As part of a financial update released last week, Houghton Mifflin Harcourt said it plans to eliminate roughly 8% of its workforce in another effort to align its operations with its business objectives.
In addition to announcing the pending cuts, which will eliminate about 280 jobs, HMH said that, starting in 2020, it will adopt a “redesigned product development model that is expected to result in about 20% less content development expenditures than previously planned over the next three years." The cuts, according to HMH, will be limited to the education group and not the trade division.
The planned downsizing comes despite a better than expected third quarter performance that prompted HMH to revise upward its 2019 revenue projections. HMH now expects 2019 billings to be between $1.59 billion and $1.62 million, up from $1.53 billion to $1.61 billion.
The updated guidance is based on solid gains in two of the company's educational publishing business—core solutions and extensions. Billings at HMH Books & Media are expected to decline in the high single digits.
Pointing to the publisher’s improved financial picture, HMH CEO Jack Lynch said the company is positioned “to further leverage the strength of our portfolio to drive billings growth, simplify and strengthen our business model, reduce costs, and generate sustained and positive free cash flow." He continued: "By realigning our organization, we will be able to better meet the needs of our customers while creating value for our shareholders."
This story has been updated to note that the HMH trade group is not part of the downsizing plan.
