Graham Holdings Co.: Q2 FY2026 earnings call

What management said about Q2 FY2026, from the documents filed with the SEC on 30 July 2026: press release. The quarter’s numbers.

Key takeaways

Revenue rose 7% in the quarter: Second-quarter revenue was $1,302.5 million, up 7% from $1,215.8 million a year earlier, with growth at television, healthcare, manufacturing, automotive and other businesses. Source
Operating income rose 15%: Operating income was $83.6 million against $72.8 million. Management credited improved results at education, television broadcasting and other businesses, partly offset by declines at healthcare, manufacturing and automotive. Source
Net income and adjusted EPS both higher: Net income attributable to common shares was $281.1 million, or $64.86 per diluted share, against $8.35 a year earlier. Adjusted net income was $84.2 million, or $19.46 per share. Source
Education revenue fell, profit rose: Education revenue was $417.8 million, down 4%, while education operating income rose 9% to $50.3 million and adjusted operating cash flow rose 2% to $60.9 million. Source
Pension settlement produced large gain: A $137.0 million pre-tax noncash settlement gain was recorded after the annuity purchase, which moved obligations for about 1,080 retirees and beneficiaries to the insurer. Source
KLG tax benefit and Pillar Two accrual: A $69.6 million U.S. tax benefit was recognized for the six months from the KLG restructuring and sale. In the quarter, a $19.2 million non-U.S. global minimum top-up tax expense was accrued, and the quarter's provision rose 74% to $35.1 million. Source
Kaplan Languages Group sale closed: The KLG sale closed May 1, 2026, following a $19.0 million impairment recorded in the first quarter. A $5.2 million loss on the sale was recorded in the second quarter. Source

“Management believes that these non-GAAP measures, when read in conjunction with the Company’s GAAP financials, provide useful information to investors by offering:”
Graham Holdings Co., press release

What changed from last quarter

New: In June 2026 the Company bought a group annuity contract to settle part of its defined benefit pension obligation, funded from plan assets. Source
Ended: The Kaplan Languages Group sale, which the prior release said had been agreed in the first quarter, closed.

Results and growth drivers

Revenue rose 7% in the quarter: Second-quarter revenue was $1,302.5 million, up 7% from $1,215.8 million a year earlier, with growth at television, healthcare, manufacturing, automotive and other businesses. Source
Operating income rose 15%: Operating income was $83.6 million against $72.8 million. Management credited improved results at education, television broadcasting and other businesses, partly offset by declines at healthcare, manufacturing and automotive. Source
Net income and adjusted EPS both higher: Net income attributable to common shares was $281.1 million, or $64.86 per diluted share, against $8.35 a year earlier. Adjusted net income was $84.2 million, or $19.46 per share. Source
Six-month revenue and operating income up: For the first six months, revenue was $2,538.5 million, up 7%, and operating income was $141.5 million, up from $120.2 million, with improvement at television broadcasting, manufacturing and other businesses. Source

Segment operating results

Education revenue fell, profit rose: Education revenue was $417.8 million, down 4%, while education operating income rose 9% to $50.3 million and adjusted operating cash flow rose 2% to $60.9 million. Source
Television broadcasting profit up: Television broadcasting revenue rose 3% to $109.6 million. Operating income rose 9% to $30.5 million, and adjusted operating cash flow rose 7% to $35.8 million. Source
Healthcare revenue up, profit down: Healthcare revenue rose 22% to $247.7 million, led by CSI at up 31%. Operating income fell 2% to $24.6 million, with CSI operating income down 11%. Source
Manufacturing revenue up 39%: Manufacturing revenue rose 39% to $133.3 million, while operating income fell 6% to $7.1 million and amortization within the segment rose 54%. Source
Automotive revenue up, profit down: Automotive revenue rose 6% to $301.4 million, while operating income fell 13% to $8.1 million and adjusted operating cash flow fell 9% to $10.1 million. Source

“these items are independent of the Company’s core operations and not indicative of the performance of the Company’s business operations.”
Graham Holdings Co., press release

Education and Kaplan detail

Kaplan international revenue down 7%: Kaplan international revenue was $252.4 million, down 7%, while its operating income rose 10% to $32.9 million. Source
Higher education and supplemental mixed: Higher education revenue rose 2% to $86.3 million, but its operating income fell 7% to $16.6 million. Supplemental education revenue fell 1% to $79.5 million. Source

Costs, margins and depreciation

Depreciation and amortization fell: Depreciation fell 7% to $18.3 million and amortization of intangible assets fell 17% to $6.0 million, compared with the prior-year quarter. Source

