Thomson Reuters (TRI) 8 Aug 222022 Q2 Earnings call transcript

Good day, everyone and welcome to the Q2 2022 Earnings Call hosted by Gary Bisbee, Head of Investor Relations. My name is Nica and I'm your operator today. [Operator Instructions] I would like to advise all parties that this conference is being recorded for replay purposes. And with that, I'd like to hand the floor to Gary. Please go ahead.

you. Thank and quarter joining XXXX everyone Thomson today you second Reuters' earnings thank morning, us for for Good call. our of I'm Steve joined will each their Hasker; CEO, take discuss whom and our questions today CFO, Mike remarks. by following results and our your Eastwood, growth an Throughout revenue organic presentation, basis. we today's as currency Instructions] we compare before [Operator period-on-period, well performance when discuss rates as on underlying this We best performance the of the measure the provides believe to business. basis statements and non-IFRS Today's presentation measures. contains forward-looking financial materially differ uncertainties and that to may Actual a and we to time results of risks agencies. due discussed number from regulatory in filings time reports to provide

may access our contacting You by documents these website or Relations department. our Investor on

now Steve over to turn Hasker. me it Let

today. Thanks. Thank of you, Gary and us to thanks all joining you for

I'm second recorded segments quarter our healthy ahead or organic greater to report building expectations. our and QX revenues to total X been company has revenue business growth on the X%. with the our again that our businesses in of organic X% of in rose revenue highlights. pleased of sales and continued momentum Now X

business X internal our organically. We momentum. also external drivers Big Our of grew and improving segments X% see

well rising to and we're expect total that invest to the continue recent we're strength these We outlook first Due believe of prior views healthy half margin toward our Big meaningful change our Solid revenue to business we efforts pressures. our confidence are tailwinds are revenue position better Overall, contributed. We in full and continue provides markets. we by XXXX outlook. and as or us of right innings X%, prioritize achieve and path revenue over of We regulation risk-related growth, our benefit tailwinds to now complexity strong heightened to few X% in our to absorb businesses QX year targets. best inflationary early in the the momentum the years. and X.X% respectively. execution Tax next from opportunities our revenue in annual X have value to investments And book and Legal, X.X%, and driven by up and on our step starting from the our raising a compliance see maintain by also XXXX contract and

and While market economic concerns increased, business around positioned. slowing is have growth well our inflation

through leading indicators stable strong remain And momentum Our is our business. resilient of growing and historically markets. operate recurring QX and with blessed end we're XX% healthy. in we was a revenue and

and from margins, will also significantly efforts our our Change which cash We XXXX. benefit boost Program flow earnings in

capital capacity create and billion early June value. complete reinvesting Through share of we've program. are Our within to million asset the with on our of shareholder key liquidity a we XX a look an months. important to step focused took XX, repurchase shares purchased we announcement July We $XXX $X in that the remain program and

also strategic continue to for and inorganic have and capacity to buybacks both expect ample M&A. We opportunities assess

Risk, Fraud As software includes targeted Compliance Tax our and & in and workflow a automation reminder, Legal focus markets and our expansion. international and acquisition

a Legal legal the of play a in Professionals, sizable tech-driven see transformation role example, in For critical we profession. opportunity the to

gained The Law our in provide combination to is this and research experience AI-driven the acquisition customers software. ThoughtTrace and unique builds a like the with a HighQ. Practical upon highly smarter, expertise through with workflow analysis through positioned and step contract uniquely are capabilities seamless of content we recent We differentiated direction capabilities

around and and our inorganic both organic assess to legal and customers, better for that contract opportunities our documents capabilities further to expand workflow particularly integrate and solutions our continue automation leading with We content drive outcomes drafting.

quarter. results the the to for Now

up revenue XX%, business. again revenue organic revenues Events events X%. X% organic in-person Reuters Second and grew our to grew revenues up recurring transactional a Organic calendar aided at robust reported X% a return the by shift with quarter with

revenue growth the million, margin we EBITDA points expect in improvement XXX to we basis reflecting While Adjusted XX.X%. to to second revenue moderate transactional increased half, $XXX momentum see continuing. recurring

XX.X%. Program, Excluding earnings Change $X.XX, costs in the of related adjusted up $X.XX to EBITDA the performance margin strong This year prior the from in was share per resulted adjusted period.

of revenue second X%, of across markets. continued all momentum, a The growth. key its businesses by consecutive recent X% Legal and remains Turning in small, segments. U.S. customers and the X to Legal firms, results government The overseas market broad key large-sized fifth growth strength. quarter Big reflecting achieved quarter delivering healthy segments: mid- organic organic

to For XX% example, from XX% at continue value adoption XXXX. of the penetration contract annual expect Edge to approach continues by end year-end we Westlaw drive and revenue to

