What Willis Towers Watson Public (WTW) Said on Its Q3 Earnings Call

Key Points

• WTW delivered a strong third quarter, with 4% organic revenue growth, adjusted operating margin expansion of 150 basis points to 21.9%, and adjusted diluted EPS up 18% to $3.63.
• The company lowered its Health, Wealth & Career outlook to low- to mid-single-digit growth, mainly because three large retiree marketplace implementations were delayed until 2027. Risk & Broking remained stronger, growing 5% organically, and its full-year growth and margin outlook was maintained.
• WTW is accelerating AI and technology investments through its Propel program, targeting approximately $350 million in net annualized savings by 2028. The company also expects 2026 share repurchases to exceed $1 billion, while its Willis Re investment is projected to weigh about $0.30 on adjusted EPS.

Willis Towers Watson Public NASDAQ: WTW reported third-quarter organic revenue growth of 4%, adjusted operating margin expansion of 150 basis points and adjusted diluted earnings per share growth of 18%, Chief Executive Officer Carl Hess said on the company’s earnings call.

Adjusted diluted EPS reached $3.63 for the quarter, while adjusted operating margin was 21.9%. Chief Financial Officer Andrew Krasner said margin expansion reflected top-line momentum, early benefits from technology investments and expense discipline.

“Across both segments, we grew the top line and expanded margins, allowing us to deliver double-digit earnings growth,” Hess said.

Segment performance and revised outlook

Health, Wealth & Career, or HWC, posted 4% organic revenue growth in the third quarter and a 29.5% operating margin, up 90 basis points from a year earlier. Health revenue grew 6% organically, supported by new business, renewals and project work, particularly as employers seek help managing elevated healthcare costs.

Wealth grew 2% organically, with steady retirement activity in Europe and international markets, new global client wins and continued de-risking activity in Great Britain. Career revenue increased 9%, or 10% excluding the Middle East, driven largely by compensation survey sales and delivery. However, the company said part of Career’s growth reflected survey-delivery timing that benefited the quarter and will unwind in the fourth quarter.

Benefits Delivery & Outsourcing revenue declined 2% organically. Krasner said outsourcing grew modestly, but individual marketplace revenue declined outside the annual enrollment period. The company had its strongest individual marketplace sales cycle in a decade, according to HWC President Julie Gebauer, but three large clients representing 75,000 retirees delayed implementations until 2027.

As a result, WTW reduced its full-year HWC organic-growth expectation to low- to mid-single digits from a prior mid-single-digit outlook. The company now expects BD&O revenue to be roughly flat in 2026 rather than grow at a low-single-digit rate, while Career is now expected to post low-single-digit growth for the year.

Gebauer said the delayed implementations did not alter the underlying demand outlook. “These retirees flow into 2027, and that is on top of an already stronger pipeline than we had at the beginning of this year,” she said.

Risk & Broking, or R&B, grew revenue 5% organically, or 4% excluding book-of-business settlements and interest income. Corporate Risk & Broking produced 5% organic growth, led by double-digit expansion in North America, including construction, surety and transactional risk activity. International operations grew at a high-single-digit rate, with strength in Asia and Central and Eastern Europe, the Middle East and Africa.

Insurance Consulting and Technology grew 2% organically. The technology business posted strong growth, including demand for the company’s Radar platform, while consulting revenue declined as clients deferred discretionary projects. WTW now expects low-single-digit ICT growth for the full year.

R&B operating margin was 19.8%, rising 100 basis points from the previous year. WTW maintained its outlook for mid-single-digit organic growth and about 100 basis points of full-year margin expansion in the segment, with Krasner saying organic growth is expected to accelerate sequentially in the fourth quarter from the reported 5% third-quarter rate.

Technology and AI initiatives

Hess highlighted progress under Propel, WTW’s AI Acceleration Plan, which the company introduced last quarter. The program is intended to enhance client offerings and generate efficiency savings through wider deployment of AI, automation and technology-enabled operating models.

Among recent developments, WTW launched Via Retirement, an AI-enabled financial planning and retirement marketplace solution for individuals moving from employment into retirement. It also worked with Microsoft to develop an agentic administration process within its Violet outsourcing AI suite. Hess said the system is managing workflows across 160 vendors for more than 20 clients and has saved tens of thousands of human hours so far.

In Risk & Broking, WTW launched RiskIQ Nexus, a platform that consolidates client policy, premium, loss and exposure information into a single view. The company also plans in the fourth quarter to begin the first global release of Neuron, its AI-enabled operating model, across 10 additional countries in Europe and Asia-Pacific.

WTW expects to invest about $625 million of cash under Propel to generate approximately $400 million of run-rate savings by the end of 2028. After roughly $50 million of reinvestment for growth, the company expects about $350 million of net run-rate savings and an adjusted operating margin of approximately 30% in 2028.

During the third quarter, WTW incurred about $7 million in cash costs and $14 million in non-cash charges related to Propel. Actions taken so far represent roughly $18 million in annualized run-rate savings, Krasner said, though the company expects investment and savings to increase more materially in 2027.

Market conditions, capital allocation and Willis Re

Hess said commercial insurance pricing continued to soften during the quarter, particularly in property lines for large and complex programs. U.S. casualty rates remained an exception, with increases continuing in excess layers as carriers respond to loss-cost inflation. WTW said it remains focused on specialty offerings, data and analytics, client retention and new-business generation rather than attempting to forecast insurance market cycles.

The company said specialty demand remains strong in areas including transactional risk, construction, digital infrastructure, natural resources, defense and security, and sports and entertainment.

WTW’s Newfront and Cushon integrations remain on track, with cost synergies modestly ahead of plan, Hess said. The company also said its Willis Re joint venture with Bain Capital reached two milestones during the quarter: Neil Eckert was appointed chief executive officer, with a planned early-2027 start, and Willis Re agreed to acquire BMS Re’s U.S. reinsurance broking business, subject to regulatory approval.

Krasner said the Willis Re investment generated a $13 million loss through earnings of associates in the third quarter, in line with expectations. WTW continues to expect roughly a $0.30 drag on 2026 adjusted EPS from the investment and expects it to remain a drag in 2027 as the platform is scaled and BMS Re’s U.S. operations are integrated.

Free cash flow for the first nine months totaled $1.064 billion, up from $838 million a year earlier. During the quarter, WTW repurchased $220 million of shares and paid $89 million in quarterly dividends. Year-to-date share repurchases reached $970 million, and the company now expects full-year repurchases to exceed $1 billion, subject to market conditions and investment opportunities.

For 2026, WTW continues to expect mid-single-digit organic revenue growth, though toward the lower end of that range, annual adjusted operating margin expansion and improving free cash flow.

About Willis Towers Watson Public (NASDAQ:WTW)

Willis Towers Watson Public Limited Company NASDAQ: WTW is a global advisory, broking and solutions company that helps organizations manage risk, optimize benefits and improve performance. Its clients include corporations, governments, institutions and individuals across a range of industries and markets.

The company's services include insurance brokerage and risk management, reinsurance, employee benefits consulting, retirement and investment advisory, and human capital and organizational consulting.

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