Non-operating items and pension

Pension settlement produced large gain: A $137.0 million pre-tax noncash settlement gain was recorded after the annuity purchase, which moved obligations for about 1,080 retirees and beneficiaries to the insurer. Source
Equity affiliates recorded a loss: Equity in losses of affiliates was $19.9 million, against earnings of $3.1 million a year earlier. Interest expense fell 5% to $17.2 million. Source
Marketable securities produced gains: Net gains on marketable equity securities were $101.9 million in the quarter, against $11.5 million of net losses a year earlier. Source

Income taxes

KLG tax benefit and Pillar Two accrual: A $69.6 million U.S. tax benefit was recognized for the six months from the KLG restructuring and sale. In the quarter, a $19.2 million non-U.S. global minimum top-up tax expense was accrued, and the quarter's provision rose 74% to $35.1 million. Source

Debt, cash and investments

Borrowings rose to $900.4 million: Borrowings were $900.4 million at an average rate of 5.7%, compared with $822.0 million at March 31. Of this, $231.2 million was drawn on the $400 million revolver. Source
Cash and investments of $1.3 billion: Cash, marketable equity securities and other investments totaled $1,297.4 million at June 30, 2026, compared with $1,171.8 million at March 31, 2026. Source

Share repurchases and capital spending

Buybacks of $122.0 million in six months: Class B repurchases in the first six months totaled 110,471 shares for $122.0 million. Remaining authorization was 352,011 shares at June 30, against 430,292 at March 31. Source
Capital spending flat in quarter: Capital expenditures were $19.8 million in each of the second quarters of 2026 and 2025. Six-month capital expenditures rose to $40.6 million from $33.9 million. Source

Acquisitions and dispositions

Kaplan Languages Group sale closed: The KLG sale closed May 1, 2026, following a $19.0 million impairment recorded in the first quarter. A $5.2 million loss on the sale was recorded in the second quarter. Source

Coming up, as management said on 30 July 2026

Tax accrual may reverse on enactment: Management said enactment of legislation in the U.K. and other jurisdictions would favorably affect the tax provision and could fully reverse the $19.2 million accrual without payment. Source

Risks management discussed

Regulatory: Management said the $19.2 million accrual covers non-U.S. jurisdictions that have not yet enacted OECD guidance exempting U.S. parent groups from Pillar Two top-up tax. Source
Financial: The company noted that gains and losses on its equity securities portfolio reflect changes in fair value measured by quoted prices. Source

Earlier plans management reported on

Not stated: The prior release gave an expected closing date of May 1, 2026 for the KLG sale; this release reports the sale closed on May 1, 2026.

Other quarters

Summarised with AI from the documents the company filed with the SEC. Every point is checked against the filing before it is shown: management’s own words word for word, figures against the line or table row they come from. A point that fails the check is left out. Source opens the filing at that line.

As filed with the SEC

Open the filing on EDGAR

ARLINGTON, VA - Graham Holdings Company (NYSE: GHC) today reported its financial results for the second quarter of 2026. The Company also filed its Form 10-Q today for the quarter ended June 30, 2026 with the Securities and Exchange Commission.

Division Operating Results

Revenue for the second quarter of 2026 was $1,302.5 million, up 7% from $1,215.8 million in the second quarter of 2025. Revenues increased at television broadcasting, healthcare, manufacturing, automotive and other businesses, partially offset by a decline at education. The Company reported operating income of $83.6 million for the second quarter of 2026, compared to $72.8 million for the second quarter of 2025. The increase in operating results is due to improved results at education, television broadcasting and other businesses, partially offset by declines at healthcare, manufacturing and automotive. The Company reported adjusted operating cash flow (non-GAAP) of $119.8 million for the second quarter of 2026, compared to $111.3 million for the second quarter of 2025. Adjusted operating cash flow increased at education, television broadcasting, manufacturing and other businesses, partially offset by declines at healthcare and automotive. Capital expenditures totaled $19.8 million for each of the second quarters of 2026 and 2025.

Revenue for the first six months of 2026 was $2,538.5 million, up 7% from $2,381.7 million in the first six months of 2025. Revenues increased at television broadcasting, healthcare, manufacturing, automotive and other businesses, partially offset by a slight decline at education. The Company reported operating income of $141.5 million for the first six months of 2026, compared to $120.2 million for the first six months of 2025. The increase in operating results is due to improved results at television broadcasting, manufacturing and other businesses, partially offset by declines at education, healthcare and automotive. The Company reported adjusted operating cash flow (non-GAAP) of $232.7 million for the first six months of 2026, compared to $199.4 million for the first six months of 2025. Adjusted operating cash flow increased at education, television broadcasting, manufacturing and other businesses, partially offset by declines at healthcare and automotive. Capital expenditures totaled $40.6 million and $33.9 million for the first six months of 2026 and 2025, respectively.