Law Government the contributes double-digit year. balance to and the Practical growth Second, performance in of in organically as Legal growth. of grew third, segments, our business Corporates a strong quarter And acceleration with and we continued which see likely both revenue a X%

will continued Corporates rose again growth our Recurring strong quarter another growth had more Corporates. writing Accounting robust Turning of Tax in revenue momentum our & a transactional X%. shortly. revenue Organic business in revenue and expectations I discuss with X% X%. to revenue up X%. with exceeded organic detail

results was with we excited print better that X% revenues summary, to very timing our building organic in due momentum and the of News of remains about all driver. Growth QX. Our growth and expected, quarter that's increased America within which in businesses. business Dominio the organic higher Reuters a benefits lines than Global driver. particular, we're in nearly Latin Events, a In to third-party called and normalize remainder XXXX. business. grew the expect revenues Print And pleased declined XX% these finally, was across key revenues in Reuters occurred XX% key we're

discuss prospects confident Now let few and growth me take businesses the & why we and both. Fraud Compliance are our segment to minutes a in our of Corporates Risk,

half offerings. the provider the RFC and serves solutions of States X% year this corporations growth our may users organic Legal, second key and of RFC the XXX. Beginning discussion accelerating segment our The both last formed provide & Momentum first serve, or last brief incremental in of Tax and useful. did and the with some better Risk, we tax and like #X revenue the the and with was of segment As half in Fortune X% background built with Corporates the over all Corporates I'd quarter from year. portfolio our Corporates, in be our businesses. Corporates X% brief United half Fraud around XXXX XXXX a for of quarter, legal to for transparency the first fourth penetrate to innovate for in some to is corporate in Compliance of has nicely

year are For growth previously the achieving organic full confident target XXXX, we XXXX. we in X% X% for set to

growth slide, strong Tax CLEAR our from Tax our Legal revenue what's portfolio Corporates Confirmation Law at range areas. X across on portfolio, double-digit include this product others. and Key from and So a growers momentum? of green product driving Practical double-digit are from growers which Indirect and rate. comprise all amongst from in growing segment We in HighQ the RFC, of offerings are see circled XX% a and year-over-year In total, mid-teens

rapidly last growing described momentum. healthy shift these a to Corporates offerings our contributing mix quarter we segment, As more Legal Professionals toward our for is

efficiency-driven portfolio confident potential Building and with long-term actionable remain this Corporates building on and insights the our demand tools, penetration and in market driven significant for discussion, workflow we segment healthy growth corporate I'll Fraud Risk, upon for addressable Compliance momentum, by & the white-space combined forward, product Looking a expand opportunities. our businesses.

includes which RFC of court Legal also discussed our legal subsegment Professionals Government our historically have into government and customers. part as offerings sold We system

an important also of a for RFC bit However, revenue. driver which generates are our our over RFC businesses XX% Corporates

safety. We leading Thomson customers Pondera cloud and global provides a record improving CLEAR government add. algorithms to TRSS This adding in leverage extend data, Reuters up security-cleared in our that have fraud to risk and Special mitigating TRSS Services government complemented TRSS a and by public Both of programs. several is leverages our advanced value by information, RFC and franchise, decisioning CLEAR, and help businesses analysts that that a support Pondera. entitlement provides solution. detect make insight technology solution combination public capabilities led Pondera or

nicely growth, growth access our partnership expanding by of XX% digits have X contributed since a an growing and have been double it number to with that this growth of functionality by RFC which including annual CLEAR also expanding businesses was and bolstered cases across over growth has government and drivers corporate usage year years every last and has key revenue RFC boosted in the through compound rate APIs efforts. There several Our acquired use total customers; XXXX. enhanced pricing; in of

over years. growth the businesses that well are positioned Looking believe the forward, we in RFC few next teens to deliver revenue our

which from platform space. also our M&A believe a the future strong current in RFC is position consider We to

driver sources leading makes deeper analytics including brings and a success. Let together CLEAR source up pricing growth and has records highly In that We've records strong databases robust an our and and a revenue. approximately leader to and X/X is resulted entity mitigation advantages, case proprietary which adding It years, billions me indicators growth today. bit data including of single go that customers' by third-party several set. from tools a database unique solution We in decisioning scoring. to data across prevention CLEAR due analytics offering our and diligence we've deliver perform risk-related insights revenue added ownership for with robust beneficial compelling identity set enhanced aided revenue content, additions connections purposes. dashboards. market focused business risk aggregated building analytics-driven by recent a fraud identity to information multiple on a and dashboard. use lists investigators to customizable incremental real-time Historically, runway connections, investigative, content, enables risk search RFC public data they of configurable sanctions -- a technology powered public compliance, resolution is and and believe and little transparency a have has important points and expanded data and more identify This added customary These and comprehensive are data. technology, easy-to-navigate around verification uncover and remains growth an CLEAR our also on CLEAR data

