Sales at Houghton Mifflin Harcourt’s trade division rose 11.4% in 2017 over 2016, jumping from $165.6 million to $184.5 million. The revenue gain, along with cost reductions, resulted in the division reporting net income of $2.0 million in the year, compared to a net loss of $7.0 million in 2016.
HMH attributed the trade group’s improvement to sales of the Whole30 series, the success of Tim Ferriss’ Tribe of Mentors and Tools of Titans, and strong backlist print sales of such titles as The Polar Express and The Giver. Unlike most trade publishers, e-book sales rose at HMH, driven by demand for The Handmaid’s Tale and 1984.
The gains in the trade division came in a year in which HMH underwent a companywide restructuring. According to HMH’s 10-K filing, the company cut its workforce from 4,500 people (at the end of 2016) to 3,800 (at the close of 2017). Of that number, about 20 positions were eliminated in the trade division, with the balance of the cuts being made in HMH’s much larger education group. To account for the downsizing, HMH took a $16.2 million severance charge in 2017.
The cost cutting, along with a 2.5% increase in total revenue to $1.41 billion, led to a net loss for HMH of $103.2 million last year, down from a loss of $284.5 million in 2016.
In the education group revenue increased 1.3%, to $1.22 billion. Gains at HMH’s Heinemann unit and higher sales of supplemental and assessment products were partially offset by declines in textbooks sales in open territories programs, lower sales of math programs across adoption states, and lower sales in HMH’s international business.
HMH said it expects total revenue in 2018 to range from $1.36 billion to $1.43 billion.