Acquisitions and Dispositions of Businesses

In the first quarter of 2026, the Company entered into an agreement to sell the Kaplan Languages Group (KLG) included in Kaplan International and recorded a $19.0 million pre-tax impairment charge. The transaction closed on May 1, 2026; the Company recorded a $5.2 million loss on the sale of the business in the second quarter of 2026.

Pension Plan

In June 2026, the Company purchased an irrevocable group annuity contract from an insurance company for $113.9 million to settle $124.3 million of the outstanding defined benefit pension obligation related to certain retirees and beneficiaries. The purchase of the group annuity contract was funded from the assets of the Company’s pension plan. As a result of this transaction, the Company was relieved of all responsibility for these pension obligations and the insurance company is now required to pay and administer the retirement benefits owed to approximately 1,080 retirees and beneficiaries, with no change to the amount, timing or form of monthly retirement benefit payments. As a result, the Company recorded a pre-tax noncash settlement gain of $137.0 million in the second quarter of 2026.

Income Taxes

The Company recognized a U.S. income tax benefit of $69.6 million during the six months ended June 30, 2026, in connection with the restructuring and sale of the KLG business.

As a result of this significant U.S. income tax benefit, the Company accrued a non-U.S. global minimum corporate top-up income tax expense of $19.2 million in the second quarter of 2026. This accrual relates to non-U.S. jurisdictions that have not yet enacted legislation adopting recent guidance from the Organization for Economic Co-operation and Development (OECD), which would exempt U.S. parent multinational groups from Pillar Two top-up tax on their U.S. source income. The enactment of legislation in the U.K. and other jurisdictions would have a favorable impact on the Company’s income tax provision and could result in a complete reversal of the $19.2 million accrued amount without payment.

Debt, Cash and Marketable Equity Securities

At June 30, 2026, the Company had $900.4 million in borrowings outstanding at an average interest rate of 5.7%, including $231.2 million outstanding on its $400 million revolving credit facility. Cash, marketable equity securities and other investments totaled $1,297.4 million at June 30, 2026.

Overall, the Company recognized $101.9 million and $33.0 million in net gains on marketable equity securities in the second quarter and first six months of 2026, compared to $11.5 million in net losses and $32.3 million in net gains on marketable equity securities in the second quarter and first six months of 2025.

Common Stock Repurchases

During the first six months of 2026, the Company purchased a total of 110,471 shares of its Class B common stock at a cost of $122.0 million. At June 30, 2026, there were 4,251,268 shares outstanding. On September 12, 2024, the Board of Directors authorized the Company to acquire up to 500,000 shares of its Class B common stock; the Company has remaining authorization for 352,011 shares as of June 30, 2026.

Overall Company Results

The Company reported net income attributable to common shares of $281.1 million ($64.86 per share) for the second quarter of 2026, compared to $36.7 million ($8.35 per share) for the second quarter of 2025. For the first six months of 2026, the Company reported net income attributable to common shares of $310.2 million ($71.04 per share), compared to $60.6 million ($13.81 per share) for the first six months of 2025.

The results for the second quarter and first six months of 2026 and 2025 were affected by a number of items as described in the Non-GAAP Financial Information schedule attached to this release. Excluding these items, net income attributable to common shares was $84.2 million ($19.46 per share) for the second quarter of 2026, compared to $63.1 million ($14.33 per share) for the second quarter of 2025. Excluding these items, net income attributable to common shares was $158.1 million ($36.19 per share) for the first six months of 2026, compared to $114.1 million ($25.98 per share) for the first six months of 2025.

Forward-Looking Statements

Forward-looking statements notice

All public statements made by the Company and its representatives that are not statements of historical fact, including certain statements in this press release, in the Company’s Annual Report on Form 10-K and in the Company’s 2025 Annual Report to Stockholders, are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on expectations, forecasts, and assumptions by the Company’s management and involve a number of risks, uncertainties, and other factors that could cause actual results to differ from those stated, including, without limitation, comments about expectations related to acquisitions or dispositions or related business activities, the Company’s business strategies and objectives, the prospects for growth in the Company’s various business operations, the Company’s future financial performance, and the risks and uncertainties described in Item 1A of the Company’s Annual Report on Form 10-K. Accordingly, undue reliance should not be placed on any forward-looking statement made by or on behalf of the Company. The Company assumes no obligation to update any forward-looking statement after the date on which such statement is made, even if new information subsequently becomes available.

