Worldwide sales for the four large trade publishers that publicly report their financial results were all up by double digits in 2023 over 2019, the last prepandemic year. Overall unit sales of print books, as measured by Circana BookScan, were also up—roughly 8.8% higher in 2023 than in 2019, with 767.3 million copies sold compared to 705.6 million. So why do so many industry leaders feel uneasy about the state of the business in 2024?

For one thing, the leveling out of the pandemic sales roller coaster has not come without pain. To meet the spike in sales in 2020 and 2021, publishers hired extra staff and in many cases overprinted while retailers overordered. When sales began to slow (sales are down 9% from the peak in 2021, when 843 million units were sold in BookScan outlets), a wake-up call was inevitable, which Amazon delivered in summer 2022 when it dramatically curtailed new orders.

Nowhere was Amazon’s action felt more acutely than at HarperCollins. After a record fiscal 2022, HC sales fell 10% and profits plunged 45% in the fiscal year ended June 30, 2023. In addition to the problems at Amazon, HC CEO Brian Murray attributed the poor results to the entire publishing industry taking longer than expected to work through pandemic-related issues. But like many executives in trade publishing, Murray took a long view of 2023 sales, noting that revenue remained higher than in 2019.

Indeed, at HC, revenue in calendar 2023 was up 20.7% over 2019, while sales have increased 15.3% at Lagadère Publishing and 24.3% at Penguin Random House. At Simon & Schuster, information for 2023 is limited to the first 10 months of the year, before the private equity firm KKR completed its acquisition. But even with only 10 months of results reported to the public, revenue at S&S was already ahead of sales for all of 2019, and the company was on course to post its third consecutive year of sales topping $1 billion.

That’s the good news. The not-so-good news is that while earnings also rose at all four companies, profit margins in 2023 were up over 2019 only at Hachette parent company Lagardère and S&S, slipping at HC and PRH.

In his March letter to employees discussing PRH’s 2023 results, CEO Nihar Malaviya said higher expenses were a major factor in the dip in the company’s earnings and profit margin last year compared to 2022, despite a solid 7% sales increase. And executives at all four publishers point to the need to adjust to an environment where the higher costs of doing business (among them increased manufacturing and employee costs) are not expected to fall dramatically in 2024.

In 2023, the need to rein in costs led to some tough decisions. The most high-profile actions were layoffs and buyouts at PRH and downsizing at HC, where parent company News Corp mandated a 5% workforce reduction. At Lagardère, HBG UK chief executive David Shelley was named CEO of a new English-language management unit at the end of 2023, while HBG US CEO Michael Pietsch was kicked upstairs to the chairman’s office. Though Shelley hasn’t made dramatic cuts, it’s clear he was brought into HBG to give the U.S. company a boost after sales fell nearly 7% in 2023.

With sales leveling off, corporate publishers turned to a favorite tactic to increase sales and growth: acquisitions. In 2021, HC acquired the HMH trade division, which had sales of $182 million in 2019. Following its failure to buy S&S, PRH acquired 10 companies in 2023 alone, and upped its stake in Sourcebooks to 52%, which added more than $200 million to PRH US sales last year.

So where does the publishing industry stand in 2024? No executive has said they expect significant sales gains this year, and the general view is that flat sales combined with more cost controls will result in a slight improvement in margins. Perhaps the forecast for 2024 was best summed up by Malaviya in his letter to PRH employees, in which he said he believed the tough measures undertaken in 2023 have put the company “on solid footing.”