Bhavan beyond the $130 million program.
Speaker Change: As we drive toward further margin expansion beyond fiscal 'twenty six.
Speaker Change: I am very pleased about our progress so far and very confident in our direction of travel.
Matthew S. Kissner: Let's talk about how we delivered on our stated commitment. When I stepped into the role right around mid-year, I said that we were going to be relentless in our execution and move with certainty on our value plans, operational improvements, RE-ORG, and culture. And that's what we did.
Speaker Change: Let's talk about how we delivered on our stated commitments.
When I stepped into the role right around mid year.
Speaker Change: I said that we were going to be relentless in our execution and moved with certainty on our value plans operational improvements reorganize culture.
Speaker Change: This is what we've done.
Matthew S. Kissner: We delivered revenue at the higher end of our guidance, as projected. Today's Wiley is more predictable and focused, with greater visibility and consistency. All of us are proud to say that we exceeded our EBITDA and EPS guidance even after revising them upward in Q3. Today, Wiley is leaner, more competitive, and more efficient.
Speaker Change: We delivered revenue at the higher end of our guidance as projected today's Wiley is more predictable and focused with greater visibility and consistency.
Speaker Change: All of US are proud to say that we exceeded our EBITDA and EPS guidance, even after revising them upward in Q3.
Speaker Change: Today, Wiley is leaner more competitive and more efficient.
Matthew S. Kissner: We set out to accelerate our restructuring plans and operating improvements over the back half of the year, and we've done exactly that. Last June, Christina projected to exit the year at or better than our fiscal 23 adjusted EBITDA margin, which was 23.3%. We delivered a Q4 margin of 28.3%, or 25.6% excluding the AR deal. This is not a sustained exit rate heading into fiscal 25, as seasonality played a role.
Speaker Change: We set out to accelerate our restructuring plans and operating improvements over the back half of the year and we've done exactly that.
Speaker Change: Last June Kristina projected to exit the year.
Speaker Change: At or better than our fiscal 'twenty, three adjusted EBITDA margin, which was 23, 3%.
Speaker Change: We delivered a Q4 margin of 28, 3% or.
Speaker Change: Or 25, 6%, excluding the AI deal.
Speaker Change: This is not a sustained exit rate heading into fiscal 'twenty five as seasonality played a role.
Matthew S. Kissner: That said, we remain on track with our margin expansion targets in fiscal 25 and 26, and we fully expect to deliver on these while reinvesting for sustained long-term growth. As discussed, we have materially exceeded our in-year cost savings goals. We originally projected $30 million and ended with $60 million of savings. This is the result of relentless execution and the importance of hitting the ground running.
Christina M. Van Tassell: That said, we remain on track with our margin expansion targets in fiscal 'twenty five 'twenty six and we fully expect to deliver on these while reinvesting for sustained long term growth.
Christina M. Van Tassell: As discussed we have materially exceeded our in year cost savings goals. This year.
Christina M. Van Tassell: We originally projected $30 million and ended with $60 million of savings.
Speaker Change: This is the result of relentless execution and the importance of hitting the ground running.
Matthew S. Kissner: Free cash flow is a consistent strength of ours, and we delivered $114 million versus our projection of $100 million, mainly due to cash earnings outperformance. As a reminder, we're in a muted two-year period for cash flow due to restructuring and investing. But we expect to be back in the 200 million dollar range in fiscal 26 and see continuous upside from there. Finally, the Wiley culture has been reinvigorated by the move to a much simpler and more efficient organization. Everyone is in sync and rowing in the same direction.
Speaker Change: Free cash flow is the consistent strength of ours, and we delivered 114 million versus our projection of 100 million, mainly due to cash earnings outperformance.
Speaker Change: As a reminder, we are in a muted two year period for cash flow due to restructuring and investment.
Speaker Change: But we expect to be back in the $200 million range in fiscal 'twenty, six and see continuous upside from there.
Speaker Change: Finally, the Wiley culture has been reinvigorated by the move to a much simpler and more efficient organization.
Speaker Change: Everyone is in sync and rowing in the same direction, it's just a lot easier to get things done here.
Matthew S. Kissner: It's just a lot easier to get things done. Let's talk about the AI opportunity. Wiley has become one of the early beneficiaries of Gen AI development. Our high-quality content in science, learning, and innovation is foundational for training and fine-tuning large language models and applications.
Speaker Change: Let's talk about the AI opportunity.
Wiley has become one of the early beneficiaries of Gen AI development.
Speaker Change: Our high quality content and science learning and innovation is foundational for training and fine tuning Lodge language models and applications.
Matthew S. Kissner: Large AI developers and R&D-intensive corporations can use it to greatly improve the accuracy, safety, and impact of their models and shorten their time to market. Demand is, therefore, accelerated. This quarter, as previously discussed, we executed a $23 million licensing project with a large tech company for our previously published learning content. We're following that up with a $21 million project with another tech company for a mix of learning and research content. To be recognized in fiscal 25. Both of these projects are of limited duration, with limited rights and use, in this case for model training purposes.
Speaker Change: La <unk> developers and R&D intensive corporates can use it to greatly improve the accuracy safety and impact of their models and shorten lead time to market.
Speaker Change: Demand is therefore accelerating.
Speaker Change: This quarter as previously discussed we executed a $23 million licensing project with a large tech company for our previously published learning content.
Speaker Change: We're following that up with a $21 million project with another Tech company for a mix of learning and research content to be recognized in fiscal 'twenty five.
Speaker Change: Both of these projects are of limited duration with limited rights and use in this case for model training purposes. They are nonexclusive subject to extension and do not constrain us from pursuing further opportunities.
Matthew S. Kissner: They are non-exclusive, subject to extension, and do not constrain us from pursuing further opportunities. We see the new AI business opportunity in two stages. The first, as discussed, is content licensing or providing limited access to select content for the purposes of developing Gen AI models.
Speaker Change: We see the new AI business opportunity in two stages.
Speaker Change: The first as discussed is content licensing or providing limited access to select content for the purposes of developing Gen AI models.
Matthew S. Kissner: The opportunity is right here and now. In addition to the two executed deals, we're seeing significant interest from other LLM developers for increasingly specific and technical content. This is precisely what Wiley specializes in, with over 200 years of history behind us. It's still too early to size these opportunities, but we are seeing growing interest while remaining prudent on the scope of the rights granted. The second stage is developing new business models around content applications that bring us ever closer to the customer. These include recurring licensing arrangements as these models evolve and as companies bring our content into their AI environments. For example, Wiley is a leading provider of scientific content.
Speaker Change: The opportunity is right here and now.
Speaker Change: In addition to the two executed deals we're seeing significant <unk> from other LLM developers for increasingly specific and technical content.
Speaker Change: This is precisely what wildly specializes in with over 200 years of history behind us.
Speaker Change: It's still too early to size these opportunities, but we are seeing a growing interest while remaining prudent on the scope of the rights granted.
Speaker Change: The second stage is developing new business models around content application that brings us ever closer to the customer.
Speaker Change: These include recurring licensing arrangements as these models evolve and as companies bring our content into the AI environments for example.
Wiley: Wiley is a leading provider of scientific content, we can embed this content into gen AI applications for pharmaceutical companies healthcare providers chemical companies government agencies and many others.
Matthew S. Kissner: We can embed this content into Gen-AI applications for pharmaceutical companies, healthcare providers, chemical companies, government agencies, and many others. Wiley is also a leading provider of business and economics content, which we can embed into applications for financial services providers. These are just some examples of the opportunities ahead. In addition to content licensing and application, another very real Gen AI opportunity for us is in product and publishing innovation. Through various AI-based tools, we are transforming how we publish by shortening authoring time and effort, increasing editorial productivity, and streamlining content work.
Speaker Change: Wiley is also a leading provider of business and economics content, which we can embed into applications with financial services providers. These.
Speaker Change: These are just some examples of the opportunities ahead.
Speaker Change: In addition to content licensing and application another very real Gen AI opportunity for us is in product and publishing innovation.
Speaker Change: Through various AI based tools, we are transforming how we publish by shortening authoring time and effort, increasing editorial productivity and streamlining content workflow.
Matthew S. Kissner: We have already deployed AI in our research platform, using it to safeguard research integrity at the point of article submission. In fact, we've introduced a new service that incorporates six distinct tools to identify potentially compromised content, including paper mill similarity detection, Problematic Phrase Recognition, Researcher Identity Verification, and Gen AI Content Detection, among others.
Speaker Change: We have already deployed AI into our research platform using it to safeguard research integrity at the point of article submission.
Speaker Change: In fact, we've introduced a new service that incorporates six distinct tools to identify potentially compromised content.
Speaker Change: Including paper mill similarity detection.
Speaker Change: Problematic phrase recognition.
Speaker Change: Researcher identity verification.
Speaker Change: And Jen AI content detection among others.
