CLVT

Image source: The Motley Fool. Wed, July 29, 2026 at 9:30 a.m. ET Head of Investor Relations - Mark Donohue Chief Executive Officer - Matti Shem Tov Executive Vice President and Chief Financial Officer - Jonathan Collins Chief Accounting Officer - Michael Easton Operator: Hello, everyone. Thank you for joining us, and welcome to Clarivate's Q2 earnings conference call. After today's prepared remarks, we will host a question-and-answer session. To raise your hand, press star one. To withdraw your question, press star one again. I will now hand the conference over to Mark Donohue, Head of Investor Relations at Clarivate. Please go ahead. Mark Donohue: Thank you, and good morning, everyone. Thank you for joining us for the Clarivate second quarter 2026 earnings conference call. As a reminder, this conference call is being recorded and webcast and is copyrighted property of Clarivate. Any rebroadcast of this information in whole or in part without prior written consent of Clarivate is prohibited. And the accompanying earnings call presentation is available on the Investor Relations section of the company's website. During our call, we may make certain forward-looking statements within the meaning of the applicable securities laws. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of the business or developments in Clarivate's business to differ materially from the anticipated results, performance, achievements or developments expressed or implied by such forward-looking statements. Information about the factors that could cause actual results to differ materially from results and performance, can be found in Clarivate's filings with the SEC and on the company's website. Our discussion will include non-GAAP measures or adjusted numbers, Clarivate believes non-GAAP results are useful in order to enhance understanding of our ongoing operating performance but they are a supplement to and should not be considered in isolation from or as a substitute for GAAP financial measures. Reconciliation of these measures to GAAP measures are available in our earnings release and supplemental presentation on our website. With me today are Matti Shem Tov, Chief Executive Officer; Jonathan Collins, Chief Financial Officer and Michael Easton, Chief Accounting Officer. After our prepared remarks, we will open up the call to your questions. And with that, it is a pleasure to turn the call over to Matti. Matti Shem Tov: Good morning, everyone, and thank you for joining us. The key messages today are straightforward. We are delivering on our commitment and now we have the building blocks in place to accelerate organic growth. During the quarter, we advanced our AI innovation roadmap, grew organic ACV year-over-year, maintained disciplined cost management, and strengthened our balance sheet through deleveraging. These actions will deliver further long-term value to shareholders. In the second quarter, we drove continued progress across the business. Organic ACV growth improved to 1.5% and profit margin has expanded to more than 42%. At the segment level, Academia & Government and Life Sciences & Healthcare, each delivered 2% organic ACV growth. A sign of continued progress here is the shift from transactional to recurring revenue. We expect to see this continue in the coming quarters as we focus on subscription revenue. In the Intellectual Property segment, recurring organic revenue improved to flat in the quarter. We continue to expect a return to growth in the second half. We advanced key innovation milestones including introducing two new agentic AI products, Nexus Connect and IP-1, which I will discuss in greater detail later. And, in early July, we announced the agreement to sell our Life Sciences & Healthcare segment, sharpening our focus on AI-driven transformative intelligence and enhancing our financial profile. I will also share more here in a minute. These results reflect the steady execution of the value creation plan which we launched in late 2024. We are moving forward with urgency. Our progress is clear. We are investing wisely, operating with more discipline, and directing resources towards the highest value growth opportunities. What differentiates Clarivate in this industry is our ability to apply AI to highly curated proprietary datasets that have been built and refined over decades. As a result, we believe that we are on a path towards accelerating our growth rate over the next couple of years. Turning to the A&G segment. Our strategy is to be the trusted layer between AI and research. That means using cloud-based proprietary data, domain expertise, and local solutions to help institutions make better decisions with confidence and transparency. This quarter, we launched Web of Science Research Intelligence globally. This is an AI-native platform for research strategy, impact, and funding. It is shaped by more than 50 development partners and early adopters across 20 countries. Its insights are grounded in publisher-neutral Web of Science data. It provides the full editorial provenance. It has already generated a multimillion-dollar ACV pipeline and we have secured 77 paying customers to date. This is a great example of incremental pipeline resulting from new AI-driven