(Refiles to fix typo in CoCounsel in paragraph 9) By Kenneth Li (Reuters) -Thomson Reuters reported higher third-quarter revenue on Tuesday, boosted by investments in artificial intelligence products in its legal and tax and accounting divisions. The Toronto-based content and technology company also reaffirmed its full-year 2025 guidance of a 7% to 7.5% rise in […]
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Thomson Reuters revenue rises in third quarter, reaffirms 2025 forecast
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(Refiles to fix typo in CoCounsel in paragraph 9)
By Kenneth Li
(Reuters) -Thomson Reuters reported higher third-quarter revenue on Tuesday, boosted by investments in artificial intelligence products in its legal and tax and accounting divisions.
The Toronto-based content and technology company also reaffirmed its full-year 2025 guidance of a 7% to 7.5% rise in organic revenue, which tracks income from existing businesses on a constant currency basis.
“Our third-quarter results reflect continued momentum and the ongoing execution of our AI-driven innovation strategy,” Thomson Reuters CEO Steve Hasker said in a statement.
The owner of Westlaw legal database, Reuters news agency and the Checkpoint tax and accounting service reported third-quarter adjusted earnings per share of 85 cents, slightly exceeding Wall Street expectations of 83 cents, according to LSEG data.
Thomson Reuters revenue rose 3% to $1.78 billion, meeting expectations for the third quarter, during which it launched new AI features in products in its legal and tax and accounting businesses. It also purchased Additive AI, an artificial intelligence-powered tax document processing specialist.
Revenue at its “Big 3” businesses – legal, tax and accounting and corporates – rose 9% on an organic basis, while Reuters News revenue rose 3% and global print revenue fell 4%.
The generative AI spending frenzy kicked off by the launch of OpenAI’s ChatGPT in late 2022 has led some global corporations to question the financial returns, with some studies showing most struggling to integrate the new technology.
Hasker said in an interview with Reuters after the release of the results that investments in AI in the Thomson Reuters legal division directly contributed to its 9% rise in organic revenue for the third quarter.
In August, Thomson Reuters launched CoCounsel Legal, a legal research tool that features AI-powered agents that perform tasks autonomously to accomplish pre-defined goals.
It also launched deep research features in Westlaw that it says think like a lawyer and can conduct in-depth research by autonomously analyzing data to generate reports.
Chief Financial Officer Michael Eastwood told Reuters the contribution of generative AI-enhanced products has continued to rise since Thomson Reuters began tracking it late last year.
Generative AI is now responsible for up to 24% of the group’s underlying contract value, which breaks down a contract’s total value, compared with 22% in the last quarter.
Eastwood said it is expected to rise further.
AI investments are also expected to help operating profitability forecasts at Thomson Reuters, which said it now expects an adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) margin expansion of about 100 basis points, up from a prior expectation of 50 basis points.
Thomson Reuters said it has about $9 billion to spend on potential acquisitions, after completing a previously announced $1 billion share repurchase plan.
Thomson Reuters shares have fallen about 5.4% this year up to Monday’s market close, underperforming the 16.5% rise in the S&P 500 index, which has been boosted by increases in AI-heavy big tech stocks.
(Reporting by Kenneth Li in New York; Editing by Alexander Smith)