Matthew S. Kissner: We're already piloting this service with key society and publishing partners as the industry tackles this issue head-on. Through our past experience, we've become a thought leader in this area, and we're sharing our insights with others. Finally, we're already deploying AI to materially improve office productivity and customer service as we begin to transform how we work. In customer service, for example, we're already seeing cost savings and reductions in handle time through the latest AI augmentation and automated processes. To summarize, Wiley is highly valued and well positioned in the evolution of AI.
Speaker Change: We're already piloting this service with key Society and publishing partners as the industry tackles. This issue head on.
Speaker Change: Through our past experience, we have become a thought leader in this area and we are sharing our insights with others.
Speaker Change: Finally, we're already deploying AI to materially improve office productivity and customer service as we begin to transform how we work.
Speaker Change: And customer service for example, we're already seeing cost savings and reductions in handle time through the latest AI augmentation and automated processes.
Speaker Change: To summarize while he is highly valued and well positioned in the evolution of AI.
Matthew S. Kissner: We're closing deals, developing additional opportunities, and seeing both quality and efficiency gains today. As I've said before, we are confident that the advancement of these technologies will be a contributor to customer value, productivity, and growth in the years to come. Now, Christina will provide more details on our performance for the quarter.
Speaker Change: We're closing deals developing additional opportunities and seeing both quality and efficiency gains today.
Speaker Change: As I've said before we are confident that the advancement of these technologies will be a contributor to customer value productivity and growth in the years to come.
Speaker Change: Let me briefly touch on our performance for the quarter Kristina will provide more detail.
Matthew S. Kissner: As a reminder, we will be excluding our held for sale or sold assets in our commentary unless otherwise noted. We finished strong due to our accelerated value creation plan savings and the $23 million Gen-AI Contents Rights Project and Learning. Adjusted revenue was up 4% to $441 million driven by growth and learning, including the Gen AI content rights project. Academics continue to outperform as it has all year. This was partially offset by timing and lower ancillary print and licensing revenue from research.
Speaker Change: As a reminder, we will be excluding our held for sale or sold assets in our commentary unless otherwise noted.
Speaker Change: We finished strong due to our accelerated value creation plan savings and the $23 million Gen AI contents rights project and learning.
Christina M. Van Tassell: Adjusted revenue was up 4% to $441 million driven by growth in learning, including the Gen. AI content rights project academic continued to outperform as it has all year.
Christina M. Van Tassell: This was partially offset by timing and lower ancillary print and licensing revenue in research.
Matthew S. Kissner: Adjusted EBITDA rose 7% to $125 million from the combination of revenue growth and restructuring savings. As I mentioned, adjusted EBITDA margin for the quarter was 28.3%. Adjusted EPS rose 2% to $1.21, with strong revenue performance partially offset by tech write-offs as part of legacy decommissioning. Our Q4 GAP results continued to be impacted by divestitures and related activity, as well as restructuring.
Adjusted EBITDA rose, 7% to $125 million from the combination of revenue growth and restructuring savings as I mentioned adjusted EBITDA margin for the quarter was 28, 3%.
Christina M. Van Tassell: Adjusted EPS rose, 2% to $1 21, with strong revenue performance, partially offset by tech write offs as part of legacy decommissioning.
Christina M. Van Tassell: Our Q4 GAAP results continued to be impacted by the divestitures and related activity as well as restructuring.
Matthew S. Kissner: On to our full year performance. As a reminder, Fiscal 24 was a transitional year as we made the necessary moves to become a higher-performing and more profitable Wiley. These structural changes and transition year dynamics were evident in our gap results shown here. I'll be focusing on our adjusted results. Full year adjusted revenue declined modestly to $1.617 billion.
Onto our full year performance as a reminder, fiscal 'twenty four was a transitional year as we made the necessary moves to become a higher performing and more profitable wildly.
Christina M. Van Tassell: These structural changes and transition year dynamics were evident in our GAAP results shown here.
Christina M. Van Tassell: Ill be focusing on our adjusted results.
Christina M. Van Tassell: Full year adjusted revenue declined modestly to 161 7 billion.
Matthew S. Kissner: Outperformance in learning was offset by a decline in research due to the COVID research lab and the effects of the Hindawi disruption. Also note we had some currency favorability on revenue this year of about $11 million. Adjusted EBITDA was down 3% to $369 million, largely due to revenue performance. Our adjusted EBITDA margin for the year was 22.8. Adjusted EPS was down 19% due to a combination of lower operating income and higher interest and tax expense.
Christina M. Van Tassell: Outperformance in learning was offset by a decline in research due to the Covid research lag and the effects of the Hendawi disruption.
Christina M. Van Tassell: Also note we had some currency favorability on revenue this year of about $11 million.
Christina M. Van Tassell: Adjusted EBITDA was down 3% to $369 million largely due to revenue performance.
Speaker Change: Our adjusted EBITDA margin for the year was 22, 8%.
Speaker Change: Adjusted EPS was down 19% due to a combination of lower operating income and higher interest and tax expense.
Matthew S. Kissner: And as noted, free cash flow of $114 million compared to $173 million in the prior year due to a combination of transition year factors including lower cash earnings and restructuring, plus higher interest. As a reminder, we don't report an adjusted free cash flow metric, so this number includes the health for sale asset. Now, let's talk about our momentum heading into Fiscal 25. I'll start with research.
Speaker Change: And as noted free cash flow of $114 million compared to $173 million in the prior year due to a combination of transition year factors, including lower cash earnings and restructuring plus higher interest.
Speaker Change: As a reminder, we don't reported adjusted free cash flow metrics. So this number includes the held for sale assets.
Speaker Change: Let's talk about our momentum heading into fiscal 'twenty five I'll start with research.
Matthew S. Kissner: Submissions growth, a critical leading demand indicator, has risen to 15% on a trailing 12-month basis. This is considerably higher than we expected and speaks to the global research demand to publish, be recognized, and further one's career. Wiley enables all of this as a leading peer-reviewed public
Submissions growth a critical leading demand indicators has risen to 15% on a trailing 12 month basis.
Speaker Change: This is considerably higher than we expected and speak to the global research of demand to publish be recognized and further ones career wildly enables all of this is a leading peer reviewed publisher.
Matthew S. Kissner: Output growth has rapidly accelerated. After a slow start, we saw marked improvement throughout the year, with output growing by mid-single digits in Q4. We're seeing solid growth patterns return in the U.S., EMEA, and Japan, and we're seeing strong demand in high growth markets like China and India. In Fiscal 25, we expect to see continued mid-single-digit output growth, and that's reflected in our revenue projection. Third, our institutional models are strong, with steady growth expected. As a reminder, these models, which include both subscriptions for research libraries and institutional open access agreements with consortia or single institutions, are recurring in nature.
Speaker Change: Output growth has rapidly accelerated after a slow start we saw a marked improvement throughout the year without growing by mid single digits in Q4.
Speaker Change: We're seeing solid growth patterns return in the U S EMEA and Japan.
Speaker Change: And we're seeing strong demand in the high growth markets like China and India.
Speaker Change: In fiscal 'twenty five we expect to see continued mid single digit output growth and thats reflected in our revenue projections.
Speaker Change: Third our institutional models are strong with steady growth expected.
Speaker Change: As a reminder, these models which include both subscriptions for research libraries, and institutional open access agreements with consortia or single institutions are recurring in nature.
Matthew S. Kissner: Fourth, Gold Open Access is expected to continue to deliver about 20% growth. To refresh, Gold Open Access is our author-funded OA model. As always, journal quality and impact are paramount.
Speaker Change: Fourth gold open access is expected to continue to deliver about 20% growth to refresh gold open access is our author funded OE model.
Speaker Change: As always journal quality and impact of Paramount.
Matthew S. Kissner: And we remain very well positioned as a best-in-class publisher with leading portfolios in chemistry, materials science, energy, oncology, food science, and many others. Finally, the development of our research publishing platform is accelerating. We recently successfully completed our first large-scale journal migration, and we're now expecting to have the platform fully deployed in fiscal 25, earlier than we originally projected. This platform will allow us to deliver incremental growth by standing up new content offerings and improving article reference and translation. It should lead to a material reduction in turnaround times and cost per article and allow us to detect research integrity issues through the use of AI.
Speaker Change: And we remain very well positioned as the best in class publisher with leading portfolios in chemistry materials Science energy oncology food science and many others.
Speaker Change: Finally, the development of our research publishing platform is accelerating.
Speaker Change: We recently successfully completed our first large scale journal migration and we're now expecting to have the platform fully deployed in fiscal 'twenty five earlier than we originally projected.
Speaker Change: This platform will allow us to deliver incremental growth by standing up new content offerings and improving article referring transfer it should lead to a material reduction in turnaround times and cost per article and allow us to detect research integrity issues through the use of AI.
Matthew S. Kissner: After some outliers this year, we're now seeing the obvious upside of a simpler Wiley focused intently on its research core. Let's now turn to our momentum in learning. It was a consistently good year, above and beyond the Gen A ideal. Market conditions turned favorable, particularly in academic, digital content, and coursework. Undergrad enrollment increased for the first time since the pandemic. However, institutions gravitated toward Inclusive Access Models, where the cost of digital course content is added to the student's tuition and fees.