	Three Months Ended
	June 30				%
GRAHAM HOLDINGS COMPANY
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(in thousands, except per share amounts)		2026		2025	Change
Operating revenues	$1,302,506		$1,215,772		7
Operating expenses	1,194,613		1,116,128		7
Depreciation of property, plant and equipment	18,281		19,652		(7)
Amortization of intangible assets	5,978		7,241		(17)
Operating income	83,634		72,751		15
Equity in (losses) earnings of affiliates, net	(19,863)		3,114		-
Interest income	1,881		2,261		(17)
Interest expense	(17,173)		(18,106)		(5)
Non-operating pension and postretirement benefit income, net	169,649		28,602		-
Gain (loss) on marketable equity securities, net	101,879		(11,543)		-
Other expense, net	(2,531)		(16,456)		(85)
Income before income taxes	317,476		60,623		-
Provision for income taxes	35,100		20,200		74
Net income	282,376		40,423		-
Net income attributable to noncontrolling interests	(1,273)		(3,674)		(65)
Net Income Attributable to Graham Holdings Company Common Stockholders	$281,103		$36,749		-
Per Share Information Attributable to Graham Holdings Company Common Stockholders
Basic net income per common share	$65.53		$8.43		-
Basic average number of common shares outstanding	4,265		4,333
Diluted net income per common share	$64.86		$8.35		-
Diluted average number of common shares outstanding	4,309		4,373

	Six Months Ended
	June 30				%
GRAHAM HOLDINGS COMPANY
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(in thousands, except per share amounts)		2026		2025	Change
Operating revenues	$2,538,498		$2,381,687		7
Operating expenses	2,329,294		2,206,192		6
Depreciation of property, plant and equipment	36,675		40,206		(9)
Amortization of intangible assets	12,033		15,065		(20)
Impairment of goodwill and asset group held for sale	19,029		-		-
Operating income	141,467		120,224		18
Equity in earnings (losses) of affiliates, net	14,987		(5,314)		-
Interest income	4,356		4,761		(9)
Interest expense	(33,402)		(100,383)		(67)
Non-operating pension and postretirement benefit income, net	200,722		63,219		-
Gain on marketable equity securities, net	32,956		32,258		2
Other expense, net	(2,959)		(20,521)		(86)
Income before income taxes	358,127		94,244		-
Provision for income taxes	45,000		28,100		60
Net income	313,127		66,144		-
Net income attributable to noncontrolling interests	(2,918)		(5,501)		(47)
Net Income Attributable to Graham Holdings Company Common Stockholders	$310,209		$60,643		-
Per Share Information Attributable to Graham Holdings Company Common Stockholders
Basic net income per common share	$71.76		$13.93		-
Basic average number of common shares outstanding	4,298		4,327
Diluted net income per common share	$71.04		$13.81		-
Diluted average number of common shares outstanding	4,342		4,366

