Thomson Reuters Corp ((TSE:TRI)) has held its Q3 earnings call. Read on for the main highlights of the call.
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Thomson Reuters Corp’s recent earnings call painted a picture of robust performance in key areas, tempered by some challenges. The sentiment was largely positive, with strong growth in the Big 3 segments and encouraging customer feedback on AI products. However, the company also faced hurdles such as declines in Global Print revenue and temporary factors impacting overall revenue growth.
Strong Revenue Growth in Big 3 Segments
The earnings call revealed impressive growth in Thomson Reuters’ Big 3 segments, with total company organic revenues rising by 7%. Notably, the Legal Professionals segment saw a 9% organic revenue increase, driven by the momentum of Westlaw and significant growth from CoCounsel and Cocounsel drafting.
Positive Customer Feedback on AI Products
Thomson Reuters received very positive customer feedback on its Agentic AI products launched over the summer. Initial sales trends are promising, particularly for the CoCounsel legal integrated offer, Westlaw advantage, and CoCounsel for tax, audit, and accounting.
$1 Billion Share Repurchase Program Completed
The company successfully completed a $1 billion share repurchase program, acquiring approximately 6 million shares. This move underscores Thomson Reuters’ strong capital capacity and commitment to enhancing shareholder value.
Improved Profit Margins and EBITDA Growth
Thomson Reuters reported a 10% increase in adjusted EBITDA to $672 million, with a 240 basis point margin increase to 37.7%. This improvement was attributed to healthy operating leverage and effective cost management.
Global Print Revenue Decline
The earnings call highlighted a 4% year-on-year decline in Global Print organic revenues, which contributed to a slower total organic revenue growth rate, trending closer to 3%.
Temporary Factors Affecting Revenue Growth
Several temporary factors, including a slower ramp of commercial print volumes and recent U.S. federal government cancellations, have affected revenue growth. These factors have led to a trend of total and organic revenue growth closer to 3% and 7%, respectively.
Challenges in Government Segment
Thomson Reuters faced challenges in the government segment, with recent downgrades and losses related to U.S. federal efficiency programs impacting full-year organic revenue growth by approximately 20 basis points.
Forward-Looking Guidance
Looking ahead, Thomson Reuters provided detailed guidance for its financial performance. The company reaffirmed its full-year 2025 outlook, projecting 9% organic revenue growth for the Big 3 segments. For 2026, it anticipates 7.5% to 8% organic revenue growth, with a 100 basis point EBITDA margin expansion and higher free cash flow, driven by ongoing innovation and technology integration, particularly in AI. The company remains confident in its ability to pursue both organic and inorganic growth opportunities.
In summary, Thomson Reuters Corp’s earnings call reflected a strong performance in key segments, bolstered by positive customer feedback and strategic capital deployment. While challenges in the Global Print and government segments were noted, the company’s forward-looking guidance remains optimistic, with expectations of continued growth and innovation.