Financial Performance - Group sales decreased by 2% on a headline basis to £1,722 million in H1 2025 compared to £1,754 million in H1 2024, but increased by 2% on an underlying basis [29][31] - Adjusted operating profit increased by 2% on an underlying basis to £242 million, while statutory operating profit rose by 10% to £240 million [5][29] - Free cash flow increased significantly by £129 million to £156 million, aided by a £114 million State Aid tax recovery [6][49] Strategic Developments - The company is on track to meet its 2025 guidance, with expectations of stronger growth in the second half of the year [3][6] - Strategic partnerships with major tech companies like Microsoft, AWS, and Google Cloud are enhancing the company's AI transformation agenda [6][13] - The acquisition of eDynamic Learning for $225 million is expected to strengthen the company's position in the Early Careers space [58] Business Unit Performance - Assessment & Qualifications sales increased by 2% on an underlying basis, with strong growth in Clinical Assessments and UK & International Qualifications [5][19] - Virtual Learning sales decreased by 1% on an underlying basis, with a 5% decline on a headline basis due to previous school losses [20] - Higher Education sales rose by 4% on an underlying basis, driven by a 21% increase in Inclusive Access and a 3% rise in US digital subscriptions [21] Cash Flow and Capital Management - Operating cash flow was stable at £126 million, while net cash generated from operations was £188 million [47][48] - The company has initiated a £350 million share buyback program, with £169 million of shares repurchased by June 30, 2025 [6][61] - Net debt decreased to £1.0 billion from £1.2 billion at the end of H1 2024, reflecting strong cash performance [51] Outlook - The company reaffirms its medium-term outlook, projecting mid-single digit underlying sales growth and sustained margin improvement [8][25] - Sales growth is expected to be H2 weighted, particularly in Q4, driven by new and renewed contracts [25]

Core Insights - Pearson announces updates to its English language testing portfolio, including enhancements to the Pearson Test of English (PTE) and the launch of the Pearson English Express Test, aimed at improving the testing experience for governments, universities, and test takers globally [1][10] Enhancements to PTE - Starting August 2025, PTE Academic will introduce two new speaking tasks: "Respond to a Situation" and "Summarize a Group Discussion," designed to assess real-world communication skills [2] - The scoring model will be enhanced with advanced AI and human expert collaboration to better detect unoriginal responses [3] - New preparation resources for the enhanced PTE Academic include scored practice tests, expert courseware, webinars, and video content [3] Trusted Fundamentals - PTE remains fully computer-based, primarily AI scored, and delivers results typically within two days, trusted by over 3,500 institutions and millions of learners worldwide [4] Growth in Test Center Network - PTE's secure test center network expanded with 30 new centers in 2025, totaling 517 locations across various countries, supporting growth in migration and study abroad markets [5] Introduction of Pearson English Express Test - The Pearson English Express Test is a new online assessment designed for US-bound learners, offering a one-hour test that can be taken anytime, anywhere, with results available within minutes [6] - This test addresses the demand from universities for secure and accurate English proficiency assessments, allowing institutions to set scores using Pearson's Global Scale of English (GSE) [7] Security Features - Universities will receive samples of written and spoken responses, with security features including identity checks, human oversight, and dual-camera monitoring [8] Company Commitment - Pearson emphasizes its investment in assessment innovation to meet the needs of governments, institutions, and learners, with enhancements to PTE Academic effective from August 7, 2025 [10]