RELX (REL) Q4 2025 earnings review
Algorithmic Consistency: Legal Segment Accelerates as Print Fades
RELX delivered another year of textbook compounding in FY25, characterized by 7% underlying revenue growth and 9% underlying operating profit growth. The standout story is the Legal segment, which accelerated to 9% underlying growth (up from 7% prior) driven by the rapid adoption of AI-enabled tools like Lexis+ AI. While reported revenue growth (+2%) was dampened by FX headwinds and the strategic wind-down of Print (now a separate, shrinking segment), the core transition to high-margin analytics is complete. Management signaled confidence with a massive step-up in buybacks to £2.25 billion for 2026.
🐂 Bull Case
The Legal division is no longer just a steady earner; it is a growth engine. Underlying revenue growth accelerated to +9% (vs +7% historically), with operating profit up +12%. The rollout of Generative AI tools (Lexis+ AI, Protégé) is driving demonstrable upsells and renewals, proving the monetization thesis.
Management announced a £2.25 billion share buyback for 2026, a 50% increase from the £1.5 billion deployed in 2025. Coupled with a 7% dividend hike, this signals substantial excess cash generation and management confidence in the valuation.
🐻 Bear Case
The newly segregated 'Print & Print-related' segment collapsed 23% to £399m. While strategically necessary, this creates a headline drag: reported revenue grew only 2% despite 7% underlying growth in core businesses. This segment remains a £177m profit contributor that will eventually zero out.
Sterling strength significantly impacted reported numbers. While underlying profit grew 9%, reported operating profit grew only 6% due to a 3% negative currency impact. With 60%+ of revenue in USD, RELX remains sensitive to FX volatility.
⚖️ Verdict: 🟢🟢
Excellent. RELX demonstrates the 'boring is beautiful' thesis perfectly. The acceleration in Legal proves AI is a tailwind, not a threat. The increased buyback is the cherry on top. The only negative is the inevitable shrinking of legacy print, which is well-managed.
Key Themes
Legal Segment Breakout
Accelerating. Legal has historically grown in the mid-single digits. In FY25, it hit +9% underlying revenue growth and +12% profit growth. This structural shift is driven by the shift from content to 'Decision Tools.' The adoption of Lexis+ AI and the new 'Protégé' agentic assistant are driving mix-shift to higher-value subscriptions.
Risk Analytics Remains the Anchor
Stable/Strong. The Risk segment, RELX's largest profit generator, delivered consistent +8% revenue and +10% profit growth. The margin expanded to a massive 37.4%. Growth is broad-based across Financial Crime Compliance and Fraud & Identity, proving resilience regardless of the economic cycle.
The 'Bad Bank' of Print
Reversing. RELX has segregated Print into its own reporting line to purify the growth metrics of the core divisions. Revenue in this segment dropped from £517m to £399m (-23%), and profit fell from £206m to £177m. This creates a permanent, albeit shrinking, headwind to headline reported numbers.
Operational Gearing
Accelerating. The company continues to grow profit faster than revenue. Group Adjusted Operating Margin expanded by 90bps to 34.8%. This demonstrates the scalability of the analytics model—once the data sets and algorithms are built, incremental revenue drops straight to the bottom line.
AI Monetization Realized
RELX is one of the few companies monetizing AI today, not just spending on it. Management cited 'Scopus AI' (STM) and 'Lexis+ AI' (Legal) as key drivers for new sales and renewals. In 2026, they are launching 'LeapSpace', an AI-powered researcher solution. Capital Expenditure was £525m (5.5% of revenue), largely for product development, showing disciplined investment.
Other KPIs
Accelerating. EPS growth outpaced revenue growth, driven by margin expansion and share buybacks. Reported EPS growth was +9% (112.6p).
Stable. Up from £1,005m in FY24. Cash conversion was excellent at 99%. This strong cash generation fully funds the increased £2.25bn buyback program.
Stable. Up slightly from 1.8x in FY24, primarily due to FX translation effects on USD debt and increased shareholder returns. Remains well within the comfort zone.
Guidance
Stable. Management expects a continuation of FY25 trends (approx 7%). The outlook is positive across all four segments.
Stable. Guidance explicitly states profit growth will exceed revenue growth, implying further margin expansion toward 35%+.
Accelerating. A significant increase from the £1,500m completed in FY25. £250m has already been completed year-to-date in 2026.
Accelerating. After hitting 34.6% in FY25, management guides for further margin improvement, signaling the post-COVID recovery in this high-margin segment still has room to run.
Key Questions
Legal Growth Durability
Legal revenue growth jumped to 9% this year. Is this a one-time step-up due to initial AI tool pricing, or is this the new sustainable run-rate for the segment?
Print Segment Endgame
With the Print segment now isolated and declining 23% YoY, what is the timeline for a complete exit or divestiture to stop the drag on reported figures?
Acquisition Appetite vs Buybacks
You raised buybacks significantly to £2.25bn. Does this signal a lack of attractive M&A targets in the market, or can you maintain this pace of returns while still pursuing acquisitions?