Page Consolidated Statements of Operations for the years ended May 31, 2026, 2025 and 2024 38 Consolidated Statements of Comprehensive Income (Loss) for the years ended May 31, 2026, 2025 and 2024 39 Consolidated Balance Sheets at May 31, 2026 and 2025 40 Consolidated Statement of Changes in Stockholders’ Equity for the years ended May 31, 2026, 2025 and 2024 41 Consolidated Statements of Cash Flows for the years ended May 31, 2026, 2025 and 2024 42 Notes to Consolidated Financial Statements 44 Reports of Independent Registered Public Accounting Firm (PCAOB ID: 42) 88 Supplementary Financial Information - Summary of Quarterly Results of Operations 91 The following consolidated financial statement schedule for the years ended May 31, 2026, 2025 and 2024 is filed with this annual report on Form 10-K: Schedule II — Valuation and Qualifying Accounts and Reserves S-1 All other schedules have been omitted since the required information is not present or is not present in amounts sufficient to require submission of the schedule, or because the information required is included in the Consolidated Financial Statements or the Notes thereto. 37 Consolidated Statements of Operations (Amounts in millions, except per share data) For fiscal years ended May 31, 2026 2025 2024 Revenues $ 1,581.9 $ 1,625.5 $ 1,589.7 Operating costs and expenses Cost of goods sold 689.8 718.8 705.1 Selling, general and administrative expenses 807.2 822.3 803.0 Depreciation and amortization 58.8 65.7 57.1 Asset impairments and write downs 10.9 2.9 10.0 Total operating costs and expenses 1,566.7 1,609.7 1,575.2 Operating income (loss) 15.2 15.8 14.5 Interest income 2.9 2.2 4.6 Interest expense (14.1) (18.2) (1.9) Other components of net periodic benefit (cost) (1.3) (1.1) (1.0) Loss on sale of investments (17.2) — — Gain on sale and leaseback transactions 99.7 — — Earnings (loss) before income taxes 85.2 (1.3) 16.2 Provision (benefit) for income taxes 28.5 0.6 4.1 Net income (loss) $ 56.7 $ (1.9) $ 12.1 Basic and diluted earnings (loss) per share of Class A and Common Stock Basic: Net Income (loss) $ 2.39 $ (0.07) $ 0.41 Diluted: Net Income (loss) $ 2.34 $ (0.07) $ 0.40 Dividends declared per share of Class A and Common Stock $ 0.80 $ 0.80 $ 0.80 See accompanying notes 38 Consolidated Statements of Comprehensive Income (Loss) (Amounts in millions) For fiscal years ended May 31, 2026 2025 2024 Net income (loss) $ 56.7 $ (1.9) $ 12.1 Other comprehensive income (loss), net: Foreign currency translation adjustments 8.2 10.9 3.1 Pension and postretirement adjustments, net of tax (2.6) 0.1 0.2 Total other comprehensive income (loss) $ 5.6 $ 11.0 $ 3.3 Comprehensive income (loss) $ 62.3 $ 9.1 $ 15.4 See accompanying notes 39 Consolidated Balance Sheets (Amounts in millions) Balances at May 31, ASSETS 2026 2025 Current Assets: Cash and cash equivalents $ 134.9 $ 124.0 Accounts receivable, net 236.4 273.4 Inventories, net 265.0 250.2 Income tax receivable 28.4 8.8 Tax credit receivable 19.3 21.0 Prepaid expenses and other current assets 37.3 47.9 Total current assets 721.3 725.3 Noncurrent Assets: Property, plant and equipment, net 201.6 516.3 Prepublication costs, net 41.1 49.7 Investment in film and television programs, net 40.4 42.1 Operating lease right-of-use assets, net 291.2 103.9 Royalty advances, net 64.6 78.1 Goodwill 199.4 198.9 Other intangible assets, net 77.9 87.9 Noncurrent deferred income taxes 31.8 34.7 Other assets and deferred charges 58.8 113.2 Total noncurrent assets 1,006.8 1,224.8 Total assets $ 1,728.1 $ 1,950.1 LIABILITIES AND STOCKHOLDERS’ EQUITY Current Liabilities: Lines of credit and current portion of long-term debt $ 5.5 $ 6.2 Film related obligations 17.1 18.3 Accounts payable 144.2 157.3 Accrued royalties 50.3 69.1 Deferred revenue 179.2 178.8 Other accrued expenses 158.1 166.2 Accrued income taxes 4.7 3.7 Operating lease liabilities 26.4 26.8 Total current liabilities 585.5 626.4 Noncurrent Liabilities: Long-term debt 75.0 250.0 Operating lease liabilities 280.6 91.5 Other noncurrent liabilities 36.2 35.7 Total noncurrent liabilities 391.8 377.2 Commitments and Contingencies: — — Stockholders’ Equity: Preferred Stock, $1.00 par value: Authorized, 2.0 shares; Issued and Outstanding, none $ — $ — Class A Stock, $0.01 par value: Authorized, 3.2 shares; Issued and Outstanding, 0.8 shares. 0.0 0.0 Common Stock, $0.01 par value: Authorized, 70.0 shares; Issued, 42.9 shares; Outstanding, 17.9 and 24.2 shares, respectively 0.4 0.4 Additional paid-in capital 602.5 607.1 Accumulated other comprehensive income (loss) (35.9) (41.5) Retained earnings 1,037.6 999.7 Treasury stock at cost: 25.0 and 18.7 shares, respectively (853.8) (619.2) Total stockholders’ equity 750.8 946.5 Total liabilities and stockholders’ equity $ 1,728.1 $ 1,950.1 See accompanying notes 40 Consolidated Statement of Changes in Stockholders’ Equity (Amounts in millions) Class A Stock Common Stock Additional Paid-in Capital Accumulated Other Comprehensive Income (Loss) Retained Earnings Treasury Stock At Cost Total Stockholders' Equity of Scholastic Corporation Noncontrolling Interest Total Stockholders' Equity Shares Amount Shares Amount Balance at May 31, 2023 1.7 $ 0.0 30.0 $ 0.4 $ 632.2 $ (55.8) $ 1,035.6 $ (449.5) $ 1,162.9 $ 1.6 $ 1,164.5 Net Income (loss) — — — — — — 12.1 — 12.1 — 12.1 Foreign currency translation adjustment — — — — — 3.1 — — 3.1 — 3.1 Pension and post-retirement adjustments (net of tax of $0.2) — — — — — 0.2 — — 0.2 — 0.2 Stock-based compensation — — — — 11.0 — — — 11.0 — 11.0 Proceeds pursuant to stock-based compensation plans — — — — 6.5 — — — 6.5 — 6.5 Purchases of treasury stock at cost — — (4.0) — — — — (156.8) (156.8) — (156.8) Treasury stock issued pursuant to equity-based plans — — 0.5 — (16.0) — — 19.6 3.6 — 3.6 Dividends — — — — — — (24.0) — (24.0) — (24.0) Other (share conversion) (0.9) — 0.9 — (28.6) — — 28.6 — — — Other (noncontrolling interest) — — — — (0.5) — — — (0.5) (1.6) (2.1) Balance at May 31, 2024 0.8 $ 0.0 27.4 $ 0.4 $ 604.6 $ (52.5) $ 1,023.7 $ (558.1) $ 1,018.1 $ — $ 1,018.1 Net Income (loss) — — — — — — (1.9) — (1.9) — (1.9) Foreign currency translation adjustment — — — — — 10.9 — — 10.9 — 10.9 Pension and post-retirement adjustments (net of tax of $0.2) — — — — — 0.1 — — 0.1 — 0.1 Stock-based compensation — — — — 9.3 — — — 9.3 — 9.3 Proceeds pursuant to stock-based compensation plans — — — — (0.4) — — — (0.4) — (0.4) Purchases of treasury stock at cost — — (3.5) — — — — (70.9) (70.9) — (70.9) Treasury stock issued pursuant to equity-based plans — — 0.3 — (6.4) — — 9.8 3.4 — 3.4 Dividends — — — — — — (22.1) — (22.1) — (22.1) Balance at May 31, 2025 0.8 $ 0.0 24.2 $ 0.4 $ 607.1 $ (41.5) $ 999.7 $ (619.2) $ 946.5 $ — $ 946.5 Net Income (loss) — — — — — — 56.7 — 56.7 — 56.7 Foreign currency translation adjustment — — — — — 8.2 — — 8.2 — 8.2 Pension and post-retirement adjustments (net of tax of $0.3) — — — — — (2.6) — — (2.6) — (2.6) Stock-based compensation — — — — 8.5 — — — 8.5 — 8.5 Proceeds pursuant to stock-based compensation plans — — — — 17.8 — — — 17.8 — 17.8 Purchases of treasury stock at cost — — (7.3) — — — — (268.6) (268.6) — (268.6) Treasury stock issued pursuant to equity-based plans — — 1.0 — (30.9) — — 34.0 3.1 — 3.1 Dividends — — — — — — (18.8) — (18.8) — (18.8) Balance at May 31, 2026 0.8 $ 0.0 17.9 $ 0.4 $ 602.5 $ (35.9) $ 1,037.6 $ (853.8) $ 750.8 $ — $ 750.8 See accompanying notes 41 Consolidated Statements of Cash Flows (Amounts in millions) Years ended May 31, 2026 2025 2024 Cash flows - operating activities: Net income (loss) $ 56.7 $ (1.9) $ 12.1 Adjustments to reconcile Net income (loss) to net cash provided by (used in) operating activities: Provision for losses on accounts receivable 6.5 5.0 5.2 Provision for losses on inventory 8.9 16.1 20.4 Provision for losses on royalty advances 6.2 5.7 2.7 Amortization of prepublication costs 21.6 21.9 26.2 Amortization of film and television programs 11.9 9.9 — Depreciation and amortization 71.8 78.5 67.0 Amortization of pension and postretirement plans 0.8 0.5 0.4 Deferred income taxes 3.6 (19.7) (1.9) Stock-based compensation 8.5 9.3 11.0 Income from equity method investments (0.3) (0.5) (0.5) Loss on sale of investments 17.2 — — Non cash write off related to asset impairments and write downs 10.9 2.9 10.0 Gain on sale and leaseback transactions (99.7) — — Changes in assets and liabilities, net of amounts acquired: Accounts receivable 31.4 (26.7) 38.2 Inventories (22.5) (2.8) 50.9 Income tax receivable (19.6) 6.8 (6.3) Tax credit receivable 1.6 10.6 — Prepaid expenses and other current assets 7.4 4.1 (1.7) Investment in film and television programs (12.1) (12.5) — Royalty advances 7.6 (25.8) (3.4) Employee benefit plan contribution (8.6) — — Accounts payable (13.8) 15.5 (32.5) Accrued royalties (19.4) 13.3 (4.5) Deferred revenue (0.1) 7.5 (8.1) Other accrued expenses (10.5) (1.5) (10.3) Accrued income taxes 1.0 1.7 (11.5) Other, net (16.1) 6.3 (8.8) Net cash provided by (used in) operating activities 50.9 124.2 154.6 Cash flows - investing activities: Prepublication expenditures (17.9) (24.5) (22.8) Additions to property, plant and equipment (48.4) (52.2) (58.4) Net proceeds from sale and leaseback transactions 452.4 — — Net proceeds from sale of investments 19.4 — — Return of capital from investments 0.3 — — Acquisition-related payments — (176.2) (6.4) Purchase of noncontrolling interests — — (2.1) Net cash provided by (used in) investing activities 405.8 (252.9) (89.7) See accompanying notes 42 Consolidated Statements of Cash Flows (Amounts in millions) Years ended May 31, 2026 2025 2024 Cash flows - financing activities: Borrowings under lines of credit, credit agreement and revolving loan 234.3 305.9 54.1 Repayments of lines of credit, credit agreement and revolving loan (409.8) (57.4) (54.1) Borrowings under film related obligations 17.5 16.5 — Repayments of film related obligations (including interests) (18.5) (34.8) — Repayment of capital lease obligations (2.1) (1.7) (2.3) Reacquisition of common stock (265.9) (70.0) (158.2) Proceeds pursuant to stock-based compensation plans 18.6 1.2 9.1 Payment of dividends (20.0) (22.6) (24.7) Other, net (0.1) 0.2 — Net cash provided by (used in) financing activities (446.0) 137.3 (176.1) Effect of exchange rate changes on cash and cash equivalents 0.2 1.7 0.4 Net increase (decrease) in cash and cash equivalents 10.9 10.3 (110.8) Cash and cash equivalents at beginning of period 124.0 113.7 224.5 Cash and cash equivalents at end of period $ 134.9 $ 124.0 $ 113.7 2026 2025 2024 Supplemental Information: Cash paid for income taxes, net of refunds $ 43.4 $ 2.0 $ 23.7 Cash paid for interest 15.2 18.3 2.2 See accompanying notes 43 Notes to Consolidated Financial Statements (Amounts in millions, except share and per share data) 1. DESCRIPTION OF THE BUSINESS, BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Description of the business Scholastic Corporation (the “Corporation” and together with its subsidiaries, “Scholastic” or the “Company”) is the world’s largest publisher and distributor of children’s books, a leading provider of print and digital instructional materials for grades pre-kindergarten ("pre-K") to grade 12 and a producer of entertaining literary and educational children’s media. The Company creates quality books and ebooks, print and technology-based learning materials and programs, classroom magazines and other products that, in combination, offer schools, as well as parents and children, customized and comprehensive solutions to support children’s learning and reading both at school and at home. Since its founding in 1920, Scholastic has emphasized quality products and a dedication to reading, learning and literacy. The Company is the leading operator of school-based book club and book fair proprietary channels. It distributes its products and services through these channels, as well as directly to schools and libraries, through retail stores and through the internet. The Company’s website, scholastic.com, is a leading site for teachers, classrooms and parents and an award-winning destination for children. Scholastic has operations in the United States and throughout the world including Canada, the United Kingdom, Ireland, Australia, New Zealand and Asia and, through its export business, sells products in approximately 145 international locations. Basis of presentation Principles of consolidation The Consolidated Financial Statements include the accounts of Scholastic Corporation (the “Corporation”) and all wholly-owned and majority-owned subsidiaries (collectively, “Scholastic” or the “Company”). The Company reviews its relationships with other entities to identify whether it is the primary beneficiary of a variable interest entity (“VIE”). If the determination is made that the Company is the primary beneficiary, then the entity is consolidated. Intercompany transactions are eliminated in consolidation. The Company’s fiscal year is not a calendar year. Accordingly, references in this document to fiscal 2026 relate to the twelve-month period ended May 31, 2026. Certain prior period amounts have been reclassified to conform with the current year presentation. Noncontrolling Interest On June 1, 2023, the Company acquired the remaining shares of Make Believe Ideas Limited ("MBI"), a UK-based children's book publishing company, which represented a 5.0% noncontrolling interest, increasing the Company's total ownership from 95.0% to 100%. Prior to June 1, 2023, the founder and chief executive officer of MBI retained a 5.0% noncontrolling ownership interest in MBI. The Company fully consolidated MBI as of the acquisition date and the 5.0% noncontrolling interest was classified within stockholder's equity. Use of estimates The Company’s Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States ("U.S. GAAP"). The preparation of these financial statements involves the use of estimates and assumptions by management, which affects the amounts reported in the Consolidated Financial Statements and accompanying notes. The Company bases its estimates on historical experience, current business factors and various other assumptions believed to be reasonable under the circumstances, all of which are necessary in order to form a basis for determining the carrying values of assets and liabilities. Actual results may differ from those estimates and assumptions. On an ongoing basis, the Company evaluates the adequacy of its reserves and the estimates used in calculations, including, but not limited to: •Accounts receivable allowance for credit losses •Pension and other postretirement benefit obligations •Uncertain tax positions 44 •The timing and amount of future income taxes and related deductions •Inventory reserves •Cost of goods sold from book fair operations during interim periods based on estimated gross profit rates •Sales tax contingencies •Royalty advance reserves and royalty expense accruals •Expected economic useful life and recoverability of film and television program assets and prepublication costs •Impairment assessment of goodwill, intangibles and other long-lived assets •Assets and liabilities acquired in business combinations •Variable consideration related to anticipated returns •Allocation of transaction price to contractual performance obligations •Incremental borrowing rate used to determine the present value of future lease payments and related lease liabilities Summary of Significant Accounting Policies Revenue recognition The Company’s revenue recognition policies for its principal businesses are as follows: School-Based Book Clubs – Revenue from school-based book clubs is recognized upon shipment of the products. School-Based Book Fairs – Revenues associated with school-based book fairs relate to the sale of children's books and other products to book fair sponsors. In addition, the Company employs an incentive program to encourage the sponsorship of book fairs and increase the number of fairs held each school year. The Company identifies two potential performance obligations within its school-based book fair contracts, which include the fulfillment of book fairs product and the fulfillment of product upon the redemption of incentive program credits by customers. The Company allocates the transaction price to each performance obligation and recognizes revenue at a point in time. The Company utilizes certain estimates based on historical experience, redemption patterns and future expectations related to the participation in the incentive program to determine the relative fair value of each performance obligation when allocating the transaction price. Changes in these estimates could impact the timing of the recognition of revenue. Revenue allocated to the book fairs product is recognized at the point at which product is delivered to the customer and control is transferred. The revenue allocated to the incentive program credits is recognized upon redemption of incentive credits and the transfer of control of the redeemed product. Incentive credits are generally redeemed within 12 months of issuance. Payment for school-based book fairs product is due at the completion of a customer's fair. Revenues associated with virtual fairs are recognized upon shipment of the products and related incentive program credits are expensed upon issuance. Trade – Revenue from the sale of children’s books for distribution in the retail channel is primarily recognized when performance obligations are satisfied and control is transferred to the customer, or when the product is on sale and available to the public. For newly published titles, the Company, on occasion, contractually agrees with its customers when the publication may be first offered for sale to the public, or an agreed upon “Strict Laydown Date." For such titles, the control of the product is not deemed to be transferred to the customer until such time that the publication can contractually be sold to the public, and the Company defers revenue on sales of such titles until such time as the customer is permitted to sell the product to the public. Revenue for ebooks, which is generally the net amount received from the retailer, is recognized upon electronic delivery to the customer by the retailer. The sale of trade product generally includes a right of return. Education – Revenue from the sale of educational materials is recognized upon shipment of the products, or upon acceptance of product by the customer, depending on individual contractual terms. Revenue from digital products is deferred and recognized ratably over the subscription period. Revenue from professional development services is recognized when the services have been provided to the customer. Revenue from contracts with multiple deliverables are recognized as each performance obligation is satisfied in which the transaction price is allocated on a relative standalone selling price basis. Magazines – Revenue is deferred and recognized ratably over the subscription period, as the magazines are delivered. Film and TV production – Revenue is deferred during production and recognized at a point in time when the film or episodes have been delivered and are available for showing or exploitation. 