Declining sales in Pearson’s North America business combined with divestitures dropped the company from its longtime perch as the world’s largest book publisher and into second place on Livres Hebdo/Publishers Weekly’s annual ranking. The new book publishing leader is RELX Group (formerly known as Reed Elsevier), which posted publishing revenue of $5.28 billion last year.
RELX moved into the top spot despite a 6% decline in publishing sales in 2018 compared to 2017. The decline was due to a drop in sales from the company’s legal division—which is built around its LexisNexis database—that offset a gain in its scientific, technical, medical group. Revenue from RELX’s events group (which owns BookExpo, among many other trade shows) and its risk assessment division are not included in the publishing revenue figure.
RELX’s accession to the top spot among publishers also highlights how companies that began primarily as print book and journal publishers now rely on digital publishing to support growth. In 2018, about 74% of RELX’s revenue came from content sold in digital format.
Pearson’s publishing revenue fell 14% in 2018, though stripping out the impact of divestitures and currency movements, revenue was down 1% in underlying terms. That 1% dip was due to a decline in the company’s U.S. Higher Education Courseware unit of 5% and mid-single-digit declines in its U.S. K–12 Courseware division, largely offset by the rest of the business growing in aggregate at over 1%. Pearson sold the K–12 Courseware unit in the first quarter of 2019.
Revenue in 2018 fell in seven of the world’s top 10 publishers, due in part to lower spending on educational materials in the U.S. (According to the Association of American Publishers, sales in the higher education market fell 7.3% in 2018 compared to 2017, while revenue to the K–12 market declined 4.4%.) Still, the top 10 companies in the ranking accounted for slightly over half of the total revenue of the 56 publishers who made this year’s cut (i.e., those with sales of at least $150 million). The next 10 companies on the list generated another 20% of total revenue. This basic ratio has hardly changed over the past decade.
The largest publishers were built in large part through acquisitions, but the biggest deal impacting the publishers in this year’s ranking involved a divestiture. Spain’s Groupo Planeta sold its French subsidiary, Editis, to French multimedia company Vivendi—the company from which Planeta had acquired Editis. The result of the transaction was a drop in Planeta’s revenue to just over $1 billion, and its standing in the world ranking fell to #22, down from #7 in 2017. Vivendi, meanwhile, entered the list at #25, with publishing revenue of $858 million.
Last year also had its share of niche purchases. In the U.S., for example, Bertelsmann’s Penguin Random House subsidiary acquired Rodale Books, and the company continued to push further into Spanish-speaking markets. And there is another big deal in the works this year, involving the 12th- and 13th-largest publishers (McGraw-Hill Education and Cengage, respectively). The merger, which has faced some opposition in the U.S., would create an educational publishing company with revenue of around $3 billion, shooting it up to sixth place in the global ranking. The acquisition is expected to be completed in the first quarter of 2020.
This year’s ranking also includes the return of five Chinese publishers. After appearing for the first time on the ranking in 2015, the Chinese publishers were excluded in 2016 and 2017 because of changes in Chinese government policies. But another change has allowed the publishers to come back for the 2018 list. The largest of the Chinese publishers, Phoenix Publishing and Media Company, was the 11th-largest publisher in the ranking, with revenue of $1.6 billion.
The full report from which this ranking is drawn, as well as profiles of all the publishers listed, can be viewed at publishersweekly.com/global50.