Pearson lifts growth outlook & unveils four-unit shake-up

Pearson's underlying revenue rose 5% in the first nine months of 2026, with growth accelerating to 6% in the third quarter.

The education group said it remains on track to meet its full-year outlook for mid-single-digit revenue growth and narrowed its adjusted operating profit range to £650 million-£675 million, from £640 million-£685 million.

It also announced a reorganisation that will split the business into four customer-focused units from the start of 2027, alongside two acquisitions aimed at strengthening its assessment and skills operations.

The new structure will create units for US K12, US Higher Education, UK & International Education, and Enterprise. Pearson said the changes would sharpen accountability and align the business more closely with customer needs, while giving investors a clearer view of revenue streams and growth drivers.

The re-segmentation is expected to result in one-off reorganisation costs of about £50 million across 2026 and 2027, with around half non-cash. Associated savings will be reinvested in the business.

Alongside the overhaul, Pearson completed the acquisition of ITS, an assessment technology provider, and agreed to acquire Workera, which focuses on enterprise assessment and skills verification. The Workera deal is expected to complete before the end of the year.

Assessment and qualifications remained one of the stronger areas in the quarter. Revenue in that division rose 4% in the first nine months and 10% in the third quarter, helped by new contracts and demand for AI skills verification.

Professional Assessments benefited from new contract launches, including a global certification programme with Anthropic. In US Student Assessment, Pearson secured a long-term statewide assessment award in Pennsylvania, effective from the 2027-2028 academic year assessment cycle.

Virtual Learning continued to deliver the fastest growth across Pearson's reporting lines. Revenue increased 17% in the first nine months and 13% in the third quarter, supported by enrolment growth, funding, and product mix.

Enrolments for the 2026/27 academic year were up 8% in the fall semester. Pearson opened five new schools for the academic year, taking its network to 46 schools across 32 states, including its first in North Carolina.

Higher Education posted slower but positive growth, with revenue up 2% in both the nine-month period and the third quarter. In the US, growth in core courseware and Inclusive Access was partly offset by declines in K12, where delayed adoptions and funding pressures weighed on performance.

English Language Learning remained the weakest part of the portfolio. Revenue fell 4% in the first nine months and 5% in the third quarter, reflecting tough market conditions in Pearson Test of English and a strong comparative period following test enhancements introduced a year earlier.

Enterprise Learning & Skills reported revenue growth of 7% in the first nine months and 6% in the quarter, driven by vocational qualifications and enterprise solutions, with support from strategic partnerships.

Executive changes

The trading update was accompanied by a senior leadership change. Tom ap Simon, President of Higher Education and Virtual Learning, will leave the company after helping with the transition into early 2027.

Kate Eberle Walker will lead the new US Higher Education business unit. Pearson said she brings more than 25 years of education leadership experience, including roles at Presence, The Princeton Review, Kaplan, and Tutor.com.

Omar Abbosh, Chief Executive of Pearson, said: "Pearson delivered accelerated revenue growth in the quarter, meaning we are on track to deliver our 2026 guidance. We are strengthening our portfolio through two high-quality acquisitions that will enhance our core assessment and verification capabilities and accelerate our strategy to support enterprises in developing, assessing and verifying the skills needed in an AI-driven economy. Together with optimising Pearson's structure to create clearer customer ownership and to elevate our commercial and product capabilities, this gives us further confidence in our ability to drive ever-stronger performance and to deliver sustainable long-term growth."