45 Production services – Revenue is recognized over time using the percentage-of-completion method based on the proportion of costs incurred in the current period to total expected costs as this depicts the transfer of control of the promised services or goods to the customer. Licensing and royalty income – Revenue from the sale or granting of broadcast license rights to third parties is recognized when the licensed content is available to the customer and the customer has the contractual right to broadcast or stream the content. Revenue from sales and usage-based royalties related to licenses is generally recognized when the subsequent sale or usage occurs. Export – Revenue from the export channel is recognized upon acceptance of the physical product by the customer. The Company has elected to present sales and other related taxes on a net basis, excluded from revenues, and as such, these are included within Other accrued expenses until remitted to taxing authorities. Cash equivalents Cash equivalents consist of short-term investments with original maturities of three months or less. Accounts receivable Accounts receivable are recognized net of an allowance for credit losses. In the normal course of business, the Company extends credit to customers that satisfy predefined credit criteria. The Company recognizes an allowance for credit losses on trade receivables that are expected to be incurred over the lifetime of the receivable. Reserves for estimated credit losses are established at the time of sale and are based on relevant information about past events, current conditions, and supportable forecasts impacting its ultimate collectability, including specific reserves on a customer-by-customer basis, creditworthiness of the Company’s customers and prior collection experience. At the time the Company determines that a receivable balance, or any portion thereof, is deemed to be permanently uncollectible, the balance is then written off. Accounts receivable allowance for credit losses was $11.0 as of May 31, 2026 and 2025. Estimated returns For sales that include a right of return, the Company estimates the transaction price and records revenues as variable consideration based on the amounts the Company expects to ultimately be entitled. In order to determine estimated returns, the Company utilizes historical return rates, sales patterns, types of products and expectations and recognizes a corresponding reduction to Revenues and Cost of goods sold. Management also considers patterns of sales and returns in the months preceding the fiscal year, as well as actual returns received subsequent to the fiscal year, available customer and market specific data and other return rate information that management believes is relevant. In addition, a refund liability is recorded within Other accrued expenses for the consideration to which the Company believes it will not ultimately be entitled and a return asset is recorded within Prepaid expenses and other current assets for the expected inventory to be returned. Actual returns could differ from the Company's estimate. Inventories Inventories, consisting principally of books, are stated at the lower of cost, using the first-in, first-out method, or net realizable value. The Company records a reserve for excess and obsolete inventory based upon a calculation using the expected future sales of existing inventory driven by estimates around forecasted purchases, inventory consumption costs, and the sell-through rate of current fiscal year purchases. In accordance with the Company's inventory retention policy, expected future sales of existing inventory are compared against historical usage by channel for reasonableness and any specifically identified excess or obsolete inventory, due to an anticipated lack of demand, will also be reserved. Property, plant and equipment Property, plant and equipment are stated at cost. Depreciation and amortization are recognized on a straight-line basis over the estimated useful lives of the assets. Buildings have an estimated useful life, for purposes of depreciation, of forty years. Building improvements are depreciated over the life of the improvement which typically does not exceed twenty-five years. Capitalized software, net of accumulated amortization, was $52.4 and $51.8 at May 31, 2026 and 2025, respectively. Capitalized software is amortized over a period of three to ten years. Amortization expense for capitalized software was $21.9, $23.0 and $25.1 for the fiscal years ended May 31, 2026, 2025 and 2024, respectively. Furniture, fixtures and equipment are depreciated over periods not exceeding ten years. Leasehold improvements are amortized over the life of the lease or the life of the assets, whichever is shorter. The Company assesses the estimated 46 useful lives of property, plant and equipment and evaluates potential impairment when events or circumstances indicate that the carrying value may not be recoverable. Cloud Computing Arrangements The Company incurs costs to implement cloud computing arrangements that are hosted by a third party vendor. Implementation costs incurred during the application development stage are capitalized and amortized over the term of the hosting arrangement on a straight-line basis. The Company capitalized $8.2 and $9.8 of costs incurred in fiscal 2026 and 2025, respectively, to implement cloud computing arrangements, primarily related to digital and consumer data platforms. These amounts are included within Other assets and deferred charges on the Company's Consolidated Balance Sheets. Leases The Company's lease arrangements primarily relate to corporate offices and warehouse facilities, and to a lesser extent, certain equipment and other assets. The Company's leases generally have initial terms ranging from 3 to 10 years, except for the leases associated with its headquarters and primary distribution facility, which have initial terms of 15 years and 20 years, respectively. Certain leases include renewal or early-termination options, rent escalation clauses, and/or lease incentives. Lease renewal rent payment terms generally reflect adjustments for market rates prevailing at the time of renewal. The Company's leases require fixed minimum rent payments and also often require the payment of certain other costs that do not relate specifically to its right to use an underlying leased asset, but are associated with the asset, such as real estate taxes, insurance, common area maintenance fees and/or certain other costs (referred to collectively herein as "non-lease components"), which may be fixed or variable in amount depending on the terms of the respective lease agreement. The Company's leases do not contain significant residual value guarantees or restrictive covenants. The Company determines whether an arrangement contains a lease at the inception of the arrangement. If a lease is determined to exist, the term of such lease is assessed based on the date on which the underlying asset is made available for the Company's use by the lessor. The Company's assessment of the lease term reflects the non-cancelable term of the lease, inclusive of any rent-free periods and/or periods covered by early-termination options which the Company is reasonably certain of not exercising, as well as periods covered by renewal options which the Company is reasonably certain of exercising. The Company also determines lease classification as either operating or finance at lease commencement, which governs the pattern of expense recognition and the presentation reflected in the Consolidated Statements of Operations over the lease term. For leases with a term exceeding 12 months, a lease liability is recorded on the Company's Consolidated Balance Sheet at lease commencement reflecting the present value of its fixed minimum payment obligations over the lease term. A corresponding right-of-use ("ROU") asset equal to the initial lease liability is also recorded, adjusted for any prepaid rent and/or initial direct costs incurred in connection with execution of the lease and reduced by any lease incentives received. The Company elects, by asset class, to account for lease and non-lease components as a single lease component and, accordingly, includes fixed payments associated with non-lease components in the measurement of ROU assets and lease liabilities for all classes of underlying assets, except its corporate headquarters lease. ROU assets associated with finance leases are presented separate from ROU assets associated with operating leases and are included within Property, plant and equipment, net on the Company's Consolidated Balance Sheet. For purposes of measuring the present value of its fixed payment obligations for a given lease, the Company uses its incremental borrowing rate, determined based on information available at lease commencement, as rates implicit in its leasing arrangements are typically not readily determinable. The Company's incremental borrowing rate reflects the rate it would pay to borrow on a secured basis, and incorporates the term and economic environment of the associated lease. For operating leases, fixed lease payments are recognized as lease expense on a straight-line basis over the lease term. For finance leases, the initial ROU asset is depreciated on a straight-line basis over the lease term, along with recognition of interest expense associated with accretion of the lease liability, which is ultimately reduced by the related fixed payments. For leases with a term of 12 months or less, any fixed lease payments are recognized on a straight-line basis over the lease term, and are not recognized on the Company's Consolidated Balance Sheet. Variable lease costs for both operating and finance leases, if any, are recognized as incurred. Sublease rental income is recognized on a straight-line basis over the duration of each lease term. To the extent expected sublease income is less than expected rental payments, the Company recognizes a loss on the difference based on the present value of the minimum lease payments under each lease. Lease payments received are presented as Revenues in the Consolidated Statements of Operations. 47 Prepublication costs Prepublication costs are incurred in all of the Company’s reportable segments. Prepublication costs include costs incurred to create the art, prepress, editorial, digital conversion and other content required for the creation of the master copy of a book or other media. Prepublication costs are amortized on a straight-line basis over a two-to-five-year period based on expected future revenues. The Company regularly reviews the recoverability of these capitalized costs based on expected future cash flows. Investment in film and television programs Investments in film and television programs are stated at the lower of cost or net realizable value. Investment in film and television programs includes all direct production and financing costs incurred during production and minimum guarantee payments made to acquire distribution rights. Interest costs are capitalized to the cost of the film or television program until substantially all of the activities required for delivery are complete. Investments in film and television programs are amortized using the declining-balance method with rates ranging from 50% to 90% at the time of initial episodic delivery and at rates ranging from 10% to 25% annually thereafter. The determination of the rates is based on the expected economic useful life of the film or television program and includes factors such as rights retained by the Company, the availability of rights to renew licenses for episodic television programs in various territories, and the availability of secondary market revenue. The Company regularly reviews the recoverability of these capitalized costs based on expected future cash flows for an individual film or television program. Government financing and assistance The Company has access to government programs and tax credits that are designed to assist film, television and digital media production and distribution. Amounts received and amounts receivable which relate to the Company's film and television program assets are recorded as a reduction in the production costs of the related asset. Long-lived assets Long-lived assets, including operating lease right-of-use assets, property, plant, and equipment, prepublication costs and definite-lived intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of any such asset may not be recoverable. For the purposes of impairment testing, long-lived assets are grouped at the lowest level of identifiable cash flows. If impairment indicators are present, the Company performs a recoverability test by comparing the sum of the estimated undiscounted future cash flows attributable to the asset to its carrying amount. If it is determined that a long-lived asset is not recoverable, an impairment loss is recognized based on the excess of the carrying amount over the fair value of the asset. The fair values determined by the Company require significant judgment and include certain assumptions regarding future sales and expenses, discount rates and real estate market conditions. Royalty advances Royalty advances are incurred in all of the Company’s reportable segments except the Entertainment segment, but are most prevalent in the Children’s Book Publishing and Distribution segment and enable the Company to obtain contractual commitments from authors, illustrators, licensors and other publishers to produce content. The Company regularly provides these content providers advances against expected future royalty payments, often before the books are written. Upon publication and sale of the books or other media, the content providers will not receive further royalty payments until the contractual royalties earned from sales of such books or other media exceed such advances. Royalty advances are initially capitalized and subsequently expensed as related revenues are earned or when the Company determines future recovery through earndowns is not probable. The Company has a long history of providing authors, illustrators, licensors and other publishers with royalty advances and it tracks each advance earned with respect to the sale of the related publication. The royalties earned are applied first against the remaining unearned portion of the advance. Historically, the longer the unearned portion of the advance remains outstanding, the less likely it is that the Company will recover the advance through the sale of the publication. The Company applies this historical experience to its existing outstanding royalty advances to estimate the likelihood of recoveries through earndowns. Additionally, the Company’s editorial staff regularly reviews its portfolio of royalty advances to determine if individual royalty advances are not recoverable through earndowns for discrete reasons, such as the death of an author prior to completion of a title or titles, a Company decision to not publish a title, poor market demand or other relevant factors that could impact recoverability. The reserve for royalty advances was $92.7 and $86.9 as of May 31, 2026 and 2025, respectively. 48 Goodwill and intangible assets The Company records intangible assets based on their fair value on the date of acquisition. Goodwill is recorded as the difference between the fair value of the purchase consideration and the fair value of the net identifiable tangible and intangible assets acquired. Goodwill and other intangible assets with indefinite lives are not amortized and are reviewed for impairment annually as of May 31 or more frequently if impairment indicators arise. With regard to goodwill, the Company compares the estimated fair values of its identified reporting units to the carrying values of their net assets. The Company first performs a qualitative assessment to determine whether it is more likely than not that the fair values of its identified reporting units are less than their carrying values. If it is more likely than not that the fair value of a reporting unit is less than its carrying amount, the Company performs the quantitative goodwill impairment test. The Company measures goodwill impairment by the amount the carrying value exceeds the fair value of a reporting unit. For each of the reporting units, the estimated fair value is determined utilizing the expected present value of the projected future cash flows of the reporting unit, in addition to comparisons to similar companies. The Company reviews its definition of reporting units annually or more frequently if conditions indicate that the reporting units may change. The Company evaluates its operating segments to determine if there are components one level below the operating segment level. A component is present if discrete financial information is available and segment management regularly reviews the operating results of the business. If an operating segment only contains a single component, that component is determined to be a reporting unit for goodwill impairment testing purposes. If an operating segment contains multiple components, the Company evaluates the economic characteristics of these components. Any components within an operating segment that share similar economic characteristics are aggregated and deemed to be a reporting unit for goodwill impairment testing purposes. Components within the same operating segment that do not share similar economic characteristics are deemed to be individual reporting units for goodwill impairment testing purposes. The Company has seven reporting units with goodwill subject to impairment testing. With regard to other intangibles with indefinite lives, the Company first performs a qualitative assessment to determine whether it is more likely than not that the fair value of the identified asset is less than its carrying value. If it is more likely than not that the fair value of the asset is less than its carrying amount, the Company performs a quantitative test. The estimated fair value is determined utilizing the expected present value of the projected future cash flows of the asset. Intangible assets with definite lives consist principally of customer lists, customer contracts/relationships, intellectual property, and trade names and are amortized over their expected useful lives. Customer lists, customer contracts/relationships, intellectual property and trade names are typically amortized on a straight-line basis over five to ten years. Income taxes The Company uses the asset and liability method of accounting for income taxes. Under this method, for purposes of determining taxable income, deferred tax assets and liabilities are determined based on differences between the financial reporting and the tax basis of such assets and liabilities and are measured using enacted tax rates and laws that will be in effect when the differences are expected to be realized. The Company believes that its taxable earnings, during the periods when the temporary differences giving rise to deferred tax assets become deductible or when tax benefit carryforwards may be utilized, should be sufficient to realize the related future income tax benefits. For those jurisdictions where the expiration date of the tax benefit carryforwards or the projected taxable earnings indicates that realization is not likely, the Company establishes a valuation allowance. In assessing the need for a valuation allowance, the Company estimates future taxable earnings, with consideration for the feasibility of ongoing tax planning strategies and the realizability of tax benefit carryforwards, to determine which deferred tax assets are more likely than not to be realized in the future. Valuation allowances related to deferred tax assets can be impacted by changes to tax laws, changes to statutory tax rates and future taxable earnings. In the event that actual results differ from these estimates in future periods, the Company may need to adjust the valuation allowance. The Company accounts for uncertain tax positions using a two-step method. Recognition occurs when an entity concludes that a tax position, based solely on technical merits, is more likely than not to be sustained upon examination. If a tax position is more likely than not to be sustained upon examination, the amount recognized is the 49 largest amount of benefit, determined on a cumulative probability basis, which is more likely than not to be realized upon settlement. The Company assesses all income tax positions and adjusts its reserves against these positions periodically based upon these criteria. The Company also assesses potential penalties and interest associated with these tax positions, and includes these amounts as a component of income tax expense. The Company assesses foreign investment levels periodically to determine if all or a portion of the Company’s investments in foreign subsidiaries are indefinitely invested. Any required adjustment to the income tax provision would be reflected in the period that the Company changes this assessment. The Company elects to recognize the tax on Global Intangible Low-Taxed Income (GILTI) earned by foreign subsidiaries as a period expense in the period the tax is incurred. Non-income Taxes The Company is subject to tax examinations for sales-based taxes. A number of these examinations are ongoing and, in certain cases, have resulted in assessments from taxing authorities. Where a sales tax liability with respect to a jurisdiction is probable and can be reliably estimated, the Company has made accruals for these matters which are reflected in the Company’s Consolidated Financial Statements. These amounts are included in the Consolidated Financial Statements in Selling, general and administrative expenses. Future developments relating to the foregoing could result in