Thomson Reuters Q2 Earnings Call Highlights

Key Points

• Thomson Reuters reported strong Q2 performance, with organic revenue growth of 8% and Big 3 segment growth of 10%. Adjusted EBITDA rose 10% to $745 million, while free cash flow increased 29% to $727 million.
• The company raised its full-year revenue growth outlook to approximately 8% and lifted its Big 3 growth forecast to 9.5%–10%, while maintaining targets for a 40% adjusted EBITDA margin and approximately $2.1 billion in free cash flow.
• AI adoption continued to accelerate, with GenAI-enabled products representing 32% of annualized contract value. Thomson Reuters also plans to expand CoCounsel and deploy its proprietary Thomson legal model, while selling a 51% stake in Global Print to KKR for about $500 million.

Thomson Reuters NASDAQ: TRI reported second-quarter 2026 organic revenue growth of 8%, led by accelerating performance across its Legal, Corporates, and Tax, Audit & Accounting businesses. The company raised its full-year revenue outlook, citing stronger-than-expected first-half results and continued demand for AI-enabled professional workflow tools.

Chief Executive Officer Steve Hasker said total company organic revenue increased 8% in the quarter, while the company’s “Big 3” segments grew 10% organically, up from 9% in recent quarters. The Big 3 includes Legal Professionals, Corporates, and Tax, Audit & Accounting.

“Our strong start to 2026 continued in the second quarter, with revenue growth ahead of our prior expectations and margins in line,” Hasker said.

Revenue growth accelerates across core businesses

Legal Professionals organic revenue rose 10%, while Legal excluding government grew 11% for a second consecutive quarter. The company attributed the performance to continued momentum in Westlaw and CoCounsel Legal, as well as growth across large, mid-sized, small, and international law firms.

Government revenue growth improved to 5% from 1% in the first quarter. However, Chief Financial Officer Gary Bischoping said government growth is expected to be softer in the third quarter because certain transactional revenue recognized in the second quarter is not expected to recur at the same level.

Corporates organic revenue also increased 10%, with recurring revenue up 9% and transactional revenue up 24%. Bischoping identified Pagero, Indirect Tax, CLEAR, CoCounsel Legal and international operations as key contributors. He said Pagero’s global expansion has accelerated its performance, and Hasker pointed to a recent Pagero customer win with Google.

Tax, Audit & Accounting organic revenue grew 8%, supported by CoCounsel for Tax & Accounting, the company’s Latin American business, SafeSend and Cloud Audit Suite offerings. Transactional revenue growth in the segment, however, fell short of management’s expectations.

Bischoping said the shortfall reflected timing issues and go-to-market execution challenges, including customer and sales-team confusion around the company’s future product vision for integrated tax workflows. The company has made leadership changes and talent additions and expects the segment’s growth to accelerate during the second half of the year.

Reuters organic revenue grew 4%, driven primarily by its agency business and its news agreement with the data and analytics business of LSEG. Global Print organic revenue declined 3%, in line with company expectations.

Profitability, cash flow and outlook

Adjusted EBITDA rose 10% to $745 million, producing an adjusted EBITDA margin of 38.1%, a 30-basis-point increase from the prior-year period. Adjusted earnings per share increased 14% to $0.99, including a $0.01 benefit from currency.

Free cash flow increased 29% to $727 million from $566 million a year earlier, primarily reflecting EBITDA growth and working-capital changes.

The company raised its full-year outlook for total and organic revenue growth to approximately 8%, the high end of its previous 7.5% to 8% range. It also lifted its Big 3 revenue growth outlook to 9.5% to 10%, from approximately 9.5% previously. Thomson Reuters maintained its forecast for an adjusted EBITDA margin of approximately 40% and free cash flow of about $2.1 billion.

For the third quarter, the company expects organic revenue growth of approximately 8% and an adjusted EBITDA margin of approximately 36%. That outlook includes an anticipated $19 million of severance expense associated with initiatives to “reimagine how we work.”