Speaker Change: After some outliers this year, we're now seeing the obvious upside of a simpler wildly focused intently on its research core.
Speaker Change: Let's now turn to our momentum and learning it.
Speaker Change: It was a consistently good year above and beyond the <unk> deal.
Speaker Change: Market conditions turned favorable, particularly in academic digital content and courseware.
Speaker Change: Undergrad enrollment increased for the first time since the pandemic.
Speaker Change: Institutions gravitated towards inclusive access models, where the cost of digital course content is added to the students tuition and fees.
Matthew S. Kissner: And our STEM courseware product continued to see strong growth in adoptions and use. We expect this positive momentum to continue. I want to take a moment and commend the team this year for not only delivering better than expected revenue growth but significant margin acceleration as well. In Professional, we're seeing very good momentum in signing up new authors and titles, a result of simply focusing on this profitable business more than we have in the past.
Speaker Change: And our stem courseware product continued to see strong growth in adoption and usage we.
Speaker Change: We expect this positive momentum to continue.
Speaker Change: I wanted to take a moment and commend the team this year for not only delivering better than expected revenue growth, but significant margin acceleration as well.
Speaker Change: In professional we're seeing very good momentum in signing up new waters entitles, a result of simply focusing on this profitable business more than we have in the past.
Matthew S. Kissner: Given the long lead time to publish, we'll see the benefit of these signings beginning in Fiscal 2021. Our assessments business grew modestly in fiscal 24, but we expect better growth from the recent expansion of our sales partner network. Finally, as noted, we're going to continue to respond to and actively pursue opportunities for our learning content in Gen AI Mod. In summary, we're pleased with our overall momentum heading into Fiscal 25. I'll turn it over to Christina.
Speaker Change: Given the long lead time to publish we'll see the benefit of these signings beginning in fiscal 'twenty five.
Speaker Change: Our assessments business grew modestly in fiscal 'twenty, four, but we expect better growth from the recent expansion of our sales partner network.
Speaker Change: Finally, as noted we're going to continue to respond to and actively pursue opportunities for our learning content in Gen AI models.
Speaker Change: In summary, we're pleased with our overall momentum heading into fiscal 'twenty five.
Speaker Change: I'll turn it over to Christina.
Christina M. Van Tassell: Thank you, Matt, and hello, everyone. I want to start by thanking our global colleagues for all they've done to get us here. We are a much stronger company than we were last June. At this time last year, we announced our value creation plan. I said then that we were about to embark on a clear and decisive plan to simplify our portfolio.
Christina: Thank you, Matt and Hello, everyone.
Christina: I wanted to start by thanking our global colleagues for all they've done to get US here leering much stronger company than we were last June.
Christina: At this time last year, we announced our value creation plan.
I said, then we were about to embark on a clear and decisive plan to simplify our portfolio.
Christina M. Van Tassell: This would enable us to focus on our most competitively advantaged businesses in order to drive consistent growth while streamlining the organization. Expanding Profit Margins and Deploying Our Capital More Efficiently. So let's review our progress to date. We reorganized the businesses from three disparate segments into one go-to-market research and learning team under Jay Flynn. This has been a great move for us, and we continue to advance commercial gains and unlock synergies from this important realignment. We've closed on the sale of both University Services and Wiley Edge.
This will enable us to focus on our most competitively advantaged businesses in order to drive consistent growth while streamlining the organization.
Christina: Expanding profit margins and deploying our capital more efficiently.
Christina: So let's review our progress to date.
Christina: We reorganized the businesses from three desperate segment into one go to market research and learning team under J Flynn.
Christina: This has been a great move for us and we continue to advance commercial gains and unlock synergies from this important realignment.
Speaker Change: We've closed on the sale of both University services and wildly edge.
Christina M. Van Tassell: The total consideration for both is approximately $175 million, subject to adjustments. Our primary goal here was to free ourselves of these stressed, non-core assets to focus on our profitable and cash-generative core. The remaining divestiture cross-knowledge is in process and is immaterial.
Speaker Change: Total consideration for both is approximately $175 million subject to adjustments.
Speaker Change: Our primary goal here was to free ourselves at least stressed noncore assets to focus on our profitable and cash generative core.
Speaker Change: The remaining divestiture cross knowledge is in process and is immaterial.
Christina M. Van Tassell: We actioned $90 million of run rate savings in our $130 million savings plan, with $60 million of it being realized in-year. The remainder will be achieved in Fiscal 25 ahead of schedule. Key drivers here are Corporate Overhead Savings, Business Savings from the Consolidation of Various Functions and our Real Estate Footprints, as well as technology savings from the retirement of legacy systems and reduced hosting costs. During the year, we further consolidated our office footprint with two office closures and four reductions.
Speaker Change: We actually had $90 million of run rate savings and our $130 million savings plan with $60 million of that being realized in year.
Speaker Change: The remainder will be action in fiscal 'twenty five ahead of schedule.
Speaker Change: The key drivers here are corporate overhead savings.
Speaker Change: The savings from the consolidation of various functions in our real estate footprint.
Speaker Change: As well as technology savings from the retirement of legacy systems and reduced hosting costs.
Speaker Change: During the year, we further consolidated our office footprint with two office closures and for reductions.
Christina M. Van Tassell: Since March of 2020, we've reduced our global office footprint by around 40%. Also note... As part of our tech consolidation and modernization, we wrote off tech debt this quarter. As a reminder, we expect half of the $130 million of savings to flow through the margin and half to be reinvested.
Speaker Change: Since March of 2020, we've reduced our global office footprint by around 40%.
Speaker Change: Also note that.
As part of our tech consolidation and modernization, we wrote our tech debt this quarter.
Speaker Change: As a reminder, we expect half of the $130 million of savings to flow through to margin and has to be reinvested.
Christina M. Van Tassell: This is reflected in our Fiscal 25 Outlook and Fiscal 26 targets. In addition, we will also be reinvesting a portion of the proceeds from our large content deals towards driving sustained, profitable growth. Let's talk about where we're reinvesting.
Speaker Change: This is reflected in our fiscal 'twenty five outlook and fiscal 'twenty six targets.
Speaker Change: In addition, we will also be reinvesting a portion of the proceeds from our large content deals towards driving sustained profitable growth.
Speaker Change: Let's talk about where are we investing.
Christina M. Van Tassell: Our primary objective is to drive additional growth in research where we have a strong competitive advantage and pent-up demand. This includes scaling our general portfolio and referring transfer capabilities, expanding our flagship journal brands into additional verticals, and optimizing go-to-market to attract and retain authors.
Speaker Change: Our primary objective is to drive additional growth in research, where we have strong competitive advantage and pent up demand.
This includes scaling our journal portfolio and referring transfer capabilities.
Speaker Change: Extending our flagship journal brands into additional verticals and.
Speaker Change: And optimizing go to market to attract and retain authors.
Christina M. Van Tassell: It also includes expanding our editorial capacity and corporate research sales team. We will also invest in signing new in-demand authors and titles on the learning side to better leverage the publishing infrastructure we have in place. Second, we are investing in Gen-AI growth and productivity initiatives, including optimizing our content for LLM deployment, leveraging GenAI in our content-enabled applications, and developing new business models.
Speaker Change: It also includes expanding our editorial capacity and corporate research sales teams.
Speaker Change: We will also invest in signing new in demand authors and titles on the learning side to better leverage the publishing infrastructure, we have in place.
Speaker Change: Second we.
Speaker Change: We are investing in gen AIG growth and productivity initiatives, including optimizing our content for LLM deployment.
Speaker Change: Leveraging journey INR content enabled applications and developing new business models.
Christina M. Van Tassell: We are also investing in AI productivity tools for our colleagues. We're modernizing our systems to improve speed, decision-making, and productivity. We've talked about two specific areas here, our research publishing platform and our infrastructure modernization. We are confident that these initiatives will enhance revenue growth and margin acceleration beyond fiscal 2016. As we grow to meet the ever-increasing demand for publications and take full advantage of the Gen-A opportunities, we also expect to lower our costs to publish through workflow automation, content reuse, and the decommissioning of legacy systems.
Speaker Change: We are also investing in AI productivity tools for our colleagues.
Speaker Change: We're modernizing our systems to improve speed decision, making and productivity.
Speaker Change: We've talked about two specific areas here, our research publishing platform and our infrastructure modernization.
Speaker Change: We are confident these initiatives will enhance revenue growth and margin acceleration beyond fiscal 'twenty six.
Speaker Change: Got to meet the ever increasing demand to publish and take full advantage of the journey opportunity.
Speaker Change: We also expect to lower our cost of published their workflow automation content reuse and the decommissioning of legacy systems.
