Franklin Covey Company
04/01/2026 | Press release | Distributed by Public on 04/01/2026 14:20
FRANKLIN COVEY REPORTS SECOND QUARTER FISCAL 2026 FINANCIAL RESULTS (Form 8-K)
FRANKLIN COVEY REPORTS SECOND QUARTER FISCAL 2026
FINANCIAL RESULTS
Consolidated Second Quarter Revenue of $59.6 Million
Invoiced Amounts in Enterprise North America Increases 7%
Deferred Revenue Increases 7% to $101.5 Million
Net Loss for the Second Quarter of $2.0 Million
Adjusted EBITDA Increases 99% to $4.1 Million
Liquidity Remains Strong at Over $76 Million, with $13.7 Million of Cash
and the Company's $62.5 Million Credit Facility Fully Available
Purchased $17.0 million of Common Stock During the
Second Quarter Fiscal 2026
Company Affirms Annual Guidance for Fiscal 2026
Salt Lake City, Utah - Franklin Covey Co. (NYSE: FC), a global leadership and organizational performance partner, gives strategy the human edge. We help clients achieve breakthrough results and transform how they execute strategy at scale. Today, the Company announced its financial results for the second quarter of fiscal 2026, which ended on February 28, 2026.
Second Quarter Fiscal 2026 Financial Overview
The Company's consolidated revenue for Q2 FY2026 was $59.6 million, which was flat to Q2 FY2025. Consolidated invoiced amounts for Q2 FY2026 grew 5% over the prior year. The Company's financial results for Q2 FY2026 include the following:
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Enterprise Division revenue for Q2 FY2026 totaled $41.6 million compared with $43.6 million in the prior year.
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Enterprise Division revenue reflected a $2.0 million decline in North America segment revenue partially offset by a $0.1 million increase in International segment revenue. The North America segment was adversely affected by lower subscription revenue recognized as a result of lower invoiced amounts and deferred revenue last fiscal year.
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Enterprise North America invoiced amounts grew 7% for the second quarter in a row.
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Deferred revenue for the Enterprise Division increased 15% year-over-year.
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Education Division revenue in Q2 FY2026 increased $2.4 million, or 16%, to $17.5 million compared with $15.1 million in the prior year.
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The increase was driven by higher training, coaching, materials, and membership subscription revenue during the quarter.
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Consolidated subscription and subscription services revenue for Q2 FY2026 was $50.9 million compared with $49.5 million in Q2 FY2025. Subscription and contractually committed services
invoiced for Q2 FY2026 totaled $39.3 million, growth of 16%, compared with $33.9 million in Q2 FY2025.
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The Company realized a net loss for Q2 FY2026 of $(2.0) million, or $(0.17) per share, compared with a net loss of $(1.1) million, or $(0.08) per share, in Q2 FY2025.
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Adjusted EBITDA for Q2 FY2026 increased 99% to $4.1 million compared with $2.1 million in the prior year.
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Consolidated deferred revenue at February 28, 2026 increased 7% to $101.5 million compared with $94.4 million at February 28, 2025.
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At February 28, 2026, 59% of the Company's AAP contracts in North America were for at least two years, compared with 55% at February 28, 2025, and the percentage of contracted amounts represented by multi-year contracts was 62% compared with 61% on February 28, 2025.
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Unbilled deferred revenue totaled $64.9 million at February 28, 2026, compared with $64.5 million at February 28, 2025.
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Cash provided by operating activities for the first two quarters of FY2026 was $16.4 million reflecting the strength of Q2 FY2026 operating cash flows of $16.3 million compared with $(1.4) million of cash used in the prior year.
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Free cash flow for Q2 FY2026 was $13.2 million compared with $(3.6) million in Q2 FY2025.
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Cash and cash equivalents totaled $13.7 million compared with $40.4 million as of February 28, 2025.
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During Q2 FY2026, the Company purchased approximately 947,000 shares of its common stock for $17.0 million. Approximately 922,000 shares were purchased in the open market under 10b5-1 trading plans and approximately 25,000 shares were withheld to cover statutory income taxes on stock-based compensation awards that vested and were issued during the second quarter.
Paul Walker, President and Chief Executive Officer commented, "Our second quarter results reflect the importance of what we do and the traction of our go-to-market transformation. We delivered our second consecutive quarter of 7% invoiced growth in Enterprise North America as strong execution on our go-to-market strategy continues to gain traction. We believe we are at an inflection point where the return on investment from our transformation is becoming evident.
This momentum comes as AI is reshaping how work gets done, and we are seeing increased demand for FranklinCovey's expertise in helping organizations strengthen the human side of execution-leadership, trust, change management, sales performance, collaboration, and disciplined execution. FranklinCovey is uniquely positioned as a long-term performance partner, helping organizations navigate AI-driven opportunities and complexities to deliver sustained performance."
Jessi Betjemann, Chief Financial Officer said, "In the second quarter, we translated operational momentum into improved profitability and strong cash generation. Adjusted EBITDA increased to $4.1 million, operating cash flow was $16.3 million, and free cash flow improved to $13.2 million. We also returned $17.0 million to shareholders through the repurchase of approximately 947,000 shares, while maintaining $76 million of liquidity. We are reaffirming our FY2026 guidance of total revenue of $265 to $275 million and Adjusted EBITDA of $28 to $33 million, in constant currency."
Fiscal 2026 Guidance
The Company expects to return to growth in both revenue and Adjusted EBITDA in FY2026 as the benefits of its go-to-market transformation and cost reduction actions begin to increase revenue, lower costs, and flow through improved results.
Based on current expectations, the Company affirms the following guidance, in constant currency:
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Total revenue in the range of $265 million to $275 million.
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Adjusted EBITDA in the range of $28 million to $33 million.
This guidance reflects the positive momentum the Company is seeing and expecting in both the Enterprise and Education divisions, balanced with a disciplined view of the risks and opportunities ahead as it continues to execute in an uncertain macro environment. The Company anticipates strong invoiced growth in FY2026 which the Company believes will translate into meaningful reported growth in revenue and Adjusted EBITDA in FY2027.
Earnings Conference Call
On Wednesday, April 1, 2026, at 5:00 p.m. Eastern (3:00 p.m. Mountain Time) Franklin Covey will host a conference call to review its second quarter fiscal 2026 financial results. Interested persons may access a live audio webcast at https://edge.media-server.com/mmc/p/qux2545x or may participate via telephone by registering at https://register-conf.media-server.com/register/BI2c1e170bc74e4643ad0d7d53976bef49. Once registered, participants will have the option of 1) dialing into the call from their phone (via a personalized PIN); or 2) clicking the "Call Me" option to receive an automated call directly to their phone. For either option, registration will be required to access the call. A replay of the conference call webcast will be archived on the Company's website for at least 30 days.
Franklin Covey Company published this content on April 01, 2026, and is solely responsible for the information contained herein. Distributed via EDGAR on April 01, 2026 at 20:20 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]