Abstract
Thomson Reuters will publish its fourth-quarter 2025 results on February 05, 2026 Pre-Market, with investors watching revenue, margin resilience, and adjusted EPS trajectories amid stable subscription trends.
Market Forecast
Consensus built around the company’s guidance points to fourth-quarter revenue of $2.00 billion, EBIT of $0.60 billion, and adjusted EPS of $1.06, implying year-over-year increases of 4.99%, 10.66%, and 9.40%, respectively. Forecasts embed modest gross margin expansion, continued high-teens to low-twenties net profitability, and further EPS leverage on disciplined cost execution. The company’s recurring-information businesses are expected to sustain healthy momentum, with the largest incremental growth coming from software and workflow upgrades in flagship legal and tax offerings. The most promising segment this quarter is the reportable segments portfolio, where core content and software subscriptions anchor revenue at $1.79 billion with mid-single-digit year-over-year expansion.
Last Quarter Review
In the third quarter of 2025, Thomson Reuters reported revenue of $1.78 billion, a gross profit margin of 37.77%, GAAP net profit attributable to the parent company of $0.42 billion, a net profit margin of 23.74%, and adjusted EPS of $0.85, with year-over-year growth across all major indicators. The company outperformed its prior-quarter EPS and EBIT estimates, reflecting expense discipline and steady subscription renewals, while the reportable segments continued to account for nearly all of revenue with minimal offsets from eliminations. Main business performance remained robust in the reportable segments at $1.79 billion revenue, supported by subscription renewals and product enhancements, while eliminations of $0.01 billion slightly reduced the consolidated figure.
Current Quarter Outlook
Core Information and Workflow Subscriptions
Thomson Reuters’ core revenue engine remains subscription-led, spanning legal research, tax compliance, and risk intelligence. Quarter to date indicators suggest stable renewal rates and modest price realization, consistent with forecast revenue of $2.00 billion and year-over-year growth of 4.99%. Management’s cost framework implies incremental operating leverage, aligning with a forecast EBIT of $0.60 billion and adjusted EPS of $1.06. The interplay of new product modules, user seat expansions at enterprise accounts, and ongoing migrations to cloud-delivered tools supports mid-single-digit top-line growth while preserving margins. A continued focus on product mix—emphasizing higher-value workflow software and AI-enabled content—underpins expectations for slight gross margin expansion from the prior quarter’s 37.77% level. Risks to this outlook include slower cyclical demand from smaller law firms and consulting channels, yet large enterprise and government renewals have historically smoothed variability into year-end and early year budget cycles.
Most Promising Growth Driver: Upgrades in Legal and Tax Software
The most significant incremental growth is expected from upgrades and seat additions in legal and tax software suites, where embedded adoption of integrated workflow and AI-augmented tools increases customer lifetime value. Within the reportable segments portfolio, which generated $1.79 billion last quarter, new functionality and packaged bundles appear to be lifting cross-sell and attach rates. The fourth-quarter forecast implies improved year-over-year growth in adjusted EPS relative to revenue, signaling favorable revenue quality and operating leverage from these offerings. With enterprise clients prioritizing compliance, audit-readiness, and productivity gains, the company is well placed to expand average revenue per account while keeping churn low. Execution around price updates, streamlined implementations, and support for large-scale rollouts will be pivotal to sustaining the expected high-teens-to-low-twenties net profit margin profile.
Stock Price Drivers: Margin Trajectory and AI Monetization Signals
Share performance into and after the print will hinge on clarity around margin trajectory and the timetable for monetizing AI-enhanced features across the portfolio. Guidance that confirms mid-single-digit revenue growth coupled with a stable or slightly higher gross margin than the last quarter’s 37.77% would reinforce confidence in the EBIT estimate of $0.60 billion and adjusted EPS of $1.06. Investors will look for commentary on pipeline conversion for large enterprise deals, the pace of migration to next-generation platforms, and early customer adoption metrics for AI-enabled tools. Any update on capital deployment, including buyback cadence and integration of prior investments into sales efficiency, could also influence sentiment. Conversely, softer booking trends or a cautious tone on smaller customer cohorts could temper enthusiasm even if headline results meet estimates.
Analyst Opinions
Analyst previews surveyed over the past months skew positive, with a majority anticipating an in-line-to-slight beat on revenue and adjusted EPS, backed by stable subscription renewals and cost discipline. Several well-followed institutions emphasize the visibility of mid-single-digit organic growth and see scope for modest margin expansion as higher-value workflow software scales. The prevailing view expects management to reiterate constructive commentary on demand from large enterprises and regulated industries, framing 2026 as a year of steady compounding rather than step-change acceleration. These analysts highlight that valuation support is most sensitive to confirmation of the forecasted $2.00 billion in revenue and $1.06 adjusted EPS, alongside narratives around AI-enabled product adoption and mix upgrade. A minority of cautious voices focuses on potential elongation of sales cycles among small and mid-market customers, but the consensus remains that large-client renewals will anchor performance this quarter.Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.
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