Pearson starts 2024 with growth as firm 'pleased' with AI progress
The FTSE 100 firm told investors on Friday that it is "on track" to meet its guidance for the year after growth in the first quarter.
Educational publisher Pearson has kicked off 2024 on a positive note, reporting growth in sales driven by strong demand for English language and work skills courses. The company also revealed that it has seen encouraging engagement with its learning tools that incorporate AI technology, and plans to expand the use of these features throughout the year.
Despite this, shares took a slight dip in early trading, even though the results largely met analyst expectations. The FTSE 100 firm reassured investors on Friday that it is "on track" to meet its annual guidance following first-quarter growth.
It reported a two percent increase in sales over the first three months of the year, or three percent when excluding parts of the business currently under review. Pearson's assessments and qualifications division saw a two percent rise, although this was offset by its US assessment performance.
Meanwhile, its virtual schools division enjoyed a four percent boost thanks to favourable funding opportunities during the period, but revenues for the higher education arm fell by four percent. However, within higher education, Pearson noted a three percent increase in digital registrations and expressed satisfaction with the level of engagement from both students and faculty with its AI study tools.
English language sales were particularly robust, growing by 22 percent, aided by inflation in Argentina.
Pearson, the education and publishing company, have announced that their workforce skills division has experienced a rise of nine percent for the quarter, meeting predictions. CEO Omar Abbosh asserted: "The year has started well."
He also added: "Financial performance was in line with our expectations, thanks to strong execution across the business, and we maintain a sharp focus on delivering against the priorities that I outlined."
Additionally, a Shore Capital analyst Roddy Davidson commented: "Forward looking comments indicate that the year is unfolding as anticipated, and that management continues to expect an acceleration of growth during the second half and deliver against full year guidance."
He went on to express optimism about the company's digital future, saying: "We are encouraged to note the solid start to full-year 2024 summarised above and, more broadly, continue to believe that a sharper focus on growth (as part of the next stage of the group's digital journey), allied to a positive long-term outlook for global learning spend bodes well."
Despite this optimistic forecast, Pearson shares dropped by 1.2 percent to 980p on Friday morning.