products. We also introduced Nexus Connect, an AI-native gateway that provides a single university connector with AI chat agents such as ChatGPT and Claude. It allows students and researchers to access scholarly resources and services seamlessly integrating with various AI platforms to enhance the research experience. The important point is that we are embedding Clarivate proprietary intelligence into existing research workflows for the academic community. It is leading to new revenue streams. We are applying the same innovation approach to the IP segment. We announced the development of IP-1, a unified AI platform that combines purpose-built AI agents with private, trusted proprietary assets and unique expertise. This platform's agentic AI capabilities allow IP professionals to efficiently solve both patent and trademark intelligence questions as well as simplify daily complex workflow across the entire IP lifecycle. IP-1 is being developed in close collaboration with leading corporate IP teams and law firms. We look forward to discussing this in the coming quarters. We are seeing more market validation for our IP innovation. Recently, RiskMark was named the best AI tool for lawyers at the 2026 CODiE awards. It was recognized for its use of predictive and generative AI to reduce trademark risk assessment from hours to minutes. This marks the product's second industry recognition following its 2025 LegalTech Predictive AI Solution of the Year award. In June, we were pleased to welcome Simon Webster as president of our IP segment. Simon is a proven leader in the global IP ecosystem with more than two decades of experience including as CEO of CPA Global, which Clarivate acquired in late 2020. During his time at CPA Global, the organization delivered compounded annual organic growth in the mid-single digits. Our priorities in IP are retention across annuities and software, increase commercial intensity and accelerate AI innovation supported by our proprietary data assets. Importantly, our IP business has meaningful differentiators. Scale, trusted relationships with leading law firms, and blue-chip corporate IP teams, a strong recurring annuity, and renewal engine, and differentiated proprietary content. We believe this strength, combined with disciplined execution under Simon's guidance, positions IP to improve its performance, over time. As mentioned before, in early July, we announced an agreement to sell our Life Sciences & Healthcare segment to Altaris. This marks an important step in our portfolio rationalization effort, and is a clear example of the VCP in action. This transaction creates a more focused company as a subscription-first provider simplifying our operating model and allowing us to make more targeted investments in organic growth. It also improves the quality of Clarivate's revenue base. On a pro forma basis, recurring revenue mix increases from 89% to approximately 92% improving predictability, retention and cash-flow visibility. We plan to use the net proceeds to reduce debt, which extends our average maturity, strengthens our balance sheet and enhances financial flexibility enabling further shareholder value creation. Let me bring to your attention slide 12. I will walk you through the progress we have made since launching the value creation plan in late 2024. It starts with business model optimization. We have meaningfully shifted our revenue towards a recurring subscription-based model. This gives us greater visibility, greater predictability, a higher quality base to build on. We have also improved our go-to-market by sharpening how we sell and how we serve customers. We have improved the momentum of our recurring business and set a stronger foundation for future bookings. At the same time, we have accelerated our AI innovation across the business. We have a robust and growing portfolio of new AI-powered products, deepening the value we deliver to customers and reinforcing our competitive position. We have rationalized the portfolio. We have taken deliberate action to divest non-core assets announcing several disposals so that our capital and our attention are concentrated on our two major markets, which brings me to what is next. Accelerating organic growth. With a more focused portfolio and higher quality recurring revenue base, a stronger go-to-market engine, exciting new products, and a healthier balance sheet, we expect sequential improvement in recurring organic growth in the second half of 2026 and continued momentum into 2027. We are investing in the right opportunities and we are more confident than ever in our ability to execute, accelerate organic growth and deliver long-term value to shareholders. I will turn it over to Jonathan to discuss this quarter's results in more detail. Jonathan Collins: Thank you, Matti. Slide 14 is an overview of our second quarter and first half results compared with the same periods last year. Q2 revenue was $587 million bringing first half revenue to nearly $1.2 billion. The change in the quarter over the prior year was due to the inorganic disposals, lower organic transactional revenues, and a modest foreign exchange impact partially offset by organic recurring revenue growth. The second quarter net loss was $269 million. The change over the prior year was driven entirely by the non-cash impairment charge triggered by the definitive agreement we reached to divest the LS&H segment. Adjusted diluted EPS in the second quarter was up $0.01 over the prior year to $0.19, bringing the first half to $0.38, which is a 19% increase over the same period last year. Operating cash flow was $99 million in the quarter. The change compared to last year was driven by lower adjusted EBITDA from the disposals and foreign exchange as lower interest expense was offset by higher working capital requirements due to timing of receipts and disbursements. Please turn with me now to page 15 for a closer look at the drivers of the second quarter top and bottom line changes from the prior year. The changes over the prior year were driven by three primary factors. First, organic revenues declined by $9 million as recurring growth of about 1.5% only partially offset lower transactional revenues. We mitigated the revenue impact through cost efficiencies leaving a negligible impact to profit. Second, the businesses we are disposing of reduced revenue by $24 million but were largely offset by cost reductions due to the wind-downs yielding a net $7 million reduction in adjusted EBITDA. And finally, while the top line was essentially unchanged due to foreign exchange, we experienced an adjusted EBITDA headwind of $7 million due to the appreciation of a basket of foreign currencies compared to the U.S. dollar. In total, disciplined cost management allowed us to maintain our adjusted EBITDA margin over the same period last year despite the revenue decline. Please turn with me now to page 16 for the same analysis for the first half. While organic revenues are down $5 million over last year, cost discipline has completely mitigated the impact and contributed $8 million to adjusted EBITDA. The strategic disposals have lowered revenue by $49 million but have expanded profit margins, yielding only a $10 million reduction in adjusted EBITDA. For the comparable period in the prior year, the U.S. dollar was weaker against the basket of foreign currencies, which caused a foreign exchange tailwind of $12 million on the top line but resulted in a profit headwind of $5 million due to transaction gains last year that did not recur this year. Overall, the strategic disposals and disciplined cost management drove margin expansion of nearly a full percentage point in the first half of the year, an improving trend we expect to continue in the second half of the year. Please turn with me now to page 17 to see how our adjusted EBITDA converted to free cash flow and how we continued to allocate our capital in a disciplined manner to further strengthen the balance sheet. Free cash flow was $44 million in the second quarter, which was $6 million lower than the same period last year. The change was due to higher working capital, largely due to the timing of collections and payments, partially offset by lower interest and capital spending. We used free cash flow and excess cash on hand to repurchase another $75 million of bonds due in 2028 at a modest discount of about 3%, bringing the first half debt reduction to $218 million. Please turn with me now to page 18 for a look at our full-year financial guidance ranges which remain unchanged from the guidance we initially provided in February, affirmed in April, and then refined a few weeks ago when we announced the agreement to sell the LS&H segment. Today, we are further refining our indications within these ranges, largely to reflect the impact associated with the divestiture of the LS&H business, which we expect to close by the end of the year. For modeling purposes, rather than estimating the closing date, assume the transaction will close at year-end. If it closes prior, we will modify the guidance accordingly at the time to reflect the impact. We now expect our organic annual contract value to be in the lower half of the range entirely due to the fact that LS&H will be excluded from this metric in the second half as it will be moved to discontinued operations. Importantly, we expect A&G to approach 3% and the IP segment to return to growth by year-end to blend to about 2.25% growth. We still expect recurring organic growth of about 1.5% near the midpoint of our range, which remains an improvement of nearly a percentage point over last year. Our revenue is now expected just below the midpoint of the range at $2.35 billion due entirely to foreign exchange, and our organic recurring revenue mix will be above the high end of the original range at about 92% as LS&H moves to discontinued operations. Adjusted EBITDA should remain at just over $1 billion for a profit margin of nearly 43% at the midpoint of the range. We still expect adjusted diluted EPS will grow about 9% at the midpoint of the range to $0.75. Finally, free cash flow is now likely to be at the low end of the range as we have contemplated the full transaction cost to close the LS&H divestiture and have also incorporated additional restructuring costs to achieve incremental cost savings to recognize the full benefit next year. Please turn with me now to page 19 for a reminder of the full-year top and bottom line changes we