adjustments being made to these accruals. Employee Benefit Plan Obligations The rate assumptions discussed below impact the Company’s calculations of its UK pension and U.S. postretirement obligations. The rates applied by the Company are based on the UK pension plan asset portfolio's past average rates of return, discount rates and actuarial information. Any change in market performance, interest rate performance, assumed health care cost trend rate and compensation rates could result in significant changes in the Company’s UK pension plan and U.S. postretirement obligations. Pension obligations – Scholastic Corporation's UK subsidiary has a defined benefit pension plan covering the majority of its employees who meet certain eligibility requirements. The Company’s pension plan and other postretirement benefits are accounted for using actuarial valuations. The Company’s UK Pension Plan calculations are based on three primary actuarial assumptions: the discount rate, the long-term expected rate of return on plan assets and the anticipated rate of compensation increases. The discount rate is used in the measurement of the projected, accumulated and vested benefit obligations and interest cost component of net periodic pension costs. The long-term expected return on plan assets is used to calculate the expected earnings from the investment or reinvestment of plan assets. The anticipated rate of compensation increase is used to estimate the increase in compensation for participants of the plan from their current age to their assumed retirement age. The estimated compensation amounts are used to determine the benefit obligations. Other postretirement benefits – The Company provides postretirement benefits, consisting of healthcare and life insurance benefits, to eligible retired United State-based employees. The postretirement medical plan benefits are funded on a pay-as-you-go basis, with the employee paying a portion of the premium and the Company paying the remainder. The existing benefit obligation is based on the discount rate and the assumed health care cost trend rate. The discount rate is used in the measurement of the projected and accumulated benefit obligations and the interest cost component of net periodic postretirement benefit cost. The assumed health care cost trend rate is used in the measurement of the long-term expected increase in medical claims. Foreign currency translation The Company’s non-United States dollar-denominated assets and liabilities are translated into United States dollars at prevailing rates at the balance sheet date and the revenues, costs and expenses are translated at the weighted average rates prevailing during each reporting period. Net gains or losses resulting from the translation of the foreign financial statements and the effect of exchange rate changes on long-term intercompany balances are accumulated and charged directly to the foreign currency translation adjustment component of stockholders’ equity until such time as the operations are substantially liquidated or sold. The Company assesses foreign investment levels periodically to determine if all or a portion of the Company’s investments in foreign subsidiaries are indefinitely invested. Shipping and handling costs Amounts billed to customers for shipping and handling are classified as revenue. Costs incurred in shipping and handling are recognized in Cost of goods sold. 50 Advertising costs Advertising costs are expensed by the Company as incurred. Total advertising expense was $58.4, $61.4 and $61.7 for the twelve months ended May 31, 2026, 2025 and 2024, respectively. Stock-based compensation The Company recognizes the cost of services received in exchange for any stock-based awards. The Company recognizes the cost on a straight-line basis over an award’s requisite service period, which is generally the vesting period, except for the grants to retirement-eligible employees, based on the award’s fair value at the date of grant. The fair values of stock options granted by the Company are estimated at the date of grant using the Black-Scholes option-pricing model. The Company’s determination of the fair value of stock-based payment awards using this option-pricing model is affected by the price of the Common Stock as well as by assumptions regarding highly complex and subjective variables, including, but not limited to, the expected price volatility of the Common Stock over the terms of the awards, the risk-free interest rate, and actual and projected employee stock option exercise behaviors. Estimates of fair value are not intended to predict actual future events or the value that may ultimately be realized by those who receive these awards. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates, in order to derive the Company’s best estimate of awards ultimately expected to vest. In determining the estimated forfeiture rates for stock-based awards, the Company annually conducts an assessment of the actual number of equity awards that have been forfeited previously. When estimating expected forfeitures, the Company considers factors such as the type of award, the employee class and historical experience. The estimate of stock-based awards that will ultimately be forfeited requires significant judgment and, to the extent that actual results or updated estimates differ from current estimates, such amounts will be recognized as a cumulative adjustment in the period such estimates are revised. The table set forth below provides the estimated fair value of options granted by the Company during fiscal years 2026, 2025 and 2024 and the significant weighted average assumptions used in determining such fair value under the Black-Scholes option-pricing model. The average expected life represents an estimate of the period of time stock options are expected to remain outstanding based on the historical exercise behavior of the option grantees. The risk-free interest rate was based on the U.S. Treasury yield curve corresponding to the expected life in effect at the time of the grant. The volatility was estimated based on historical volatility corresponding to the expected life. 2026 2025 2024 Estimated fair value of stock options granted $ 6.91 $ 11.92 $ 11.53 Assumptions: Expected dividend yield 3.7 % 2.2 % 2.2 % Expected stock price volatility 43.9 % 38.8 % 37.4 % Risk-free interest rate 3.9 % 4.3 % 4.7 % Average expected life of options 6 years 5 years 4 years Recently Adopted Accounting Pronouncements In December 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2023-09, "Income Taxes (Topic 740)." The amendments in this update enhance the transparency and decision usefulness of income tax disclosures to provide information to better assess how an entity’s operations and related tax risks and tax planning and operational opportunities affect its tax rate and prospects for future cash flows. The amendments in this ASU require more transparency about income tax information through improvements to income tax disclosures primarily related to the rate reconciliation and income taxes paid information. The amendments in this ASU have been applied prospectively. Refer to Note 14, "Taxes," for the Company's disclosures related to this update. Recently Issued Accounting Pronouncements In December 2025, the FASB issued ASU 2025-10, "Government Grants (Topic 832): Accounting for Government Grants Received by Business Entities." The amendments in this Update establish the accounting for a government grant received by a business entity, including guidance for (1) a grant related to an asset and (2) a grant related to income. A grant related to an asset is a government grant, or part of a government grant, that is conditioned on the purchase, construction, or acquisition of an asset (for example, a long-lived asset or inventory). A grant related to 51 income is a government grant, or part of a government grant, other than a grant related to an asset (for example, a grant that reimburses a business entity for operating expenses). The update provides guidance for the recognition, measurement, and presentation of government grants. This ASU applies to government tax credits that the Company receives related to film, television and digital media production and distribution. The ASU is effective for the Company's fiscal year 2030 and early adoption is permitted. The Company is currently assessing the impact of this ASU on its consolidated financial statements. In September 2025, the FASB issued ASU 2025-06, "Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40) Targeted Improvements to the Accounting for Internal-Use Software." The amendments in this Update remove all references to prescriptive and sequential software development stages throughout Subtopic 350-40. Therefore, an entity is required to start capitalizing software costs when both of the following occur: 1. Management has authorized and committed to funding the software project. 2. It is probable that the project will be completed and the software will be used to perform the function intended. The amendments in this Update specify that the disclosures in Subtopic 360-10, "Property, Plant, and Equipment—Overall," are required for all capitalized internal-use software costs, regardless of how those costs are presented in the financial statements. Additionally, the amendments clarify that the intangibles disclosures in paragraphs 350-30-50-1 through 50-3 are not required for capitalized internal-use software costs. Furthermore, the amendments in this Update supersede the website development costs guidance and incorporate the recognition requirements for website-specific development costs from Subtopic 350-50 into Subtopic 350-40. This ASU is effective for the Company's fiscal year 2029. Early adoption is permitted. The Company is currently assessing the impact of this ASU on its consolidated financial statements. In July 2025, the FASB issued ASU 2025-05, "Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets." The amendments in this Update provide entities with a practical expedient related to developing reasonable and supportable forecasts as part of estimating expected credit losses, in which entities may elect to assume that current conditions as of the balance sheet date do not change for the remaining life of the asset. If the Company elects to use the practical expedient, this ASU is effective for the Company's fiscal year 2027. Early adoption is allowed. The Company is currently assessing the impact of this ASU on its consolidated financial statements. In November 2024, the FASB issued ASU 2024-03, "Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40) - Disaggregation of Income Statement Expenses." This ASU improves financial reporting by requiring that public business entities disclose additional information about specific expense categories in the notes to financial statements at interim and annual reporting periods. In January 2025, the FASB issued ASU 2025-01,""Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40) - Clarifying the Effective Date" to clarify the effective date of ASU 2024-03 for non-calendar year-end entities. ASU 2024-03 is effective for the Company's fiscal year 2028, and interim periods starting in fiscal year 2029. Early adoption is permitted. The amendments in this ASU are to be applied retrospectively to all prior periods presented in the financial statements. The Company is currently assessing the impact of the disclosure requirements on its consolidated financial statements. 52 2. REVENUES Disaggregated Revenue Data The following table presents the Company’s segment revenues disaggregated by region and domestic channel during the year ended May 31: 2026 2025 2024 Book Clubs - U.S. $ 57.1 $ 64.2 $ 62.7 Book Fairs - U.S. 576.0 548.3 541.6 Trade - U.S. (1) 289.9 304.7 298.7 Trade - International (2) 41.2 46.7 50.3 Total Children's Book Publishing and Distribution 964.2 963.9 953.3 Education - U.S. 267.6 309.8 351.2 Total Education 267.6 309.8 351.2 Entertainment - U.S. (1) 8.8 5.2 1.9 Entertainment - International 56.9 55.8 — Total Entertainment 65.7 61.0 1.9 International - Major Markets (3) 235.9 241.6 228.6 International - Other Markets (4) 41.3 38.0 45.0 Total International 277.2 279.6 273.6 Overhead (5) 7.2 11.2 9.7 Total Revenues $ 1,581.9 $ 1,625.5 $ 1,589.7 (1) The Entertainment segment includes the operations of SEI, which were included in the Children’s Book Publishing and Distribution segment in prior periods, and 9 Story. The financial results for SEI for fiscal 2024 have been reclassified to Entertainment to reflect this change. (2) Primarily includes foreign rights and certain product sales in the UK. (3) Includes Canada, UK, Australia and New Zealand. (4) Primarily includes markets in Asia. (5) Overhead includes rental income related to leased space in the Company's headquarters. As a result of the sale and leaseback transactions completed during the third quarter of fiscal 2026, the Company no longer owns the underlying leasable space. Refer to Note 4, "Sale and Leaseback Transactions", and Note 11, "Leases", for further details. Estimated Returns A liability for expected returns of $32.2 and $34.4 was recorded within Other accrued expenses on the Company's Consolidated Balance Sheets as of May 31, 2026 and 2025, respectively. In addition, a return asset of $4.4 and $3.7 was recorded within Prepaid expenses and other current assets as of May 31, 2026 and 2025, respectively, for the recoverable cost of product estimated to be returned by customers. 53 Contract Liabilities The following table presents further detail regarding the Company's contract liabilities balance for the years ended May 31: 2026 2025 Book fairs incentive credits $ 127.2 $ 122.1 Magazines+ subscriptions 3.6 3.9 U.S. digital subscriptions 6.6 11.1 U.S. education-related (1) 5.7 7.5 Entertainment-related (2) 10.9 8.2 Stored value programs 22.5 22.4 Other (3) 5.4 7.8 Total contract liabilities $ 181.9 $ 183.0 (1) Primarily relates to contracts with school districts and professional services. (2) Primarily relates to contracts for film and TV productions and production services. (3) Primarily relates to contracts for various international products and services. The Company's contract liabilities consist of advance billings and payments received from customers in excess of revenue recognized and revenue allocated to outstanding book fairs incentive credits. Contract liabilities of $179.2 and $178.8 as of May 31, 2026 and 2025, respectively, are recorded within Deferred revenue on the Company's Consolidated Balance Sheets and are classified as short term, as substantially all of the associated performance obligations are expected to be satisfied, and related revenue recognized, within one year. The remaining $2.7 and $4.2 of contract liabilities as of May 31, 2026 and 2025, respectively, are recorded within Other noncurrent liabilities on the Company's Consolidated Balance Sheets as the associated performance obligations are expected to be satisfied, and related revenue recognized, in excess of one year. The amount of revenue recognized during the years ended May 31, 2026 and 2025 included within the opening Deferred revenue balance was $158.5 and $136.8, respectively. Allowance for Credit Losses The following table presents the change in the allowance for credit losses, which is included in Accounts Receivable, net on the Consolidated Balance Sheets: Allowance for Credit Losses Balance as of June 1, 2025 $ 11.0 Current period provision 6.5 Write-offs and other (6.5) Balance as of May 31, 2026 $ 11.0 3. SEGMENT INFORMATION The Company categorizes its businesses into four reportable segments: Children’s Book Publishing and Distribution, Education, Entertainment and International. •Children’s Book Publishing and Distribution operates as an integrated business which includes the publication and distribution of children’s books, ebooks, media and interactive products in the United States through its School Reading Events business, which includes the book clubs and book fairs channels and through the trade channel. This segment is comprised of two operating segments. •Education includes the publication and distribution to schools and libraries of children’s books, classroom magazines, print and digital supplemental and core classroom materials and programs and related support services, and print and online reference and non-fiction products for grades pre-kindergarten to 12 in the United States. This segment is comprised of one operating segment. •Entertainment includes the development, production, distribution and licensing of children and family film and television content. This segment is comprised of one operating segment. 54 •International includes the publication and distribution of products and services outside the United States by the Company’s international operations and its export and foreign rights businesses. This segment is comprised of four operating segments. The Company's chief operating decision maker ("CODM") is the President and Chief Executive Officer. The CODM uses operating income (loss) as the profit measure to evaluate segment performance and allocate resources to the segments. The CODM considers variances of actual performance to forecasts and prior year when making decisions. The following tables present the Company’s revenue, significant expenses, and operating income (loss) by segment for the three fiscal years ended May 31: 2026 Children's Book Publishing and Distribution Education Entertainment (1) International Overhead (2) Consolidated Revenues $ 964.2 $ 267.6 $ 65.7 $ 277.2 $ 7.2 $ 1,581.9 Cost of goods sold (3) 393.5 104.1 37.9 155.0 (0.7) 689.8 Selling, general and administrative expenses (3)(4) 404.1 151.8 26.2 110.1 115.0 807.2 Depreciation and amortization 22.3 11.5 12.5 5.7 6.8 58.8 Other segment items (5) 1.4 4.3 5.2 — — 10.9 Operating income (Loss) $ 142.9 $ (4.1) $ (16.1) $ 6.4 $ (113.9) $ 15.2 Interest income (expense), net (11.2) Other components of net periodic benefit (cost) (1.3) Loss on sale of investments (17.2) Gain on sale and leaseback transactions 99.7 Earnings (loss) before income taxes $ 85.2 Other segment disclosures: Segment assets $ 579.6 $ 234.1 $ 246.4 $ 246.8 $ 421.2 $ 1,728.1 Long-lived asset additions 5.4 0.1 1.4 14.9 13.4 35.2 (1) The Entertainment segment includes the operations of 9 Story Media Group Inc. as acquired on June 20, 2024 ("9 Story"), and Scholastic Entertainment Inc. ("SEI").(2) Overhead includes all domestic corporate amounts not allocated to segments, including expenses and costs related to the management of corporate assets and rental income related to leased space in the Company's headquarters. As a result of the sale and leaseback transactions completed during the third quarter of fiscal 2026, the Company no longer owns the underlying leasable space. Refer to Note 4, "Sale and Leaseback Transactions", and Note 11, "Leases", for further details.(3) The significant expense categories and amounts align with the segment-level information that is regularly provided to the CODM.(4) Selling, general and administrative expenses includes equity in the net income of investees accounted for by the equity method of less than $0.1 within the Entertainment segment and $0.3 within the International segment.(5) Other segment items include asset impairments and write downs. 55 2025 Children's Book Publishing and Distribution Education Entertainment (1) International Overhead (2) Consolidated Revenues $ 963.9 $ 309.8 $ 61.0 $ 279.6 $ 11.2 $ 1,625.5 Cost of goods sold (3) 410.2 122.8 33.4 159.3 (6.9) 718.8 Selling, general and administrative expenses (3)(4) 399.7 169.5 27.6 114.2 111.3 822.3 Depreciation and amortization 22.7 10.6 11.6 6.0 14.8 65.7 Other segment items (5) 0.6 0.6 0.5 1.1 0.1 2.9 Operating income (Loss) $ 130.7 $ 6.3 $ (12.1) $ (1.0) $ (108.1) $ 15.8 Interest income (expense), net (16.0) Other components of net periodic benefit (cost) (1.1) Earnings (loss) before income taxes $ (1.3) Other segment disclosures: Segment assets $ 604.5 $ 245.8 $ 256.6 $ 269.1 $ 574.1 $ 1,950.1 Long-lived asset additions 12.3 0.9 0.3 3.9 14.7 32.1 (1) The Entertainment segment includes the operations of 9 Story Media Group Inc. as acquired on June 20, 2024 ("9 Story"), and Scholastic Entertainment Inc. ("SEI").(2) Overhead includes all domestic corporate amounts not allocated to segments, including expenses and costs related to the management of corporate assets and rental income related to leased space in the Company's headquarters.