Thomson Reuters Reports Second-Quarter 2025 Results

Executive Summary

• Thomson Reuters reported second-quarter 2025 financial results, showing total revenue growth of 3% and organic revenue growth of 7%, with the "Big 3" segments (Legal Professionals, Corporates, and Tax & Accounting Professionals) driving 9% organic growth.
• The company maintained its full-year 2025 outlook for organic revenue growth, adjusted EBITDA margin, and free cash flow, while updating guidance for depreciation/amortization and net interest expense.
• Key operational highlights include the launch of new agentic AI solutions (CoCounsel Legal and CoCounsel for tax/audit/accounting) and the repayment of $1.4 billion in Canadian notes using cash on hand.

Key Details

• Q2 2025 Consolidated Financials (Three Months Ended June 30):

  • Total Revenues: $1,785 million (up 3% year-over-year; up 2% at constant currency).
  • Organic Revenue Growth: 7%.
  • Recurring Revenues: Up 3% (82% of total revenue); Organic recurring revenue up 9%.
  • Transactions Revenues: Up 5% (organic up 7%).
  • Global Print Revenues: Down 7% (organic down 7%).
  • Operating Profit: $436 million (up 5%).
  • Adjusted EBITDA: $678 million (up 5%); Margin: 37.8% (up 70 basis points).
  • Adjusted EPS: $0.87 (up 2%).
  • Free Cash Flow: $566 million (up 4%).
  • Net Cash Provided by Operating Activities: $746 million (up 5%).
  • Diluted EPS: $0.69 (down 63%, primarily due to currency losses and prior-year non-cash tax benefits/LSEG valuation gains).

• Six-Month 2025 Financials (Six Months Ended June 30):

  • Total Revenues: $3,685 million (up 2%).
  • Organic Revenue Growth: 7%.
  • Adjusted EBITDA: $1,487 million (up 2%); Margin: 40.1%.
  • Adjusted EPS: $2.00 (up 2%).
  • Free Cash Flow: $843 million (up 4%).

• Segment Performance (Q2 2025):

  • Legal Professionals: Revenues $709 million (down 2% total, up 8% organic). Adjusted EBITDA $339 million (up 4%); Margin 47.8%. Growth driven by Westlaw, CoCounsel, and Practical Law.
  • Corporates: Revenues $472 million (up 7% total, up 9% organic). Adjusted EBITDA $169 million (up 3%); Margin 35.7%. Growth driven by Indirect/Direct Tax, Pagero, and Practical Law.
  • Tax & Accounting Professionals: Revenues $277 million (up 11% total, up 11% organic). Adjusted EBITDA $113 million (up 22%); Margin 39.3%. Growth driven by SafeSend acquisition, SurePrep, UltraTax, and Latin America business.
  • Reuters News: Revenues $218 million (up 7% total, up 5% organic). Adjusted EBITDA $45 million (down 11%); Margin 20.8%.
  • Global Print: Revenues $114 million (down 7% organic). Adjusted EBITDA $41 million (down 5%); Margin 36.0%.

• 2025 Full-Year Outlook:

  • Maintained previous guidance for Total Revenue Growth (3.0-3.5%), Organic Revenue Growth (7.0-7.5%), Adjusted EBITDA Margin (~39%), Corporate Costs ($120-$130 million), Free Cash Flow (~$1.9 billion), and Accrued Capex (~8% of revenue).
  • Updated Guidance:
    • Depreciation and amortization of computer software: $825 million to $835 million (previously $835-$855 million).
    • Net interest expense: Approximately $130 million (previously ~$150 million).
  • Q3 2025 Guidance: Organic revenue growth approximately 7%; Adjusted EBITDA margin approximately 36%.

• Capital Allocation & Debt:

  • Repaid Canadian $1.4 billion (U.S. $1.0 billion) 2.239% notes upon maturity in May 2025 using cash on hand.
  • Dividend increased by 10% to $2.38 per common share annually ($0.595 per share quarterly).
  • Shares outstanding: Approximately 450.7 million as of August 4, 2025.

• Product Updates:

  • Launched new agentic AI solutions leveraging Thomson Reuters content, including CoCounsel Legal (with Deep Research on Westlaw) and CoCounsel for tax, audit, and accounting.

Notable Quotes

• "We saw good momentum continue in the second quarter, with revenue in-line and margins modestly ahead of our expectations... We remain focused on delivering product innovation across our portfolio, as exemplified by the launch of CoCounsel Legal... and CoCounsel for tax, audit and accounting." — Steve Hasker, President and CEO
• "As we look ahead, we remain committed to a balanced capital allocation approach and continue to assess inorganic opportunities as they arise, while focusing on delivering sustained value creation through a long-term investment strategy." — Steve Hasker, President and CEO