are expecting compared to last year. We continue to expect adjusted EBITDA margin will expand by about 200 bps driven by a return to organic growth, continued cost discipline, and completion of the strategic disposals. We anticipate organic growth of about 1%, led by subscription revenue growth from continued ACV acceleration. We have plans in place to achieve cost efficiencies to fully offset inflation, driving $25 million of profit growth. This will account for about a third of the profit margin expansion. The inorganic disposals are expected to lower revenue this year by $125 million and we are reducing operating expenses by about $100 million which yields a profit impact of about $25 million delivering the remaining two-thirds of the profit margin expansion. As a reminder, our guidance assumes we will own the LS&H business until year-end, and if the transaction closes earlier, a revision to our guidance will be made at that time. We now anticipate foreign exchange will be essentially flat compared to last year, comprising the only change to our revenue and adjusted EBITDA indication within their respective ranges. Please turn with me now to page 20 to step through the expected seasonality of our revenue and profits this year. We have refined based on our first half results. We continue to anticipate the business will accelerate organically in the second half of the year led by improved retention and new business sales. The organic growth, further cost efficiencies, and the benefit of the strategic disposals should inflect profit margins as we move through the balance of the year. Revenue should be seasonally lower in Q3, and then higher in Q4 due to the normal cadence of patent and trademark renewals and transactional revenues. Please turn with me now to page 21 to review how we expect the more than $1 billion of adjusted EBITDA will convert to free cash flow and how we plan to allocate this capital alongside the proceeds from the LS&H divestiture to reduce our debt this year by about $900 million. Due to the transaction costs we will incur at the closing of the LS&H divestiture, we now expect free cash flow will be flat compared to last year, but the vast majority of the one-time cost of nearly $70 million will not recur next year. We continue to expect cash interest will improve by about $20 million over last year due to the debt we repaid last year and this year. Cash taxes are still expected to be $5 million to $10 million higher than last year due largely to the new corporate tax in Jersey. Anticipate the change in working capital this year will be a use of approximately $25 million primarily due to incentive compensation payments. We are also expecting a $10 million benefit associated with lower impaired contractual costs reflected on the other row. And while we remain committed to investing in product innovation, the disposals and cost efficiencies will improve capital spending by about $20 million. From a capital allocation perspective, we plan to use the free cash flow we generate in the second half of the year and the proceeds from the LS&H divestiture to retire notes due in the next few years. I will now turn the call back over to Matti for some closing remarks before Q&A. Matti Shem Tov: Before we transition to Q&A, I want to touch on our other announcement today: Michael Easton has been appointed as our next chief financial officer, effective August 8. Many of you already know Michael. He serves as our chief accounting officer and is a member of our senior leadership team. He is well regarded and brings more than 25 years of finance and leadership experience. Michael has a deep understanding of our business and has been key to strengthening financial discipline, governance, and operational execution across Clarivate. He will be focused on accelerating growth, improving profitability, strengthening free cash flow generation and maintaining disciplined capital allocation. I want to thank Jonathan for his leadership. He has made many meaningful contributions to our company over the years. He oversaw the successful integration of the three acquisitions that today comprise Clarivate, setting up the segment operating structure we have today and transforming the finance organization. Personally, in the last two years, He has been an important partner to me in advancing the VCP, working to improve profitability and strengthening our balance sheet. I wish Jonathan every success in the future. Operator, we will turn to Q&A now. Operator: Thank you. We will begin the question-and-answer session now. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. We ask that you pick up your handset when asking a question to allow for optimum sound quality. If you are muted locally, please remember to unmute your device. Please stand by now while we compile the Q&A roster. First question comes from the line of Scott Wurtzel with Wolfe Research. Your line is open. Please go ahead. Scott Wurtzel: Hey, guys. Good morning, and thank you for taking my questions. Just wanted to touch on you guys cited some timing around renewals that may have impacted the ACV growth during the quarter. Is anything around that due to longer sales cycles? And anything we should expect to persist at all in the second half of the year? Jonathan Collins: Hey, good morning, Scott. Thanks for the question. We believe that our results for Q2 and the first half are in line with our original expectations. If I remind everyone, we pointed the equivalent of page 20 in Q1 indicated we expected to see a pullback in recurring organic growth in Q2. Subscriptions were a part of that. So ACV we continue to make progress over the last six quarters. It is not always going to be linear. But we continue to see strong renewal rates. and good opportunities for the new products to convert to sales. The timing of renewals is something we see in the business, from time to time. So we do not think it is an elongation of the renewal cycle, and the organic ACV growth of about a percent and a half in the end of June is generally in line with our first half organic growth for subscription revenues at about 1.2%. So we are generally where we expected. As we indicate also on page 20 in this quarter's deck, we expect the ACV and the organic recurring revenue to inflect in the second half of the year. We have good line of sight to that. At this point, in the year, the A&G business, as of the end of July, has 75% of this year's business in the bag. Very similar to what we saw at this point last year. The fall is an important renewal cycle, but we are already well on our way, and we have good line of sight for the second half of the year. Thanks for the question, Scott. Operator: Your next question comes from the line of Toni Kaplan with Morgan Stanley. Your line is open. Toni Kaplan: Thank you. so much. I was hoping you could talk about the MCP opportunity, where you think the like, which client types are going to more gravitate towards, utilizing your data over MCP, which segments, etcetera. And just how you are thinking about how it could contribute to growth, and is it included in the subscription, or is there an upcharge for it? And also, Jonathan, congratulations on your new opportunity. Thanks, Jonathan. Matti Shem Tov: Yeah. So I will take this one. Thank you, Toni. I have to take a broader view on the AI innovation we are doing. We are very much focused. And since I joined, since we started the-- the VCP, we are delivering on 19 different initiatives. Regarding external and new product that we are delivering. We are very, very pleased with the progress so far. We see the AI enablement of our existing product. It is a source for revenue for new logos, new products, new returns, improving your retention, and I think also to allow us to have some AI-specific pricing for new products. So new revenue generation or new revenue stream. For example, Web of Science Research Intelligence, definitely a revenue, a new revenue stream. Alma Specto, a new revenue stream. IP-1, and I have been talking about, and we are very excited about IP-1. Definitely a new revenue stream. Nexus Connect, another product from A&G which involves MCP. And we see the customers in the three segments, including Life Sciences, are the ones to consume our data, our proprietary data. So either directly through us with our UX or a new AI-enabled product or using their own systems, there is a tendency in some of the bigger customers who would like us to embed our capabilities, MCP capabilities into their respective, you know, corporate AI product, and this is why you see more of our product whether it is embedded into Anthropic, ChatGPT, and other generic LLMs. By and large, bigger customers would like to be able to embed this suite through MCP. Smaller customers may want to use it in our environment. But this is just early days overall. We are very pleased with the momentum that we are having introducing AI, either our own native or embedding our proprietary data into the MCP environment of the customer basically, as a corporate AI infrastructure. Jonathan Collins: Thank you. Operator: Your next question comes from the line of Manav Patnaik with Baird. Your line is open. Please go ahead. Manav Patnaik: Thank you. And congratulations, Jonathan and Michael, for your new roles. I just had a question on the expectation for acceleration of organic growth, I think, that is sequentially 100 basis points? Can you flesh that out a bit if it is different between Academia & Government and then the IP side as well? And, just thinking, going into 2027, I guess, maybe just, is that 100 basis points for the full year as well in 2027, or how we should think about that? Matti Shem Tov: I think we are pretty positive on both segments. We have a line of sight and momentum building up in IP as well. We are back to recurring flat in Q2. We believe that we are going to improve recurring in the second half of the year for IP as well. With a great new momentum. And here, it is really worth mentioning the rejoining of Simon to Clarivate. He has been in the industry for 20 years. He was kind enough to come back and support us. He will utilize all of his IP know-how and expertise in accelerating the progress on the IP turnaround. So we do believe IP will be turned around faster with Simon in place and with the great assets in annuity, software and intelligence that we have, and with the AI innovation I have mentioned. You know, I have mentioned RiskMark as