Thomson Reuters' 'Big 3' Segments Drive Organic Revenue Growth Of 7% Despite Missing Consensus

Thomson Reuters Corp (NYSE: TRI) reported first-quarter FY23 revenue growth of 4% year-on-year to $1.738 billion, missing the consensus of $1.740 billion. 

• Organic revenues increased by 6%, driven by recurring revenues. 
• The "Big 3" segments (Legal Professionals, Corporates, and Tax & Accounting Professionals) collectively comprised 82% of total revenues and reported organic revenue growth of 7%. Legal Professionals' revenue grew 2% Y/Y to $714 million, Corporates' revenue rose 6% Y/Y to $435 million, and Tax & Accounting Professionals' revenue increased 11% Y/Y to $282 million.
• Reuters News revenue was flattish Y/Y at $175 million, and the Global Print revenue fell 3% Y/Y to $138 million.
• Adjusted EBITDA margin expanded by 300 bps to 38.8% due to higher revenue.
• Adjusted EPS of $0.82 beat the consensus of $0.79.
• Thomson Reuters generated $133 million in free cash flow and held $1.69 billion in cash and equivalents. 
• Outlook: Thomson Reuters expects Q2 organic revenue growth rate to be at the low end of the full year, 5.5% - 6.0%.
• Thomson Reuters reiterated FY23 organic revenue growth of 5.5% - 6.0%. 
• Thomson Reuters lowered FY23 revenue growth from 4.5% - 5.0%, down from the prior 3.0% - 3.5% (consensus $6.93 billion).

Price Action: TRI shares were trading lower by 1.77% to $129.83 at the last check Tuesday.

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