WTW posts 41% decline in Q4 2025 profit

Core Insights - WTW reported a net income of $736 million in Q4 2025, a 41% decrease from $1.25 billion in the previous year [1] - The company experienced a diluted earnings per share of $7.62, down 38% year-on-year, while operational income rose 13% to $1.01 billion [1] - Quarterly revenue was $2.94 billion, a 3% decline from $3.04 billion a year earlier, but showed 6% organic growth [1] Financial Performance - Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) for the quarter was $1.12 billion, representing 38.2% of revenue, down from $1.15 billion (37.9% of revenue) in Q4 last year [2] - The Health, Wealth & Career (HWC) division reported revenue of $1.65 billion, an 11% decline year-on-year due to the TRANZACT sale, although organic growth was 6% [2] - The Risk & Broking (R&B) division saw a 10% increase in revenue to $1.25 billion, with organic and constant currency growth at 7% [3] Annual Overview - For the full year, WTW generated $9.71 billion in revenue, a 2% decrease from $9.93 billion the previous year, primarily due to the TRANZACT divestiture [3] - Net income for 2025 reached $1.61 billion, reversing a net loss of $88 million from the prior year [4] - WTW repurchased $350 million of its shares during Q4 and a total of $1.65 billion over the entire year [4] Strategic Outlook - WTW's CEO highlighted strong performance across businesses, emphasizing strategic investments in talent and innovation to enhance efficiency and optimize the portfolio [5] - Looking ahead to 2026, WTW anticipates continued margin expansion, projecting around 100 basis points of average annual margin improvement over the next two years in R&B and further gains in HWC [5] - The acquisition of US broker Newfront is expected to be $0.10 dilutive to adjusted earnings per share and generate approximately $250 million in post-close annual revenue in 2026 [6]