Christina M. Van Tassell: Finally, we expect to deliver a superior author experience through faster turnaround times and article transfer, which we believe will give us a competitive advantage in the marketplace. Now, let's turn to our research performance in this unusual year. We had the ADVERSE, the Hyundai Impact, and the COVID Research Lab. As noted, the Hindawi Journal portfolio is now integrated within the Wiley Open Access portfolio, and the COVID lag is fully behind us. So I'll focus on the quarter. Research revenue is down 3% due to timing and declines in our ancillary prints and licensing revenue.
Speaker Change: Finally, we expect to deliver a superior author experience through faster turnaround times and article transfer, which we believe will give us competitive advantage in the marketplace.
Speaker Change: Let's turn to our research performance in this unusual year.
Speaker Change: We had the adverse impact in the Covid research lag.
Speaker Change: As noted the Hendawi Journal portfolio is now integrated within the widely open access portfolio and the covered lag is fully behind us.
Speaker Change: So I'll focus on the quarter.
Speaker Change: Research revenue was down 3% due to timing and declines in our ancillary prints and licensing revenue.
Christina M. Van Tassell: The timing impact involved a portion of our journal revenue slipping into FY25, a fairly common occurrence stemming from the divergence of our fiscal year and the research library budget season. We expect to recover this delayed revenue in Q1. Research Solutions had a down quarter due to soft market conditions for advertising and recruiting, offsetting moderate growth in our publishing solutions business for societies.
Speaker Change: The timing impact involved the portion of our German revenue slipping into fiscal 'twenty five a fairly common occurrence stemming from the divergence of our fiscal year and the research library budget season.
Speaker Change: We expect to recover this delayed revenue in Q1.
Speaker Change: Research solutions had a down quarter due to soft market conditions for advertising and recruiting offset a moderate growth in our publishing solutions business for societies.
Christina M. Van Tassell: We have good visibility based on customer contracts signed in fiscal 23 and 24, and so we expect better performance in fiscal 25. In Q4, adjusted EBITDA for research declined 12% due to the unusual year-over-year incentive comp swing, which we've discussed all year. Our Q4 margin was 34.6%. In summary, we feel good about research heading into Fiscal 25. Strong publishing KPIs and trends are expected to deliver double-digit revenue growth in gold open access, steady growth in our multi-year institutional models, and material improvement in the solution. Now, let's talk about learning performance.
Speaker Change: We have good visibility based on customer contract signed in fiscal 'twenty, three and 'twenty four until we expect better performance in 'twenty five.
Speaker Change: In Q4, adjusted EBITDA for research declined 12% due to the unusual year over year incentive comp swing, which we've discussed all year.
Speaker Change: Our Q4 margin was 34, 6%.
Speaker Change: In summary, we feel good about our research heading into fiscal 'twenty five.
Speaker Change: <unk> publishing Kpis and trends are expected to deliver double digit revenue growth and gold open access.
Speaker Change: Steady growth at our multi year institutional models and material improvement in our solutions.
Speaker Change: Let's talk about learnings outperformance.
Christina M. Van Tassell: The team executed exceedingly well in driving both mid-single-digit growth and 600 basis points of margin expansion this year, yet another outcome of a more focused Wiley. For the quarter, academic revenue rose 22% or 8% excluding the GEN-AI deal driven by continued strong growth in digital content and courseware, and rights and licenses. Also, according to industry data, U.S. undergrad enrollment rose 1.2% in the fall and 2.5% in the spring, so a positive trend there after several years of decline. Professional revenue rose 13% in the quarter, but was down 5% excluding the GENAI deal. The performance was driven by modestly lower backlist and frontlist sales.
Speaker Change: The team executed exceedingly well and driving those mid single digit growth and 600 basis points of margin expansion. This year, yet another outcome of a more focused wiley.
Speaker Change: For the quarter academic revenue rose, 22% or 8%, excluding the journey ideal driven by continued strong growth in digital content, and courseware and rates and licensing.
Speaker Change: Also according to industry data U S undergrad enrollment rose one 2% in the fall and two 5% in the spring say positive trend there after several years of decline.
Speaker Change: Professional revenue rose, 13% in the quarter, but was down 5%, excluding the journey ideal.
Speaker Change: Performance is driven by modestly lower back list and frontline sales.
Christina M. Van Tassell: To refresh, Gen AI content revenue is split evenly between academic and professional. Adjusted EBITDA and learning for the quarter rose 54%, mainly driven by revenue performance and cost savings. In summary, we feel good about learning. Higher education market conditions are more favorable now than in the recent past, both in terms of enrollment and demand. In Professional, we drove higher title and author signings, which will start to come online in FY 25 and beyond.
To refresh Jenny I content revenue is split evenly between academic and professional.
Speaker Change: Adjusted EBITDA and learning for the quarter rose, 54%, mainly driven by revenue performance and cost savings.
Speaker Change: Our Q4 adjusted EBIT margin was 43, 5%.
Speaker Change: In summary, we feel good about learning.
Speaker Change: Higher education market conditions are more favorable now than in recent past both in terms of enrolment and demand.
Speaker Change: In professional we drove higher title and author signings, which will start to come online in fiscal 'twenty five and beyond.
Christina M. Van Tassell: In Assessments, we expanded the number of sales agents by 19%, which gives us a good outlook for our personality assessment and team development products. Okay, let's move from segments into corporate expenses. For the year, we saw a 4% increase, as expected, in the corporate line to $163 million, offsetting value creation plan savings. The net increase was largely due to the lower incentive accrual in the prior years due to underperformance.
Speaker Change: And assessments, we expanded the number of sales agents by 19%, which gives us a good outlook for our personality assessment and team development products.
Speaker Change #100: Okay, let's move from segments into corporate expenses.
Speaker Change #101: For the year, we saw a 4% increase as expected in the corporate line to $163 million offsetting value creation plan savings.
Speaker Change #102: The net increase was largely due to lower incentive accrual in the prior years due to underperformance.
Christina M. Van Tassell: Hire executive costs this year related to severance and transition your consulting fees. Let's turn now to our Fiscal 25 Outlook. Given Leading Indicators and Favorable Trends, we're projecting full-year revenue of $1.65 to $1.69 billion for a top-line growth of 2 to 4 percent. This is driven by an expectation of low- to mid-single-digit growth in research and low-single-digit growth in learning. Two important things to note. First, our Outlook includes both GenAI content deals with $23 million recognized in Fiscal 24 and $21 million recognized in Fiscal 25. This does not reflect additional content licensing deals for Gen AI models.
Speaker Change #103: Higher executive costs, this year related to severance and transition year consulting fees.
Christina M. Van Tassell: We will update our guidance during the year if additional deals materialize. Adjusted EBITDA is expected to be in a range of $385 to $410 million, for a growth of 4 to 11%. This reflects a margin target of 23 to 24%. Performance is expected to be driven by a combination of revenue growth and continued cost savings partially offset by reinvestment in research, Gen-AI, and infrastructure modernization. Adjusted EPS is expected to be in the range of $3.25 to $3.60, with growth of 17-29%.
Speaker Change #104: Let's turn now to our fiscal 'twenty five outlook.
Speaker Change #104: Giving many indicators and favorable trends, we're projecting full year revenue.
Speaker Change #104: $1 65 to $1 six 9 billion for topline growth of 2% to 4%.
Speaker Change #105: This is driven by an expectation of low to mid single digit growth in research and low single digit growth in learning.
Speaker Change #105: Two important things to note.
Speaker Change #106: Our outlook includes the jet AI content deals with 23 million recognized in fiscal 'twenty, four and 'twenty 1 million recognized in fiscal 'twenty five.
Speaker Change #106: It does not reflect additional content licensing deals for Jennie and models.
Speaker Change #107: We will update our guidance during the year as additional deals materialize.
Speaker Change #107: Adjusted EBITDA is expected to be in a range of $385 million to $410 million for a growth of 4% to 11%.
Speaker Change #107: This reflects a margin target of 23% to 24%.
Performance is expected to be driven by a combination of revenue growth and continued cost savings, partially offset by reinvestment in research Gen AI and infrastructure modernization.
Speaker Change #108: Adjusted EPS is expected to be in the range of $3 25 to.
Speaker Change #108: To $3 64.
Speaker Change #108: Growth of 17% to 29%.
Christina M. Van Tassell: The primary drivers are higher expected adjusted operating income and accrued interest income from divestitures offsetting higher interest and tax expenses. Free cash flow is anticipated to be approximately $125 million, up from $114 million. This is due to improved working capital and lower restructuring payments offsetting higher CapEx and higher incentive compensation payments compared to the normally low payouts in the prior year. As noted, we anticipate CapEx to be approximately $130 million compared to $93 million this year due to near-term infrastructure investments. So, cash flow remains below historical norms in Fiscal 25 due to a combination of elevated capex and restructuring activities.
Speaker Change #108: The primary drivers of our higher expected adjusted operating income and accrued interest income from divestitures.
Speaker Change #108: It's at a higher interest and tax expense.
Speaker Change #109: Free cash flow is anticipated to be approximately $125 million up from $114 million.
Speaker Change #110: This is due to improved working capital and lower restructuring payments offsetting higher capex and higher incentive compensation payments compared to the abnormally low payout in the prior year.
