Clarivate Plc
Q1 2025 Earnings
Market Reaction
S&P 500 over the same 30 days: +6.33%.
Did CLVT Beat Earnings? Q1 2025 Results
Clarivate delivered a stronger-than-expected first quarter, posting adjusted diluted EPS of $0.14 against a consensus estimate of $0.12, a beat of 20.69%, while revenue of $593.70 million cleared Wall Street's $570.36 million estimate by 4.09%, even as total reported revenue fell 4.4% year-over-year due to deliberate divestitures, product disposals, and currency headwinds. The most material driver behind the results was disciplined cost execution under the company's Value Creation Plan, which helped expand Adjusted EBITDA margin by 130 basis points to 39.3% despite the top-line decline, and underpinned a return to 0.3% organic revenue growth. Organic ACV growth accelerated to 1.2%, supported by a 94% renewal rate, while early momentum on the Web of Science commercial model, where 15 customers signed multiyear deals totaling over $80.00 million in total contract value, signaled traction in the subscription-first strategy. Management reaffirmed full-year 2025 guidance, targeting revenues of $2.28 billion to $2.40 billion and adjusted diluted EPS of $0.60 to $0.70.
- Organic ACV growth of 1.2%, up 30 basis points sequentially
- 94% renewal rate, up 1% year-over-year
- Recurring organic revenue growth of 0.6% driven by subscription and re-occurring revenues
- Re-occurring revenue organic growth of 5.3% from higher IP patent renewal volumes
- Adjusted EBITDA margin expansion of 130 basis points to 39.3% from cost discipline
- Strong free cash flow conversion of 47%
“We delivered improved sequential organic ACV growth in the first quarter from higher renewals and new business wins, reinforcing the impact of our Value Creation Plan.”
Clarivate CEO, on the earnings call
Forward Guidance & Outlook
Clarivate reaffirmed its full-year 2025 outlook: Organic ACV growth of 1.0% to 2.0%; Recurring organic revenue growth of (1.0)% to 1.0%; Total revenues of $2.28B to $2.40B; Adjusted EBITDA of $940M to $1.00B (40.5%-42.5% margin); Adjusted diluted EPS of $0.60 to $0.70 (based on ~696M diluted shares); Free cash flow of $300M to $380M. The company expects modest organic revenue decline from remaining transactional business, with strategic disposals improving recurring revenue mix by approximately 5%. Management plans to maintain Adjusted EBITDA margin and FCF conversion despite lower revenue through cost efficiencies. Share repurchases of approximately $300M are targeted for the full year. The outlook remains cautious on foreign exchange due to high volatility.
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Figures from SEC filings and company reports. Not investment advice.