WTW Reports Second Quarter 2024 Earnings

Core Insights - WTW reported strong second-quarter results for 2024, with significant growth in earnings per share (EPS) and operating margins, driven by robust organic growth and operational efficiency [1][3] - The company raised its full-year 2024 targets for adjusted operating margin to 23.0%-23.5% and adjusted EPS to $16.00-$17.00, reflecting confidence in ongoing performance [1][9] Financial Performance - Revenue for Q2 2024 was $2.27 billion, a 5% increase from $2.16 billion in Q2 2023; on an organic basis, revenue also increased by 6% [2][4] - Income from operations rose to $212 million, up 49% year-over-year, with an operating margin of 9.4%, an increase of 280 basis points [4][71] - Adjusted operating income increased by 22% to $385 million, with an adjusted operating margin of 17.0%, up 240 basis points from the previous year [4][78] Segment Highlights - The Health, Wealth & Career (HWC) segment generated revenue of $1.26 billion, a 4% increase year-over-year, with organic growth driven by project work and client retention [7][27] - The Risk & Broking (R&B) segment reported revenue of $979 million, a 9% increase, with operating income rising 39% to $202 million and an operating margin of 20.6%, up 450 basis points [8][28] Cash Flow and Capital Allocation - Cash flows from operating activities were $431 million for Q2 2024, slightly up from $430 million in the prior year; free cash flow for the first half of 2024 was $361 million, an increase of $11 million year-over-year [26][6] - The company repurchased $200 million of its outstanding shares during the quarter, reflecting a commitment to returning value to shareholders [6] Outlook - WTW's updated targets for 2024 include revenue expectations of over $9.9 billion, with adjusted operating margin and adjusted diluted EPS revised upwards [27][30] - The company anticipates annual cost savings from its transformation program to reach approximately $450 million, with total costs to achieve the program estimated at $1.175 billion [30]