Speaker Change #110: As noted we anticipate capex to be approximately $130 million compared to $93 million. This year due to near term infrastructure investments.
Speaker Change #111: Sal Castro remained below historical norms in fiscal 'twenty five due to a combination of elevated capex and restructuring activities.
Christina M. Van Tassell: As a reminder, we expect to be at $200 million in fiscal 26 as cash earnings continue to improve, CAPEX normalizes, and restructuring tapers. In terms of quarterly phasing, the $21 million GenAI content rights project in FY25 will be recognized in the first two quarters of this year. Moving on to our financial positions, free cash flow for the year of $114 million was down $59 million, as expected.
Speaker Change #112: As a reminder, we expect to be at $200 million in fiscal 'twenty as cash earnings continued to improve capex normalizes and restructuring papers.
Speaker Change #112: In terms of quarterly phasing the $21 million Gen AI content rights project in fiscal 'twenty five will be recognized in the first two quarters of this year.
Speaker Change #113: Moving onto our financial position.
Speaker Change #113: Free cash flow for the year of 149 was down $59 million as expected.
Christina M. Van Tassell: Lower Adjusted EBITDA, Higher Restructuring Interest Payments, and Lower Incentive Comp Payments Offset Lower CAPEX. For the year, we allocated $122 million towards dividends and share repurchases, up $10 million versus the prior year. $45 million of that was used to acquire 1.3 million shares at an average cost per share of $34.71.
Speaker Change #113: Lower adjusted EBITDA, higher restructuring and interest payments and lower incentive comp payments offset lower capex.
Speaker Change #114: For the year, we allocated $122 million towards dividends and share repurchases of $10 million versus prior year.
Speaker Change #114: 45, nine of that was used to acquire one 3 million shares at an average cost per share of $34 71.
Christina M. Van Tassell: This compares to 832,000 shares repurchased in the prior year period. Additionally, our current dividend yield remains above 3.5%. Finally, our net debt to EBITDA ratio was 1.7 at the end of April compared to 1.5 in the prior year.
Speaker Change #114: This compares to 832000 shares repurchased in the prior year period.
Speaker Change #114: Our current dividend yield remains above three 5%.
Finally, net debt to EBITDA ratio was one seven at the end of April compared to $1 five in the prior year.
Christina M. Van Tassell: With that, I'll pass it back over to Matt. Thank you, Christina. Let me quickly summarize the key takeaways. As we put this very eventful year behind us, there was a renewed sense of confidence and optimism across our organization. We're meeting and exceeding our profit and performance objectives. We're moving decisively to uncover near-term opportunities. We're reinvesting where we have a unique right to win.
Speaker Change #115: With that I'll pass it back over to Matt.
Matthew S. Kissner: Thank you Christina.
Matthew S. Kissner: Let me quickly summarize the key takeaways.
Matthew S. Kissner: As we put this very eventful year behind US there is a renewed sense of confidence and optimism across our organization.
Matthew S. Kissner: We're meeting and exceeding our profit and performance objectives.
Matthew S. Kissner: We're moving decisively to uncover near turnaround opportunities.
Speaker Change #117: We are reinvesting where we have a unique right to win.
Matthew S. Kissner: And we're moving faster and making work life easy. We're seeing strong underlying momentum in research and outperformance in learning. Gen-AI momentum is accelerating, and we're seeing additional interest from other AI providers. We've made significant progress on our value creation plan, including divestitures and savings. We have more work in front of us, but we have made tremendous strides. We're confident in our fiscal 25 outlook for revenue growth and margin expense.
Speaker Change #117: And we're moving faster and making work life easier.
Speaker Change #117: We're seeing strong underlying momentum in research and outperformance in learning.
Speaker Change #118: Gen II momentum is accelerating with two executed content rights projects, we're seeing additional interest from other AI providers.
Speaker Change #119: We've made significant progress on our value creation plan, including divestitures as savings.
Speaker Change #120: We have more work in front of us, but we have made tremendous strides.
Speaker Change #120: We are confident in our fiscal 'twenty five outlook for revenue growth and margin expansion.
Matthew S. Kissner: And we see expected continued margin and cash flow acceleration in fiscal 26 and beyond. I'll finish with our fiscal 26 financial target. On revenue, we anticipate low to mid-single-digit revenue growth, as our core drivers in publishing and solutions continue to benefit from ever-increasing demand and a strong competitive position. As with our Fiscal 25 Outlook, our 26 targets do not reflect any additional Gen-AI content licensing projects.
Speaker Change #120: And we see expected continued margin and cash flow acceleration in fiscal 'twenty six and beyond.
Speaker Change #120: I'll finish.
Speaker Change #121: <unk> with our fiscal 2006 financial targets.
Speaker Change #122: On revenue, we anticipate low to mid single digit revenue growth as a core drivers and publishing and solutions continued to benefit from ever increasing demand and a strong competitive position.
Speaker Change #122: As with our fiscal 'twenty five outlook on 26 targets do not reflect any additional gen AI content licensing projects.
Matthew S. Kissner: Our Adjusted EBITDA mod is expected to grow to 24 to 25 percent driven by high quality revenue growth and value creation plant savings, and free cash flow is expected to rise to $200 million. As CapEx returns to more normal levels, and restructuring payments taper off, beyond Fiscal 26, we're focused on delivering strong, consistent revenue growth at or above market growth. Continued margin expansion from greater publishing scale and delivery, leaner processes and operations, and a more efficient infrastructure, and further free cash flow acceleration.
Speaker Change #122: Our adjusted EBITDA margin is expected to grow to 24% to 25% driven by high quality revenue growth and value creation play of savings.
And free cash flow is expected to rise to $200 million as capex returns to more normal levels and restructuring payments taper off.
Speaker Change #122: Beyond fiscal 'twenty six we are focused on delivering strong consistent revenue growth at or above market growth.
Speaker Change #123: Continued margin expansion from greater publishing scale and delivery leaner processes and operations and a more efficient infrastructure.
Operator: And further free cash flow acceleration, as cash earnings expand, cash flow conversion improves, and capex normalizes.
Speaker Change #123: And further free cash flow acceleration as cash earnings expand.
Matthew S. Kissner: Cash Earnings Expand, Cash Flow Conversion Improves, and CapEx Normalized. I want to thank all of you for joining us. And I want to thank our Wiley colleagues for their many achievements this year and their continuous drive and dedication. As I said last quarter, nothing unites us more than being on a winning team. I'll now open the floor to any comments and questions. At this time, if you would like to ask a question, simply press star followed by the number 1 on your telephone keypad.
Speaker Change #123: Cash flow conversion improves and Capex normalizes.
Operator: I want to thank all of you for joining today. And I want to thank our Wiley colleagues for their many achievements this year, and their continuous drive and dedication.
Speaker Change #123: I want to thank all of you for joining today.
Speaker Change #124: And I want to thank our Wiley colleagues for their many achievements this year and the continuous drive and dedication.
Operator: As I said last quarter, nothing unites us more than being on a winning team.
Speaker Change #125: As I said last quarter, nothing unites us more than being on a winning team.
Operator: I'll now open the floor to any comments and questions. At this time, if you would like to ask a question, simply press star followed by the number one on your telephone keypad. Again, that is star one to ask a question.
Speaker Change #126: I'll now open the Florida any comments and questions.
Speaker Change #127: At this time, if you would like to ask a question simply press star followed by the number one on your telephone keypad again that is star one to ask a question. Our first question will come from the line of Daniel Moore with CJS Securities. Please go ahead.
Operator: Again, that is Star 1 to ask a question. Our first question will come from the line of Daniel Moore with CJS Securities. Please go ahead. Good morning. Thanks for all the color and thanks for taking the questions.
Operator: Our first question will come from the line of Daniel Moore with CJ S. Securities. Please go ahead.
Dan Moore: Good morning. Thanks for all the color, and thanks for taking the questions. Just updating my thoughts here.
Daniel Joseph Moore: Good morning, Thanks for all the color and thanks for taking the questions.
Daniel Joseph Moore: Just updating my thoughts here. So maybe start, Matt and Christina, with research. Now that we've fully cycled past the headwinds and challenges at Tandawi, as well as the COVID hangover, just talk about the momentum you're seeing in terms of article submission, at www.youtube.com or the link in the description below. Specific disciplines and just how sustainable that is. Hi Dan.
Daniel Joseph Moore: Just updating my thoughts here, so, let's maybe start Matt Christina with research now that were fully cycled past the headwinds and challenges.
Christina M. Van Tassell: So maybe start Matt Christina with research. Now that we're fully psyched past the headwinds and challenges at Tindawi, as well as the COVID hangover. Just talk about the momentum you're seeing in terms of article submissions. Clearly, 15% in the quarter is really strong. You know, where's that momentum comes from geographically, as well as specific disciplines, and just how sustainable is. That type of growth in your mind.
Daniel Joseph Moore: As well as the Covid hangover just talked about the momentum youre seeing in terms of article submissions clearly 15% in the quarter is really strong, whereas that momentum come sheet coming from geographically as well as.
