By Adriano Marchese
Shares of Thomson Reuters fell sharply Tuesday after artificial intelligence company Anthropic revealed a new legal automation tool that threatens to encroach on the company's core contract-review and workflow-software business.
Shares trading in Toronto were down more than 17% to 123.21 Canadian dollars ($90.06).
Anthropic, the maker of Claude, released a new legal tool aimed at helping companies speed up routine legal work, such as review contracts, sort nondisclosure agreements, handle compliance workflows, prepare legal briefings and draft standard responses.
The new tool touches a sensitive area for Thromson Reuters, whose legal software platforms such as Westlaw, Practical Law and CoCounsel, offer similar capabilities and have been a major focus of the company's push to integrate generative AI across its products.
Legal Professionals is one of Thomson Reuters' "Big 3" business segments. It generated roughly half of the company's $1.46 billion revenue in the most-recent quarter.
While Thomson Reuters offers a large legal database and stores of archives for the industry, the threat is more to the company's workflow automation layer that has become a major growth focus for the company. Chief Executive John Hasker told investors in November that Thomson Reuters expects to continue investing heavily in generative AI, with spending expected to exceed $200 million in 2025 and in 2026.
Two of Europe's largest professional information companies, RELX and Wolters Kluwer, began the stock cascade Tuesday following the Anthropic news. The two companies both have large businesses built around legal research, compliance tools and workflow software.
Earlier in the week, National Bank of Canada downgraded the stocks target price to C$190 from a previous C$300. The stock has seen a nearly 50% decline over the past 52 weeks. Analyst Adam Shine said the decline comes as investors shift more of their attention toward AI-driven demand for computing power, such as the chips and processing units that run massive data centers. At the same time, he adds that markets are growing more cautious that AI could eventually reduce the need for traditional software licenses and workflow tools.
Write to Adriano Marchese at adriano.marchese@wsj.com
(END) Dow Jones Newswires
February 03, 2026 11:41 ET (16:41 GMT)
Copyright (c) 2026 Dow Jones & Company, Inc.
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