Graham (GHC -2.32%), a diversified conglomerate with major interests in education, media, healthcare, and manufacturing, reported results on July 30, 2025. The company delivered earnings per share (EPS) of $14.33 (Non-GAAP), well above the analyst estimate of $10.15 (non-GAAP). Revenue (GAAP) reached $1,215.8 million, easily beating GAAP expectations of $1,175.3 million. These results signal a solid operational quarter, marked by improved contributions from education and healthcare, offsetting softness in television broadcasting and automotive businesses.
| Metric | Q2 2025 | Q2 2025 Estimate | Q2 2024 | Y/Y Change |
|---|---|---|---|---|
| EPS (Non-GAAP) | $8.35 | $10.15 | $12.70 | -34.3% |
| Revenue (GAAP) | $1,215.8 million | $1,175.3 million | $1,185.3 million | 2.6% |
| Operating Income (GAAP) | $72.8 million | $25.9 million | 181.1% | |
| Adjusted Operating Cash Flow (Non-GAAP) | $111.3 million | $98.5 million | 13.0% | |
| Net Income (GAAP) | $36.7 million | $(21.0) million | $57.7 million |
Source: Analyst estimates for the quarter provided by FactSet.
Business Overview and Strategic Focus
Graham is a holding company active in education, broadcasting, healthcare, manufacturing, and automotive retail. Its education business, Kaplan, stands out as a global provider of test prep, online, and higher education services. Graham Media Group operates multiple TV stations, while the company’s healthcare arm delivers home health and pharmacy services across several states. Manufacturing and auto segments round out the company’s diverse portfolio, including specialty wood products and car dealerships.
The company’s strategy centers on growing education and healthcare, maintaining leadership in broadcasting despite digital disruption, and managing its manufacturing and automotive units for capital-efficient performance. Key to success are regulatory compliance, operational efficiency, and targeted acquisitions. Recent focus areas include expanding online education, responding to digital shifts in broadcasting, and navigating Medicare dependency in healthcare.
Quarter Highlights: Segment Performance and Notable Events
Education services remained a dependable source of revenue, led by Kaplan. Revenue from education rose 3% while operating income jumped 31% year over year. Subsegments showed solid gains: Kaplan International generated a 2% revenue increase, higher education was up 5%, and supplemental education climbed 10%. Operating income (GAAP) rose across all three education subsegments. These results build on Kaplan’s focus on online offerings and expanded university partnerships.
The healthcare segment posted notable results, with revenue up 37% and operating income nearly doubling versus the prior-year quarter. The segment benefited from continued demand for home health, a key service supported by Medicare reimbursement. However, both co-CEOs of Graham Healthcare Group recently announced departures, creating some management transition. The company also settled a $205 million noncontrolling interest in healthcare in Q1 2025.
Television broadcasting saw an 8% drop in revenue and a 10.3% decline in operating income. The industry continues to wrestle with declining ad revenue and challenges from cord-cutting and changing media consumption. No new digital initiatives or major contract renewals were highlighted for the segment in the release. Economic and structural trends continue to weigh on results.
Manufacturing revenue dropped 7%, but operating income rose 77%. A significant one-time event was the acquisition of Arconic Architectural Products, funded through the assumption of $105 million in pension liabilities. Automotive revenue declined 8% (GAAP), with similar pressure on operating income. Persistent demand weakness and operational challenges continue to affect the segment.
Looking Ahead: Guidance and Key Watch Areas
Management did not provide quantitative guidance for the coming quarter or the full year. However, it highlighted the completion of the World of Good Brands wind-down, which is expected to wrap up by the end of the next quarter. Leadership also referenced continued integration work on the manufacturing acquisition and ongoing management transitions in healthcare as areas of focus.
The company maintains a strong net cash position, with $1.13 billion in cash, marketable equity securities, and investments, compared to $816.4 million in borrowings as of June 30, 2025. This provides flexibility for future investments or share repurchases, though just $3.5 million was spent on buybacks during the first half of 2025. Broadcasting and automotive remain pressured, while education and healthcare will stay in the spotlight, especially given exposure to policy shifts. Investors should monitor segment trends, executed acquisitions, and any future updates on the company’s operating strategy or leadership team.
Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.
