Thomson Reuters's building in Times Square, New York. The company reported third-quarter revenue of US$1.78-billion.Jeenah Moon/Reuters
Thomson Reuters TRI-T reported higher higher third-quarter revenue on Tuesday, boosted by investments in artificial intelligence products in its legal and tax and accounting divisions.
The Toronto-based content and technology company also reaffirmed its full year 2025 guidance of a 7-per-cent to 7.5-per-cent rise in organic revenue, which tracks income from existing businesses on a constant currency basis.
“Our third-quarter results reflect continued momentum and the ongoing execution of our AI-driven innovation strategy,” Thomson Reuters chief executive Steve Hasker said in a statement.
Thomson Reuters shares fell as much as 5 per cent on the Canadian and New York stock exchanges. They had fallen about 5.4 per cent this year up to Monday’s market close, underperforming a 16.5-per-cent rise in the S&P 500, which has been lifted by big tech stocks.
The owner of Westlaw legal database, Reuters news agency and the Checkpoint tax and accounting service reported third-quarter adjusted earnings per share of 85 US cents, slightly exceeding Wall Street expectations, according to LSEG data.
Thomson Reuters revenue rose 3 per cent to US$1.78-billion, meeting expectations for the third quarter, during which it launched new AI features in products in its legal and tax and accounting businesses. It also purchased Additive AI, an artificial intelligence-powered tax document processing specialist.
Revenue at its “Big 3” businesses - legal, tax and accounting and corporates - rose 9 per cent on an organic basis, while Reuters News revenue rose 3 per cent and global print revenue fell 4 per cent.
The generative AI spending frenzy kicked off by the launch of OpenAI’s ChatGPT in late 2022 has led some global corporations to question the financial returns, with some studies showing most struggling to integrate the new technology.
Hasker said in an interview that investments in AI in the Thomson Reuters legal division directly contributed to its 9 per cent rise in organic revenue for the third quarter.
In August, Thomson Reuters launched CoCounsel Legal, a legal research tool that features AI-powered agents that perform tasks autonomously to accomplish pre-defined goals.
It also launched deep research features in Westlaw that it says think like a lawyer and can conduct in-depth research.
Chief financial officer Michael Eastwood told Reuters the contribution of generative AI-enhanced products has continued to rise since Thomson Reuters began tracking it late last year.
Generative AI is now responsible for up to 24 per cent of the group’s underlying contract value, which breaks down a contract’s total value, compared with 22 per cent in the last quarter.
Eastwood said it is expected to rise further.
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AI investments are also expected to help operating profitability forecasts at Thomson Reuters, which said it now expects an adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) margin expansion of about 100 basis points, up from a prior expectation of 50 basis points.
Some analysts have questioned the returns for companies from the generative AI spending frenzy kicked off by the launch of OpenAI’s ChatGPT in late 2022.
Faisal Hersi, an analyst at Edward Jones, said Thomson Reuters shares are trading at lower historical multiples at around 35 times 2026 earnings, down from a peak of about 48 times in July and a historical average of about 38 times, due to expectations of increased AI-driven competition from startups.
AI adoption has fueled surging interest from venture capital investors in the legal sector, which they used to overlook for not having a growing addressable market and being dominated by a handful of big players.
For example, Harvey, a startup backed by Kleiner Perkins that competes in the legal AI market, raised US$300-million in June at a valuation of US$5-billion and reportedly closed another round recently at an US$8-billion valuation.
Thomson Reuters said it has about US$9-billion to spend on potential acquisitions, after completing a previously announced US$1-billion share repurchase plan.
In 2024, global investment in legal technology startups hit US$2.1-billion, data from Crunchbase showed and February 2025 saw one of the highest investment totals in U.S. legal tech history.
Thomson Reuters said it has about US$9-billion to spend on potential acquisitions, after completing a previously announced US$1-billion share repurchase plan.
Woodbridge Co. Ltd., the Thomson family holding company and controlling shareholder of Thomson Reuters, also owns The Globe and Mail.