(3) The significant expense categories and amounts align with the segment-level information that is regularly provided to the CODM.(4) Selling, general and administrative expenses includes equity in the net income of investees accounted for by the equity method of $0.2 within the Entertainment segment and $0.3 within the International segment.(5) Other segment items include asset impairments and write downs. 2024 Children's Book Publishing and Distribution Education Entertainment (1) International Overhead (2) Consolidated Revenues $ 953.3 $ 351.2 $ 1.9 $ 273.6 $ 9.7 $ 1,589.7 Cost of goods sold (3) 412.0 137.6 0.1 162.2 (6.8) 705.1 Selling, general and administrative expenses (3)(4) 393.2 179.0 12.7 111.7 106.4 803.0 Depreciation and amortization 24.3 12.7 0.3 5.5 14.3 57.1 Other segment items (5) 0.5 6.1 — 1.1 2.3 10.0 Operating income (Loss) $ 123.3 $ 15.8 $ (11.2) $ (6.9) $ (106.5) $ 14.5 Interest income (expense), net 2.7 Other components of net periodic benefit (cost) (1.0) Earnings (loss) before income taxes $ 16.2 Other segment disclosures: Segment assets $ 555.7 $ 242.0 $ 9.4 $ 256.0 $ 608.1 $ 1,671.2 Long-lived asset additions 18.2 0.0 — 2.6 14.9 35.7 (1) The Entertainment segment includes the operations of 9 Story Media Group Inc. as acquired on June 20, 2024 ("9 Story"), and Scholastic Entertainment Inc. ("SEI"). SEI was reported in the Children's Book Publishing and Distribution segment in prior years. The financial results for SEI for fiscal 2024 have been reclassified to Entertainment to reflect this change.(2) Overhead includes all domestic corporate amounts not allocated to segments, including expenses and costs related to the management of corporate assets and rental income related to leased space in the Company's headquarters.(3) The significant expense categories and amounts align with the segment-level information that is regularly provided to the CODM.(4) Selling, general and administrative expenses includes equity in the net income of investees accounted for by the equity method of $0.5 within the International segment.(5) Other segment items include asset impairments and write downs. 56 The following table presents geographic information for revenues for the three fiscal years ended May 31. Revenues are attributed to locations based on the origin of sale. 2026 2025 2024 United States $ 1,206.6 $ 1,243.4 $ 1,265.8 International 375.3 382.1 323.9 Total Revenues $ 1,581.9 $ 1,625.5 $ 1,589.7 The following table presents geographic information for long-lived assets for the three fiscal years ended May 31. Long-lived assets consist of property, plant and equipment, net, excluding capitalized software. 2026 2025 2024 United States (1) $ 102.6 $ 431.7 $ 430.5 International 46.6 32.8 26.8 Total Long-lived assets $ 149.2 $ 464.5 $ 457.3 (1) During fiscal 2026, the Company sold the building and land associated with its headquarters in New York City and its primary distribution facility in Jefferson City, Missouri. Refer to Note 4, "Sale and Leaseback Transactions", for further details. 4. SALE AND LEASEBACK TRANSACTIONS On December 17, 2025, the Company completed the sale of its headquarters location at 555-557 Broadway in New York, New York (SoHo) for a sales price of $386.0 and its primary distribution facility in Jefferson City, Missouri for a sales price of $95.0. Concurrent with these sales, the Company entered into a 15-year lease for a portion of its headquarters building ("SoHo lease") and a 20-year lease for the distribution facility ("Jefferson City lease"), both with two 10-year renewal options. The Company determined that these transactions met the requirements for sale accounting in accordance with ASC 842, Leases, and qualified as a sale in accordance with ASC 606, Revenue from Contracts with Customers, as control of the assets transferred to the buyer-lessors. The Company concluded that both the sales price and leaseback payments for these transactions were at fair value. The assets related to these properties were included in Overhead and had a net carrying value on the date of sale of $352.7. These assets were classified as held for sale as of November 30, 2025. The Company recognized a total pre-tax gain of $99.7 which is included in Gain on sale and leaseback transactions within the Company's Consolidated Statement of Operations for the fiscal year ended May 31, 2026, and pre-tax net proceeds of $452.4, which represents the sales price less transaction costs and buyer-lessor credits. The following table presents the carrying value of the assets and liabilities by major asset class for each disposal group as of the date of the sale: SoHo Headquarters Jefferson City Distribution Facility Total Land $ 67.9 $ 4.6 $ 72.5 Building and improvements 240.7 10.8 251.5 Furniture, fixtures and equipment 1.0 0.1 1.1 Prepaid expenses and other current assets (1) 2.4 — 2.4 Other assets and deferred charges (1) 25.2 — 25.2 Net Carrying Value $ 337.2 $ 15.5 $ 352.7 (1) Includes current and noncurrent deferred lease income and deferred lease costs. ASC 842 provides a practical expedient that permits the combination of lease and non-lease components in the measurement of right-of-use ("ROU") assets and lease liabilities. The practical expedient is applied as an accounting policy election by class of underlying assets. As a result of entering into the SoHo lease, the Company established a new class of underlying assets, corporate headquarters, and elected not to apply the practical expedient for this class. As a result, only the portion of consideration attributed to the lease component is included in the measurement of the related ROU asset and lease liability. The non-lease components included in the SoHo lease, primarily consisting of common‑area maintenance, utilities, insurance, real estate taxes and other operating costs, were estimated using 57 historical cost information from the period in which the Company owned and operated the building prior to entering into the lease. The Company believes that these historical operating costs reasonably approximate the expected stand‑alone prices of the non‑lease components under the new lease arrangement. The SoHo and Jefferson City leases are classified as operating leases in accordance with ASC 842. The initial annual base rent for the SoHo lease is $11.7, excluding estimated non-lease components, and escalates approximately 4% annually. The initial annual base rent for the Jefferson City lease is $6.9 and escalates 1% to 4% annually based on the Consumer Price Index. The Company recorded an initial ROU asset and lease liability related to the SoHo and Jefferson City leases of $113.8 and $62.2, respectively. The operating lease cost associated with these leases is approximately $23.7 annually. The lease measurement is based on the initial lease term as the Company is not reasonably certain to exercise the renewal options. The Company used an incremental borrowing rate of 10.4% to measure the lease liabilities. In developing this rate, the Company considered its credit profile, including its higher leverage position at the time of the sale and leaseback transactions, observable market yields on secured and unsecured borrowings, interest‑rate spreads for comparable companies and transactions, and the longer lease terms. Refer to Note 11, Leases, for further details regarding the impact of these transactions. 5. ASSET WRITE DOWN During fiscal 2026, the Company identified certain assets that were not recoverable. The estimated future cash flows related to these assets were impacted by the Company's decision to no longer sell the related products or the Company ceased development activities for the related products and television programs. The assets consisted of $4.9 of investment in film and television programs and other production costs included in the Entertainment segment, $4.3 of prepublication costs included in the Education segment, and $0.8 of capitalized costs related to cloud computing arrangements included within the Children's Book Publishing and Distribution segment. The Company also identified $0.6 of inventory within the Children's Book Publishing and Distribution segment that was not recoverable as a result of a warehouse fire. Refer to Note 7, Commitments and Contingencies for further details. In addition, the Company identified indicators of impairment related to its 12% ownership interest in a children's book publishing business located in the UK as the business has been wound down. This investment had a carrying value of $0.3 and was included in the Entertainment segment. The Company performed an assessment and concluded the investment was not recoverable. Accordingly, the Company recognized total impairment charges of $10.9 which was included in Asset impairments and write downs within the Company's Consolidated Statement of Operations for the fiscal year ended May 31, 2026. The related impact of the impairments was a loss per basic and diluted share of Class A and Common Stock of $0.35 and $0.34, respectively, in the twelve months ended May 31, 2026. During fiscal 2025, the Company identified certain digital products that were not recoverable. The estimated future cash flows related to these assets were impacted by the Company's decision to no longer sell the related products. The assets consisted of prepublication costs of which $0.6 were included within the Children's Book Publishing and Distribution segment and $0.6 were included within the Education segment. The Company also identified assets of $1.1 that were not recoverable as a result of the reorganization in China. These assets consisted primarily of inventory and were included within the International segment. In addition, the Company ceased use of certain leased office space in the U.S., Canada and Ireland as part of the Company's efforts to rightsize its real estate footprint to reduce occupancy costs. The Company recognized an impairment expense related to the right-of-use (ROU) assets associated with the operating leases of which $0.5 was included within the Entertainment segment and $0.1 was included in Overhead. Accordingly, the Company recognized a total impairment charge of $2.9 which was included in Asset impairments and write downs within the Company's Consolidated Statement of Operations for the fiscal year ended May 31, 2025. The related impact of the impairments was a loss per basic and diluted share of Class A and Common Stock of $0.08 in the twelve months ended May 31, 2025. During fiscal 2024, the Company identified certain education products that were not recoverable. The estimated future cash flows related to these assets were impacted by the shift to evidence-based approaches to literacy instruction within the education market. The assets consisted primarily of prepublication costs and amortizable intangible assets and were included within the Education segment. Accordingly, the Company recognized an impairment charge of $6.1 which was included in Asset impairments and write downs within the Company's Consolidated Statement of Operations for the fiscal year ended May 31, 2024. In addition, during fiscal 2024, the Company ceased use of certain leased office space in the U.S. and Canada as part of the Company's efforts to rightsize its real estate footprint to reduce occupancy costs. A total impairment expense of $3.9 was recognized during fiscal 2024 which was included in Asset impairments and write downs within the Company's Consolidated Statement of Operations for the fiscal year ended May 31, 2024. A right-of-use (ROU) asset of $2.3 was related to leased office space in New York City and included in Overhead, $1.1 was related to leased office space in Canada and included in the International segment, and $0.5 was related to leased office space used by the U.S. book fairs business 58 and included in the Children's Book Publishing and Distribution segment. The related impact of the impairments was a loss per basic and diluted share of Class A and Common Stock of $0.25 in the twelve months ended May 31, 2024. 6. DEBT The following table summarizes the Company's debt, excluding film related obligations, as of May 31: Carrying Value Fair Value Carrying Value Fair Value 2026 2025 Loan Agreement: Revolving loan $ 75.0 $ 75.0 $ 250.0 $ 250.0 Unsecured lines of credit (weighted average interest rates of 4.2% and 4.5%, respectively) 5.5 5.5 6.2 6.2 Total debt $ 80.5 $ 80.5 $ 256.2 $ 256.2 Less: lines of credit and current portion of long-term debt (5.5) (5.5) (6.2) (6.2) Total long-term debt $ 75.0 $ 75.0 $ 250.0 $ 250.0 The following table sets forth the maturities of the carrying values of the Company's debt obligations, excluding film related obligations, as of May 31, 2026 for the twelve month periods ended May 31: 2027 $ 5.5 2028 — 2029 — 2030 75.0 2031 — Thereafter — Total Debt $ 80.5 U.S. Credit Agreement On November 26, 2024, Scholastic Corporation and its principal operating subsidiary, Scholastic Inc., entered into a Third Amendment to Amended and Restated Credit Agreement (the “Amendment”) with a syndicate of banks and Bank of America, N.A., as administrative agent, and Truist Bank and Wells Fargo Bank, National Association, as co-syndication agents (as amended by the Third Amendment, the “Credit Agreement”). The arrangement was accounted for as a debt modification. The revised terms of the amended Credit Agreement include the following: •an increase in borrowing limits to $400.0 from $300.0, as amended on October 27, 2021; •an increase in the interest pricing margins for SOFR loans to a range of 1.625% to 1.875% from a range of 1.35% to 1.75% and for Base Rate loans to a range of 0.625% to 0.875% from a range of 0.35% to 0.75%; •the elimination of the credit spread adjustment of 0.10% applicable to Term SOFR loans; and •the extension of the maturity date to November 26, 2029. The Company incurred debt issuance costs of $1.6 in connection with the Amendment which are amortized over the term of the Credit Agreement. The current portion of these costs is recorded within Prepaid expenses and other current assets and the noncurrent portion is recorded within Other assets and deferred charges on the Company's Consolidated Balance Sheets. The Credit Agreement provides for a $400.0 unsecured revolving credit facility and allows the Company to borrow, repay or prepay and reborrow at any time prior to the November 26, 2029 maturity date. The Credit Agreement also provides an unlimited basket for permitted payments of dividends and other distributions in respect of capital stock so long as the Corporation’s pro forma Consolidated Net Leverage Ratio, as defined in the Credit Agreement, is not in excess of 2.75:1. Under the Credit Agreement, interest on (i) Base Rate Advances (as defined in the Credit Agreement) is due and payable in arrears quarterly on the last day of each February, May, August and November, and (ii) Term SOFR Advances 59 (as defined in the Credit Agreement) is due and payable in arrears on the last day of the interest period (defined as the period commencing on the date of the advance and ending on the last day of the period selected by the Borrowers at the time each advance is made). The interest pricing under the Credit Agreement is dependent upon the Company’s election of a rate that is either: •a Base Rate Advance equal to the higher of (i) the prime rate, (ii) the prevailing Federal Funds rate plus 0.50% or (iii) the Term SOFR Rate plus 1.00% plus, in each case, an applicable margin ranging from 0.625% to 0.875%, as determined by the Company’s prevailing Consolidated Net Leverage Ratio (as defined in the Credit Agreement); -or- •a Term SOFR Advance equal to the Term SOFR rate plus an applicable margin ranging from 1.625% to 1.875%, as determined by the Company’s prevailing Consolidated Net Leverage Ratio (as defined in the Credit Agreement). As of May 31, 2026, the applicable margin on Base Rate Advances was 0.625% and the applicable margin on SOFR Advances was 1.625%. The Credit Agreement provides for payment of a commitment fee in respect of the aggregate unused amount of revolving credit commitments ranging from 0.20% to 0.30% per annum based upon the Corporation’s then prevailing Consolidated Net Leverage Ratio. As of May 31, 2026, the commitment fee rate was 0.20%. A portion of the revolving credit facility, up to a maximum of $50.0, is available for the issuance of letters of credit. In addition, a portion of the revolving credit facility, up to a maximum of $15.0, is available for swingline loans. The Credit Agreement has an accordion feature which permits the Company, provided certain conditions are satisfied, to increase the facility by up to an additional $150.0. As of May 31, 2026, the Company had outstanding borrowings of $75.0 under the Credit Agreement at a weighted average interest rate of 5.2%. While this obligation is not due until the November 26, 2029 maturity date, the Company may, from time to time, make payments to reduce this obligation when cash from operations becomes available for this purpose. As of May 31, 2025, the Company had borrowings of $250.0 under the Credit Agreement at a weighted average interest rate of 6.1%. The Credit Agreement contains certain financial covenants related to leverage and interest coverage ratios (as defined in the Credit Agreement), limitations on the amount of dividends and other distributions, and other limitations on fundamental changes to the Company or its business. The Company was in compliance with required covenants for all periods presented. At May 31, 2026, the Company had open standby letters of credit totaling $5.4 issued under certain credit lines, including $0.4 under the Credit Agreement and $5.0 under the domestic credit lines discussed below. Unsecured Lines of Credit As of May 31, 2026, the Company’s domestic credit lines available under unsecured money market bid rate credit lines totaled $10.0. There were no outstanding borrowings under these credit lines as of May 31, 2026 and May 31, 2025. As of May 31, 2026, availability under these unsecured money market bid rate credit lines totaled $5.0, excluding commitments of $5.0. All loans made under these credit lines are at the sole discretion of the lender and at an interest rate and term agreed to at the time each loan is made, but not to exceed 365 days. These credit lines may be renewed, if requested by the Company, at the option of the lender. As of May 31, 2026, the Company had various local currency international credit lines totaling $26.1, underwritten by banks primarily in the United States and the United Kingdom. Outstanding borrowings under these facilities were $5.5 at May 31, 2026 at a weighted average interest rate of 4.2%, compared to outstanding borrowings of $6.2 at May 31, 2025 at a weighted average interest rate of 4.5%. As of May 31, 2026, the amounts available under these facilities totaled $20.6. These credit lines are typically available for overdraft borrowings or loans up to 364 days and may be renewed, if requested by the Company, at the sole option of the lender. 60 Film Related Obligations The Company's entertainment business enters into credit facilities with third-party banks to obtain interim financing for certain productions. The interim production credit facilities are secured by an assignment and direction of specific production financing including tax credits and license contract receivables and are due on demand. As of May 31, 2026, interest is charged at the following rates: •the bank prime rate plus a margin ranging from 0.50% to 0.75% for Canadian dollar loans; •SOFR plus a margin of 3.00% for U.S. dollar loans; and •Euribor plus a margin of 2.00% for Euro loans. As of May 31, 2026, outstanding borrowings under these facilities were $17.1 at a weighted average interest rate of 5.2%. As of May 31, 2025, outstanding borrowings under these facilities were $18.3 at a weighted average interest rate of 6.2%. 