Government both help product how Slide are customers Our NPS counterparties. or about questions investigate scores see can by demonstrate this understanding relevant business. government as speaks our of customers offering. well RFC their company to need our and AML questions deep These criminal as graphic networks efforts to critical corporate use from The for in ranging real-world and and the answering customers compliance value example KYC trafficking and a detect investigations key numerous which CLEAR CLEAR with people on cases, a the corporate to human potential and users bring the me illustrates close companies, life, XX to To the identifying entities, prevent, risk among for and important both government others. across fraud for let customers in from highest

our so claims our of proud During safe Risk, robust the accelerating stop a programs insurance struggled denying through fraud. The unfortunately, processed key has period, California pandemic of AI helping It the help Reuters and claims. Pondera's $XXX any using than We're the partner billion to while of turned skyrocketed identify government claims. initial the algorithms payments initially verify Fraud helped own integrity fraudulent entitlement by other in did to potential state's in claims of claims of State & California claims. activity. uphold while Thomson and solutions a combination period which claims fraud-related more and a work backlog data work state and implementation, highlight with to the support unemployment and recipients compliance combination process solution Compliance minimizing support claims X.X qualified Since and of been to CLEAR and, legitimate a in to efforts. communities, fraudulent X-week done state million teams This fraudulent and

let turn on will Mike, it provide over more me results. who the to second quarter detail Now

Thank today. for and you, us thanks Steve joining

As I organic before a currency will reminder, basis. an talk and on growth to revenue

marks X% growth for Big segments currency quarter revenue organically our organic increased at have performance our X segments. me quarter. least X% second Revenues fifth This our revenue to X forward, year. Edge start and growth rose transactional revenues to by for quarter In Professionals is business. Westlaw Indirect for revenue. consecutive level at the Tax and Law continue to the to the rate. a about revenue from Corporates recurring Organic expected unlikely planned growth X%. Practical The discussing Legal's This is CLEAR, It level recurring are drivers revenues at volumes at this nature by grown also of later growth X% of Government continues organic X% the a release points Professionals. marks seasonal quarter continue healthy was contribute FindLaw Edge quarter the our similar to X.X half revenue driven the supported fifth is of Law, benefited Legal organic XXX add maintaining Westlaw Practical the going and X%. that and basis year. transactional were growth by Big increased X%. key in second segment, of the of Legal of the and constant that and in of Let by growth premium driven consecutive

& However, the momentum XX%. X% organic growth by driven segment's businesses driven revenue revenues Organic we by growth And see grew was recurring revenue audit growth Latin in Ultra Accounting's and products recurring America. finally, Tax continuing. of Tax,

business. expectations to particular, increased as QX shift benefited it XX%, revenues and Professionals Reuters strength event Events growth Reuters to of a the in-person return calendar events. drove Moving favorable into our organic Total from In also the News. exceeding in and due both

Reuters moderate the the half We year. expect more growth in News second from of

of Lastly, sales Global expectations. Print and declined printing total and revenues Higher timing drove services new for of ahead in the X% third-party second outperformance. the organic quarter, revenues

On both in So the X%. expect remainder organic quarter revenues a by normalize consolidated basis, second of increased XXXX. we to

Turning Program period for period rising higher $XXX segments with to the our million, year up Big profitability. Improvement year prior Change margin XX due over and from X% XX.X% points. prior Adjusted basis was the a X to revenues savings. EBITDA was

operating corporate Program at the are level. Change recorded the reminder, a As costs

was $XX $X growth higher million a drove Global Print's up period $XX with of XX.X%, company increase million, revenue. and with $XXX total basis a to the Print third-party XXX was EBITDA Reuters a up million of revenues adjusted QX decline aggregate, million, mix was from XX.X%, News. year XX% of Adjusted dilutive to due impact XXX prior points. and Moving a margin Revenue in adjusted basis margins. EBITDA XXXX. the of the margin points lower-margin In versus EBITDA decrease events

related increased Change costs periods, EBITDA the to Excluding in Program adjusted both X%.

was or an XX.X% The XX.X% underlying Change second margin related adjusted costs EBITDA the excluding on quarter's to Program. basis,

per Turning share. earnings to

driven had adjusted the quarter. mainly Second positive The increase up was year was $X.XX by $X.XX, period. Currency adjusted prior in adjusted $X.XX the quarter from impact in a EPS higher EPS on EBITDA.

year $XX tax operations upwards, cash with component slide related in of to Program operations payments year million business. the we for as more was the This year compared period. U.K. was the Also the million Let of the flow $XXX first bottom removes the made million in our turn due $XXX prior me factors free the versus half, to period. former now than to cash cash period. $XX of half. prior authority free Consistent the cash our from outflows to Change was of previous this first Refinitiv to million impacting flow Reported in payments distorting free million our the free performance $XXX discontinued flow the cash quarters, the the from page prior our flow. Working