	Three Months Ended					Six Months Ended
	June 30				%	June 30				%
GRAHAM HOLDINGS COMPANY
BUSINESS DIVISION INFORMATION
(Unaudited)
(in thousands)		2026		2025	Change		2026		2025	Change
Operating Revenues
Education	$417,808		$436,813		(4)	$858,287		$861,544		0
Television broadcasting	109,630		105,984		3	221,183		209,538		6
Healthcare	247,651		202,219		22	456,991		375,960		22
Manufacturing	133,280		96,218		39	258,314		194,223		33
Automotive	301,352		285,572		6	568,976		566,563		0
Other businesses	92,839		88,970		4	174,766		173,867		1
Corporate office	723		621		16	1,395		1,241		12
Intersegment elimination	(777)		(625)		-	(1,414)		(1,249)		-
	$1,302,506		$1,215,772		7	$2,538,498		$2,381,687		7
Operating Expenses
Education	$367,532		$390,628		(6)	$775,629		$775,326		0
Television broadcasting	79,147		78,044		1	156,757		157,200		0
Healthcare	223,041		177,122		26	414,955		332,546		25
Manufacturing	126,179		88,652		42	243,213		181,177		34
Automotive	293,287		276,279		6	555,603		550,778		1
Other businesses	110,026		116,265		(5)	216,090		232,400		(7)
Corporate office	20,437		16,656		23	36,198		33,285		9
Intersegment elimination	(777)		(625)		-	(1,414)		(1,249)		-
	$1,218,872		$1,143,021		7	$2,397,031		$2,261,463		6
Operating Income (Loss)
Education	$50,276		$46,185		9	$82,658		$86,218		(4)
Television broadcasting	30,483		27,940		9	64,426		52,338		23
Healthcare	24,610		25,097		(2)	42,036		43,414		(3)
Manufacturing	7,101		7,566		(6)	15,101		13,046		16
Automotive	8,065		9,293		(13)	13,373		15,785		(15)
Other businesses	(17,187)		(27,295)		37	(41,324)		(58,533)		29
Corporate office	(19,714)		(16,035)		(23)	(34,803)		(32,044)		(9)
	$83,634		$72,751		15	$141,467		$120,224		18
Amortization of Intangible Assets and Impairment of Goodwill and Asset Group Held for Sale
Education	$243		$1,699		(86)	$19,586		$3,818		-
Television broadcasting	1,360		1,360		-	2,720		2,720		-
Healthcare	90		117		(23)	186		235		(21)
Manufacturing	3,743		2,431		54	7,486		4,862		54
Automotive	5		5		-	10		10		-
Other businesses	537		1,629		(67)	1,074		3,420		(69)
Corporate office	-		-		-	-		-		-
	$5,978		$7,241		(17)	$31,062		$15,065		-
Operating Income (Loss) before Amortization of Intangible Assets and Impairment of Goodwill and Asset Group Held for Sale
Education	$50,519		$47,884		6	$102,244		$90,036		14
Television broadcasting	31,843		29,300		9	67,146		55,058		22
Healthcare	24,700		25,214		(2)	42,222		43,649		(3)
Manufacturing	10,844		9,997		8	22,587		17,908		26
Automotive	8,070		9,298		(13)	13,383		15,795		(15)
Other businesses	(16,650)		(25,666)		35	(40,250)		(55,113)		27
Corporate office	(19,714)		(16,035)		(23)	(34,803)		(32,044)		(9)
	$89,612		$79,992		12	$172,529		$135,289		28

	Three Months Ended					Six Months Ended
	June 30				%	June 30				%
(in thousands)		2026		2025	Change		2026		2025	Change
Depreciation
Education	$5,659		$7,412		(24)	$11,713		$15,176		(23)
Television broadcasting	2,345		2,625		(11)	4,681		5,253		(11)
Healthcare	1,913		1,723		11	3,827		3,509		9
Manufacturing	3,037		2,654		14	6,172		5,357		15
Automotive	1,937		1,708		13	3,782		3,437		10
Other businesses	3,223		3,353		(4)	6,161		7,142		(14)
Corporate office	167		177		(6)	339		332		2
	$18,281		$19,652		(7)	$36,675		$40,206		(9)
Pension Expense
Education	$4,672		$4,413		6	$9,111		$8,636		6
Television broadcasting	1,619		1,532		6	3,107		2,951		5
Healthcare	1,643		1,993		(18)	3,529		4,992		(29)
Manufacturing	1,255		654		92	2,485		1,730		44
Automotive	51		21		-	68		48		42
Other businesses	1,938		2,295		(16)	3,725		4,011		(7)
Corporate office	744		791		(6)	1,477		1,523		(3)
	$11,922		$11,699		2	$23,502		$23,891		(2)
Adjusted Operating Cash Flow (non-GAAP)
Education	$60,850		$59,709		2	$123,068		$113,848		8
Television broadcasting	35,807		33,457		7	74,934		63,262		18
Healthcare	28,256		28,930		(2)	49,578		52,150		(5)
Manufacturing	15,136		13,305		14	31,244		24,995		25
Automotive	10,058		11,027		(9)	17,233		19,280		(11)
Other businesses	(11,489)		(20,018)		43	(30,364)		(43,960)		31
Corporate office	(18,803)		(15,067)		(25)	(32,987)		(30,189)		(9)
	$119,815		$111,343		8	$232,706		$199,386		17

Adjusted Operating Cash Flow (non-GAAP) is calculated as Operating Income (Loss) before Amortization of Intangible Assets and Impairment of Goodwill and Asset Group Held for Sale plus Depreciation Expense and Pension Expense.

