Pearson Q1 2025 Trading Update (Unaudited)

Core Viewpoint - Pearson is on track to meet its 2025 guidance, with a positive outlook for the second half of the year despite global economic uncertainties [2][4]. Financial Performance - Underlying Group sales growth was 1% in Q1 2025, with expectations for acceleration in the second half [3][5]. - Higher Education sales increased by 6%, driven by AI study tools and successful monetization of the Channels product [5][6]. - Assessment & Qualifications sales grew by 1%, while Virtual Learning sales decreased by 4% [7]. - English Language Learning sales fell by 6%, but growth is anticipated in subsequent quarters [6][8]. Strategic Initiatives - The company is expanding its professional learning capabilities with the new Pearson Skilling Suite and launching AI-powered tools [5][6]. - New contracts in Enterprise Learning & Skills, including partnerships with the UK Ministry of Defence, are contributing to growth [5][6]. - A £350 million share buyback program has been initiated, with £65 million already purchased by the end of April 2025 [5][6]. Future Outlook - Pearson expects low single-digit sales growth in H1 2025, with stronger growth anticipated in H2 [8]. - The company aims for mid-single digit underlying sales growth CAGR beyond 2025, with sustained margin improvement [6][8]. - Adjusted operating profit is expected to align with market expectations, with a free cash flow conversion of 90-100% [8].