This and expense we annualized $XXX quarter, Change to second In reaching adjust update due the million gross by flow savings Change continuing comparable in run $XXX prior million. savings savings We million, lower items, achieved XXXX. was expense annual of cash from higher run our by these the now approximately provide Program annual bonuses. billion. related confidence annual brings for This year the will Program. $XX you $XXX to progress operating million incentive full operating our period, operating rate an year to I cash rate than XXXX year-end on reaffirm free million our free $X.X the of increases savings. operations approximately $XXX of expense outlook $X million flow primarily plan cumulative If

business a reinvesting savings projected As million reminder, $XXX a we million. of of anticipate $XXX the savings the million into of net back $XXX for

update an on quarter Program XXXX. Change remainder for our costs and Now second of the the

estimates million $XXX annual anticipate total second We last we of of Spend $XX million, saying second none million $XX the of of and by me of $XX million start OpEx during comprised quarter half XXXX. in was the changed CapEx. spend Let from what the quarter. have provided of

full year, total to continue bring million. expect which the million $XXX investments to XXXX approximately $XXX of would we and investments XXXX For Program cumulative Change

split roughly continue to also OpEx CapEx. We XX% anticipate of XX% a and

our me and outlook XXXX with for conclude Let XXXX.

revenue of As Steve full approximately increased TR X.X% year and respectively. organic approximately Big X.X%, for X outlined, we have total and now revenue organic revenue up our and Big XXXX the growth from X outlook We total X%, forecast of growth. X% prior

and drive continue our margin reaffirm There monitor and adjusted are we outlook impacts no XXXX assess approximately other we targets. of to XX% revenue is to EBITDA investment our We outlook inflationary to momentum. maintaining change opportunities continued items XXXX as

to to for expect year be basis XX and to the full third points and lower Print. updated News rates Looking more below revenue Reuters quarter, revenue growth to the we due growth Global normalized XXX forecast transactional

we improve However, revenue from QX. quarter growth to fourth expect

X% recurring for the expand revenue expect We by full year. to

margin decline from seasonality, our adjusted expect investments. Change normal Reuters Events Program QX We third to of basis points to and the quarter EBITDA cadence sequentially due timing XXX of

to time, believe growth, our rate and by and summary, achieve healthy a see high content-driven significantly and the businesses effective our by momentum cash XX% higher revenue our savings. be company. QX confident the strength supported markets. can XXXX key margins and transforming half full we free we faster our flow Professionals first Change Tax we profitability to benefit to Over in to we from XX% of our higher XXXX underlying targets, expect of in strong from technology as continue likely range. and We tax segment the remain year, at achieving We the aided year scaling Program watermark seasonal In midpoint

back questions. me Gary to turn it Let for now

we're Steve. Mike to begin the ready Nica, and Q&A. Thank you,

Instructions] Kaplan couple [Operator received and the of have Toni one first from of Morgan coming We questions a Stanley. is

basis the or organic potential to growth sort 'XX. a recession which process there, you Or what to You raised of go XX so a Is congrats is by raise concern raise about conservatism row your didn't first? that great not have planning through in 'XX? on in noticed the of quarters 'XX I to you Just that. drove raising the points guidance in-depth few do need 'XX? just decision guidance

our an and our very guidance confident based against think execution the on But February. our our of the provided. confident We delivering we half first more execution. year, our the very update of business confident of macro We're various the book the our remain XXXX we few confident confidence team, on targets factors, more on in as very go-to-market XXXX the our and macro signals are sales But our our XXXX to months. the underlying of Change on We're execution certainly in you strength planning factors through it's very wait very process Yes, to the the in the delivering going regards is all remain process forward We it's very to mentioned, to and but latter, year Program, full updated Toni, in in assessing in guidance. team. very prudent what And Toni. high. being we look in it's But given of next providing planning prudent, positive. complete in

Toni, Yes. Steve. it's

to that. adding Just

of in that quarterly is and process late conduct comes recurring. Dave -- have and And know, our October. Mike you business QBR, our Larson revenue XX% we So as September, review

We segments. very percentage our multiyear contracts of high Big have across a X

before predictions. and good that sort very make about want further diligent process we any it of visibility get be we've we got to through So but

to point year, the recurring as regards nature. at Just through also, visibility, you getting we is in the point, so in that, plan Steve's there, process, the XX% complete one additional Toni, to mentioned

good give complete will business of of February book as good line us sight we the will a call. and QX visibility go QX Our into as have earnings which we

changed talk conversation? have hoping sort macro Great. about, has And any to could client you of the

for question. thanks the Toni,

with know, their you of like time getting understanding as and enormous customers So and deeper spend deeper an we businesses. amount a to of

accounting heads small, corporate firms the solid. I on the results based and firms, and would of record large pretty firms date, to of say their XXXX. government had conversations with law law I medium, some my mean think tax I have in our that results and been customers,

of sort bit demand think base have And so they've corporate fewer seen some But haven't of proud restructuring. just their might of customer through of stance yet to but as carefully the bit very, and -- yet that The paranoia either. early issuance. our IPOs, I I are seen in robust fewer soft, litigation debt our a it signs we pretty we watching date of very what far, has their haven't through the come But results to most XXXX, for customers is practices same a practices it softness. next think healthy and seen which

would I slightly X that in than XXXX. higher rates are renewal Retention Toni, rates Yes. with monitor, points additional retention we or supplement far our rates. thus XXXX

