News Corp wrote down the value of Amplify after another disappointing sales season leading to an operating loss of $24 million, leading to a $371 write-off.
In a conference call News Corp CEO Robert Thomson said the company is already in advanced negotiations to sell Amplify to a potential investor.
Launched in 2012, Amplify is a tablet-based learning and analytics platform for the K-12 market. The subsidiary also manufactured its own tablet device but has now stopped the production. News Corp will stop advertising Amplify to new customers but continue to serve existing ones and develop the curriculum software.
Amplify is based on the assets of Wireless Generation, an education company News Corp acquired in 2010 for $360 million.
Joel Klein, CEO of Amplify, also confirmed talks with an outside investor in a memo to the employees and that the Amplify management team was considering to participate in the investment.
News Corp hoped to turn its digital education business into a growing division for the company, shaking up the textbook market and compensate for declining revenues from newspapers and media. The company invested over $1 billion into Amplify and is expected to get around $100 million out of the sale.
Further Reading
- News Corp Posts Loss on Education Write-Down | WSJ
- Education unit drags News Corp to loss | BDLive
- News Corp.'s Amplify education experiment: What went wrong? | ZDNet
- News Corp. Planning to Sell Off Money-Losing Education Unit | New York Times
- News Corp. to Exit Education Business With Amplify Sale | Bloomberg