Thomson Reuters Corp reported higher sales and operating profits and said it would reshape its corporate structure for a post-pandemic world, closing offices, streamlining technology and relying more on artificial intelligence and machines.
The news and information group said it would invest $500 million to $600 million over two years to make the transition from a content provider to a content-driven technology company to serve customers increasingly working from home during the COVID-19 pandemic.
It aims to cut annual operating expenses by $600 million through eliminating duplicate functions and consolidating technology, as well as through attrition and shrinking its real estate footprint. The cost cuts do not involve layoff programs and divestitures, the company said.
"We look at the changing behaviors as a result of COVID ... on professionals working from home working remotely being much more reliant on 24-7, digital always-on, sort of real-time always available information, served through software and powered by AI and ML (machine learning)," Chief Executive Steve Hasker said in an interview.
Sales growth is forecast to accelerate in each of the next three years compared with 1.3% reported sales growth for 2020, the company said in its earnings release.
Thomson Reuters, which owns Reuters News, said revenues rose 2% to $1.62 billion, while its operating profit jumped more than 300% to $956 million, reflecting the sale of an investment and other items.
Its three main divisions, Legal Professionals, Tax & Accounting Professionals and Corporates, all showed higher organic quarterly sales and adjusted profit.
Adjusted earnings per share of 54 cents were ahead of the 46 cents expected, based on data from Refinitiv.
The company raised its annual dividend by 10 cents to $1.62 per share.
The Reuters News business showed lower revenue in the fourth quarter. In January, Stephen J. Adler, Reuters' editor-in-chief for the past decade, said he would retire in April from the world's largest international news provider.
Thomson Reuters also said its stake in The London Stock Exchange is now worth about $11.2 billion.
The LSE last month completed its $27-billion takeover of data and analytics business Refinitiv, 45%-owned by Thomson Reuters.
(Writing by Nick Zieminski in New York, editing by Louise Heavens and Jane Merriman)