Image source: Shutterstock

Highlights

  • Underlying group sales up 1%, with 6% growth in Higher Education segment

  • £350 million share buyback underway; £0.1 billion State Aid recovery received

  • Innovative AI-powered tools and new contracts support strategic momentum

Education and learning giant Pearson plc (LSE:PSON) has published its unaudited Q1 2025 trading update, reporting a 1% increase in underlying group sales and reaffirming its confidence in meeting full-year guidance. The company expects sales growth to accelerate in the second half of the year.

All of Pearson’s business units are performing in line with expectations, with a particularly positive performance in the Higher Education division, where underlying sales grew by 6%.

Strategic Milestones

Pearson made significant progress on several key strategic initiatives:

  • Launch of the Pearson Skilling Suite, expanding its capabilities in professional learning

  • Rollout of the AI-powered Smart Lesson Generator, reflecting continued leadership in tech-enhanced learning

  • Securing major contracts, including a notable win with the UK Ministry of Defence in Enterprise Learning & Skills

  • Rebranding efforts to reflect Pearson’s future-facing approach to education and digital learning

These moves signal the company’s commitment to digital innovation and its ability to serve institutional, enterprise, and individual learners across markets.

Financial Performance and Capital Returns

Pearson has launched a £350 million share buyback programme. Additionally, the company has recovered £0.1 billion in State Aid funds.

Outlook for 2025 and Beyond

The company remains on track to meet its 2025 financial guidance, with expectations of low single-digit sales growth in H1 and significant growth in H2. It anticipates adjusted operating profit to be in line with market expectations.

Looking beyond 2025, Pearson forecasts:

  • Mid-single-digit compound annual growth rate (CAGR) in underlying sales

  • Annual operating margin improvement averaging 40 basis points

  • Positive free cash conversion, expected to average 90% to 100% across the period