a product. It has won three awards. And I am also happy about IP-1. IP-1 is not just intelligence. IP-1 is, in fact, an agentic environment in which IP professionals. Basically, we are taking a different route. So we all know about the tailwinds and the other one which has been a little bit contracting. And, basically, we are just going to disrupt the market using both our agentic capabilities and expertise and our proprietary data. That is on the IP side. On the A&G side, momentum is also building with the new Web of Science Research Intelligence, with a new Alma Specto, and with, obviously, Nexus Connect. And some of the new innovation coming out from the A&G product hubs. Optimistic on both sides. Operator: Your next question, please. Your next question comes from the line of George Tong with Goldman Sachs. Your line is open. Please go ahead. George Tong: Good morning. Thank you. I wanted to dive more into transactional revenue performance. To what extent would you say the transactional revenue declines are due to industry factors versus idiosyncratic execution factors. And what gives you confidence that there is a path for a transactional revenue performance to improve? Matti Shem Tov: Let me start, and I will hand it over to Jonathan. The idea that we are moving is part of my playbook or the playbook we have used in the VCP is to move away from transactions. So going into this VCP, there were certain businesses that we divested completely, like the one-time books, the one-time files, the real-world data. We got out faster completely. But with the divestiture of Life Sciences, we are also giving away, some of the Life Sciences with a little bit higher. that is transactional. There is still a portion of transactional business that will stay with us and is supporting the one-time piece that we had. But still within this transactional business, there are still business that we as a business are ambitious to transform to subscription. Just one simple example is the batch files of Web of Science. This will be gradually improved to our subscription rate going in and beyond 94%, 92%. Now I will hand it over to Jonathan to provide some more specifics about the quarter. Jonathan Collins: Yeah. Thanks, Matti. Just a little bit of a different, additional color on the quarter, George. The Life Sciences business is still in our organic results in Q2. We did not, reach agreement until after the end of the quarter. But that business, saw some headwinds in the quarter on transactional in particular. As Matti said, we have been looking to migrate some of those things, to subscription, that is a piece of it, but also we just saw some headwinds in Life Sciences. In the other two businesses, yeah, the business can be lumpy quarter to quarter. We knew we lapped a couple of things in Q2 in both of those businesses that were going to be a bit of a headwind. But we do expect that to ameliorate in the second half of the year. We have better line of sight into that. Our full-year guide does contemplate this. Transactional will be down slightly year-over-year. But I think we will see some improvement on that in the second half. Thanks for the questions, George. Operator: Thank you. As a reminder, if you would like to ask a question, please press star one now to raise your hand and join the queue. Your next question comes from the line of Shlomo Rosenbaum with Stifel. Your line is open. Please go ahead. Adam Parrington: Hi. This is Adam Parrington on for Shlomo. Was there any client that might have impacted the Life Sciences business that drove the revenue decline due to the kind of transactional movement? Jonathan Collins: Yeah. Thanks for the question. No. There is nothing discrete or specific, as I mentioned. Matti talked about the fact that we have had an emphasis over the last year or so of really providing good subscriptions to migrate some of the transactional business away from. So, certainly, that is an item, but nothing specific that we would highlight on an individual basis. Other than just some headwinds in that area on the transactional side. Adam Parrington: Okay. And the buyer of the Life Sciences division aware of the performance in the second quarter when they announced the deal? I just want to verify what could potentially trigger it, sort of a MAC clause or anything like that. Jonathan Collins: No. Certainly, this is nothing to that level, and, no, that process is moving exactly as we would expect. We worked through the process to reach an agreement and all of the approvals that are required are customary, and we expect those to occur in the coming months, and we expect this to close before the end of the year. Adam Parrington: Thank you. Operator: We have reached the end of the Q&A session. I would now like to turn the call back to Matti for closing remarks. Please go ahead. Matti Shem Tov: As we close, I want to just repeat the key takeaways. Today are very, very clear. We have the building blocks in place to accelerate organic growth and we will continue to deliver on our commitment to drive long-term shareholder value. Thank you for joining us. Operator: This concludes today's call. Thank you for attending. You may now disconnect. 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This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Clarivate (CLVT) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

