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According to CEO Steve Hasker, Thomson Reuters is armed with an $8 billion fund earmarked for acquisitions and investments in artificial intelligence. The company is optimistic that AI will revolutionize its core business of providing information to professionals like lawyers and accountants rather than posing a threat to it.
In an interview with the Financial Times ahead of the upcoming investor day, which marks the first in three years, Hasker emphasized the substantial financial resources at their disposal to expand into AI-driven professional services and information sectors. This strategic move aligns with their decision to divest the remaining stake in the London Stock Exchange Group.
Hasker highlighted, “We have dry powder of around $8 billion due to the cash-generating capacity of our existing operations, a conservatively leveraged balance sheet, and the divestiture of our LSEG holding.”
Furthermore, Thomson Reuters is committed to investing over $100 million annually in advancing its proprietary AI technology to cater to clientele in fields such as legal, tax, and accounting.
Following a two-year initiative aimed at transitioning from a content provider to a technology-driven company, Thomson Reuters encountered the disruptive force of generative AI, prompting yet another transformation in their approach.
The impact of AI on consumer spending behaviors remains uncertain, but Hasker views it as one of several favorable factors driving the company forward. Acquisitions will predominantly target firms with AI capabilities, with recent investments totaling approximately $2 billion in companies like SurePrep, Casetext, and Pagero.
While a significant portion of the company’s revenue originates from the US, Thomson Reuters aims to diversify geographically over the next three to five years, with a keen interest in expanding operations in regions spanning from Brazil and Mexico to Southeast Asia and Japan.
Moreover, Thomson Reuters has engaged in partnerships with AI entities seeking to leverage Reuters news for training their expansive language models. These collaborations aim to feed the AI models with high-quality, factual content to enhance their functionality.
Despite refraining from divulging specifics on the commercial agreements, Hasker alluded to the strategic importance of these alliances. Additionally, he refrained from commenting on an ongoing copyright dispute with Ross Intelligence, a legal research firm powered by AI.
Thomson Reuters, with a global workforce of approximately 26,000 employees, is predominantly owned by the Thomson family, holding nearly 70% of the company, with the remaining shares publicly listed in Toronto and New York. David Thomson, chair of the company and scion of the Thomson media legacy, oversees the media conglomerate established by his grandfather Roy Thomson.
The company’s stake in LSEG, acquired during the sale of its financial data business Refinitiv for $27 billion in 2019, has been gradually divested, with plans to completely exit the position by next year. Hasker clarified that this investment was financially motivated rather than strategic.
In a bid to enhance its AI offerings, Thomson Reuters introduced new services enabling customers to pose intricate research queries and receive AI-driven responses from authoritative legal sources. The company is poised to unveil six to eight new products in the upcoming months, reflecting a heightened pace of innovation.
Despite queries from analysts regarding the synergy between Reuters news and the company’s tech-focused trajectory, Hasker affirmed that Reuters remains an indispensable component of their portfolio. The news division, albeit contributing a smaller fraction of revenues, is integral to their overarching strategy.
Hasker underscored the collaborative potential between Reuters news bureaus and the company’s AI technology, citing the utilization of AI tools to generate story ideas. While contemplating the prospect of a news paywall akin to competitors like Bloomberg, the current focus remains on servicing LSEG and agency clients.
Nevertheless, Thomson Reuters is exploring the viability of premium news and AI products tailored for professionals that could potentially be housed behind a paywall.