	Three Months Ended					Six Months Ended
	June 30				%	June 30				%
GRAHAM HOLDINGS COMPANY
EDUCATION DIVISION INFORMATION
(Unaudited)
(in thousands)		2026		2025	Change		2026		2025	Change
Operating Revenues
Kaplan international	$252,375		$272,171		(7)	$524,011		$533,427		(2)
Higher education	86,293		84,738		2	178,696		173,225		3
Supplemental education	79,476		80,161		(1)	156,340		155,564		0
Kaplan corporate and other	284		23		-	555		35		-
Intersegment elimination	(620)		(280)		-	(1,315)		(707)		-
	$417,808		$436,813		(4)	$858,287		$861,544		0
Operating Expenses
Kaplan international	$219,512		$242,234		(9)	$459,761		$473,428		(3)
Higher education	69,645		66,766		4	144,359		142,446		1
Supplemental education	70,972		72,755		(2)	140,556		142,190		(1)
Kaplan corporate and other	8,051		7,439		8	12,672		14,099		(10)
Amortization of intangible assets	243		1,699		(86)	557		3,818		(85)
Impairment of goodwill and asset group held for sale	-		-		-	19,029		-		-
Intersegment elimination	(891)		(265)		-	(1,305)		(655)		-
	$367,532		$390,628		(6)	$775,629		$775,326		0
Operating Income (Loss)
Kaplan international	$32,863		$29,937		10	$64,250		$59,999		7
Higher education	16,648		17,972		(7)	34,337		30,779		12
Supplemental education	8,504		7,406		15	15,784		13,374		18
Kaplan corporate and other	(7,767)		(7,416)		(5)	(12,117)		(14,064)		14
Amortization of intangible assets	(243)		(1,699)		86	(557)		(3,818)		85
Impairment of goodwill and asset group held for sale	-		-		-	(19,029)		-		-
Intersegment elimination	271		(15)		-	(10)		(52)		-
	$50,276		$46,185		9	$82,658		$86,218		(4)
Operating Income (Loss) before Amortization of Intangible Assets and Impairment of Goodwill and Asset Group Held for Sale
Kaplan international	$32,863		$29,937		10	$64,250		$59,999		7
Higher education	16,648		17,972		(7)	34,337		30,779		12
Supplemental education	8,504		7,406		15	15,784		13,374		18
Kaplan corporate and other	(7,767)		(7,416)		(5)	(12,117)		(14,064)		14
Intersegment elimination	271		(15)		-	(10)		(52)		-
	$50,519		$47,884		6	$102,244		$90,036		14
Depreciation
Kaplan international	$4,611		$6,393		(28)	$9,579		$12,942		(26)
Higher education	300		383		(22)	567		839		(32)
Supplemental education	738		631		17	1,548		1,384		12
Kaplan corporate and other	10		5		-	19		11		73
	$5,659		$7,412		(24)	$11,713		$15,176		(23)
Pension Expense
Kaplan international	$50		$146		(66)	$176		$286		(38)
Higher education	2,032		1,889		8	3,952		3,697		7
Supplemental education	2,060		1,972		4	4,046		3,859		5
Kaplan corporate and other	530		406		31	937		794		18
	$4,672		$4,413		6	$9,111		$8,636		6
Adjusted Operating Cash Flow (non-GAAP)
Kaplan international	$37,524		$36,476		3	$74,005		$73,227		1
Higher education	18,980		20,244		(6)	38,856		35,315		10
Supplemental education	11,302		10,009		13	21,378		18,617		15
Kaplan corporate and other	(7,227)		(7,005)		(3)	(11,161)		(13,259)		16
Intersegment elimination	271		(15)		-	(10)		(52)		-
	$60,850		$59,709		2	$123,068		$113,848		8

Adjusted Operating Cash Flow (non-GAAP) is calculated as Operating Income (Loss) before Amortization of Intangible Assets and Impairment of Goodwill and Asset Group Held for Sale plus Depreciation Expense and Pension Expense.