In early August 2026, Owens Corning reported second-quarter 2026 results showing broadly flat sales at US$2,756 million year on year, but a decline in net income to US$226 million and lower earnings per share compared with the prior-year quarter. Alongside these results, the company completed two substantial share repurchase programs totaling about 11.79% and 1.53% of its shares since late 2022 and mid-2025, while also announcing a CFO transition that elevates former finance chief Todd Fister to President and COO and brings in experienced finance leader Jonathan Collins from Clarivate. We’ll now examine how Owens Corning’s strong earnings surprise relative to analyst expectations reshapes the company’s existing investment narrative and outlook. The future of work is here. Discover the 36 top robotics and automation stocks leading the charge in AI-driven automation and industrial transformation. To own Owens Corning, you need to believe its core roofing, insulation and doors franchises can stay profitable through uneven construction cycles, even when earnings are lumpy. The latest quarter delivered a strong beat versus expectations despite flat sales and lower net income, which supports that resilience. For now, this positive earnings surprise does not materially change the biggest near term catalyst, which is execution in Roofing and Insulation, or the key risk around prolonged weakness in North American housing and R&R demand. The most relevant announcement to this earnings beat is the completion of two sizeable share repurchase programs, retiring roughly 13% of shares since late 2022. Combined with steady dividends, this shows Owens Corning continuing to return cash while absorbing softer reported profits. For investors watching catalysts, the question is whether this level of capital return remains compatible with pressure on margins, particularly if end markets or input costs move against the company for longer. Yet investors should be aware of how quickly weaker residential and R&R demand could interact with high capital spending and... Read the full narrative on Owens Corning (it's free!) Owens Corning's narrative projects $10.9 billion revenue and $4.0 billion earnings by 2029. Uncover how Owens Corning's forecasts yield a $164.57 fair value, a 9% upside to its current price. Before this report, the most optimistic analysts were betting on earnings climbing toward about US$2.2 billion, which is a far more upbeat story than the cautious view that new capacity could be underutilized if demand stays weak, so it is worth seeing how both narratives evolve as fresh results come through. Explore 4 other fair value estimates on Owens Corning - why the stock might be worth 20% less than the current price! Disagree with existing narratives? Extraordinary investment returns rarely come from following the herd, so go with your instincts. A great starting point for your Owens Corning research is our analysis highlighting 3 key rewards and 2 important warning signs that could impact your investment decision. Our free Owens Corning research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Owens Corning's overall financial health at a glance. Opportunities like this don't last. These are today's most promising picks. Check them out now: Explore 26 top quantum computing companies leading the revolution in next-gen technology and shaping the future with breakthroughs in quantum algorithms, superconducting qubits, and cutting-edge research. AI is about to change healthcare. These 42 stocks are working on everything from early diagnostics to drug discovery. The best part - they are all under $10b in market cap - there's still time to get in early. Uncover the next big thing with 20 elite penny stocks that balance risk and reward. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include OC. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

This article first appeared on GuruFocus. Release Date: July 29, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Clarivate PLC (NYSE:CLVT) reported an improvement in organic Annual Contract Value (ACV) growth to 1.5% and expanded profit margins to over 42%. The company introduced two new AI products, Nexus Connect and IP1, which are expected to drive new revenue streams. Clarivate PLC (NYSE:CLVT) announced the sale of its Life Science and Health segment, which will sharpen its focus on AI-driven intelligence and improve its financial profile. The company has successfully shifted its revenue model towards a recurring subscription-based model, increasing predictability and quality of revenue. Clarivate PLC (NYSE:CLVT) is investing in AI innovation, which is expected to accelerate growth and enhance its competitive position. Clarivate PLC (NYSE:CLVT) reported a net loss of $269 million in the second quarter, driven by a non-cash impairment charge related to the divestiture of the Life Science and Health segment. Organic revenues declined by $9 million due to lower transactional revenues, despite recurring growth. The company experienced a $7 million adjusted EBITDA headwind due to foreign exchange