Graham Holdings Company (NYSE: GHC) has released its financial results for the second quarter of 2026, showcasing a solid performance across several business sectors. The company reported a revenue increase of 7% year-over-year, alongside significant gains in net income, driven by improvements in various operational divisions.

1. Financial Highlights

For the second quarter ended June 30, 2026, Graham Holdings recorded revenues of $1,302.5 million, compared to $1,215.8 million in the same period of 2025. The operating income rose to $83.6 million, up from $72.8 million a year ago. Adjusted operating cash flow (non-GAAP) also increased to $119.8 million, an improvement from $111.3 million in the second quarter of 2025.

The company reported a net income attributable to common shares of $281.1 million ($64.86 per share), significantly up from $36.7 million ($8.35 per share) in the second quarter of 2025.

2. Division Operating Results

Revenue Growth Across Divisions

Graham Holdings experienced revenue growth across several divisions:

Television Broadcasting: Revenue increased to $109.6 million, up 3% from the previous year.

Healthcare: Revenues surged by 22% to $247.7 million.

Manufacturing: This division saw a remarkable 39% increase, reaching $133.3 million.

Automotive: Revenue remained stable at $301.4 million, reflecting a 6% increase.

Other Businesses: Grew by 4%, contributing $92.8 million.

However, the Education division reported a slight decline, generating $417.8 million, a 4% decrease from the prior year.

Adjusted Operating Cash Flow

The adjusted operating cash flow for the first six months of 2026 reached $232.7 million, compared to $199.4 million for the same period in 2025, indicating a 17% growth.

3. Strategic Transactions

In a move to streamline operations, Graham Holdings sold its Kaplan Languages Group (KLG) during the first quarter of 2026, incurring a $19.0 million pre-tax impairment charge and a $5.2 million loss on the sale in the second quarter.

4. Pension Plan Restructuring

In June 2026, the company made a strategic decision to settle a portion of its defined benefit pension obligations by purchasing an irrevocable group annuity contract for $113.9 million, which allowed it to relieve itself of responsibilities toward approximately 1,080 retirees. This transaction resulted in a $137.0 million pre-tax noncash settlement gain recorded in the second quarter.

5. Tax Considerations

During the first half of 2026, Graham Holdings recognized a U.S. income tax benefit of $69.6 million due to the restructuring and sale of the KLG business. However, a non-U.S. global minimum corporate top-up income tax expense of $19.2 million was accrued in the second quarter, reflecting the company's proactive approach to comply with evolving international tax regulations.

6. Balance Sheet Overview

As of June 30, 2026, the company reported $900.4 million in borrowings with an average interest rate of 5.7%. It also held $1,297.4 million in cash, marketable equity securities, and other investments, ensuring a robust liquidity position.

Share Repurchases

In the first half of 2026, Graham Holdings repurchased 110,471 shares of its Class B common stock at a total cost of $122.0 million. The company has remaining authorization for 352,011 shares.

7. Conclusion

Graham Holdings Company’s second-quarter earnings reflect a robust growth trajectory, driven by strategic operational improvements and effective cost management across its diversified portfolio. The encouraging financial results indicate resilience and adaptability in a dynamic market environment, positioning the company well for future growth as it continues to navigate the challenges and opportunities ahead.

Original press release