7. COMMITMENTS AND CONTINGENCIES Contractual Commitments The following table sets forth the aggregate minimum future contractual commitments at May 31, 2026 relating to royalty advances and minimum print quantities for the fiscal years ending May 31: Royalty Advances Minimum Print Quantities 2027 $ 20.1 $ 0.4 2028 7.2 0.7 2029 5.0 0.3 2030 2.7 0.3 2031 1.0 — Thereafter 1.6 — Total commitments $ 37.6 $ 1.7 The Company had open standby letters of credit of $5.4 and $4.0 issued under certain credit lines as of May 31, 2026 and May 31, 2025, respectively, in support of its insurance programs. These letters of credit are scheduled to expire within one year; however, the Company expects that substantially all of these letters of credit will be renewed, at similar terms, prior to their expiration. Contingencies Legal Matters Various claims and lawsuits arising in the normal course of business are pending against the Company. The Company accrues a liability for such matters when it is probable that a liability has occurred and the amount of such liability can be reasonably estimated. When only a range can be estimated, the most probable amount in the range is accrued unless no amount within the range is a better estimate than any other amount, in which case the minimum amount in the range is accrued. Legal costs associated with litigation are expensed in the period in which they are incurred. The Company does not expect, in the case of those various claims and lawsuits arising in the normal course of business where a loss is considered probable or reasonably possible, that the reasonably possible losses from such claims and lawsuits (either individually or in the aggregate) would have a material adverse effect on the Company’s consolidated financial position or results of operations. The Company is a potential claimant in a class action settlement related to alleged copyright infringement. The proposed settlement, which is subject to final court approval and completion of the claims administration process, provides for the distribution of a settlement fund to eligible copyright holders. As of May 31, 2026, the Company has not recorded any receivable related to this matter, as realization of any proceeds is not yet considered both probable and reasonably estimable. The amount and timing of any potential recovery are subject to significant uncertainty, including the outcome of final court approval, the number of valid claims submitted by other claimants, and the final allocation of settlement proceeds. The Company will recognize any proceeds upon receipt. 61 The Company also expects to receive additional recoveries from its insurance programs related to an intellectual property legal settlement accrued during fiscal 2021, however, it is premature to determine with any level of probability or accuracy the amount of those recoveries at this time. Other Matters Tariffs As a result of a Supreme Court ruling issued in February 2026, the Company may be entitled to a refund of tariffs previously paid on imported products under the International Emergency Economic Powers Act (IEEPA). The Company estimates that approximately $9.0 of its tariff payments are subject to this ruling. As of May 31, 2026, the Company has received $2.8 of refunds related to IEEPA tariffs which were recognized accordingly. The Company has not recognized an asset related to the remaining potential refund. The Company will continue to evaluate new information and will recognize the refund when the right to receive the amount becomes realized or realizable in accordance with ASC 450, Contingencies. Warehouse Fire On May 25, 2026, a fire occurred at a book fairs warehouse facility, primarily resulting in damage to inventory. The Company has insurance coverage for property damage and business interruption losses and has filed claims with its insurers. During the year ended May 31, 2026, the Company recognized total losses of $0.6, consisting of inventory write-offs. These losses are included in Asset impairments and write downs in the Consolidated Statements of Operations. As of May 31, 2026, the Company recorded insurance receivables of $0.6 for insurance recoveries deemed probable, not to exceed the related impairment loss recognized. The insurance recoveries are included in Selling, general and administrative expenses in the Consolidated Statements of Operations. The ultimate amount and timing of insurance recoveries, including amounts related to business interruption coverage, remain subject to ongoing negotiations with the Company’s insurers. Any additional recoveries will be recognized upon determination that receipt is probable and reasonably estimable. 8. INVESTMENT IN FILM AND TELEVISION PROGRAMS The Company predominantly monetizes film and television programs on an individual film basis. The following table summarizes investment in film and television programs at May 31: 2026 2025 Released, net of accumulated amortization $ 28.9 $ 26.2 Completed and not released — — In production 4.3 6.8 In development 3.7 5.2 Acquired library content (1) 3.1 3.6 Other (2) 0.4 0.3 Investment in Film and Television Programs, net (3) $ 40.4 $ 42.1 (1) Acquired library content is monetized individually and amortized on a straight-line basis. At May 31, 2026, the weighted-average remaining amortization period was approximately 6.4 years. (2) Other primarily consists of third party distribution rights. (3) Production tax credits reduced total investment in films and television programs by $3.5 and $5.8 as of May 31, 2026 and May 31, 2025, respectively, and resulted in a reduction of Cost of goods sold related to the amortization of investment in films and television programs of approximately $11.8 and $9.5 for the fiscal years ended May 31, 2026 and May 31, 2025, respectively. Amortization of film and television programs was $11.9 and $9.9 for the fiscal years ended May 31, 2026 and May 31, 2025, respectively, which was included in Cost of goods sold in the Consolidated Statement of Operations. 62 The following table summarizes estimated future amortization expense for the Company’s investment in film and television programs as of May 31, 2026: Fiscal year ending May 31, 2027 2028 2029 Estimated future amortization expense: Released, net of accumulated amortization $ 4.1 $ 5.8 $ 4.1 Acquired library content 0.5 0.5 0.5 Investment in film and television programs, net includes write-downs to fair value which are included in Cost of goods sold in the Consolidated Statement of Operations. During the fiscal years ended May 31, 2026 and May 31, 2025, the Company recognized write-downs of $0.3 and $0.2, respectively, related to programs in development. In addition, during fiscal 2026, the Company identified certain investment in film and television programs that were not recoverable and recognized an impairment charge of $4.9. Refer to Note 5, "Asset Write Down," for further details. Participation costs represent amounts payable to parties associated with the film or television program and are based on the performance of the film or television program. The Company estimates participation costs based on the contractual participation percentage on the revenue recognized to date, less participation payments made to date. As of May 31, 2026 and May 31, 2025, accrued participation costs were $9.9 and $7.0, respectively, and were included in Accrued royalties on the Company’s Consolidated Balance Sheet. 9. INVESTMENTS Investments are included in Other assets and deferred charges on the Consolidated Balance Sheets. The following table summarizes the Company’s investments for the fiscal years ended May 31: 2026 2025 Segment Equity method investments $ — $ 33.6 International Equity method and other investments 5.8 6.4 Entertainment Total investments $ 5.8 $ 40.0 On May 19, 2026, the Company sold its 26.2% equity interest in a children’s book publishing business located in the UK for a sale price of $20.2. This investment was accounted for using the equity method of accounting and equity method income from this investment was reported in the International segment. The carrying value of the investment at the time of sale was approximately $33.9. The Company recognized a loss of $17.2 on the sale of the investment during the fiscal year ended May 31, 2026, which included the reclassification of the related cumulative translation adjustment of $3.5 from Accumulated Other Comprehensive Income (Loss) to earnings. The loss is included in Loss on sale of investment in the Consolidated Statements of Operations. During fiscal 2026, the Company determined that its 12% ownership interest in a children's book publishing business located in the UK, which was accounted for using the cost method of accounting, was not recoverable and recognized an impairment charge for the carrying value of $0.3. Refer to Note 5, "Asset Write Down," for further details. The Company has a 4.6% ownership interest in a financing and production company that makes film, television, and digital programming designed for the youth market. This equity investment does not have a readily determinable fair value and the Company has elected to apply the measurement alternative and report this investment at cost, less impairment, on the Company's Consolidated Balance Sheets. During fiscal 2026, the Company received a $0.3 return of capital related to this investment, which reduced the carrying value to $5.7 as of May 31, 2026. The Company also has a 50% ownership interest in certain animated television production companies which is accounted for using the equity method of accounting. These investments are included in the Entertainment segment. Income from equity investments reported in Selling, general and administrative expenses in the Consolidated Statements of Operations totaled $0.3 for the year ended May 31, 2026, $0.5 for the year ended May 31, 2025 and $0.5 for the year ended May 31, 2024. No dividends were received in the fiscal years ended May 31, 2026 and May 31, 2025. The Company received dividends of $1.3 for the year ended May 31, 2024. 63 10. PROPERTY, PLANT AND EQUIPMENT The following table summarizes the major classes of assets at cost and accumulated depreciation for the fiscal years ended May 31: 2026 2025 Land $ 5.7 $ 81.4 Buildings 19.1 233.3 Capitalized software 289.9 273.8 Furniture, fixtures and equipment 230.2 244.5 Building and leasehold improvements 25.3 239.6 Construction in progress 37.6 30.8 Total at cost $ 607.8 $ 1,103.4 Less: Accumulated depreciation and amortization (406.2) (587.1) Property, plant and equipment, net $ 201.6 $ 516.3 During fiscal 2026, the Company sold the building and land associated with its headquarters in New York City and its primary distribution facility in Jefferson City, Missouri. Refer to Note 4, "Sale and Leaseback Transactions", for further details. Included in Other assets and deferred charges 2026 2025 Capitalized cloud computing arrangements, net $ 49.8 $ 51.4 Depreciation and amortization expense related to property, plant, and equipment was $47.5, $54.5 and $54.5 for the fiscal years ended May 31, 2026, 2025 and 2024, respectively. Amortization expense related to cloud computing arrangements was $10.4, $9.9 and $7.4 for the fiscal years ended May 31, 2026, 2025 and 2024, respectively. 11. LEASES The following table summarizes right-of-use assets and lease liabilities recorded on the Company's Consolidated Balance Sheet for the fiscal years ended May 31, 2026 and May 31, 2025: May 31, 2026 May 31, 2025 Location within Consolidated Balance Sheet Operating leases $ 291.2 $ 103.9 Operating lease right-of-use assets, net Finance leases 14.1 6.0 Property, plant and equipment, net Total lease assets $ 305.3 $ 109.9 Operating leases: Current portion $ 26.4 $ 26.8 Operating lease liabilities, current Noncurrent portion 280.6 91.5 Operating lease liabilities, noncurrent Total operating lease liabilities $ 307.0 $ 118.3 Finance leases: Current portion $ 3.2 $ 1.7 Other accrued expenses Noncurrent portion 11.7 4.9 Other noncurrent liabilities Total finance lease liabilities $ 14.9 $ 6.6 Total lease liabilities $ 321.9 $ 124.9 During fiscal 2026, the Company sold its headquarters in New York City and its primary distribution facility in Jefferson City, Missouri, and concurrently entered into a 15-year lease for a portion of its headquarters building and a 20-year lease for the distribution facility. These leases are classified as operating leases in accordance with ASC 842. Refer to Note 4, "Sale and Leaseback Transactions", for further details. 64 As part of the Company's efforts to rightsize its real estate footprint to reduce occupancy costs, the Company recognized pretax impairment charges of $0.6 and $3.9 for the fiscal years ended May 31, 2025 and 2024, respectively, related to operating lease right-of-use assets in connection with the early exit of certain leased office space. Refer to Note 5, "Asset Write Down", for further discussion regarding the impairment. The Company did not recognize any lease impairment charges during fiscal 2026. The following table summarizes the lease expense activity for the fiscal years ended May 31: Location within Consolidated Statements of Operations 2026 2025 2024 Operating lease expense $ 43.6 $ 31.7 $ 29.7 Selling, general and administrative expenses Finance lease costs : Depreciation of leased assets 2.1 1.4 2.1 Depreciation and amortization Accretion of lease liabilities 0.7 0.6 0.3 Interest expense Total lease expense $ 46.4 $ 33.7 $ 32.1 The following table summarizes certain cash flows information related to the Company's leases for the fiscal years ended May 31: 2026 2025 2024 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 41.9 $ 28.6 $ 30.2 Operating cash flows from finance leases 0.7 0.6 0.3 Financing cash flows from finance leases 2.1 1.7 2.3 Noncash transactions: Lease assets obtained in exchange for new lease liabilities $ 217.6 $ 25.0 $ 40.4 The following table provides the maturities of the Company's lease liabilities recorded on the Company's Consolidated Balance Sheet for the fiscal year ended May 31, 2026: Operating Leases Finance Leases Fiscal 2027 $ 49.4 $ 3.9 Fiscal 2028 48.6 3.2 Fiscal 2029 41.4 2.7 Fiscal 2030 36.9 2.4 Fiscal 2031 35.5 2.2 Thereafter 335.5 2.8 Total lease payments $ 547.3 $ 17.2 Less: interest (240.3) (2.3) Total lease liabilities $ 307.0 $ 14.9 65 The following table summarizes the weighted-average remaining lease terms and weighted-average discount rates related to the Company's leases recorded on the Company's Consolidated Balance Sheets for the fiscal years ended May 31, 2026 and May 31, 2025: 2026 2025 Weighted-average remaining lease term (years): Operating Leases 11.5 5.3 Finance Leases 5.8 4.5 Weighted-average discount rate: Operating Leases 8.3 % 5.6 % Finance Leases 5.2 % 5.0 % Prior to the sale and leaseback transactions that occurred in December 2025, the Company owned leasable space in its headquarters in SoHo, New York City. The Company recognized rental income of $7.2, $11.2 and $9.7 for the fiscal years ended May 31, 2026, 2025, and 2024, respectively. 12. ACQUISITIONS 9 Story Acquisition On June 20, 2024, the Company completed the acquisition of 100% of the economic interest in the form of non-voting shares and 25% of the voting shares of 9 Story, a leading independent creator, producer and distributor of premium children’s content based in Toronto, Canada, with studios or offices in New York, United States, Dublin, Ireland and Bali, Indonesia. The aggregate purchase price was $193.7 and was funded through borrowings under the U.S. Credit Agreement incurred during the first quarter of fiscal 2025. The acquisition of 9 Story further enhances the Company's development, production and licensing interests, expanding opportunities to leverage its brand and best-selling publishing and global children's franchises across print, screen and merchandising. Pursuant to ASC Topic 810, Consolidation, 9 Story was determined to be a variable interest entity (VIE) and the Company was determined to be its primary beneficiary and therefore obtained a controlling financial interest over 9 Story. Accordingly, 9 Story has been consolidated into the Company's financial results. The operations of 9 Story are reported in the Entertainment segment. 9 Story met the definition of a business pursuant to ASC 805, Business Combinations, and the acquisition was accounted for as a business combination under the acquisition method of accounting. The Company estimated the fair value of acquired assets and liabilities as of the date of acquisition based on currently available information. 66 The following table summarizes the purchase price allocation of fair values of the assets acquired and liabilities assumed at the date of acquisition: Cash and cash equivalents $ 17.5 Accounts receivable 14.8 Investment in film and television programs 42.9 Property, plant and equipment 6.1 Operating lease right-of-use assets 6.1 Other Intangible assets: Existing content/IP 16.0 Customer contracts/relationships (1) 51.5 Trade names 16.5 Internally developed software 1.3 Tax credit receivable 31.9 Other assets 3.9 Total assets acquired 208.5 Accounts payable 2.3 Accrued expenses 16.3 Deferred revenue 9.8 Film related obligations 34.9 Operating lease liabilities 7.7 Other liabilities 8.0 Total liabilities assumed 79.0 Fair value of net assets acquired 129.5 Goodwill 64.2 Purchase price consideration $ 193.7 (1) Includes $36.7 related to distribution contracts and relationships. The assets acquired included intellectual property ("IP") related to 9 Story's existing and recognized program titles (including Investment in film and television programs), customer contracts/relationships related to licensing, distribution and service arrangements, the trade names associated with 9 Story and Brown Bag Films, its animation studio, and internally developed software. The intellectual property and customer contracts/relationships were valued using the multi-period excess earnings valuation method and are being amortized over 10 years, with the exception of contracts/relationships for service arrangements which are being amortized over 5 years. The trade names were valued using the relief-from-royalty valuation method and are being amortized over 10 years. The internally developed software was valued using the replacement cost method and is being amortized over 3 years. The Company classified these fair value measurements as Level 3 due to the significant unobservable inputs used in the analyses, such as internally-developed discounted cash flow forecasts. The difference between the purchase price over the net identifiable tangible and intangible assets acquired was allocated to goodwill, which was not deductible for tax purposes. The goodwill balance was primarily attributable to the expected synergies from the business combination and acquired workforce. The goodwill and intangible assets acquired were allocated to the Entertainment segment. The following table summarizes the unaudited pro-forma consolidated results of operations for the fiscal years ended May 31, 2025 and 2024 as if the acquisition had occurred on June 1, 2023, the beginning of fiscal 2024: 2025 2024 Revenues $ 1,631.2 $ 1,671.4 Net income (loss) (3.1) 1.9 The unaudited pro-forma consolidated results above are based on the historical financial statements of the Company and 9 Story and are not necessarily indicative of the results of operations that would have been achieved if the acquisition was completed at the beginning of fiscal 2024 and are not indicative of the future operating results of the combined entities. The financial information for 9 Story prior to the acquisition includes certain adjustments to 9 Story's historical consolidated financial statements to align with U.S. GAAP and the Company's accounting policies. The pro-forma consolidated results of operations also include the effects of purchase accounting adjustments, including amortization charges related to the finite-lived intangible assets acquired, fair value adjustments relating to leases and fixed assets, and the related tax effects assuming that the business combination occurred on June 1, 2023. 67 Purchase of Noncontrolling Interest On June 1, 2023, the Company acquired the remaining shares of Make Believe Ideas Limited, a UK-based children's book publishing company, for $2.1, increasing the Company's total ownership from 95.0% to 100%. The acquisition was accounted for as an equity transaction as there was no change in control. The carrying value of the noncontrolling interest at the acquisition date was $1.6. The difference between the fair value of consideration paid and the carrying value was recognized as an adjustment to Additional paid-in capital of $0.5. 