WTW reported its second-quarter 2025 financial results, with revenue largely unchanged from a year earlier, while net income rose compared to the same period in 2024.
Revenue for the quarter ended June 30 was $2.26 billion, down slightly from $2.27 billion in the prior-year quarter. The company said the change was mainly due to the sale of TRANZACT at the end of 2024. Excluding foreign currency effects, revenue decreased 1%, while organic revenue growth was 5%.
Net income for the second quarter reached $332 million, up from $142 million a year earlier. Adjusted EBITDA was $470 million, or 20.8% of revenue, compared to $445 million, or 19.6%, in the second quarter of 2024. WTW reported a US GAAP tax rate of (6.8)% for the quarter.
WTW's first-quarter 2025 performance set the tone for its midyear results. The company reported $2.22 billion in revenue for Q1, a 5% decline from the previous year. Net income reached $239 million, up from $194 million a year earlier, and the operating margin improved to 19.4% compared to 12.0% in Q1 2024.
Cash flows from operating activities for the first six months of 2025 were $326 million, down from $431 million in the same period of 2024. Free cash flow fell to $217 million from $305 million year over year.
The company attributed the decrease to higher compensation and cash tax payments, as well as the loss of TRANZACT-related inflows following its sale. These factors were partially offset by lower spending on its Transformation program and operational improvements. During the quarter, WTW repurchased 1,614,427 shares for $500 million.
By segment, health, wealth and career generated $1.18 billion in revenue for the quarter, compared to $1.26 billion in Q2 2024, a 6% decline on a reported basis. Revenue decreased 8% on a constant currency basis, but grew 4% organically. Operating income was $280 million, up from $276 million a year ago, with an operating margin of 23.8%, compared to 21.9% in the prior-year quarter.
Risk and broking revenue was $1.05 billion, up from $979 million last year, representing 7% reported growth and 6% on a constant currency basis. Organic revenue growth was 6%. Operating income rose to $222 million from $202 million, with the operating margin improving to 21.2% from 20.6% in Q2 2024.
Following its full-year 2024 results, WTW revised its strategic and financial projections for 2025, including expectations for an adjusted operating margin of 23.0% to 23.5% and adjusted diluted EPS between $16.00 and $17.00.
The company also increased its cost savings goal under its "Grow, Simplify & Transform" initiative to $450 million.
“Building on our strong first-half performance and continued momentum, we enter the second half of 2025 on track to deliver on our financial framework, including mid-single digit organic revenue growth, operating margin expansion, adjusted earnings per share growth, and free-cash-flow margin expansion,” CEO Carl Hess (pictured above) said.
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