Cengage Learning is a leading educational content, technology, and services company for the higher education and K–12, professional and library markets worldwide. The company provides superior content, personalized services and course-driven digital solutions that accelerate student engagement and transform the learning experience. Cengage Learning is headquartered in Boston, and also has offices in San Francisco. The company’s employees are based in nearly 38 countries and sales reach more than 165 countries throughout the world.

During the first quarter of 2017 Cengage reconstructed its segment reporting from International and Domestic into Learning, Gale and International.

Learning (renamed Domestic segment) includes a variety of digital and print educational solutions and associated services for the academic, skills and school markets in the United States.

The Gale segment offers research platforms around the world, which provide access to the company’s content including collections of primary source materials and aggregated periodicals to learners at libraries, colleges, universities, schools and businesses.

The International segment distributes educational solutions across all major academic disciplines for use in approximately 165 countries and territories around the world.

Analysis & Key Developments


Cengage closed the fiscal year in March 2017 with a declining performance. The company’s total adjusted revenues decreased to 1.5 billion USD, down from 1.6 billion USD in 2016. The loss was primarily driven by lower revenues from Cengage‘s largest segment, Learning, and partially offset by growth in the company‘s core digital product sales, and growth in the international businesses within both the Gale and International segments.

The Learning division closed fiscal year 2017 with a loss of 176 million USD, or 15.2% in adjusted revenues, for a total of 978 million USD. The decrease was due to lower enrollments and continued pressure on print products.

The International division’s adjusted revenues increased by 15 million USD, or 6.3% compared to 2016, and totaled in 260 million USD. The growth was due to increased sales of higher education products in EMEA and Australia, and ELT products in Latin America, Asia and EMEA.

Gale’s adjusted revenues for 2017 decreased by 0.5%, or 1.2 million USD to 231 million USD. The drop was attributed to the ongoing decline in the print business in the United States. The loss in revenue was partly offset by increased international sales.

Internal Organization

During the third quarter of fiscal 2016, Cengage initiated a restructuring program designed to streamline operations and improve cost structure. The restructuring resulted in three new divisions: Learning, Gale and International.

In May 2017 Cengage announced that the company’s executive vice president and chief financial officer John Lehay will step down at the end of 2017.


During fiscal year 2017, Cengage acquired WebAssign, whose flagship product is assessment and homework solutions for STEM (science, technology, engineering and math).


Cengage’s four major regional markets are served by physical locations in Asia (based in Singapore), EMEA (based in Andover, England), Australia (based in Melbourne, Australia), and Latin America (based in Mexico City, Mexico).

“Our origins and roots have been in the US education system. About 80 percent of our revenue is still in the US but our international activities are growing quite rapidly and are now about 20 percent of our total revenue,” said CEO Michael Hansen.


Over the last three years, Cengage‘s higher education core digital business increased by a CAGR of 14% over the same period. This increase in core digital gross revenue has resulted in digital sales constituting a growing amount of gross sales, with digital sales constituting 54% of Cengage‘s gross sales in the fiscal year ended March 31, 2017. The company has digitized virtually all of its content in the research market and enhanced it with interactive digital tools.

Note: Cengage’s fiscal year runs from April to March. Therefore developments for fiscal 2016 and fiscal 2017 are covered in this report.

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