XXXX. a As multiyear the versus third a And in also contracts. And we quantitative slightly of of regions. second all the question? segments, we subsegments our a our have Do our pricing pipelines is XXXX is we then pricing on sales that with and have monitor measure reminder, front, higher lot

Casey that Yes, Tim line coming the we do from and of is of BMO.

me. for X Yes,

you talk there? an in a I a acquisition what you Could looks did about for it you, question just just happened quickly, a one really. the quarter. know And like recurring Just Steve, bit little

on and can like know journey? to and shortcomings guess, Just been interfaces that a things made focus an on whatnot. -- the customer if progress your that's of us the, experience. give of wondering initiative what's on the you where update customer really How your to I the you've I of you are date improve assessment primary your assessment

Great Yes. Thanks, question. Tim.

his recent we of and we've Nick with today lot very But by work talented ThoughtTrace run AI-driven was can the leading we the gas awful the a ThoughtTrace, team can So oil Nick gas, as and, based imagine, closing done Vandivere. capability an contract. our analysis them the a Texas, Houston, leasing are how acquisition a the of which a on is business more prior closing into called broader lot in contract as of name is set particularly executive and of you think, that acquisition tool. focused most verticals. acquisition commercial since to oil to of and extend by

or at we're So or it. you looking pharmaceutical it, name services whether that's financial

a And and but and small on very Kriti us. at cutting so of our content out. building acquisition for others, Emily look to it's at And the have It's much the in teams, like Colbert AI amongst focused machine we to that that. learning application edge unique Sharma from our been

The chunk rate Change to second run look, Tim but of with part savings that with and moving spent how a the Mike onetime you we it's for your good the know, accruing as it relation positions us that million talked investment. have question the program Program, are $XXX parts, of from about many a complicated XXXX.

to. financial a shape it what and we delivering from it's in expected standpoint, great is So the Program Change

-- going the think firstly. would of number are be components going that well amongst sort components a of very conversion, are I cloud that the our

Secondly, the our addressing leader, Escaravage, Jason progress cyber our compliance. fraud of that around terms in strengths has made cyber and

assist. Thirdly, digital

by we the and done still of and of well, support product been teams into want converting have And well get on customer doing investments and mainly, we year So and and series say being and too. forth. talent And renewal talent, but done our a it's to popular. our these where that lot customer and our is and sales that's led least, her engineering the and lot so digital we a into Kirsty are I a have a capabilities, then where so we've of they strategy satisfaction. And whole not location have work on next. capabilities received this balance through and very last idea want go-to-market will would

think there it really yet. not where and the other are customers customers to are starting there where they're are pockets I see

little pandemic, Change change disruptions bit of turmoil And price for all way gone increasingly, of we're out the has that so environment the amount our an and the of our has imposed up laser-focused yet, call inflation growth enormous disruption little their Program. with And this and renewal by through being and that backdrop organic the our navigating the notwithstanding right a bit, we've And go-to-market up in on is backdrop our economic the driven of headed conversion. I'd direction, on unease, and a ourselves. gone leaders

Tim, the is far I'd say the So of with do. so good lots work left Program on Change to so punchline,

Yes. data Tim, in XXXX. We our to the at the available cloud I'll regards migration. that revenue one in in just of February add XX% end additional At back cloud the point of we had end we XX% provided being of of June, which XXXX forecast we is by And in remain with the end of prior XX% end were by 'XX. XX%. We to at be consistent confident the at our the estimates.

line of Credit McVeigh the Suisse. from coming of is question next Kevin The

guess, are boost growth retention Change do was Steve versus around in any you you that? the just that from versus guess, point starting confidence the XX terms to Number to Or the everything? one. or I a little retention, a And then can bit organic you And the pricing, I Congratulations Program the basis guidance, results. Mike, what benefits gave about on mid? see of down initial maybe to upmarket little talk retention? finer of

Sure, Kevin.

primarily Let to But guidance and driven But price regards we're we're of Big book really across progress basis as our increases the there, earlier we as points. and using basis increasing of 'XX I That will only up Toni's business to given revenue at so in were pipeline in the the average XX me number benchmark, health first. underlying the June XX%. X XXXX. Kevin, therein included underlying Price weighted based with The customers. the in of TR us was slightly remainder focus for firm. the really total by on retention, significant by seeing XX increase slightly, drivers guidance versus of not 'XX, the question of we mentioned increase question XXXX on the health continue multiyear contracts, the the but is business. have, in Kevin, the is for and revenue, regards the In points performance XX, the have that slight over as for still on business. year, basis coupled The a opportunity the we to

addressed retention to opportunity the improve the horizon lot -- we to that items there. we address during continue a experience his underlying expense So as to have time continue customer questions Tim our and of

a So rate, in price, opportunity a continue bit rounded. retention in retention. X% Each full have X% we improvement improvement a forecasting roughly revenue just little growth reminder, but in we're at little And year. to for is recurring the Kevin, of quarter our