Speaker Change #129: Specific disciplines, and just how sustainable is that type of growth.
Speaker Change #130: In your mind.
Matthew S. Kissner: It's Matt, and thanks for recognizing that's a critical leading indicator, right, of the health of the research franchise. As we have Jay with us, let me ask Jay, who's, you know, close to the market here, to give you some color on that. Jay?
Matt: Hi, Dan. It's Matt, and thanks for recognizing that's a critical leading indicator, right, of the health of the research franchise.
Matt: Hi, Dan its Matt.
Jay: Matt and thanks for recognizing that's a critical leading indicator right. If the health of the research franchise as we have Jay with US. Let me is Jay who is close to the market here to give you some color on that Jay.
Jay: As we have Jay with us, let me ask Jay, who's you know close to the market here, to give you some color on that. Jay.
James Flynn: Dan, how are you? Thanks for the question. So, yeah, we are optimistic about the trends in article submissions. And just a reminder, those don't convert directly or correlate directly with revenue growth. We have multiple ways to monetize those submissions through our continued growth and subscriptions, as well as our hybrid open access business models and our gold open access models. So, specifically around sort of breakdown and geography, what we're seeing is a return to growth, essentially globally. In article submissions, we still see very strong performance in China and India.
Jay: Dan, how are you? Thanks for the thanks for the question. So, you know, we are optimistic about the trends in article submissions, and you know, just a reminder those those don't convert and correlate directly with revenue growth. We have multiple ways to monetize those submissions through our continued growth and subscriptions, as well as our hybrid. Up and access business models and our gold open access models.
Dan: Dan how are you. Thanks for the thanks for the question. So yes, we are optimistic about the.
Jay: The trends in article submissions and just a reminder of those those don't convert and correlate directly with revenue growth we have.
Jay: Multiple ways to monetize those submissions through our continued growth and subscriptions as well as our hybrid open access business models in our in our gold open access model. So.
Jay: So just specifically around sort of breakdown in geography. What we're seeing is a return to growth essentially globally. In article submissions, we still see very strong performance in China and in India. Those those are still leading markets for growth for us, but encouragingly the more mature markets, especially the United States and Europe, have also rebounded. And we saw that in a latter half of the year, particularly in Q4, and we're looking forward to that continuing. I think. That's one of the reasons we feel very optimistic about our trajectory in the momentum that we've established in fiscal 24 heading into 25.
Jay: Just specifically around sort of breakdown of geography, what we're seeing is a return to growth essentially globally.
Speaker Change #134: In an article submissions we.
Speaker Change #134: Still see very strong performance and.
James Flynn: Those are still leading markets for growth for us. But, encouragingly, the more mature markets. We're looking forward to that continuing, I think. That's one of the reasons we feel very optimistic about our trajectory and the momentum that we've established in fiscal 24 heading into 25. That's very helpful. I appreciate it, Jay. You know, switching gears a little bit, you obviously talked a lot about the AI tools you're developing and implementing. Um, maybe just talk a little bit more.
Speaker Change #135: China and India.
Speaker Change #135: We're still leading markets for growth for us, but encouragingly the more mature markets.
Speaker Change #135: Especially the United States and Europe have also rebounded and we saw that in the latter half of the year, particularly in Q4 and and.
Speaker Change #136: We're looking forward to that continuing I think.
Speaker Change #136: That's one of the reasons, we feel very optimistic about.
Speaker Change #136: Our trajectory and the momentum that we've established in fiscal 'twenty four heading into 'twenty five.
Dan Moore: That's very helpful.
Speaker Change #137: That's very helpful. Appreciate it.
Dan Moore: Appreciate it, Jay.
Dan Moore: You know, switching gears a little bit. You obviously talk a lot about the AI tools you're developing and implementing. Maybe just talk a little bit more. Take it up.
Speaker Change #138: Switching gears, a little bit you, obviously talked a lot about the AI tools youre developing and implementing.
Speaker Change #139: Maybe just talk a little bit more.
Speaker Change #140: Take care.
Speaker Change #141: A step higher just 30000 feet the changes you've made in terms of processes procedures.
James Flynn: The changes you've made in terms of processes, procedures, you know, the sense of Dawi, and your confidence that we won't have additional similar issues going forward, you know, given the growing presence of Fraudulent Research and obviously the scope of the opportunity that you're seeing. Sure. So. As Matt mentioned in his prepared remarks, through a list of tools that we already have in production, I have eight AI tools in production right now that are built off the dataset that we acquired during the last couple of years that give us indications of where there might be, for example, paper mill activity. It helps us verify who authors are. There's synthetic content detection, image manipulation detection, and a whole set of tools.
Speaker Change #142: Since <unk> and your confidence that we won't have additional similar issues going forward given the growing presence of fudge fraudulent research in and obviously the scope of the opportunity that youre seeing in Golar and gold road.
Speaker Change #143: Sure so.
Speaker Change #144: As Matt mentioned and we rent in the prepared remarks through a list of tools that we already have in production I have eight.
Speaker Change #145: AI tools in production right now that are built off the dataset that we acquired.
Speaker Change #145: During the last couple of years that would give us indications of where there might be for example paper mill activity. It helps us verify who authors are there synthetic content detection image manipulation detection, a whole set of tools and I think the way Matt described it is accurate we are a thought leader in this space based on hard won experience.
James Flynn: I think the way Matt described it is accurate. We are a thought leader in the space based on hard-won experience. We've already announced partnerships with one society and one publisher, the world's largest membership society for academics, that is, the IEEE, and another publisher, Sage, to pilot these tools on their systems, and we've got a lot of inbound interest as a result.
Speaker Change #146: <unk>, we've announced already partnerships with <unk>.
Speaker Change #146: <unk> Society, and one publisher of the world's largest membership society in academics.
Speaker Change #146: And that's the eye Tripoli and another publisher Sage to pilot these tools on their systems and we've got a lot of inbound interest as a result, I think as I've said before.
James Flynn: I think, as I've said before in my comments, this is an ecosystem challenge, and there's a mix of things happening between incentives, geographies, and the tools that we need to shore up our own processes are deployed now. Matt mentioned progress we're making with our new platform development. I'll point to that as another example of the work that we feel good about heading into Fiscal 25. Let me add a comment, Dan, just for color.
Speaker Change #146: My comments. This is an ecosystem challenge and there is a mix of things happening between incentives geographies.
Speaker Change #146: And the tools that meet that we need to shore up our own processes are deployed now Matt mentioned progress, we're making with our new platform development I'll point to that is another example of the work that we feel good about heading into fiscal 'twenty five yes, let me add a comment.
Matthew S. Kissner: This is a scale business. We'll be presented with over a million articles for candidates for publication today. The investments we're making in infrastructure and AI are critical for enabling us to take advantage of economies of scale here. Very helpful, Matt. And certainly, Jay, the color.
Speaker Change #147: And just for color you know this is a scale business will be presented with over $1 million.
Speaker Change #148: Articles for our candidates for publication today, so the investments, we're making in infrastructure and AI are critical for enabling us to take advantage of economies of scale here.
Matt: Very helpful. Matt.
Lindsay: Answer Lindsay the color.
Daniel Joseph Moore: Obviously, great to hear the interest in AI and machine learning. The 23 million dollar deal this quarter is really encouraging another 21 million dollar deal, you know, in early fiscal 25. I know it's hard to size the opportunity, but when you think about it generally, you know, has the lowest hanging, highest revenue fruit kind of been picked?
Speaker Change #150: Obviously, great to hear the interest in AI and machine learning continues to grow.
Speaker Change #151: The $23 million deal this quarter.
Speaker Change #152: Really encouraging another $21 million deal.
Speaker Change #153: In early 'twenty fiscal 'twenty five I know, it's hard to size the opportunity, but when you think about it generally.
Speaker Change #154: How has the lowest hanging highest revenue fruit kind of been picked.
Matthew S. Kissner: Do we think of these as relatively small toe-in-the-water type deals? You know, as you get your hands around the opportunity relative to what licensing could grow into. A couple of thoughts. This is Matt, and then I'll ask Jay to comment also.
Speaker Change #155: Do we think of these as relatively small toe in the water type deals.
Now as you get your hands around the opportunity relative to what licensing could grow into over time.
Speaker Change #156: A couple of thoughts.
Matt: This is Matt and then I'll ask Jay to comment also.
Matthew S. Kissner: We're at the beginning of a wave here, I think, and we're learning as we do this. We're approaching it very cautiously. Each deal is highly customized, but there is considerable interest. The question is, we want to pursue this on terms that are favorable to both us and the licensee, and so we're very cautious about structuring these deals in the most effective way to protect our future rights but still take advantage of the fact that the kind of content we have, which is, you know, fact-based, Indexed quality content, is very appealing to these LLM model builders.
Speaker Change #157: We're at the beginning of a wave here I think and we're learning as we do this we're approaching it very cautiously each.
