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LSEG: LSEG's Strong FY 2025 Results Driven by Data & Analytics and Post Trade Solutions

LSEG reported a strong financial performance in FY 2025, with revenue growth of 7.6% driven by all businesses, particularly Data & Analytics, which is accelerating. The company achieved 210 basis points of margin expansion, with over half being organic, taking full-year EBITDA margins above 50% for the first time. Adjusted EPS grew 16% to £2.16, beating analyst estimates of £2.06. The company's focus on innovation, including its AI strategy, is already showing promising results, with David Schwimmer stating that "we're benefiting from our unique position at the forefront of AI-driven change."

LSEG.L

GBp 8744

2.87%

A-Score: 4.4/10

Publication date: February 26, 2026

Full Report

Author: Analystock.ai

📋 Highlights
  • Revenue Growth & Margin Expansion: LSEG achieved 7.6% revenue growth with 210 basis points of margin expansion, pushing EBITDA margins above 50% for the first time.
  • Capital Returns & Free Cash Flow: Delivered £2.8 billion in dividends and buybacks, supported by a record £2.45 billion in free cash flow, reflecting strong cash conversion and disciplined cost control.
  • AI Strategy & Partnerships: Launched AI-focused initiatives with 60+ financial institutions connected to MCP servers, driving data consumption growth and positioning as a leader in AI-driven financial data.
  • Post Trade Solutions & M&A: Executed a £3.5 billion M&A and capital allocation strategy, including the Post Trade Solutions transaction, targeting 80-100 bps margin improvement and 6.5-7.5% organic revenue growth in 2026.

Revenue Growth and Margin Expansion

The company's organic growth was 7.1%, slightly above the midpoint of guidance, with all subscription businesses contributing positively. EBITDA margin improved by 110 basis points, driven by operational efficiencies and cost control. The company's cash generation and capital allocation strategy has been consistent over the past 4 years, with a focus on organic investment, dividend growth, bolt-on M&A, and share buybacks.

Valuation and Dividend Yield

With a P/E Ratio of 45.51 and an EV/EBITDA of 13.74, the market is pricing in a certain level of growth and profitability. The Dividend Yield is 1.6%, which is relatively attractive compared to other financial sector companies. The ROE is 4.47%, which is relatively low, but the ROIC is 54.5%, indicating a strong return on invested capital.

AI Strategy and Innovation

LSEG's AI strategy has three pillars: trusted data, transformative products, and intelligent enterprise. The company is seeing strong customer interest and engagement in its AI partnerships, with over 60 financial institutions connected to its MCP servers directly or via one of its AI partners. The company's transformative products, such as Workspace, are driving real, measurable improvements in engagement, with investment management and trading users accessing roughly 25% more applications than a year ago.

Outlook and Guidance

The company is guiding to organic revenue growth of 6.5% to 7.5% in 2026, with a steady acceleration in subscription businesses, and an expected 80-100 bps of margin improvement on a constant currency basis. The company's long-term guidance includes mid- to high single-digit revenue growth, with EBITDA margin improving by 150bps over the period 2027-2029.

LSEG's A-Score