of of So couple a lower. a little little couple quarters a higher, quarters a

we comps are As little higher. into QX, go QX, a the

that's hopefully, helpful, Kevin. So

Aravinda And have we Canaccord from Galappatthige Genuity. next, a question of

you about you of even participants M&A on looking of sort there? of weaker gives of large workflow criteria, simply kind the Can you that it's subscription just move of Or on and space. recognizing, the be you seemingly there And be as takes would to even opportunity? the rates that how being touched mean, and significant by you at front? sort Just thoughts at Steve, wanted when just of your around sort when companies. share a to revisit kind about component. there. maybe of space color have Mike, do and think well of that of relatively software to XXXX, secondly, may you encumbered as right kind opportunities just to there. obviously, with you that the Can the look positioned sort some that sort on TRI now as the expanded just for industry labor I you enough take legal changes being recurring and I get -- that talk size you about some Any course, of the incremental inflation, Are talked there, some mid-tier respect market? helpful puts know then maybe

Aravinda. Thanks, Yes.

Let point. me quickly address first the

& that Focused workflow industry valuations What automation, we versus got the Legal, focus, with key and you Tax really of is rigorous, the and eye Legal, Accounting But M&A coming drive on bullish. very to Government selected at. as start efficiency optimistic a Fraud very very way transformation pipeline a after at disciplined sort an that around. tools and of them. robust that We're we're we'll expansions. some looking international and of is that information- Compliance are many Within That's an we're be and of other yes, area an & of the take the see pretty So look, tasks know, tech-driven about patient out we've transformation. automation going Risk, our our for hours customers. also and way it's

slow and the been many So technologies. the to And markedly years, to move out we've profession that for of pretty coming slow adopt legal seen pandemic. has change reasonably

research head lawyers every So lawyers and is them or combined on how us around questions tools of tools, to additional firm asking our a growth. less reliant our law how hiring new content can our can the be drive help

that. they advantage take different So within a vibe to firm. players of different positioned one well the to want their of we're And a create that's set of few and economics

cycle provides a we life see TAM it's technology underspent opportunity. pretty the pretty think at pretty the arguably tools, look the traditionally, on being that's real way a we firms. on and by management, overspent estate. meaningful And addressed is big that in a as growing workflow document opportunity. information leading big and We a is management, it because So further profession And aggressively

part on So of that's a question. the first your few thoughts

of 'XX view for the inflation question based XXXX regards provided point with we Chief the on Yes. inflation, our closely But of People Aravinda, in the bottom higher line HR part XXXX we second guidance, current both the Officer We're guidance. merit labor, and labor to we in on fully XXXX your on increases we there. think have say appropriate certainly into factored very our see how regards working top our for to there the would for XXXX XXXX. I and team, line, and incorporated we in and To 'XX cost. increases in

we've -- certainly that inflation pricing. to monitor there majority able Print increases been inflationary received incurred with businesses, some other The of cost offset we've of element leading but paper we the and that our postage, the Jennifer on with print Prescott

coupled aspects So other the managing think managing of costs, we labor with very all those pricing, increased and cost well. we're

'XX 'XX. puts there fully and puts takes. we for But lot we've mentioned, those guidance into and think with a and our are them takes, you incorporated of As

The the of question from of of line America. next is Bank coming Heather Balsky

talk incremental the about investing some of curious if was can sort in. of you you're I areas just

You guidance talked to the invest. are kind excited about? What opportunity most you're of keeping margin about for on the same the organic opportunities

Yes, I'll start with that, Heather.

First, Change centered our I where would we've say that that on improving invest experience. we're customer in to continuing our Program

a the involved items of Change itemized Program. that Steve earlier number think I

to other on continuing think lifting But items. regards Program lot QX, in we're our I of very first, and say, team of A QX. product Change good to that. execute highlight I'd path I to would glide work engineering. investment, still the In a has the areas So

within during our customers both Westlaw Practical acquired later corporate XXXX earlier. today. Tax Kriti important both HighQ government I counsel us. Ultra Law referenced of we and Steve business, customers perform leadership. the our July Over Beastrom's Edge a we Confirmation XXXX for under continues Fraud also today, that customers & discussed acquired incredibly is which Legal, May prepared referenced released our key highlighted in our that an is July Practical that Corporates. X.X our Professionals another Law & to back Tax within that Steve that's remarks during law of year us. general Certainly be call, Risk, our our Elizabeth in area we for Accounting area. well earnings area this First, will helps customers and impacts firm as within also X Compliance,

leverage corporate have our customers. within there also We

it's our regards So our emerging there. outside across America our our And is Change us key region to including for Latin of our help to products in customers markets. the within and and Asia investing very in Program, portfolio, also focus Heather, balanced

you Day growth Yes, presentations I about Investor start we back year, go -- X initiatives. it's our to mean, if at of last the talked

continue we're us. they take those we're where seeing results can good to because excited and invest behind We about

Helpful. some with were see how you a you to things of is downturn, if XXXX, and And cost have about you Program. the side, thinking But cutting margin margins the on of benefit the broadly, you can more if the Change you are follow-up, there when as control? think a sort of impact sales

Yes.

