Why did reported revenue decline while organic revenue grew?

Reported revenue fell 5% to $2.22 billion, largely due to the sale of TRANZACT, which completed in the fourth quarter of 2024. Excluding acquisitions and divestitures, currency effects, and interest income, organic revenue increased 5%.

Why did free cash flow decline in the first quarter?

Free cash flow was $(86) million versus $(36) million a year earlier. The filing attributes the decrease primarily to the absence of cash collections related to TRANZACT and increased compensation payments in the current-year quarter.

What are the key 2025 financial considerations WTW disclosed?

WTW expects share repurchases of about $1.5 billion, subject to market conditions. The Bain Capital reinsurance joint venture is expected to reduce adjusted diluted EPS by approximately $0.25 to $0.35, and foreign currency is expected to be neutral to adjusted diluted EPS at current rates. The company also expects about 100 basis points of average annual margin expansion in Risk & Broking over the next three years.

Did WTW change how it calculates non-GAAP measures?

Yes. All reported non-GAAP metrics will now exclude non-cash net periodic pension and postretirement benefits, and free cash flow will capture cash outflows for capitalized software costs. The filing states that historical non-GAAP measures have been recast in the supplemental slides.

How much capital did WTW return to shareholders in the quarter?

WTW repurchased shares for $200 million and paid $88 million in quarterly dividends, or $0.92 per common share, during the first quarter of 2025.

WTW 8-K: Earnings & Results & Regulation FD

01—Abstract

Summary

Summary of the 8-K filed April 24, 2025. Cited figures are marked; the original filing is the authoritative source.

WTW (Willis Towers Watson Public Limited Company) reported first-quarter 2025 results for the period ended March 31, 2025, furnishing a press release (Exhibit 99.1) and a supplemental slide presentation (Exhibit 99.2) under Items 2.02 and 7.01.

Revenue was $2.22 billion^a, down 5% as reported from $2.34 billion a year earlier, reflecting the sale of TRANZACT, but organic revenue grew 5%. Income from operations rose to $432 million from $280 million, with operating margin of 19.4% versus 12.0%, while adjusted operating margin was 21.6%, up 100 basis points. Diluted EPS was $2.33, up 27%, while adjusted diluted EPS was $3.13, flat year over year.

Cash flow was weaker: operating cash flow was negative $35 million^b, free cash flow was $(86) million versus $(36) million, and the company repurchased 607,221 shares for $200 million in the quarter. Management cited the absence of TRANZACT cash collections and higher compensation payments. Total debt was $5,310 million at March 31, 2025, and cash was $1,507 million, with the company reiterating a long-term leverage target of 2.0x to 2.5x.

Looking ahead, the filing outlines 2025 considerations including expected share repurchases of about $1.5 billion^c, a reinsurance joint venture with Bain Capital expected to reduce adjusted diluted EPS by approximately $0.25 to $0.35, and an expected neutral foreign currency impact on adjusted diluted EPS. The company also changed its non-GAAP definitions, so that adjusted results exclude non-cash net periodic pension benefits and free cash flow now deducts capitalized software costs.

02—Key points

Key Highlights

Revenue of $2.22 billion decreased 5% as reported, but organic revenue grew 5%, with the decline attributed to the sale of TRANZACT.
Diluted EPS was $2.33, up 27% year over year; adjusted diluted EPS was $3.13, flat versus the prior year.
Operating margin expanded to 19.4% from 12.0%, and adjusted operating margin rose 100 basis points to 21.6%.
Free cash flow was $(86) million versus $(36) million, reflecting the absence of TRANZACT cash collections and higher compensation payments.
WTW repurchased 607,221 shares for $200 million in the quarter and paid $88 million in dividends.
Health, Wealth & Career organic revenue grew 3% with operating margin up 160 basis points to 26.7%; Risk & Broking organic revenue grew 7% with operating margin up 120 basis points to 22.0%.
For 2025, the company expects share repurchases of about $1.5 billion and a $0.25 to $0.35 headwind to adjusted diluted EPS from the Bain Capital reinsurance joint venture.

03—Questions

Frequently Asked Questions

Why did reported revenue decline while organic revenue grew?
Reported revenue fell 5% to $2.22 billion, largely due to the sale of TRANZACT, which completed in the fourth quarter of 2024. Excluding acquisitions and divestitures, currency effects, and interest income, organic revenue increased 5%.
Why did free cash flow decline in the first quarter?
Free cash flow was $(86) million versus $(36) million a year earlier. The filing attributes the decrease primarily to the absence of cash collections related to TRANZACT and increased compensation payments in the current-year quarter.
What are the key 2025 financial considerations WTW disclosed?
WTW expects share repurchases of about $1.5 billion, subject to market conditions. The Bain Capital reinsurance joint venture is expected to reduce adjusted diluted EPS by approximately $0.25 to $0.35, and foreign currency is expected to be neutral to adjusted diluted EPS at current rates. The company also expects about 100 basis points of average annual margin expansion in Risk & Broking over the next three years.
Did WTW change how it calculates non-GAAP measures?
Yes. All reported non-GAAP metrics will now exclude non-cash net periodic pension and postretirement benefits, and free cash flow will capture cash outflows for capitalized software costs. The filing states that historical non-GAAP measures have been recast in the supplemental slides.
How much capital did WTW return to shareholders in the quarter?
WTW repurchased shares for $200 million and paid $88 million in quarterly dividends, or $0.92 per common share, during the first quarter of 2025.

04—Continue

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