13. GOODWILL AND OTHER INTANGIBLES The Company assesses goodwill and other intangible assets with indefinite lives for impairment annually or more frequently if indicators arise. The Company monitors impairment indicators in light of changes in market conditions, near and long-term demand for the Company’s products and other relevant factors. The following table summarizes the activity in Goodwill for the fiscal years ended May 31: 2026 2025 Gross beginning balance $ 238.5 $ 172.4 Accumulated impairment (39.6) (39.6) Beginning balance $ 198.9 $ 132.8 Additions — 64.2 Foreign currency translation 0.5 1.9 Gross ending balance 239.0 238.5 Accumulated impairment (39.6) (39.6) Ending balance $ 199.4 $ 198.9 In fiscal 2025, the Company completed the 9 Story acquisition which resulted in the recognition of $64.2 of Goodwill included in the Entertainment segment. Refer to Note 12, "Acquisitions", for further details regarding the acquisition. There were no impairment charges related to Goodwill in any of the periods presented. The following table presents Goodwill by segment as of May 31: 2026 2025 Children's Book Publishing and Distribution $ 47.4 $ 47.4 Education 75.7 75.7 Entertainment 66.2 65.7 International 10.1 10.1 Total $ 199.4 $ 198.9 The following table summarizes the activity in other intangibles included in Other intangible assets, net on the Company’s Financial Statements for the fiscal years ended May 31: 2026 2025 Other intangibles subject to amortization - beginning balance $ 85.8 $ 8.2 Additions — 85.3 Amortization expense (11.3) (11.2) Foreign currency translation 1.3 3.5 Total other intangibles subject to amortization, net of accumulated amortization of $61.6 and $50.3, respectively $ 75.8 $ 85.8 Total other intangibles not subject to amortization 2.1 2.1 Total other intangibles $ 77.9 $ 87.9 68 During fiscal 2025, the Company completed the 9 Story acquisition which resulted in the recognition of $85.3 of amortizable intangible assets. Refer to Note 12, "Acquisitions", for further details regarding the acquisition. Amortization expense for Other intangibles totaled $11.3, $11.2 and $2.6 for the fiscal years ended May 31, 2026, 2025 and 2024, respectively. The following table reflects the estimated amortization expense for intangibles for future fiscal years ending May 31: 2027 $ 11.3 2028 10.8 2029 10.7 2030 9.0 2031 8.9 Thereafter 25.1 Intangible assets with indefinite lives consist principally of trademark and trade name rights. Intangible assets with definite lives consist principally of customer lists, customer contracts/relationships, intellectual property, trade names and internally developed software. Intangible assets with definite lives are amortized over their estimated useful lives. The weighted-average remaining useful lives of all amortizable intangible assets is approximately 7.5 years. 14. TAXES The components of Earnings (loss) before income taxes for the fiscal years ended May 31 were: 2026 2025 2024 United States $ 81.6 $ 1.0 $ 17.3 Non-United States 3.6 (2.3) (1.1) Total $ 85.2 $ (1.3) $ 16.2 The provision (benefit) for income taxes for the fiscal years ended May 31 consisted of the following components: 2026 2025 2024 Current Federal $ 10.9 $ 6.3 $ 3.4 State and local 11.2 1.3 1.2 Non-United States 4.4 2.7 1.5 Total Current $ 26.5 $ 10.3 $ 6.1 Deferred Federal $ 2.8 $ (9.1) $ 0.5 State and local (3.3) (0.4) (1.3) Non-United States 2.5 (0.2) (1.2) Total Deferred $ 2.0 $ (9.7) $ (2.0) Total Current and Deferred $ 28.5 $ 0.6 $ 4.1 69 Effective Tax Rate Reconciliation In accordance with the prospective adoption of ASU 2023-09, the following table presents a reconciliation of the U.S. federal statutory income tax rate to the effective income tax rate for the fiscal year ended May 31, 2026, including both rate and dollar amount information: Amount Rate U.S. federal statutory income tax rate $ 17.9 21.0 % State and local income tax, net of federal income tax benefit (1) 6.6 7.8 Foreign tax effects Australia Sale of equity method investment 4.1 4.8 Permanent differences (1.3) (1.5) Other (0.7) (0.8) Canada Foreign tax rate differential 1.0 1.2 Other 1.0 1.2 Other foreign jurisdictions 1.8 2.1 Tax credits Research and development tax credit (1.2) (1.4) Foreign tax credit (1.2) (1.4) Changes in unrecognized tax benefits 1.4 1.6 Effect of cross-border tax laws 0.0 0.0 Global intangible low-taxed income 2.8 3.3 FDII (2.8) (3.3) Nontaxable or nondeductible items Charitable contributions (0.9) (1.1) Equity and other compensation (1.0) (1.1) Section 162(m) limitation 2.1 2.5 Sale of equity method investment (1.1) (1.3) Other federal tax adjustments (1.0) (1.1) Other nontaxable or nondeductible items 1.0 0.9 Effective income tax rate $ 28.5 33.4 % (1) State and local taxes in New York, New York City, and California represented the majority (greater than 50 percent) of the tax effect in this category. 70 Prior to the adoption of ASU 2023-09, the following table presents a reconciliation of the U.S. federal statutory income tax rate to the effective income tax rate for the fiscal years ended May 31: 2025 2024 Computed federal statutory provision 21.0 % 21.0 % State income tax provision, net of federal income tax benefit (66.5) (3.0) Difference in effective tax rates on earnings of foreign subsidiaries (61.4) (0.1) GILTI inclusion — 0.1 Various tax credits 62.1 (6.6) Valuation allowances, excluding state 93.8 2.9 Uncertain positions 40.7 0.4 Transaction costs — 12.0 Equity and other compensation 51.6 (3.7) Section 162(m) limitation (83.5) 6.0 Return to provision and other adjustments (132.8) (5.1) Permanent differences 29.0 1.3 Other, net (0.2) 0.1 Effective tax rates (46.2) % 25.3 % Total provision (benefit) for income taxes $ 0.6 $ 4.1 The following table presents cash paid for income taxes, net of refunds received, by jurisdiction for the fiscal year ended May 31, 2026: Federal $ 30.7 State New York 2.5 Other 7.5 Other foreign jurisdictions 2.7 Total cash paid for income taxes, net of refunds received $ 43.4 Unremitted Earnings The Company assesses foreign investment levels periodically to determine if all or a portion of the Company’s investments in foreign subsidiaries are indefinitely invested. The Company is permanently reinvested in certain foreign subsidiaries representing a portion of the Company's investments in foreign subsidiaries. Any required adjustment to the income tax provision would be reflected in the period that the Company changes this assessment. As of May 31, 2026, there have been no adjustments to the income tax provision related to unremitted earnings. 71 Deferred Taxes The significant components for deferred income taxes for the fiscal years ended May 31 were as follows: 2026 2025 Deferred tax assets: Tax uniform capitalization $ 12.8 $ 12.2 Prepublication expenses 3.9 3.0 Inventory reserves 19.2 21.8 Allowance for credit losses 2.0 1.8 Deferred revenue 6.1 6.2 Stock based compensation 4.6 5.9 Other reserves 5.2 4.4 Postretirement, post employment and pension obligations 1.6 1.6 Tax carryforwards 30.5 32.4 Lease liabilities 76.5 27.7 Other 13.5 15.0 Gross deferred tax assets $ 175.9 $ 132.0 Valuation allowance (21.6) (17.1) Total deferred tax assets $ 154.3 $ 114.9 Deferred tax liabilities: Depreciation and amortization (35.4) (53.9) Lease right-of-use assets (73.0) (24.4) Research and development costs capitalized (20.6) (8.3) Other (2.0) (3.7) Total deferred tax liabilities $ (131.0) $ (90.3) Total net deferred tax assets (1) $ 23.3 $ 24.6 (1) Total net deferred tax assets include $8.5 and $10.1 as of May 31, 2026 and May 31, 2025, respectively, of deferred tax liabilities that were recorded in Other noncurrent liabilities on the Company's Consolidated Balance Sheet primarily due to foreign jurisdictions that cannot be netted. The Company regularly assesses the realizability of deferred tax assets considering all available evidence including, to the extent applicable, the nature, frequency and severity of prior cumulative losses, forecasts of future taxable income, tax filing status, duration of statutory carryforward periods, tax planning strategies and historical experience. For the fiscal year ended May 31, 2026, the valuation allowance increased by $4.5, primarily due to state net operating losses not expected to be realized. For the fiscal year ended May 31, 2025, the valuation allowance decreased by $2.8. The Company has gross federal, state and foreign net operating loss carryforwards of $0.9, $95.2 and $87.3, respectively, and tax effected federal, state and foreign net operating loss carryforwards of $0.6, $6.2 and $20.6, respectively, for the fiscal year ended May 31, 2026. In addition, the Company has certain tax carryforwards related to tax credits of $2.3, which have various expiration dates between 2029 and 2035, and charitable contributions of $0.8 for the fiscal year ended May 31, 2026. The federal net operating loss can be carried forward indefinitely, however the deduction is limited to 80% of taxable income in the carryforward year. Certain state net operating loss carryforwards, if not utilized, expire at various times, primarily between fiscal year 2028 and fiscal year 2044. Certain foreign net operating loss carryforwards, if not utilized, also expire at various times. Approximately half of the foreign net operating loss carryforwards expire between fiscal year 2027 and fiscal year 2044 and the remaining carryforwards do not have an expiration date. Unrecognized tax benefits The benefits of uncertain tax positions are recorded in the financial statements only after determining a more likely-than-not probability that the uncertain tax positions will withstand challenge, if any, from taxing authorities, in which case such benefits are included in long-term income taxes payable and reduced by the associated federal deduction for state taxes and non-U.S. tax credits. The interest and penalties related to these uncertain tax positions are recorded 72 as part of the Company’s income tax expense and constitute part of Other noncurrent liabilities on the Company’s Consolidated Balance Sheets. The total amount of unrecognized tax benefits at May 31, 2026, 2025, and 2024 were $2.6, excluding $0.3 accrued for interest and penalties, $1.2, excluding $0.3 accrued for interest and penalties, and $1.8, excluding $0.3 accrued for interest and penalties, respectively. Of the total amount of unrecognized tax benefits at May 31, 2026, 2025, and 2024, $2.6, $1.2 and $1.8, respectively, would impact the Company’s effective tax rate. During the years presented, the Company recognized interest and penalties related to unrecognized tax benefits in the provision for taxes in the Consolidated Financial Statements. The Company recognized an expense of $0.1, a benefit of less than $0.1, and an expense of $0.1 for the years ended May 31, 2026, 2025, and 2024, respectively. The table below presents a reconciliation of the unrecognized tax benefits for the fiscal years indicated: Gross unrecognized benefits at May 31, 2023 $ 2.0 Decreases related to prior year tax positions (0.8) Increase related to prior year tax positions 0.7 Increases related to current year tax positions 0.1 Settlements during the period (0.2) Lapse of statute of limitation — Gross unrecognized benefits at May 31, 2024 $ 1.8 Decreases related to prior year tax positions — Increase related to prior year tax positions 0.1 Increases related to current year tax positions 0.1 Settlements during the period — Lapse of statute of limitation (0.8) Gross unrecognized benefits at May 31, 2025 $ 1.2 Decreases related to prior year tax positions — Increase related to prior year tax positions 1.9 Increases related to current year tax positions 0.1 Settlements during the period — Lapse of statute of limitation (0.6) Gross unrecognized benefits at May 31, 2026 $ 2.6 Income Tax Returns The Company, including its domestic subsidiaries, files a consolidated U.S. income tax return, and also files tax returns in various states and other local jurisdictions. Certain foreign subsidiaries also file income tax returns in the jurisdictions in which they operate. The Company is routinely audited by various tax authorities. Tax years relating to fiscal 2021 through 2025 remain subject to examination. Tax Legislation Updates The Organization for Economic Co-operation and Development (OECD) has issued Pillar Two model rules introducing a new global minimum tax of 15% on foreign profits of large multinational corporations intended to be effective in 2024. The United States has not yet adopted Pillar Two rules, however, many countries and jurisdictions have agreed to the proposal by the OECD. As part of the Company's ongoing assessment of the OECD's Pillar Two global minimum tax framework, a comprehensive review was conducted of the Company's global tax position to evaluate the potential impact on its effective tax rate. Based on this analysis, the Company determined the impact of Pillar Two to be immaterial to its financial statements. On July 4, 2025, the One Big Beautiful Bill Act ("OBBBA") was enacted in the United States. The OBBBA includes a number of significant tax provisions, including the permanent extension of certain provisions originally enacted under the Tax Cuts and Jobs Act, such as 100% bonus depreciation, immediate expensing of domestic research and experimental expenditures, and modifications to the limitation on business interest expense deductions. During fiscal 2026, the Company elected to immediately deduct 100% of its qualifying domestic research and experimental 73 expenditures under Section 174 and utilized 100% bonus depreciation for eligible capital investments. As a result, the enactment of the OBBBA favorably impacted the Company's current-year taxable income and cash taxes. Non-income Taxes The Company is subject to tax examinations for sales-based taxes. A number of these examinations are ongoing and, in certain cases, have resulted in assessments from taxing authorities. The Company assesses sales tax contingencies for each jurisdiction in which it operates, considering all relevant facts including statutes, regulations, case law and experience. Where a sales tax liability in respect to a jurisdiction is probable and can be reliably estimated for such jurisdiction, the Company has made accruals for these matters which are reflected in the Company’s Consolidated Financial Statements. These amounts are included in the Consolidated Financial Statements in Selling, general and administrative expenses. Future developments relating to the foregoing could result in adjustments being made to these accruals. 15. CAPITAL STOCK AND STOCK-BASED AWARDS Class A Stock and Common Stock Capital stock consisted of the following as of May 31, 2026: Class A Stock Common Stock Preferred Stock Authorized 3,171,900 70,000,000 2,000,000 Reserved for Issuance — 4,074,031 — Outstanding 828,100 17,920,321 — The only voting rights vested in the holders of Common Stock, except as required by law, are the election of such number of directors as shall equal at least one-fifth of the members of the Board. The Class A Stockholders are entitled to elect all other directors and to vote on all other matters. The Class A Stockholders and the holders of Common Stock are entitled to one vote per share on matters on which they are entitled to vote. The Class A Stockholders have the right, at their option, to convert shares of Class A Stock into shares of Common Stock on a share-for-share basis. With the exception of voting rights and conversion rights, and as to any rights of holders of Preferred Stock if issued, the Class A Stock and the Common Stock are equal in rank and are entitled on the same basis to dividends and distributions when and if declared by the Board. The Company issues shares of Common Stock from its Treasury stock upon conversion of Class A stock and to meet its share-based payment requirements, net of shares required to be withheld to cover the recipient's tax obligations. During fiscal 2024, Class A Stockholders surrendered 828,100 shares of Class A Stock for conversion into shares of Common Stock. The surrendered Class A shares were cancelled and cannot be reissued, resulting in 3,171,900 shares authorized and 828,100 shares outstanding. Preferred Stock The Company's Preferred Stock may be issued in one or more series, with the rights of each series, including voting rights, to be determined by the Board before each issuance. To date, no shares of Preferred Stock have been issued. Stock-based awards At May 31, 2026, the Company maintained four stockholder-approved stock-based compensation plans with regard to the Common Stock: •Scholastic Corporation 2021 Stock Incentive Plan (the "2021 Plan"); •Scholastic Corporation 2011 Stock Incentive Plan (the “2011 Plan”), under which no further grants can be made; •Scholastic Corporation 2017 Outside Directors Stock Incentive Plan (the “2017 Directors Plan”); and •Scholastic Corporation 2007 Outside Directors Stock Incentive Plan (the “2007 Directors Plan”), under which no further grants can be made. 74 In September 2021, the Class A Stockholders approved the 2021 Plan which provides for the issuance of certain equity awards, including non-qualified stock options, time-vested restricted stock units, performance-based restricted stock units, incentive stock options and other equity awards. The 2021 Plan initially provided for 2,500,000 shares available for issuance pursuant to awards granted or to be granted under the plan. The 2011 Plan was approved by the Class A Stockholders in September 2011 initially providing for 2,100,000 shares available for issuance for certain equity awards, including non-qualified stock options, time-vested restricted stock units, performance-based restricted stock units, incentive stock options and other equity awards. In September 2014, the Class A Stockholders approved the second amendment to the 2011 Plan increasing the shares available for issuance pursuant to awards granted under the 2011 Plan by 2,475,000 shares. In September 2018, the Class A Stockholders approved the third amendment to the 2011 Plan increasing the shares available for issuance pursuant to awards granted under the 2011 Plan by 2,540,000 shares, providing for a total of 7,115,000 shares available for issuance under the 2011 Plan. No further awards can be granted under the 2011 Plan. The Company’s stock-based awards vest over periods not to exceed four years and the Company's equity plans permit the acceleration of vesting upon retirement for certain eligible employees, as well as for certain other events. As of May 31, 2026, non-qualified stock options to purchase 650,583 and 953,508 shares of Common Stock were outstanding under the 2021 Plan and the 2011 Plan, respectively. During fiscal 2026, 18,092 options were granted under the 2021 Plan at a weighted average exercise price of $21.38. At May 31, 2026, 765,527 shares of Common Stock were available for issuance under the 2021 Plan. In September 2017, the Class A Stockholders approved the 2017 Directors Plan which has 400,000 shares of Common Stock authorized for issuance and provides for the automatic grant to each non-employee director, on the date of each annual meeting of stockholders, of stock options and/or restricted stock units with a value equal to a fixed dollar amount. The total dollar amount, as well as the relative percentage of stock options and restricted stock units, is determined annually by the Board (or Committee designated by the Board) in advance of the grant date. In July 2025, the Board approved the fiscal 2026 grant to each non-employee director, on the date of the 2025 annual meeting of stockholders, having a value, as determined by the Board, of one hundred twenty-five thousand dollars ($125,000), (based on the fair market value on the date of grant), with 100% of such award to be awarded as restricted stock units, such grant to vest in its entirety on the earlier of the first anniversary of the date of grant or the date of the next annual meeting of stockholders following the date of grant. In September 2025, the Class A Stockholders authorized an additional 100,000 shares for issuance under the 2017 Directors Plan. In September 2007, the Class A Stockholders approved the 2007 Directors Plan, under which no further awards may be granted. During the life of the 2007 Directors Plan, it provided for annual automatic grants to each non-employee director, on the date of each annual meeting of stockholders, similar to the awards described above for the 2017 Directors Plan. As of May 31, 2026, non-qualified stock options to purchase 8,448 shares remained outstanding under the 2007 Directors Plan. During fiscal 2026, 42,320 restricted stock units were granted to the non-employee directors under the 2017 Directors Plan, such grant to vest in its entirety on the earlier of the first anniversary of the date of grant or the date of the next annual meeting of Stockholders following the date of grant. During fiscal 2026, there were 28,280 shares of Common Stock issued upon the vesting of restricted stock units under the 2017 Directors Plan. As of May 31, 2026, non-qualified stock options to purchase 144,146 shares were outstanding under the 2017 Directors Plan and 154,574 shares of Common Stock were available for issuance under the 2017 Directors Plan. Stock Options - Generally, stock options granted under the Company's equity plans may not be exercised for a minimum of one year after the date of grant and expire seven to ten years after the date of grant. The intrinsic value of certain stock options is tax deductible by the Company upon exercise, if compliant with current tax law. The Company amortizes the fair value of stock options as stock-based compensation expense over the requisite service period on a straight-line basis, or sooner if the employee effectively vests upon termination of employment for certain retirement-eligible employees, as well as in certain other events. 