Education publisher McGraw Hill’s digital sales grew 10% year-over-year in the 2021 fiscal year, with about $1 billion in billings, the company said Thursday, making it the first time an increase in digital billings outpaced a drop in print materials.
The company’s total billings still declined about 4%, according to the company’s annual investor report. But executives also said that digital now accounts for 61% of all billings, an increase of 8 percentage points compared to 2020, which they cited as a reason to keep investing in digital tools and technology as a key to the company’s growth.
When K-12 sales were excluded, digital billings accounted for 72% of McGraw Hill’s business, which the company attributed to its response to the stresses of the COVID-19 pandemic.
“Throughout the last year, we worked hard to successfully meet the increased demand for digital products brought on by the pandemic,” Simon Allen, the publisher’s chief executive, said in a press release. “McGraw Hill continues to adapt to the changing times by delivering learning tools that are not only cutting-edge but also affordable and accessible.”
The company also reported a 58% increase in billings for Inclusive Access, a program in which the publisher partners with a company or bookstore to offer a group of students digital materials at a discount. Those savings are folded into students’ tuitions, instead of the student purchasing textbooks individually. Institutions also work with vendors like McGraw Hill to automatically integrate those materials into learning management systems.
Connect, McGraw Hill’s main digital learning platform for higher education, saw 27% more student activations over the past year. That platform offers course management and data and analytics on student performance, as well as proctoring and browser locking, according to the company’s website.
The earnings report detailed the company’s priorities moving forward, as it continues to navigate an edtech market that’s forecasted to expand 20% over the next seven years, according to a recent market analysis by Grand View Research. McGraw Hill’s goals include offering more personalized learning solutions and more ways to approach mastery and delivery, as well as introducing more automation that would help educators utilize data to guide instruction, the company said.
McGraw Hill is also in the process of changing hands. The company announced last week that its owner, Apollo Funds, is selling the publisher to another venture fund for $4.5 billion. The investor report says that McGraw Hill’s senior leadership team, including Allen, are expected to remain on board after the sale to Platinum Equity closes later this year.