Events. of $XX Reuters year. Reuters the I'd our good first year, for Events QX achieving certainly would any of guidance well our say In regards half us million we be in revenue potentially in for see the includes in remain Heather, would is we Transactional revenue first to confident there. think, 'XX, which having XX% where an to I revenue those in transactional XX%. of did over headwinds, incredibly

and As for expect normalize for mentioned, in half But puts Aravinda's back to it manage pull. I levers XX%, we and And to lots And point, effectively in margin, XXXX. manage second XX% confident can of the us. feel that takes have XX% to XX% to enough customers. and while our we employees our supporting delivering we to we in have we through

customers. flippant our to and Yes, better emerge should relative customers not -- into to relative to about one a deep it be able -- relatively an not to a our Heather, competitors it we recession, be it able stronger opportunity, as be to view a and we to one, serve but an and broad opportunity head better our or unequivocal shallow

market we operate. will further leads have provide in positions backdrop in us think and which, with And more every to about just which looking we we'll #X happen, a it those to. should be We economic an difficult opportunity #X forward

of us I go questions we 'XX. through Heather, to certainly just point, of position us, Steve's 'XX think investments areas as on to first Yes. stronger areas investment, your and intentionally back for make the

hand they hand. we go So think in

we a RBC. from line have McReynolds of question the Next, Drew of

terms covered coming back some so and years this to of for Mike, capabilities, you Maybe understanding leveraging that's on apologize obviously, track AI bigger-picture machine year. internal Westlaw this on down launch products went an it's you're the X.X, Westlaw And call, Thomson's off. update maybe half ago. on path question, many, And learning in Edge like a into the if it Late you've that Edge. if of still just I many in my

internal to perhaps capabilities Just for wondering, but these markets the where of to motherhood innovation you keep with learning machine kind of with companies years, look as and the pace internal could light backfill kind your kind question own So the in of X you have broad what the different you evolved machine? strategy or versus AI X quarter. curious just capabilities acquired to speak last just innovation to of M&A your in big-picture your over just that sorry

Drew, great questions.

few Westlaw X.X in multiple had Fischer, Mike demos half launch I we Paul last have this Wong, Let and in Edge Dahn, me Martens, Edge the confirm weeks. Westlaw Steve tackle X.X. Drew, we that second of David Andy from year. the will sessions,

I incredibly think pleased. you'll be

this customers launch we importantly, year. our More will pleased later when it be super

approaching with And So fully our sharing Drew, with X.X customers on customers. penetration and you Professionals year, Westlaw of the to meantime, with team Edge it Drew. XX% this Corporates, forward on In the and target they look will launch to go-to-market Edge later X.X. Westlaw definitely Legal team, all our within X.X there. work continue We're our but

question. ML address I will think AI, the Steve

Yes.

So Labs. TR have our experts ML we couple world-class a of hundred AI in and and

of them and we -- MSP influential in work instrumental Arbor spread like are so proud the in number we're have Ann a and in in throughout New quite think There's And the the very do. have number a operating folks and been Edge as about of are There And and other here of world. into I Westlaw X.X They centers London, launch in those Toronto. think, more Dallas. been, they even X.X. York

So is there. proof the

we the AI which along is up to add content Risk, of unique outrunning and & best-of-breed in Professionals that is in the machine including area amongst no but learning efforts company, to, increasingly across Tax us being Fraud mean the lines a others. done think the portfolio, more to technology up Legal with keeping changing I of opportunity starting our a environment, those it Compliance, is for and software. are Accounting if ramp we & obviously and content-driven We've feat. And to are not in

downturn. last one quick about to you, taking #X one. Super. positions Back And you of #X, advantage Steve, maybe spoke in your just a

only RELX, the execute they're competitive post-COVID? are to that seeing that their these the peers Just of phase, your but their trying COVID your not that and capabilities, on ability dynamic, would all out in on and be are peers to things Wolters Just to before change coming Kluwer you kind we change capitalize in as any great. of any get

No, Drew.

emerging new know, and competitors the respect competitors. our we you As for and traditional have towering

do but So or intensity And lightly. our the we customers don't we take without don't moment keep doing rate of on we'll in it, -- competitive innovation I discern they're of of up change that. any stay of what to. at it meaningful abreast top from

from Next, Steinerman Andrew JPMorgan. question we have of a

stepping in Is was competitors Corporates provided segment. in color talk can Tax area? positioning to your that you market the the in about if for Andrew. in Thomson Indirect the wondering Thanks I you Stephanie on relative all It's for marketplace. gaining share

Thanks, Yes. Stephanie.

