Image: Bertelsmann
By Porter Anderson, Editor-in-Chief | @Porter_Anderson
See also today: Penguin Random House UK’s ‘Lit in Colour’ Book-Vending Machine
Malaviya: ‘To Invest in the Books as Well as in the Talent’
In its comentary today (August 28) on its performance in the first half of 2024, Germany’s Bertelsmann—the parent company of Penguin Random House—has reported that it grew its overall international group revenues by 60 percent to €416 million (US$462.7 million).
In an interesting point for our United States readers of Publishing Perspectives, Bertelsmann is reporting that for the first time, its US businesses between January and June accounted for the highest revenue share of the company’s multinational expanse, with 28.4 percent in gains. Audiobooks are credited with some of this effect, as are the company’s publisher services, and a rise in the number of bestselling titles.
Simply on the basis of unit sales, as you’ll see below in the memo from Nihar Malaviya, there were “nearly 35 million more books” sold in the first half of this year than last.
Commentary from Gütersloh on Penguin Random House’s highlights includes the observation that, “In January, Penguin Random House completed its acquisition of Hay House, a leading publisher of wellness and self-help titles in the United States, and further increased its stake in the fast-growing US publisher Sourcebooks. A number of Penguin Random House authors were honored in the first half of the year, including Jayne Anne Phillips and Cristina Rivera Garza with the 2024 Pulitzer Prize and Dave Eggers with the 2024 Newbery Medal, the foremost annual award for children’s literature in the United States.”
PRH’s stake in Sourcebooks was increased from 53 percent to 75 percent, and there’s a recognition that Malaviya’s interest in acquisitions, something he discussed in his Publishing Perspectives Forum Executive Talk, has contributed to the strong showing recognized today in Bertelsmann’s report.
Nihar Malaviya, Penguin Random House’s worldwide CEO, has issued a memo to the staff today on the Bertelsmann report. In his note, he looks at part of the company’s success being thanks to getting past the fixation on blockbusters complained about by many midlist authors. He also points to the company’s Hay House acquisition, as Bertelsmann did, said to have meant €35 million (US$38.9 million) to PRH’s performance.
You also see Malaviya reference the book-banning activity in the United States—a challenge to which he has reacted with energy and innovative action, including court filings in major high-profile cases, including a lawsuit against the state of Iowa.
“As you’ll see. compared with the previous year, Penguin Random House saw a global revenue increase of €178 million (US$197.9), while our costs also increased by €145 million (US$161.3 million).
Nihar Malaviya. Image: FBM, Marc Jacquemin
“Our investments in our authors and their books increased by €63 million (US$70.1 million) while our profits rose €33 million (US$36.7 million).
“Most important, we have sold nearly 35 million more books in the first half of this year than during the same period last year. This growth is driven by excellent publishing across our various businesses and divisions as well as from company acquisitions like Hay House. We should be especially proud, as our good results are due to many, many books across our list in multiple categories selling more copies rather than relying on the performance of just a handful of standout titles.
“We want to continue on this successful path, a path that enables us to invest in the books as well as in the talent required to support acquisitions and publications.
“We’re very optimistic about the future of our industry. In most of the countries in which we operate, the book market remains stable, and we are outperforming the overall industry, thanks to employing the best talent in the entirety of publishing. These results demonstrate that we at Penguin Random House are uniquely positioned to bring our authors’ books to life better than any other publisher.
“As I shared with you in the beginning of the year, books matter more than ever—from globally acclaimed works by cultural luminary Gabriel García Márquez and living legend Salman Rushdie, which enrich the cultural dialogue, to the successful publishing of the global children’s phenomenon Bluey, which underscores our commitment to nurturing the next generation of readers. Your hard work is making a profound impact, enabling us to continue to invest in the business and in turn do even more to champion free expression, as demonstrated by our industry-leading efforts to fight book banning in the United States.”
There’s also in today’s statement from Germany a prediction of higher returns ahead.
Rolf Hellermann, CFO with Bertelsmann, says in the company’s report today, “Bertelsmann continues to expect an overall positive business performance for the full year. We are raising our group forecast for 2024, and expect to see a significant increase in revenues and earnings in our continuing operations. Due to the already completed sales of Majorel and DDV Mediengruppe, we expect a moderate decline in revenues and earnings.”
More from Publishing Perspectives on Bertelsmann is here, more on Penguin Random House international is here, and more on the United States market is here.