Jay: Each deal is highly customized but there is considerable interest.
Matt: The question is we want to pursue this on terms that are favorable to both us and the licensee and so we're very cautious about structuring these deals in the most effective way to protect our.
Speaker Change #158: Our future rights, but still take advantage of the fact that the kind of content, we have which as you know.
Speaker Change #158: Fact, based indexed quality content is very appealing to these model builders.
Matthew S. Kissner: And the other desire we have is to convert these future deals into more of a recurring revenue arrangement than a one-time revenue arrangement. So I would say we're in the early days from a learning point of view, but there is considerable interest we're seeing. Let me ask Jay to end his comments.
Speaker Change #158: And the other desire we have is to convert these future deals into more of a recurring revenue arrangement that a one time revenue arrangements. So I would say we're in the early days from a learning point of view, but there is considerable interest we're seeing.
Speaker Change #158: Let me ask Jay to add his comments.
Jay: Fully aligned with that I think.
James Flynn: What we're seeing in the market is obviously interest from the big tech companies who are doing training. As Matt noted, that opportunity is substantial, and we're encouraged by it. But, as Matt noted, we're at the very beginning stages here of this revolution in information technology and information services. And we're well positioned, I think, to support the needs of various end markets who are building their own in-house tools to support, for example, drug discovery in life sciences, in chemistry, in oil and gas, in computer science, and engineering.
Speaker Change #159: What we're seeing in the market is obviously interest from.
Speaker Change #160: The Big Tech companies, who are doing training.
Speaker Change #160: Yes.
As Matt noted that.
Speaker Change #160: And that opportunity is substantial and where we're encouraged by it but as Matt noted there are at the very beginning stages here of.
Speaker Change #161: This revolution and information technology, and information services, and we are well positioned to I think to support the needs of various end markets, who are building their own in house tools to support for example, drug discovery and life Sciences, and chemistry, and oil and gas and.
Speaker Change #161: Computer Science and engineering week, we published some of the best material in the world on that and so one of the things we'll be focused on in fiscal 'twenty. Five is the information needs of those end markets as well as.
James Flynn: We publish some of the best material in the world on that. And so one of the things we'll be focused on at Fiscal 25 is the information needs of those end markets, as well as the continued development, as I mentioned earlier, of tools to support our own internal quality processes and product development.
Speaker Change #162: That continued development as I mentioned earlier of tools to support our own internal quality processes and product development.
Daniel Joseph Moore: Maybe switching gears a little bit, and this might be a little bit more Christina, but 90 of the 130 million run rate cost savings are now in action. I assume the remaining $40 million will fall in fiscal 2025, or most of that, is that fair? Yeah, hey, Dan, that's accurate.
Speaker Change #162: Perfect.
Speaker Change #163: Maybe switching gears, a little bit and this might be a little bit more christina but.
Speaker Change #164: <unk> 90 of the $130 million run rate.
Speaker Change #165: Cost savings now actions.
Speaker Change #166: I assume the remaining $40 million will fall in fiscal 'twenty, five or most of that is that fair.
Christina M. Van Tassell: We will have about 40 million actions in 25. That's ahead of schedule. And we are feeling really good about the momentum of that as well. You know, about half of that is corporate and organizational optimization. And about 40 of that is tech reduction in strategic business decisions. And the last part of that is just, you know, business operation optimization.
Speaker Change #167: Yeah, Hey, Dan.
Speaker Change #167: Accurate.
Speaker Change #168: Well have about 40 million accident and twenty-five that's ahead of schedule.
Speaker Change #169: We are feeling really good about and mentum off of that as well you know about half of that is.
Speaker Change #170: Is cooperating and organization optimization.
Christina M. Van Tassell: So these are trends that we were able to accelerate. And I know as we got more and more focused on what we were really spending our time and energy on, we were able to really execute that in a really effective way. Of the, I think you said 60 million was realized in fiscal 24, is that right? in here, yeah, in-ear. Um, and so the, the in-ear. Okay.
Dan: And about 40 of that is in tech reductions and strategic decisions in the last part of that is just in our business operation optimization. So these are trends that we are in.
Speaker Change #171: That we were able to accelerate.
Speaker Change #172: As we got more focused on what we are really spending our time and energy on we're able to relate to.
Speaker Change #172: To execute that in a really effective way.
Speaker Change #173: Very helpful and then.
Speaker Change #173: Of the.
Speaker Change #173: Okay.
Speaker Change #174: I think you said $60 million.
Speaker Change #175: Was realized in fiscal 'twenty four is that right.
Speaker Change #175: And year, yes.
Speaker Change #175: And year.
Speaker Change #175: And so the in year, Okay. So that.
Christina M. Van Tassell: Was half of that reinvested? In other words, I know half of the 130 will be ultimately reinvested. https://www.youtube.com. Approximately, yes. Yes. We're in the ballpark. So there's not a reinvestment is still to come or anything like that. Very helpful. And then the CapEx guide, $130 million this year, is that right? It's right. It's still, given the EBIDTA guide, um...
Speaker Change #175: Was half of that reinvested in other words I know half of the 130 will be ultimately reinvested, but.
Speaker Change #176: Is that ratio does that kind of hold in year versus what's to come.
Speaker Change #177: Approximately yeah.
Speaker Change #177: Yes.
Speaker Change #178: We're in the ballpark so does not.
Speaker Change #178: That reinvestment is still to come or anything like that okay.
Speaker Change #179: Very helpful. And then the Capex guide of $130 million. This year is that right.
That's right.
Speaker Change #179: And.
Speaker Change #179: It's still given the EBITDA guide.
Daniel Joseph Moore: I guess the punchline is $125 million in free cash this year. It seems potentially a little light to me even with the elevated CapEx. Maybe just talk about your working capital assumptions and whether they, Sure. We're still coming out of our transformation year, so we've got a couple things that we are grappling with in fiscal 25. One is the payment of our incentives for this fiscal 24, which is an elevated number because, if you recall, we talked about all year about how the year before, we had significantly reduced our incentive payments. You'll see the last of that coming through in 25. That's about $30 million.
125 million I guess, what I'm. The punch line is 125 million in free cash this year it seems potentially a little light to me even with the elevated capex.
Speaker Change #180: Maybe just talk about your working capital assumptions and whether there could be a little bit of conservatism built in.
Speaker Change #181: To that expectation.
Christina M. Van Tassell: Then we've got, obviously, the elevated CapEx versus this year, and then a couple other small things that are impacting that. However, we are seeing momentum as we come out of all those things, as we execute our strategy. We're going to continue to monitor this. I also want to just mention the Gen AI deal we talked about for the first half of fiscal 25, we are using a lot of those proceeds to redeploy back into the business, as Jay rightfully mentioned, to really want to make sure that we're seizing this opportunity, not just Gen AI, but also to drive harder on our research opportunity and our learning opportunity. Those are the broad strokes of what you're seeing in free cash flow, and that does not include potential cash. Payments from Dispositions. And no, it does not.
Sure. We felt like we are we're still coming out of our.
Speaker Change #181: Out of our.
Speaker Change #181: Transformation year. So we've got a couple of things that we are.
Speaker Change #182: Grappling within 25, one is is the payment of our incentives.
Speaker Change #182: Our next fiscal 'twenty, four which is an elevated number because if you recall, we talked about all year the year before we had.
Speaker Change #183: <unk> reduced our incentive payments work.
Speaker Change #183: The last of that coming through in 'twenty, five and that's about $30 million and then we've got obviously the elevated capex versus this year.
And then and then a couple of other small things that are just that are impacting that however, we are seeing we are seeing momentum.
Speaker Change #183: As we come out of Adderall.
Speaker Change #184: Out of all of those things are executing on our strategy and so we're going to continue continuing to monitor. This I also want to just mention on the there's any idea we talked that for the first half of fiscal 'twenty. Five we are using a lot of that a lot of those proceeds to redeploy back into the business as Jay rightfully mentioned Didnt really want to make sure that we're speaking with opera.
Speaker Change #185: Any not just NII, but also to drive harder on our research opportunity and are learning opportunity. So does it does it have that brought to us what you are seeing in free cash flow.
Speaker Change #186: Makes sense and that does not include potential cash payment.
Speaker Change #186: Payments from <unk>.
Speaker Change #187: Dispositions correct.
Speaker Change #188: And no that's not correct, Okay, and then lastly.
Daniel Joseph Moore: Okay, and then lastly, let's talk about capital allocation. Obviously, you picked up the pace on buybacks, you know, free cash flow, which we'll pick up this year but then should really accelerate in fiscal 26. Given the stickiness of your model, are you likely to use it?
Speaker Change #189: You talked about capital allocation.
Speaker Change #190: <unk> picked up the pace on buybacks, you know free cash flow.
Speaker Change #191: We will pick up this year, but then should really accelerate in fiscal 'twenty six and given the stickiness of your model are you likely to be increase.