	Three Months Ended					Six Months Ended
	June 30				%	June 30				%
GRAHAM HOLDINGS COMPANY
HEALTHCARE DIVISION INFORMATION
(Unaudited)
(in thousands)		2026		2025	Change		2026		2025	Change
Operating Revenues
CSI	$148,523		$113,415		31	$266,304		$203,663		31
Other Healthcare	99,128		88,804		12	190,687		172,297		11
	$247,651		$202,219		22	$456,991		$375,960		22
Operating Expenses
CSI	$136,025		$99,418		37	$247,494		$180,023		37
Other Healthcare	87,016		77,704		12	167,461		152,523		10
	$223,041		$177,122		26	$414,955		$332,546		25
Operating Income
CSI	$12,498		$13,997		(11)	$18,810		$23,640		(20)
Other Healthcare	12,112		11,100		9	23,226		19,774		17
	$24,610		$25,097		(2)	$42,036		$43,414		(3)
Amortization of Intangible Assets
CSI	$20		$34		(41)	$41		$67		(39)
Other Healthcare	70		83		(16)	145		168		(14)
	$90		$117		(23)	$186		$235		(21)
Operating Income before Amortization of Intangible Assets
CSI	$12,518		$14,031		(11)	$18,851		$23,707		(20)
Other Healthcare	12,182		11,183		9	23,371		19,942		17
	$24,700		$25,214		(2)	$42,222		$43,649		(3)
Depreciation
CSI	$301		$183		64	$594		$359		65
Other Healthcare	1,612		1,540		5	3,233		3,150		3
	$1,913		$1,723		11	$3,827		$3,509		9
Pension Expense
CSI	$ -		$ -		-	$ -		$ -		-
Other Healthcare	1,643		1,993		(18)	3,529		4,992		(29)
	$1,643		$1,993		(18)	$3,529		$4,992		(29)
Adjusted Operating Cash Flow (non-GAAP)
CSI	$12,819		$14,214		(10)	$19,445		$24,066		(19)
Other Healthcare	15,437		14,716		5	30,133		28,084		7
	$28,256		$28,930		(2)	$49,578		$52,150		(5)

Adjusted Operating Cash Flow (non-GAAP) is calculated as Operating Income (Loss) before Amortization of Intangible Assets and Impairment of Long-Lived Assets plus Depreciation Expense and Pension Expense.

NON-GAAP FINANCIAL INFORMATION

GRAHAM HOLDINGS COMPANY

(Unaudited)

In addition to the results reported in accordance with accounting principles generally accepted in the United States (GAAP) included in this press release, the Company has provided information regarding Adjusted Operating Cash Flow and Net income excluding certain items described below, reconciled to the most directly comparable GAAP measures. Management believes that these non-GAAP measures, when read in conjunction with the Company’s GAAP financials, provide useful information to investors by offering:

the ability to make meaningful period-to-period comparisons of the Company’s ongoing results;
the ability to identify trends in the Company’s underlying business; and
a better understanding of how management plans and measures the Company’s underlying business.

Adjusted Operating Cash Flow and Net income, excluding certain items, should not be considered substitutes or alternatives to computations calculated in accordance with and required by GAAP. These non-GAAP financial measures should be read only in conjunction with financial information presented on a GAAP basis.

The gains and losses on marketable equity securities relate to the change in the fair value (quoted prices) of its portfolio of equity securities. The mandatorily redeemable noncontrolling interest represents the ownership portion of a group of minority shareholders at a subsidiary of the Company's Healthcare business. The Company measures the redemption value of this minority ownership on a quarterly basis with changes in the fair value recorded as interest expense or income, which is included in net income for the period. The effect of gains and losses on marketable equity securities and net interest expense related to fair value adjustments of the mandatorily redeemable noncontrolling interest are not directly related to the core performance of the Company’s business operations since these items do not directly relate to the sale of the Company’s services or products. GAAP requires that the Company include the gains and losses on marketable equity securities and net interest expense related to fair value adjustments of the mandatorily redeemable noncontrolling interest in net income on the Condensed Consolidated Statements of Operations. The Company excludes the gains and losses on marketable equity securities and net interest expense related to fair value adjustments of the mandatorily redeemable noncontrolling interest from the non-GAAP adjusted net income because these items are independent of the Company’s core operations and not indicative of the performance of the Company’s business operations.

The following tables reconcile the non-GAAP financial measures for Net income, excluding certain items, to the most directly comparable GAAP measures:

