Slowing industry sales and rising costs have led to the “elimination a small number of positions” at HarperCollins, CEO Brian Murray wrote in a memo to employees. The job cuts came as “leaders across the company have implemented changes to some team structures,” Murray wrote.
In addition to the job cuts, HC is reducing non-essential travel and expenses and will also be “pausing on the majority of hiring for open positions,” Murray wrote. “Balancing our future success with the present business environment is never an easy task, but it is especially difficult in a climate with so much uncertainty,” Murray told employees. "With continued costs pressures across all areas of the supply chain, and ongoing uncertainty about the remainder of the fiscal year, we need to control costs and operate as efficiently as possible."
Though HC had a record year for the fiscal year ended June 30, 2022, with sales rising 10% over fiscal 2021, to $2.2 billion, earnings increased at a much slower rate, up 1%. Sales and earnings both included contributions from the acquisition of the trade division of Houghton Mifflin Harcourt. Moreover, in the quarter ended June 30, profits fell 2% on a 4% increase in sales compared to the last quarter of fiscal 2021.
Executives at HC parent company News Corp have repeatedly cited higher manufacturing and freight costs as putting a drag on profit growth. In February, News Corp CFO Susan Panuccio said that while book industry trends remain generally favorable, the company is “clearly mindful of the uncertainty and lack of visibility from the ongoing impacts of the pandemic, including the potential cost impacts from continued supply chain pressures, particularly in book publishing.” Asked about the effect of higher inflation by analysts, News Corp CEO Robert Thomson said the company has told its businesses to be “cost conscious.”
