Thomson Reuters Q1 2025: Navigating Contradictions in Demand, AI Strategy, and Legal Growth

Impact of trade war on demand, AI investment strategy, product growth reclassification strategy, divestiture impact on Legal Professionals segment, and customer adoption of AI products are the key contradictions discussed in Thomson Reuters' latest 2025Q1 earnings call



Revenue Growth and Product Mix:
- Thomson Reuters reported organic revenues grew 6% in Q1 2025, with the Big three segments growing by 9%.
- The growth was driven by double-digit growth in key products like CoCounsel, SurePrep, Pagero, and a strategic focus on innovation, particularly in AI.

Margins and Profitability:
- Adjusted EBITDA remained unchanged at $809 million, showing a 40 basis point margin decline to 42.3%.
- Healthy revenue flow-through and favorable expense timing boosted margins, exceeding expectations.

Acquisitions and Strategic Investments:
- Thomson Reuters acquired SafeSend for $600 million in January, indicating a strategic focus on inorganic growth.
- The company raised its 2025 annual dividend by 10%, reflecting a balanced capital allocation approach.

Regulatory Environment and Demand:
- The company is closely monitoring the economic environment, especially tariff-related uncertainties, but has not yet seen changes in demand.
- Thomson Reuters maintains a resilient business model with 80% recurring revenues, ensuring stability in a potentially volatile environment.