Bischoping said the company expects a stronger margin expansion in the fourth quarter, aided by lower year-over-year severance costs, automation savings, moderating M&A dilution and operating leverage. Savings from automation and severance-related initiatives are expected to total about $40 million in the fourth quarter.

Global Print transaction to reshape portfolio

In July, Thomson Reuters agreed to sell a 51% stake in its Global Print business to KKR for approximately $500 million in cash, forming a joint venture to operate the print business. The transaction is expected to close in the fourth quarter, subject to regulatory approvals and customary closing conditions.

Following the closing, Global Print will be deconsolidated from Thomson Reuters’ financial statements, with the company’s remaining 49% interest accounted for as an equity-method investment. Beginning with third-quarter results, the company plans to report Global Print as discontinued operations and provide restated historical financial results ahead of its next earnings report.

Thomson Reuters will retain intellectual property rights and editorial control over its content. The joint venture will receive an exclusive license to publish and distribute the company’s content in print and through the ProView eBook platform. In return, the venture will pay Thomson Reuters a royalty equal to 20% of professional revenue, which represents about 85% to 90% of Global Print revenue.

Bischoping said the transaction is expected to be 60 to 70 basis points accretive to organic revenue growth and approximately neutral to margins after the transaction closes.

AI product rollout and proprietary Thomson model

The company said commercial momentum is continuing to build for its AI-enabled offerings. At the end of the second quarter, 32% of annualized contract value came from GenAI-enabled products, up from 30% in the first quarter.

Hasker said the next-generation version of CoCounsel Legal completed its beta phase ahead of schedule in June and was made available to existing CoCounsel Legal customers through early access. A broader release is expected by the end of the month. He said usage has been increasing across both Legal and Tax & Accounting versions of CoCounsel, following the company’s earlier disclosure that the platform had surpassed 1 million users.

The updated CoCounsel Legal platform is designed to provide agentic capabilities with visibility into the steps, citations and references supporting its output. Hasker said customer feedback on the product’s accuracy, breadth of capabilities and transparency had been especially strong.

Thomson Reuters also introduced AI features in its ONESOURCE portfolio, including touchless compliance for creating U.S. sales and use tax returns and AI research for global trade. Pagero added coverage in five additional countries, including France, Poland and Belgium. The company expects an agentic next-generation CoCounsel for Tax & Accounting product this fall.

Management also highlighted its proprietary legal-focused large language model, Thomson, which was developed following the company’s 2024 acquisition of SafeSign Technologies. Hasker said the first production-ready version of the model was trained on less than 10% of the company’s legal content and involved approximately $40 million of investment.

According to the company’s benchmarking study, Thomson performed on par with leading frontier models on a range of general-domain tasks while offering lower costs and, in many cases, lower latency. The model will begin powering tabular analysis, a bulk document-review tool in CoCounsel Legal, later this month.

Management said it sees potential to move more CoCounsel functions onto Thomson over time, potentially improving speed, scalability and costs. Hasker also said the company is exploring opportunities for large law firms to use the model in sovereign AI environments that preserve control over their own data and intellectual property.

On capital allocation, Thomson Reuters completed a $605 million return-of-capital transaction in May and finished a $600 million share repurchase program in July. Together, those actions reduced the company’s share count by approximately 3%. The company also repaid $500 million of maturing notes during the quarter.

About Thomson Reuters (NASDAQ:TRI)

Thomson Reuters is a global provider of information and technology solutions for professional markets, including financial services, legal, tax and accounting, and media industries. The company delivers a range of data, analytics and software tools designed to help customers make informed decisions, manage risk and stay compliant with evolving regulations. Its key offerings include the Eikon financial data platform, Westlaw legal research service, Checkpoint tax and accounting solution, and Reuters News, which supplies real‐time journalism to media organizations worldwide.

Formed in 2008 through the merger of Canada's Thomson Corporation (founded in 1934) and the UK's Reuters Group (established in 1851), Thomson Reuters has built on a legacy of journalistic integrity and information innovation.

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