Christina M. Van Tassell: you know increasingly ingress, Please talk about your priorities for capital allocation. Yeah, yeah, sure. So, you know, we're going to continue to respond to opportunities for capital deployment and strategy as we go. You did see us increasing our share purchases, and rightfully so, you know, and that was even during this muted cash period. We're going to continue looking at different things as our free cash flow climbs back up towards our normal. I'll call it steady state.
Speaker Change #191: Increasingly aggressive in terms of buying back shares given the comfortable leverage or.
Just talk about your priorities for capital allocation for the next 12 to 24 months and thanks for all the color.
Speaker Change #192: Yeah, Yeah sure. So you know we're going to continue to respond to opportunities.
Speaker Change #193: For capital planning and strategy I think you did see us increasing our share purchases purchasers and rightfully so.
Speaker Change #193: And that was even doing less immediate cash period, where we're going to continue looking at different things as our free cash flow climbs back up towards our normal I'll call it steady state.
Christina M. Van Tassell: And we do have a very intricate repurchase plan that will monitor our volatility and our stock price as we go and capitalize on that as we see what our capital deployment needs are versus the market. So we feel really good about that, actually. Okay, very good, congrats. Obviously, on all the progress this year.
Speaker Change #194: We do have a very.
Speaker Change #195: Gary our inter kit.
Speaker Change #196: Oh, the purchase plan that will monitor of volatility in our stock price as we go and capitalize capitalize on that as we as we see them.
Speaker Change #197: See what are our capital appointment needs are versus the market.
Speaker Change #198: So we feel really.
Speaker Change #199: Really good about that actually yeah.
Speaker Change #199: Okay.
Speaker Change #200: Very good congrats on obviously all the progress this year.
Speaker Change #201: And look.
Daniel Joseph Moore: We look forward to catching up soon. Thank you. Thank you, Dan. Again, for any questions, press star 1 on your telephone keypad, and your next question will come from the line of Nick Dempsey with Barclays. Please go ahead. Yeah, good morning, guys. Just about the AI deals. I wonder if you can tell us, is it your book backlist content that is being digested and absorbed rather than your journal?
Speaker Change #202: I look forward to catching up soon thanks again.
Speaker Change #203: Thank you thank you Dan.
Speaker Change #203: Again for any questions Press star one on your telephone keypad and our next question will come from the line of Nick Dempsey with Barclays. Please go ahead.
Yes. Good morning, guys just about the AI deals I Wonder if you can tell US is it your book backlist content that is being digested absorbed rather than New York journals.
Nick Dempsey: I'm sorry if I missed that. And the second question, in terms of how many other people out there who are interested in paying money for this? Are we talking a handful more, or could it be 10 plus?
Speaker Change #204: Sorry, if I missed that.
Speaker Change #205: And the second question in terms of how many other people out there who are interested in paying money for this are we talking a handful more or could it be 10 plus.
Matthew S. Kissner: It's Matt. I'll begin and then ask Jay to fill in any blanks I've left. So it is book content at this point. And in terms of interest, you know, obviously it's a concentration of the tech companies can, today it's a concentration of the tech companies who can afford to build the large language models, which are very expensive to develop.
Matt: It's Matt I'll begin and then ask Jay to fill in any blanks left so it's it is book content at this point.
Matt: And.
Matt: And the in terms of interest.
Speaker Change #206: You know obviously, it's it's a concentration of the tech companies Kendall today, its a concentration of the tech companies, who can afford to build the large language models, which are very expensive to develop however.
Matthew S. Kissner: However, there are extensions of this as companies look to tailor these models to their particular markets. So there are potential markets, for example, let's say in pharmaceuticals, where a pharmaceutical company might want to augment the model with very specific training data that fits its particular market needs. So, you know, again, as I said, it's early days as this market is developing, but there will be, I believe, extensions as people look to augment the large language models. Jay, do you want to embellish on that?
Jay: There are extensions of this as companies look to tailor. These market these models to their particular markets.
Jay: So there is a potential markets for example, let's say in pharmaceutical where a pharmaceutical company might want to.
Jay: Augment the model with very specific training data that fits its particular market needs. So.
Speaker Change #207: Again as I said, it's early days as this market is developing but there will be I believe extensions as people look to augment the large language models, Jay do you want to embellish on that.
James Flynn: I'd be happy to add a little bit more color, Matt, but I think you nailed it. First of all, a great question. And we're encouraged by the interest that we're seeing. We're getting inbound interest from a variety of sectors, as Matt described. And I just want to reiterate that this is something we're approaching on a deal by deal basis where, fundamentally, we are in the right business in many ways. And so this is well-trodden ground for us in terms of negotiating these kinds of agreements.
Jay: Happy to add a little bit more color, Matt, but I think you know that.
Speaker Change #208: First of all Great question, and where we're encouraged by the interest that we're seeing where we're getting inbound interest.
Matt: From a variety of sectors as as Matt described.
And I just want to reiterate that this is something we're approaching on a deal by deal basis, where.
Matt: We are in fundamentally we are in.
Matt: The writes business in many ways and so this is well trodden ground for us in terms of.
James Flynn: But AI is a new frontier, and the opportunities that AI presents us with, as Christina mentioned, they give us an opportunity to reinvest in our core, as well as grow our own internal AI capabilities. So I don't want to characterize in terms of numbers the size of the current interest.
Speaker Change #209: Negotiating these kinds of agreements, but AI is a new frontier and and the opportunities that AI presents us with.
Speaker Change #209: As as Kristina mentioned that gives us an opportunity to reinvest in our core.
Speaker Change #210: As well as grow our own internal AI capabilities. So I don't want to characterize in terms of numbers.
James Flynn: But as a high-quality information services provider in the disciplines that drive the global economy, we feel very well positioned to be a provider of content, tools, and services related to the AI opportunity. Thanks. Can I just tack on a quick follow-up? Would you ever think of doing this with your journal content, or is that more complicated by the monetization model for journals, the relationship with authors, etc.? Let me stress that these deals, none of these deals are what I would characterize as simple, right?
Speaker Change #210: The size of of the current interest, but as a high quality information services provider in the disciplines that drive.
Speaker Change #210: The global economy, we feel very well positioned.
Speaker Change #211: To be a provider of <unk>.
Speaker Change #211: Content tools and services related to.
Speaker Change #212: To the opportunity.
Thanks can I just tack on a quick follow up would you ever think of doing this with your journal content or is that more complicated by the monetization model for journals relationship with authors et cetera.
Speaker Change #212: So.
Speaker Change #213: Let me stress that these deals none of these deals are what I would characterize as simple IV and are in the book World and the journal World in the database World We were.
James Flynn: In the book world, in the journal world, and in the database world, we were very clear that we have to exercise diligence and we have to be very clear on rights and things like that. What I will say is that there will be opportunities for us to explore licensing both journal and book content. Journal content is increasingly relevant in the AI context for the markets that Matt just mentioned, you know, and in the context of large corporate R&D, in the context of engineering, physics, and medicine.
Speaker Change #213: Very clear that we have to exercise diligence and we have to we have to be very clear on on rights and things like that what what I will say is that there will be opportunities for us to <unk>.
Speaker Change #213: Floor licensing both journal and book content.
Speaker Change #214: Journal content is.
Speaker Change #215: Increasingly relevant in the in the context for the markets at that Matt just mentioned.
Speaker Change #215: In the context of.
Speaker Change #215: Large corporate R&D in the context of.
Speaker Change #215: Yeah.
Speaker Change #216: Engineering and physics Madison.
James Flynn: And so, you know, when those opportunities present themselves, we'll explore them. A lot of these companies buy our content already. And so one of the things they're certainly interested in, and we're certainly interested in, is talking to them about acquiring rights to use that content in ways that are integrated into their own AI programs. And, of course, as I said before, we have opportunities to use AI to develop our own products and services there too.
Speaker Change #216: And so.
Speaker Change #216: When those opportunities present themselves, we will explore a lot of these companies by our content already.
Speaker Change #217: And so one of the things, they're certainly interested in and we're certainly interested in us talking to them about acquiring rights to use that content in ways.
Speaker Change #217: That.
Speaker Change #217: Our.
Speaker Change #217: Integrated into their own AI programs and of course as I said before we have opportunities to use AI to develop our own products and services there too.
Nick Dempsey: Thank you. That's very clear. Thank you. And there are no further questions at this time. I'll hand the call back over to Matt Kissner for any closing remarks. Thank you for joining us on the call today, and we look forward to sharing more progress on our Q1 Learnings Call in September. Thank you. Have a great day. That will conclude today's meeting. Thank you all for joining. You may now disconnect.
Speaker Change #218: Thank you that's very clear.
Speaker Change #219: Thank you.
Speaker Change #219: Okay.
Speaker Change #219: And there are no further questions at this time I'll hand, the call back over to Matt Kissner for any closing remarks.
Matthew S. Kissner: Thank you for joining us is joining the call today and we look forward to sharing more more progress on our Q1 earnings call in September. Thank you have a great day.
Speaker Change #220: That will conclude today's meeting. Thank you all for joining you may now disconnect.
Speaker Change #220: [music].