75 The following table sets forth the intrinsic value of stock options exercised, pretax stock-based compensation cost and related tax benefits for the Company's equity plans for the fiscal years ended May 31: 2026 2025 2024 Total intrinsic value of stock options exercised $ 8.0 $ 0.5 $ 6.4 Total stock-based compensation cost (pretax) 8.5 9.3 11.0 Tax benefits (shortfalls) related to stock-based compensation cost 0.6 (2.5) 5.0 Weighted average grant date fair value per option $ 6.91 $ 11.92 $ 11.53 Pretax stock-based compensation cost is recognized in Selling, general and administrative expenses. As of May 31, 2026, the total pretax compensation cost not yet recognized by the Company with regard to outstanding unvested stock options was $0.1. The weighted average period over which this compensation cost is expected to be recognized is 0.4 years. The following table sets forth the stock option activity under the Company's equity plans for the fiscal year ended May 31, 2026: Options Weighted Average Exercise Price Average Remaining Contractual Term (in years) Aggregate Intrinsic Value (in millions) Outstanding at May 31, 2025 2,663,798 $ 30.90 Granted 18,092 21.38 Exercised (779,167) 24.23 Expired, canceled and forfeited (146,038) 41.57 Outstanding at May 31, 2026 1,756,685 $ 32.87 2.6 $ 14.2 Exercisable at May 31, 2026 1,655,574 $ 32.79 2.4 $ 13.6 Restricted Stock Units – In addition to stock options, the Company has issued restricted stock units to certain officers and senior management under the 2021 Plan and the 2011 Plan. During fiscal 2026, 371,416 restricted stock units were granted under the 2021 Plan. The restricted stock units convert to shares of Common Stock on a one-for-one basis upon vesting. For time-vested restricted stock units, vesting is typically in three or four equal annual installments beginning with the first anniversary of the date of grant. For performance-based restricted stock units, vesting is contingent upon attainment of pre-established performance goals. During fiscal 2026, there were 184,685 shares of Common Stock issued upon the vesting of restricted stock units under the 2021 Plan. The Company measures the value of restricted stock units at fair value based on the number of units granted and the price of the underlying Common Stock on the grant date, in addition to the expected attainment of pre-established performance goals in the case of performance-based restricted stock units. The Company amortizes the fair value of outstanding restricted stock units as stock-based compensation expense over the requisite service period on a straight-line basis, or sooner if the employee effectively vests upon termination of employment under certain circumstances. The following table sets forth the restricted stock unit award activity for the fiscal years ended May 31: 2026 2025 2024 Granted 413,736 410,392 177,867 Weighted average grant date price per unit $ 25.88 $ 31.04 $ 37.81 As of May 31, 2026, the total pretax compensation cost not yet recognized by the Company with regard to unvested restricted stock units was $6.7. The weighted average period over which this compensation cost is expected to be recognized is 1.6 years. Management Stock Purchase Plan - The Company maintains the Scholastic Corporation Management Stock Purchase Plan (the “MSPP”), which permits certain members of senior management to defer up to 100% of his or her annual cash bonus payments in the form of restricted stock units (the "MSPP RSUs”) which are purchased by the employee at a 25% discount from the lowest closing price of the Common Stock on NASDAQ on any day during the fiscal quarter in which such bonuses are awarded. The MSPP RSUs are converted into shares of Common Stock on a one-for-one basis at the end of the applicable deferral period, which must be a minimum of three years. The Company measures the value of MSPP RSUs based on the number of awards granted and the price of the underlying Common Stock on 76 the grant date, giving effect to the 25% discount. The Company amortizes this discount as stock-based compensation expense over the vesting term on a straight-line basis, or sooner if the employee effectively vests upon termination of employment under certain circumstances. During fiscal 2026, there were 52,252 shares of Common Stock issued upon the vesting of restricted stock units under the MSPP. The following table sets forth the MSPP RSUs activity for the fiscal years ended May 31: 2026 2025 2024 MSPP RSUs allocated 7,990 7,250 15,149 Purchase price per unit $ 12.77 $ 21.49 $ 27.86 In September 2025, the Class A Stockholders authorized an additional 100,000 shares for issuance under the MSPP. At May 31, 2026, there were 197,520 shares of Common Stock remaining authorized for issuance under the MSPP. As of May 31, 2026, there is no pretax compensation cost not yet recognized with regard to unvested MSPP RSUs. The following table sets forth the restricted stock unit and MSPP RSUs activity for the year ended May 31, 2026: Restricted stock units and MSPP RSUs Weighted Average grant date fair value Nonvested as of May 31, 2025 589,226 $ 31.14 Granted 421,726 18.40 Vested (265,217) 31.11 Forfeited (69,682) 29.85 Nonvested as of May 31, 2026 676,053 $ 27.82 The total fair value of shares vested during the fiscal years ended May 31, 2026, 2025 and 2024 was $8.3, $6.5 and $5.8, respectively. Employee Stock Purchase Plan - The Company maintains the Scholastic Corporation Employee Stock Purchase Plan (the “ESPP”), which is offered to eligible United States employees. The ESPP permits participating employees to purchase Common Stock, with after-tax payroll deductions, on a quarterly basis at a 15% discount from the closing price of the Common Stock on NASDAQ on the last business day of the calendar quarter. The Company recognizes the discount on the Common Stock issued under the ESPP as stock-based compensation expense in the quarter in which the employees began participating in the ESPP. The following table sets forth the ESPP share activity for the fiscal years ended May 31: 2026 2025 2024 Shares issued 88,428 109,015 79,458 Weighted average purchase price per share $ 23.61 $ 21.85 $ 32.38 In September 2024, the Class A Stockholders authorized an additional 500,000 shares for issuance under the ESPP. At May 31, 2026, there were 371,625 shares of Common Stock remaining authorized for issuance under the ESPP. 77 16. TREASURY STOCK The Company has authorizations from the Board of Directors to repurchase Common Stock, from time to time as conditions allow, on the open market or through negotiated private transactions, as summarized in the table below: Authorizations Amount March 2024 $ 54.6 March 2025 53.4 December 2025 80.0 March 2026 297.0 Total current Board authorizations $ 485.0 Less repurchases made under the authorizations as of May 31, 2026 (302.0) Remaining Board authorization at May 31, 2026 $ 183.0 Remaining Board authorization at May 31, 2026 represents the amount remaining under the current $297.0 Board authorization for repurchases of shares of Common Stock announced on March 18, 2026, which is available for further repurchases, from time to time as conditions allow, on the open market or through negotiated private transactions. Pursuant to a Board authorization on March 18, 2026, the Company commenced a modified Dutch auction tender offer on March 23, 2026, which expired on April 20, 2026. In connection with this offer, the Company repurchased 2,834,018 shares of Common Stock at a price of $40.00 per share, for an aggregate cost of $115.6, including related fees and expenses. During the fiscal year ended May 31, 2026, the Company repurchased 4,502,948 shares of Common Stock on the open market for an aggregate purchase price of $150.6. The Company also accrued $2.4 of excise tax related to share repurchases. The Company's repurchase program may be suspended at any time without prior notice. 17. EMPLOYEE BENEFIT PLANS Pension Plans The Company has a defined benefit pension plan (the “UK Pension Plan”) that covers certain employees located in the United Kingdom who meet various eligibility requirements. Benefits are based on years of service and on a percentage of compensation near retirement. The UK Pension Plan is funded by contributions from the Company. The Company’s UK Pension Plan has a measurement date of May 31. On October 24, 2025, the UK Pension Plan entered into a group annuity contract covering substantially all remaining uninsured liabilities of the plan. Under the terms of the arrangement, the insurance company is obligated to make payments to the UK Pension Plan that are intended to substantially match the pension benefits payable to the covered participants. The UK Pension Plan remains the legal obligor for the payment of benefits to participants, and participants do not have a direct contractual relationship with the insurer. Accordingly, the transaction does not constitute a settlement of the related pension obligations. The annuity contract is held as a plan asset and is reported at fair value. Following the transaction, the UK Pension Plan liabilities have been measured on a termination basis, reflecting the purchase price of the insurance policy, adjusted for interest accretion, benefit payments, and changes in market conditions subsequent to the transaction date. Postretirement Benefits The Company provides postretirement benefits to eligible retired United States-based employees (the “US Postretirement Benefits”) consisting of certain healthcare and life insurance benefits. Employees became eligible for these benefits after completing certain minimum age and service requirements. Effective June 1, 2009, the Company modified the terms of the Postretirement Benefits, effectively excluding a large percentage of employees from the plan. The Company’s postretirement benefit plan has a measurement date of May 31. The Medicare Prescription Drug, Improvement and Modernization Act (the “Medicare Act”) introduced a prescription drug benefit under Medicare (“Medicare Part D”) as well as a Federal subsidy of 28% to sponsors of retiree health care benefit plans providing a benefit that is at least actuarially equivalent to Medicare Part D. The Company has 78 determined that the US Postretirement benefits provided to its retiree population are in aggregate the actuarial equivalent of the benefits under Medicare Part D. As a result, in fiscal 2025 and 2024, the Company recognized a cumulative reduction of its accumulated postretirement benefit obligation of $0.1 due to the Federal subsidy under the Medicare Act. Beginning in fiscal 2026, the Company elected to no longer apply for the subsidy program. The following table sets forth the weighted average actuarial assumptions utilized to determine the benefit obligations for the UK Pension Plan and the US Postretirement Benefits at May 31: UK Pension Plan US Postretirement Benefits 2026 2025 2024 2026 2025 2024 Weighted average assumptions used to determine benefit obligations: Discount rate 5.4 % 5.8 % 5.2 % 5.2 % 5.4 % 5.5 % Rate of compensation increase (1) — 3.8 % 4.1 % — — — Weighted average assumptions used to determine net periodic benefit cost: Discount rate 5.8 % 5.1 % 5.5 % 5.4 % 5.4 % 5.2 % Expected long-term return on plan assets 5.5 % 4.9 % 5.6 % — — — Rate of compensation increase 3.8 % 4.1 % 4.0 % — — — (1) The rate of compensation increase assumption is not applicable for fiscal 2026 following the pension bulk insurance transaction, as the covered pension obligations are supported by annuity contracts and are no longer dependent on future compensation levels. To develop the expected long-term rate of return on plan assets assumption for the UK Pension Plan, the Company considers historical returns and future expectations. Considering this information and the potential for lower future returns due to a generally lower interest rate environment, the Company selected an assumed weighted average long-term rate of return on plan assets of 5.5% for the UK Pension Plan. The following table sets forth the change in benefit obligation for the UK Pension Plan and the US Postretirement Benefits at May 31: UK Pension Plan US Postretirement Benefits 2026 2025 2026 2025 Change in benefit obligation: Benefit obligation at beginning of year $ 25.3 $ 26.7 $ 6.5 $ 7.2 Interest cost 1.3 1.3 0.3 0.3 Plan participants’ contributions — — 0.0 0.0 Actuarial losses (gains) 4.6 (2.6) 0.3 (0.0) Foreign currency translation (0.0) 1.5 — — Benefits paid, including expenses (1.5) (1.6) (0.9) (1.0) Benefit obligation at end of year $ 29.7 $ 25.3 $ 6.2 $ 6.5 The net actuarial loss included in the projected benefit obligation for the UK Pension Plan in fiscal 2026 was primarily attributable to the change in the measurement basis of the plan's liabilities to a termination basis following the execution of a bulk annuity purchase. The net actuarial gain included in the projected benefit obligation for the UK Pension Plan in fiscal 2025 was primarily due to the increase in discount rate and impact of inflation. The net actuarial loss included in the projected benefit obligation for the US Postretirement Benefits in fiscal 2026 was primarily attributable to the decrease in discount rate and increase in the medical trend assumption. There was no net actuarial gain or loss included in the projected benefit obligation for the US Postretirement Benefits in fiscal 2025 as the gain attributable to the updated census data was offset by the loss attributable to the decrease in discount rate. 79 The following table sets forth the change in plan assets for the UK Pension Plan at May 31: UK Pension Plan 2026 2025 Change in plan assets: Fair value of plan assets at beginning of year $ 20.1 $ 21.4 Actual return on plan assets 2.2 (2.2) Employer contributions 8.7 1.3 Benefits paid, including expenses (1.5) (1.6) Foreign currency translation 0.0 1.2 Fair value of plan assets at end of year $ 29.5 $ 20.1 The following table sets forth the net funded status of the UK Pension Plan and the US Postretirement Benefits and the related amounts recognized on the Company’s Consolidated Balance Sheets at May 31: UK Pension Plan US Postretirement Benefits 2026 2025 2026 2025 Current liabilities $ — $ — $ (0.9) $ (0.9) Noncurrent liabilities (0.2) (5.2) (5.3) (5.6) Net funded balance $ (0.2) $ (5.2) $ (6.2) $ (6.5) The following amounts were recognized in Accumulated other comprehensive income (loss) for the UK Pension Plan and the US Postretirement Benefits on the Company’s Consolidated Balance Sheets at May 31: 2026 2025 UK Pension Plan US Postretirement Benefits Total UK Pension Plan US Postretirement Benefits Total Actuarial gain (loss) $ (12.7) $ 1.1 $ (11.6) $ (11.0) $ 1.4 $ (9.6) Prior service credit (cost) — 5.0 5.0 0.0 5.9 5.9 Amount recognized in Accumulated comprehensive income (loss) net of tax (12.7) 4.6 (8.1) (11.0) 5.5 (5.5) Income tax expense of $1.5, $1.8 and $2.0 were recognized in Accumulated other comprehensive loss at May 31, 2026, 2025 and 2024, respectively. The following table sets forth the projected benefit obligations, accumulated benefit obligations and the fair value of plan assets with respect to the UK Pension Plan as of May 31: UK Pension Plan 2026 2025 Projected benefit obligations $ 29.7 $ 25.3 Accumulated benefit obligations 29.7 25.2 Fair value of plan assets 29.5 20.1 80 The following table sets forth the net periodic benefit (cost) for the UK Pension Plan and the US Postretirement Benefits for the fiscal years ended May 31: UK Pension Plan US Postretirement Benefits 2026 2025 2024 2026 2025 2024 Components of net (benefit) cost: Interest cost $ 1.3 $ 1.3 $ 1.3 $ 0.3 $ 0.3 $ 0.3 Expected return on assets (1.1) (1.0) (1.1) — — — Amortization of prior service (credit) loss 0.0 0.0 0.0 (0.8) (0.8) (0.8) Amortization of net actuarial (gain) loss 1.7 1.4 1.3 (0.1) (0.1) — Net periodic (benefit) cost $ 1.9 $ 1.7 $ 1.5 $ (0.6) $ (0.6) $ (0.5) Actuarial gains and losses are amortized using a corridor approach. The gain or loss corridor is equal to 10% of the greater of the projected benefit obligation and the market-related value of assets. Gains and losses in excess of the corridor are amortized over the future working lifetime. Plan Assets The Company’s investment policy with regard to the assets in the UK Pension Plan is to actively manage, within acceptable risk parameters, certain asset classes where the potential exists to outperform the broader market. The following table sets forth the total weighted average asset allocations for the UK Pension Plan by asset category at May 31: UK Pension Plan 2026 2025 Debt securities — % 42.7 % Cash and cash equivalents — % 4.2 % Liability-driven instruments — % 37.8 % Other (1) 100.0 % 15.3 % 100.0 % 100.0 % (1) As of May 31, 2026, the UK Pension Plan consisted solely of annuity contracts. During fiscal 2026, the UK Pension Plan's investment policy was amended to reflect a target asset allocation of 100% annuity contracts following the completion of the bulk insurance transaction. The fair values of the Company’s Pension Plan assets are measured using Level 1, Level 2 and Level 3 fair value measurements. The following table sets forth the measurement of the Company’s Pension Plan assets at fair value by asset category at the respective dates: Assets at Fair Value as of May 31, 2026 UK Pension Plan Level 1 Level 2 Level 3 Total Annuities — — 29.5 29.5 Total $ — $ — $ 29.5 $ 29.5 81 Assets at Fair Value as of May 31, 2025 UK Pension Plan Level 1 Level 2 Level 3 Total Cash and cash equivalents $ 0.8 $ — $ — $ 0.8 Pooled, Common and Collective Funds (1) (2) — 7.6 — 7.6 Fixed Income (3) — 8.6 — 8.6 Annuities — — 3.1 3.1 Total $ 0.8 $ 16.2 $ 3.1 $ 20.1 (1) Funds which invest in UK government bonds and bond index-linked investments and interest rate and inflation swaps. There are no restrictions on these investments. (2) Funds which invest in bond index funds available to certain qualified retirement plans but not traded openly on any public exchanges. There are no restrictions on these investments. (3) Funds which invest in a diversified portfolio of publicly traded government bonds, corporate bonds and mortgage-backed securities. There are no restrictions on these investments. The Company has purchased annuities to service fixed payments to certain retired plan participants in the UK. These annuities are purchased from investment grade counterparties. These annuities are not traded on open markets and are therefore valued based upon the actuarial determined valuation, and related assumptions, of the underlying projected benefit obligation, a Level 3 valuation technique. The fair value of these assets was $29.5 and $3.1 at May 31, 2026 and May 31, 2025, respectively. The following table summarizes the changes in fair value of these Level 3 assets for the fiscal years ended May 31, 2026 and 2025: Balance at May 31, 2024 $ 3.2 Actual Return on Plan Assets: Relating to assets held at May 31, 2024 (0.3) Relating to assets sold during the year — Purchases, sales and settlements, net — Transfers in and/or out of Level 3 — Foreign currency translation 0.2 Balance at May 31, 2025 $ 3.1 Actual Return on Plan Assets: Relating to assets held at May 31, 2025 (0.1) Relating to assets sold during the year — Purchases, sales and settlements, net 26.3 Transfers in and/or out of Level 3 — Foreign currency translation 0.2 Balance at May 31, 2026 $ 29.5 82 Estimated future benefit payments The following table sets forth the expected future benefit payments under the UK Pension Plan and the US Postretirement Benefits by fiscal year: UK Pension Plan US Postretirement Benefits Pension benefits Benefit payments 2027 $ 1.5 $ 0.9 2028 1.6 0.8 2029 1.7 0.7 2030 1.7 0.7 2031 1.7 0.6 2031 - 2035 9.2 2.4 Assumed health care cost trend rates at May 31: 2026 2025 Health care cost trend rate assumed for the next fiscal year 7.5 % 6.3 % Rate to which the cost trend is assumed to decline (the ultimate trend rate) 5.0 % 5.0 % Year that the rate reaches the ultimate trend rate 2037 2031 Defined contribution plans The Company also provides defined contribution plans for certain eligible employees. In the United States, the Company sponsors a 401(k) retirement plan and has contributed $8.1, $8.4 and $8.7 for fiscal years 2026, 2025 and 2024, respectively. 18. ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) The following table presents the impact on earnings of reclassifications out of Accumulated other comprehensive income (loss) for the fiscal years ended May 31: 2026 2025 2024 UK Pension Plan US Postretirement Benefits UK Pension Plan US Postretirement Benefits UK Pension Plan US Postretirement Benefits Amortization of prior service (credit) loss $ 0.0 $ (0.8) $ 0.0 $ (0.8) $ 0.0 $ (0.8) Amortization of net actuarial loss (gain) 1.7 (0.1) 1.4 (0.1) 1.3 0.0 Tax (benefit) expense — 0.2 — 0.2 — 0.2 Amounts reclassified from Accumulated other comprehensive income (loss) $ 1.7 $ (0.7) $ 1.4 $ (0.7) $ 1.3 $ (0.6) The amounts reclassified out of Accumulated other comprehensive income (loss) were recognized in Other components of net periodic benefit (cost) for all periods presented. 83 The following tables summarize the activity in Accumulated other comprehensive income (loss), net of tax, by component for the periods indicated: Foreign currency translation adjustments UK Pension Plan US Postretirement Benefits Total Balance at May 31, 2024 (1) $ (46.9) $ (11.8) $ 6.2 $ (52.5) Other comprehensive income (loss) before reclassifications $ 10.9 $ (0.6) $ 0.0 $ 10.3 Less: amounts reclassified from Accumulated other comprehensive income (loss) (net of taxes) Amortization of net actuarial loss $ — $ 1.4 $ (0.1) $ 1.3 Amortization of prior service (credit) cost — 0.0 (0.6) (0.6) Other comprehensive income (loss) 10.9 0.8 (0.7) 11.0 Balance at May 31, 2025 (1) $ (36.0) $ (11.0) $ 5.5 $ (41.5) Other comprehensive income (loss) before reclassifications $ 4.7 $ (3.4) $ (0.2) $ 1.1 Less: amounts reclassified from Accumulated other comprehensive income (loss) (net of taxes) Cumulative translation adjustment related to sale of equity method investment (2) 3.5 — — 3.5 Amortization of net actuarial loss $ — $ 1.7 $ (0.1) $ 1.6 Amortization of prior service (credit) cost — 0.0 (0.6) (0.6) Other comprehensive income (loss) 8.2 (1.7) (0.9) 5.6 Balance at May 31, 2026 (1) $ (27.8) $ (12.7) $ 4.6 $ (35.9) (1) Accumulated other comprehensive income (loss) related to the UK Pension Plan and the US Postretirement Benefits are reported net of taxes of $1.5, $1.8 and $2.0 at May 31, 2026, 2025, and 2024, respectively. (2) Refer to Note 9, "Investments", for further details regarding sale of equity method investment. 19. EARNINGS (LOSS) PER SHARE The following table summarizes the reconciliation of the numerators and denominators for the Basic and Diluted earnings (loss) per share computation for the fiscal years ended May 31: 2026 2025 2024 Net income (loss) attributable to Class A and Common Shares $ 56.7 $ (1.9) $ 12.1 Weighted average Shares of Class A Stock and Common Stock outstanding for basic earnings (loss) per share (in millions) 23.7 27.6 29.6 Dilutive effect of Class A Stock and Common Stock potentially issuable pursuant to stock-based compensation plans (in millions)* 0.5 — 0.8 Adjusted weighted average Shares of Class A Stock and Common Stock outstanding for diluted earnings (loss) per share (in millions) 24.2 27.6 30.4 Earnings (loss) per share of Class A Stock and Common Stock Basic earnings (loss) per share $ 2.39 $ (0.07) $ 0.41 Diluted earnings (loss) per share $ 2.34 $ (0.07) $ 0.40 Anti-dilutive shares pursuant to stock-based compensation plans 1.4 0.4 0.9 * The Company experienced a net loss for the fiscal year ended May 31, 2025 and therefore did not report any dilutive share impact. The following potential common shares were excluded from the loss per diluted share computation: outstanding options and restricted stock units of $2.7 and $0.5, respectively. The Company measures diluted earnings per share using the Treasury Stock method. 84 The following table sets forth Options outstanding pursuant to stock-based compensation plans for the fiscal years ended May 31: 2026 2025 Options outstanding pursuant to stock-based compensation plans (in millions) 1.8 2.7 As of May 31, 2026, $183.0 remains available for future purchases of Common Stock under the current repurchase authorization of the Board of Directors. See Note 16, “Treasury Stock,” for a more complete description of the Company’s share buy-back program. 20. OTHER ACCRUED EXPENSES Other accrued expenses consisted of the following at May 31: 2026 2025 Accrued payroll, payroll taxes and benefits $ 31.2 $ 35.2 Accrued bonus and commissions 29.1 26.6 Accrued other taxes 17.3 22.2 Returns liability 32.2 34.4 Accrued advertising and promotions 5.5 5.1 Other accrued expenses 42.8 42.7 Total accrued expenses $ 158.1 $ 166.2 The table below provides information regarding Accrued severance which is included in Accrued payroll, payroll taxes and benefits on the Company’s Consolidated Balance Sheets at May 31: 2026 2025 Beginning balance $ 4.3 $ 3.9 Accruals 17.0 13.0 Payments (19.5) (12.6) Ending balance $ 1.8 $ 4.3 During fiscal 2026, the Company recognized $16.4 of severance expense related to cost-saving initiatives. 21. DERIVATIVES AND HEDGING The Company enters into foreign currency derivative contracts to economically hedge the exposure to foreign currency fluctuations associated with the forecasted purchase of inventory, the foreign exchange risk associated with certain receivables denominated in foreign currencies and certain future commitments for foreign expenditures. These derivative contracts are economic hedges and are not designated as cash flow hedges. The Company marks-to-market these instruments and records the changes in the fair value of these items in Selling, general and administrative expenses, and recognizes the unrealized gain or loss in other current assets or other current liabilities. The notional values of the contracts were $29.9 and $22.8 as of May 31, 2026 and 2025, respectively. A net unrealized loss of $0.1 was recognized at May 31, 2026 and May 31, 2025. 22. FAIR VALUE MEASUREMENTS The Company determines the appropriate level in the fair value hierarchy for each fair value measurement of assets and liabilities carried at fair value on a recurring basis in the Company’s financial statements. The fair value hierarchy prioritizes the inputs, which refer to assumptions that market participants would use in pricing an asset or liability, based upon the highest and best use, into three levels as follows: •Level 1 Unadjusted quoted prices in active markets for identical assets or liabilities at the measurement date. 85 •Level 2 Observable inputs other than unadjusted quoted prices in active markets for identical assets or liabilities such as: ◦Quoted prices for similar assets or liabilities in active markets ◦Quoted prices for identical or similar assets or liabilities in inactive markets ◦Inputs other than quoted prices that are observable for the asset or liability ◦Inputs that are derived principally from or corroborated by observable market data by correlation or other means •Level 3 Unobservable inputs in which there is little or no market data available, which are significant to the fair value measurement and require the Company to develop its own assumptions. The Company’s financial assets and liabilities measured at fair value consisted of cash and cash equivalents, debt and foreign currency forward contracts. Cash and cash equivalents are comprised of bank deposits and short-term investments, such as money market funds, the fair value of which is based on quoted market prices, a Level 1 fair value measure. The Company employs Level 2 fair value measurements for the disclosure of the fair value of its various lines of credit and long term debt. The fair value of the Company's debt approximates the carrying value for all periods presented. The fair values of foreign currency forward contracts, used by the Company to manage the impact of foreign exchange rate changes to the financial statements, are based on quotations from financial institutions, a Level 2 fair value measure. Non-financial assets and liabilities for which the Company employs fair value measures on a non-recurring basis include: •Long-lived assets •Operating lease right-of-use (ROU) assets •Investments •Assets acquired in a business combination •Impairment assessment of goodwill and intangible assets •Long-lived assets held for sale Level 2 and Level 3 inputs are employed by the Company in the fair value measurement of these assets and liabilities. For a more detailed description of the fair value measurements employed by the Company, see Note 1, “Description of the Business, Basis of Presentation and Summary of Significant Accounting Policies." The Company employs fair value measurements for certain property, plant and equipment, investment in film and television programs, investments and prepublication assets and the Company assesses future expected cash flows attributable to these assets. For investments, see Note 9, "Investments," for a more complete description of the fair value measurements employed. During fiscal 2026, certain assets related to prepublication costs, investment in film and television programs, cloud computing arrangements and a cost-method investment were measured at fair value in connection with impairment assessments, with fair value determined using a discounted cash flow methodology. Certain inventory was also measured at fair value based on its net realizable value. See Note 5, "Asset Write Down," for a more complete description of the impairments recognized in fiscal 2026. During fiscal 2025, the Company completed the acquisition of 9 Story. Refer to Note 12, "Acquisitions", for details regarding this acquisition and a description of the fair value measurements employed. In addition, certain inventory, operating lease ROU assets and prepublication costs were measured at fair value in connection with impairment assessments, with fair value determined using a discounted cash flow methodology. See Note 5, "Asset Write Down," for a more complete description of the impairments recognized in fiscal 2025. During fiscal 2024, certain operating lease ROU assets, prepublication costs and intangible assets were measured at fair value in connection with impairment assessments, with fair value determined using a discounted cash flow methodology. See Note 5, "Asset Write Down," for a more complete description of the impairments recognized in fiscal 2024. In addition, the Company acquired certain amortizable intangible assets during fiscal 2024, the fair value of which was determined using a discounted cash flow methodology. See Note 13, "Goodwill and Intangibles," for a more complete description of the acquired intangible assets. 86 The following tables present non-financial assets that were measured and recognized at fair value on a non-recurring basis and the total impairment losses and additions recognized on those assets: Net carrying value as of Fair value measured and recognized using Impairment losses for fiscal year ended Additions due to acquisitions May 31, 2026 Level 1 Level 2 Level 3 May 31, 2026 Inventory $ — $ — $ — $ 0.6 $ 0.6 $ — Prepublication assets — — — 4.3 4.3 — Investment in film and television programs — — — 4.9 4.9 — Other Assets (i) — — — 1.1 1.1 — (i) Includes capitalized costs related to cloud computing arrangements and a cost-method investment Net carrying value as of Fair value measured and recognized using Impairment losses for fiscal year ended Additions due to acquisitions May 31, 2025 Level 1 Level 2 Level 3 May 31, 2025 Inventory $ — $ — $ — $ 1.1 $ 1.1 $ — Prepublication assets — — — 1.2 1.2 — Operating lease right-of-use assets, net — — — 0.6 0.6 — Net carrying value as of Fair value measured and recognized using Impairment losses for fiscal year ended Additions due to acquisitions May 31, 2024 Level 1 Level 2 Level 3 May 31, 2024 Prepublication assets $ — $ — $ — $ 3.0 $ 3.0 $ — Operating lease right-of-use assets, net — — — 3.9 3.9 — Intangible assets 5.5 — — 6.0 3.1 6.0 23. RELATED PARTY TRANSACTIONS On April 18, 2024, the Company entered into a share repurchase agreement to purchase shares of its common stock from the Estate of M. Richard Robinson, Jr. in a privately negotiated transaction. Pursuant to the repurchase agreement, the Company purchased 400,000 shares of common stock on April 18, 2024 at a price of $33.51 per share, representing an aggregate purchase price of $13.4. The price per share paid represented a 3.8% discount to the closing price of the stock, $34.83, on the date of execution of the repurchase agreement. The repurchase was made pursuant to the Company’s current share repurchase program as previously approved by the Board. The aforementioned transaction was approved by the Board upon the recommendation of the Audit Committee. 24. SUBSEQUENT EVENTS On July 22, 2026, the Company announced its quarterly cash dividend of $0.25 per share on the Company's Class A and Common Stock for the first quarter of fiscal 2027, representing a 25% increase from the previous dividend of $0.20 per share. The dividend is payable on September 15, 2026 to shareholders of record as of the close of business on August 31, 2026. 87 Report of Independent Registered Public Accounting Firm To the Board of Directors and Stockholders of Scholastic Corporation Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of Scholastic Corporation (the Company) as of May 31, 2026 and 2025, the related consolidated statements of operations, comprehensive income (loss), changes in stockholders’ equity and cash flows for each of the three fiscal years in the period ended May 31, 2026, and the related notes and financial statement schedule listed in the Index at Item 15(c) (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at May 31, 2026 and 2025, and the results of its operations and its cash flows for each of the three fiscal years in the period ended May 31, 2026, in conformity with U.S. generally accepted accounting principles. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of May 31, 2026, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated July 24, 2026 expressed an unqualified opinion thereon. Basis for Opinion These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matter The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments. The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. 88 Revenue Recognition - allocation of contract transaction price to identified performance obligations Description of the Matter As described in Note 1 to the consolidated financial statements, the Company identifies two performance obligations within its school-based book fair contracts, which include (i) the fulfillment of book fairs product and (ii) the fulfillment of product upon the redemption of incentive program credits by customers. The Company allocates the transaction price to each performance obligation based on a relative standalone selling price. Changes in the allocation of the transaction price could impact the timing of the recognition of revenue. Considering the nature and volume of school-based book fair transactions, we identified the allocation of the transaction price to the identified performance obligations within school-based book fair contracts as a critical audit matter because the estimation of standalone selling price for the incentive program credits required especially challenging auditor effort and judgment in evaluating the methodology used to establish standalone selling price. Estimating standalone selling price for the incentive program credits utilizes estimates of a standardized value per credit. The standardized value per credit is based on historical experience of issuance and redemption patterns related to the incentive program, adjusted to normalize the data and to align with expectations of future redemptions. Changes in those assumptions can have a material effect on the amount of revenue recognized in the current or future periods. How We Addressed the Matter in Our Audit We obtained an understanding, evaluated the design, and tested the operating effectiveness of controls over the Company’s allocation of transaction price to the two performance obligations. We tested management’s review controls over the significant assumptions, such as adjustments made to historical experience and redemption patterns, and completeness and accuracy of the data used in the calculation. To test the allocation of revenue recognized in current and future periods, our audit procedures included, among others, evaluating the methodology used and analyzing the historical experience and redemption patterns, particularly the adjustments made to normalize the data and to align with expectations of future redemptions. We tested the accuracy and completeness of the underlying historical incentive credit program data used in management’s calculation. To test the accuracy and completeness of historical incentive program issuance and redemption data used in the analysis, we agreed the total incentive program activity to the source system and for a sample of transactions performed transactional testing to source documents. We also evaluated the appropriateness of management’s adjustments to historical data by gaining an understanding of the nature of the adjustments, performing a sensitivity analysis and tracing the adjustments to the historical data to source documents. /s/ Ernst & Young LLP We have served as the Company’s auditor since at least 1938, but we are unable to determine the specific year. New York, New York July 24, 2026 89 Report of Independent Registered Public Accounting Firm To the Board of Directors and Stockholders of Scholastic Corporation Opinion on Internal Control Over Financial Reporting We have audited Scholastic Corporation’s internal control over financial reporting as of May 31, 2026, based on criteria established in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria). In our opinion, Scholastic Corporation (the Company) maintained, in all material respects, effective internal control over financial reporting as of May 31, 2026, based on the COSO criteria. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of May 31, 2026 and 2025, the related consolidated statements of operations, comprehensive income (loss), changes in stockholders’ equity and cash flows for each of the three fiscal years in the period ended May 31, 2026, and the related notes and financial statement schedule listed in the Index at Item 15(c) and our report dated July 24, 2026 expressed an unqualified opinion thereon. Basis for Opinion The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Definition and Limitations of Internal Control Over Financial Reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. /s/ Ernst & Young LLP New York, New York July 24, 2026 90 Supplementary Financial Information Summary of Quarterly Results of Operations (Unaudited, amounts in millions except per share data) First Quarter Second Quarter Third Quarter Fourth Quarter Fiscal Year Ended May 31, 2026 Revenues $ 225.6 $ 551.1 $ 329.1 $ 476.1 $ 1,581.9 Cost of goods sold 123.5 225.6 150.3 190.4 689.8 Net income (loss) (71.1) 55.9 62.5 9.4 56.7 Net income (loss) per share of Class A and Common Stock: Basic (1) $ (2.83) $ 2.21 $ 2.61 $ 0.46 $ 2.39 Diluted (1) $ (2.83) $ 2.17 $ 2.55 $ 0.45 $ 2.34 2025 Revenues $ 237.2 $ 544.6 $ 335.4 $ 508.3 $ 1,625.5 Cost of goods sold 128.3 228.6 154.6 207.3 718.8 Net income (loss) (62.5) 48.8 (3.6) 15.4 (1.9) Net income (loss) per share of Class A and Common Stock: Basic (1) $ (2.21) $ 1.73 $ (0.13) $ 0.59 $ (0.07) Diluted (1) $ (2.21) $ 1.71 $ (0.13) $ 0.59 $ (0.07) (1) The sum of the quarters may not equal the full year basic and diluted earnings per share since each quarter is calculated separately. 91