	Three Months Ended June 30
	2026			2025
(in thousands, except per share amounts)	Income before income taxes	Income Taxes	Net Income	Income before income taxes	Income Taxes	Net Income
Amounts attributable to Graham Holdings Company Common Stockholders
As reported	$317,476	$35,100	$282,376	$60,623	$20,200	$40,423
Attributable to noncontrolling interests			(1,273)			(3,674)
Attributable to Graham Holdings Company Stockholders			281,103			36,749
Adjustments:
Settlement gain related to retiree annuity pension purchase	(136,955)	(35,625)	(101,330)	-	-	-
Charges related to non-operating Separation Incentive Programs and a Voluntary Retirement Incentive Program	3,837	997	2,840	6,015	1,540	4,475
Interest (income) expense related to the fair value adjustment of the mandatorily redeemable noncontrolling interest	(213)	24	(237)	1,153	(2,342)	3,495
Net (gains) losses on marketable equity securities	(101,879)	(26,025)	(75,854)	11,543	2,960	8,583
Net losses of affiliates whose operations are not managed by the Company	17,905	4,574	13,331	413	106	307
Loss on sale of KLG	5,151	(5,274)	10,425	-	-	-
Non-operating loss from the impairment of equity and cost method investments	5,800	1,482	4,318	12,679	3,206	9,473
Income tax benefit related to the KLG business	-	69,564	(69,564)	-	-	-
Non-U.S. global minimum corporate income tax expense	-	(19,180)	19,180	-	-	-
Net Income, adjusted (non-GAAP)			$84,212			$63,082
Per share information attributable to Graham Holdings Company Common Stockholders
Diluted income per common share, as reported			$64.86			$8.35
Adjustments:
Settlement gain related to retiree annuity pension purchase			(23.38)			-
Charges related to non-operating Separation Incentive Programs and a Voluntary Retirement Incentive Program			0.66			1.02
Interest (income) expense related to the fair value adjustment of the mandatorily redeemable noncontrolling interest			(0.05)			0.79
Net (gains) losses on marketable equity securities			(17.50)			1.95
Net losses of affiliates whose operations are not managed by the Company			3.08			0.07
Loss on sale of KLG			2.41			-
Non-operating loss from the impairment of equity and cost method investments			1.00			2.15
Income tax benefit related to the KLG business			(16.05)			-
Non-U.S. global minimum corporate income tax expense			4.43			-
Diluted income per common share, adjusted (non-GAAP)			$19.46			$14.33
The adjusted diluted per share amounts may not compute due to rounding.

	Six Months Ended June 30
	2026			2025
(in thousands, except per share amounts)	Income before income taxes	Income Taxes	Net Income	Income before income taxes	Income Taxes	Net Income
Amounts attributable to Graham Holdings Company Common Stockholders
As reported	$358,127	$45,000	$313,127	$94,244	$28,100	$66,144
Attributable to noncontrolling interests			(2,918)			(5,501)
Attributable to Graham Holdings Company Stockholders			$310,209			$60,643
Adjustments:
Impairment charge and loss on sale related to KLG	24,179	(594)	24,773	-	-	-
Settlement gain related to retiree annuity pension purchase	(136,955)	(35,625)	(101,330)	-	-	-
Charges related to non-operating Separation Incentive Programs and a Voluntary Retirement Incentive Program	7,937	2,064	5,873	6,639	1,700	4,939
Interest (income) expense related to the fair value adjustment of the mandatorily redeemable noncontrolling interest	(882)	(124)	(758)	67,560	13,693	53,867
Net gains on marketable equity securities	(32,956)	(8,418)	(24,538)	(32,258)	(8,271)	(23,987)
Net (earnings) losses of affiliates whose operations are not managed by the Company	(13,062)	(3,337)	(9,725)	12,323	3,160	9,163
Net non-operating loss from impairment and sale of equity and cost method investments	5,316	1,358	3,958	12,679	3,206	9,473
Income tax benefit related to the KLG business	-	69,564	(69,564)	-	-	-
Non-U.S. global minimum corporate income tax expense	-	(19,180)	19,180	-	-	-
Net Income, adjusted (non-GAAP)			$158,078			$114,098
Per share information attributable to Graham Holdings Company Common Stockholders
Diluted income per common share, as reported			$71.04			$13.81
Adjustments:
Impairment charge and loss on sale related to KLG			5.67			-
Settlement gain related to retiree annuity pension purchase			(23.21)			-
Charges related to non-operating Separation Incentive Programs and a Voluntary Retirement Incentive Program			1.34			1.12
Interest (income) expense related to the fair value adjustment of the mandatorily redeemable noncontrolling interest			(0.17)			12.26
Net gains on marketable equity securities			(5.62)			(5.46)
Net (earnings) losses of affiliates whose operations are not managed by the Company			(2.23)			2.09
Net non-operating loss from impairment and sale of equity and cost method investments			0.91			2.16
Income tax benefit related to the KLG business			(15.93)			-
Non-U.S. global minimum corporate income tax expense			4.39			-
Diluted income per common share, adjusted (non-GAAP)			$36.19			$25.98
The adjusted diluted per share amounts may not compute due to rounding.

Contacts
GRAHAM HOLDINGS COMPANY REPORTS · SECOND QUARTER EARNINGS
Wallace R. Cooney · (703) 345-6470
July 30, 2026