I #X in proposition, it's Tax Indirect not a made to would the say, terms its is earlier points but or X our #X X. of So closer size or to

or own Vertex. last growth there. to And the of I So we at at of better our X that announced we're the Investor Day X year. -- X It verticals compete so think with bit tend market is holding end we X of high our the a

the but investing building scales Avalara They've and in portfolio. somewhat is the capability proud we're of course, It's come which trying pretty have Sovos portfolio. it the SMB there. we've equity been owned, they're and up of space a the portfolio fragmented private a and territory. And robust a from efforts. move in team a different the So to but robust

we where how position think in to more over we'll and thoughtful but area the we'd of move that I be about So robust growth get certainly -- like #X to like robust -- And presence a and seeing growth #X we'd sort a or this we're is bigger, We're have might rigorous an time. mid-teens. there. matching into industry

is from question CIBC. next the of Fletcher the Scott so coming of And line

the go through extending and levels around comments scrutiny your headwinds the cycle I cycle. a as or of macro sales and healthy some on the sales just and cycles more review new of paranoia different of that impact it's sales sort you whether have question on given

little sales that it, we're but given our not watching trickiest apply the reps that's we'll now segment But thank process, any to sales our Scott, managers, businesses we're our regards managers, in cycle one also -- predictable it's credit, you. direct resources all sales as right our closely within there. change different our the closely any of subsegment significant you In bit in less watching business teams not account not and the But a we're noticeable all sales really client I seeing managers, bit supporting The leaders is with leaders Scott, we length success of just the customers for that's that, change in than government seeing the and now quarters. one that little cycle, our both our length We're future other Government to updated can right customer in now. us for nature, there. Yes, a we're keep the imagine, new. procurement right cycle. variable But probably nothing sales or do more it's and thereof. incredibly you

customers our they investing Yes. their increase And The tangible, drive see other with the growth particularly in initiatives, own measurable around where efficiency. that efficiency. conversations is healthy remain very thing a in that we're tools can note to

Tax extends So tasks, Practical into HighQ, fewer hours focus. Law, and required required & to achieve achieve propositions. a core of Accounting and tasks, core big And bodies that area that's fewer really to embraces ThoughtTrace Westlaw our

Yes, Scott, I X points mention. would additional

our meeting X.X our done this our annual years, that hybrid have significant now, we're environment, get additional a That way. the environment, coming sales up supporting to direct job the leaders I impact. time teams We go-to-market with change, customers not seeing will in mid-August. give sales have of think hell teams, last adjusting virtual our But us any in Scott. right do a Just in

question a from have We Manav Barclays. of Patnaik

is for Manav. on This Brendan

is revenue XX twice the last bps, ask increases. over guidance quick to wanted Just the X Obviously, on real guidance. up

margin at XX%. You kept

from think inflation just a Or there costs Just want should to there or that? or investments? is about simply how higher -- we bit bias

[ph]. mention, Yes, Brendan I items would X

is First certainly we investments. have made incremental

revenue. we made focused see opportunities we've in but OpEx as CapEx and both incremental our organic accelerate specifically investments on margin sustain and to You're

[ph], Secondly, Brendan to inflation. your point, certainly,

think job takes, very and remainder managing very -- certainly mention, puts thirdly, on inflationary I that we're is then factors watching the but year. I I've Here, very discussed doing And earlier as pressures just closely. eyes open being good macro the a we're the would of prudent, wide one we're during

why [ph]. confident the investing So those I of on year. reasons we're we we're delivering that X monitoring the for in items the in and at maintained But Brendan approximately margin full think the that, XX% closely convergence are

line the from coming of And question last Arthur Huber. Douglas is of the

I leadership? question. at work sort Steve, talk the just change about others, you among a firms, of that look the in technology enhanced law big-picture is sort generational of by at solution that a big When talking think of old-time partners if walk about I law AI and some and you of you and office cloud-based mean they'd started know blankly. I into the their solutions, adoption

be there wondering younger of but -- managers So to if group and a does seem I'm adoption. that's sort accelerating of

of years for the I mean you or the a it and for ago, knowledge librarian if sort research much Chief at curator or on very gatekeeper of practicing -- a Officer sure. sort of Yes, XX Doug, attorneys. side content is the business who X was you'd Knowledge research looked the see our

incorporate And we into themselves feedback. providing very at they're attorneys look into the and our so products doing do feedback more, our us and and releases. more best to would that subsequent Now direct adept

that So trend. very the is much I think

amongst said, so experience during the the design longest-tenured work stuff directly no he right? And do including exposed our folks joked to are that's I've from products. of -- to a getting teams have because because Claxton of starting up dynamic and their before using to And as more in the occurred healthy for and stickiness the careers. renewal And more technologies our time we directly even how chances senior-most, of home up, healthy become for think and much The a adopt products the with are didn't I partners, the I any first my me, price we comfortable at them with to choice. think So of that, users other thing now and to longest-tenured they increments and own one lawyers, managing IT I have that the went those guy, invest too. pandemic our COVID the and UX really goes the improve that Charlie as goes clue behind business

think, question. appreciate I that's really time We I last today. everyone's think Nica, the

very for you call today. That your Thank much, conference everyone. concludes

joining Thank disconnect. your and now the day. may you for You enjoy rest of

Thank you.