Thomson Reuters' Steady Dividend Growth Reflects Resilient Financial Strategy

Thomson Reuters Corporation (TRI) has reaffirmed its commitment to shareholders with the announcement of its quarterly dividend of $0.595 per common share, payable on June 10, 2025, to shareholders of record as of May 22, 2025. This marks the latest chapter in a 32-year streak of annual dividend increases, a testament to the company’s disciplined financial management and consistent cash generation.

The Dividend in Context: A Long History of Growth

Thomson Reuters’ dividend policy has been a cornerstone of its shareholder returns strategy. The $0.595 quarterly payout represents a 10% increase from the prior year’s $0.54 per share, part of four consecutive annual raises of this magnitude. When annualized, the dividend now stands at $2.38 per share, up from $2.18 in 2024. This growth aligns with the company’s financial discipline, which prioritizes returning capital to investors while maintaining reinvestment in growth initiatives.

Financial Fortitude Behind the Dividend

The dividend increase is underpinned by strong operational performance. In 2024, Thomson Reuters reported:
- 7% organic revenue growth, driven by its Legal & Professional and Financial & Risk segments.
- A robust adjusted EBITDA margin of 38.2%, reflecting cost efficiency.
- $1.8 billion in free cash flow, a key metric for sustaining dividends.

While 2025’s total revenue growth is expected to slow to 3.0–3.5% (due to divestitures), organic revenue growth remains healthy at 7.0–7.5%, signaling continued underlying strength. The company’s dividend payout ratio of 58.67% further underscores sustainability, with earnings comfortably covering the dividend.

Why Investors Should Take Note

Thomson Reuters’ dividend track record stands out in a market where many firms have paused payouts during economic uncertainty. The 32-year streak of increases—including four straight 10% hikes—is rare and signals:
1. Operational Resilience: Even amid macroeconomic headwinds, the company has maintained cash flow.
2. Management Prudence: The board’s focus on balancing dividends with growth investments (e.g., AI-driven tools for legal and financial services) ensures long-term viability.
3. Attractive Yield: With a dividend yield of 1.3% (as of May 2025), TRI offers a stable income stream in a low-yield environment, while its stock price has historically risen alongside dividend hikes.

Risks and Considerations

No investment is risk-free. Key concerns include:
- Slowing Revenue Growth: The projected 2025 revenue deceleration, though mitigated by organic growth, could test margins if not managed.
- Dividend Discretion: While the streak is impressive, dividends remain at the board’s discretion, though the company has shown strong shareholder alignment.

Conclusion: A Dividend Machine with Legs

Thomson Reuters’ June 2025 dividend announcement is more than a financial milestone—it’s a reflection of a company that has mastered the art of balancing shareholder returns with growth. With a payout ratio well within sustainable bounds, a fortress-like cash flow, and a 32-year dividend growth record, TRI appears positioned to continue rewarding investors.

For income-focused investors, the $0.595 quarterly dividend (yielding 1.3%) offers stability, while the stock’s potential to appreciate alongside dividend hikes provides a dual appeal. As Thomson Reuters continues to innovate in legal, tax, and financial data solutions, its dividend policy remains a beacon of reliability in an uncertain market.

Final Take: Thomson Reuters’ unwavering dividend growth underscores its financial health and strategic focus. With a disciplined capital allocation approach and a track record of converting operational success into shareholder value, TRI is a compelling option for investors seeking both income and growth.