Group 1 - The company expects revenue of approximately $5.1 billion in 2026, representing a year-over-year growth of about 6%, with a strong performance anticipated in Q4 2025, particularly in the Pearson VUE segment showing mid-single-digit growth [1] Group 2 - The company is accelerating the integration of AI and digital technologies, planning to expand its digital product line and penetrate emerging markets, while establishing strategic partnerships with tech companies like Salesforce and Deloitte to drive transformation [2] Group 3 - The international higher education market remains challenging, with immigration policies potentially impacting the demand for English language testing, and federal hiring and spending headwinds posing pressure on the PDRI business, which may lead to fluctuations in future performance [3]

Core Insights - Pearson's President of English Learning and CEO of Pearson UK, Sharon Hague, emphasized China's vast education market and its role as a source of educational innovation during the 26th China International Education Conference (CACIE) [1] - The company has been a pioneer in the Chinese market, providing a wide range of lifelong learning services, including English language learning and international qualifications [1][2] - There is a growing interest in lifelong learning and skills courses beyond English language learning in China, indicating a shift in market demand [2] Group 1 - Pearson offers personalized learning experiences in China, including English language assessments and international academic and vocational qualifications [2] - The company signed a memorandum of cooperation with NetDragon Huayu Education to deepen collaboration on BTEC international certification in computer and digital technology [2] - The "Teacher AI and Digital Education Capability Enhancement Program" was launched in collaboration with the China Education International Exchange Association, aimed at improving teachers' AI application and digital teaching skills [3] Group 2 - The AI program aligns with UNESCO's "Student AI Competency Framework" and is tailored for the Chinese market, incorporating popular domestic AI technologies [4] - Pearson aims to empower teachers through scalable projects that support their development in the context of digital transformation [3][4] - The company plans to continue collaborating with Chinese partners to provide high-quality English learning solutions and support vocational education and digital education goals in China [5]

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]