impacts. Free cash flow was $44 million, $6 million lower than the same period last year, due to higher working capital requirements. Clarivate PLC (NYSE:CLVT) expects free cash flow to be at the low end of the range due to transaction costs associated with the Life Science and Health divestiture and additional restructuring costs. Warning! GuruFocus has detected 5 Warning Signs with CLVT. Is CLVT fairly valued? Test your thesis with our free DCF calculator. Q: Can you elaborate on the timing around renewals that impacted ACV growth during the quarter? Is this due to longer sales cycles, and should we expect this to persist in the second half of the year? A: We believe our Q2 and first-half results align with our expectations. We anticipated a pullback in recurring organic growth in Q2, partly due to subscriptions. ACV growth has been consistent over the last six quarters, with strong renewal rates and opportunities for new product sales. The timing of renewals is a regular occurrence, not an elongation of the cycle. We expect ACV and organic recurring revenue to improve in the second half, with good visibility for the rest of the year. (Respondent: Unidentified_6) Q: Could you discuss the MCP opportunity and which client types are likely to utilize your data over MCP? How do you see it contributing to growth, and is it included in the subscription or an upcharge? A: Our AI innovation focuses on delivering new products and enhancing existing ones, creating new revenue streams. Products like Web of Science Research Intelligence and IP1 represent new revenue opportunities. Customers across segments, including life sciences, are interested in consuming our proprietary data, either directly or through their AI platforms. Larger customers prefer embedding our capabilities into their AI products, while smaller ones may use our environment. We are pleased with the momentum in introducing AI, either natively or through customer AI infrastructures. (Respondent: Unidentified_8) Q: Can you provide more details on the expected acceleration of organic growth, particularly between the academic and government segments and the IP side? Is the 100 basis points increase expected for the full year 2027 as well? A: We are optimistic about both segments. In IP, we expect recurring revenue to improve in the second half, with Simon Webster's leadership accelerating progress. On the academic and government side, momentum is building with new products like Web of Science Research Intelligence and Nexus Connect. We anticipate continued growth in both segments. (Respondent: Unidentified_8) Q: What factors contributed to the decline in transactional revenue, and what gives you confidence in improving transactional revenue performance? A: Our strategy involves moving away from transactional revenue, divesting certain businesses, and transforming others to subscription models. The life sciences business faced headwinds in Q2, but we expect improvement in the second half. Our full-year guidance anticipates a slight decline in transactional revenue, but we have better visibility for improvement in the latter half of the year. (Respondents: Unidentified_8 and Unidentified_6) Q: Was there any client loss impacting the life sciences business, and did the buyer of the life sciences division know about the Q2 performance when the deal was announced? A: There was no specific client loss impacting the life sciences business. The buyer was aware of the performance, and the transaction process is proceeding as expected, with approvals anticipated in the coming months. (Respondents: Unidentified_6) For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Interested in Clarivate PLC? Here are five stocks we like better. Clarivate expects growth to improve in the second half of 2025, with organic recurring revenue and annualized contract value growth supported by strong renewal visibility, product momentum and a growing pipeline of AI-enabled offerings. The company is pursuing 19 AI initiatives, including products such as Web of Science Research Intelligence, Harmaspecto, IPOne and Nexus Connect, while embedding its proprietary data into platforms including Anthropic and ChatGPT through Model Context Protocol integrations. Clarivate said its Intellectual Property and Academic & Government businesses are gaining momentum, while transactional revenue remains pressured. The pending sale of its life sciences division is proceeding as expected and is targeted to close before year-end. Bargains Galore? 3 Stocks With Insider Buying in the Millions Clarivate (NYSE:CLVT) said during its earnings call that it expects organic recurring revenue and annualized contract value growth to improve in the second half of the year, citing renewal visibility, product momentum and a growing pipeline of AI-enabled offerings. Management said second-quarter and first-half performance was consistent with its original expectations, despite a pullback in recurring organic growth during the second quarter. The company reported organic ACV growth of approximately 1.5% at the end of June, generally in line with first-half organic growth in subscription revenue of about 1.2%. → This Tiny AI Supplier Could Be More Important Than the Chipmakers Clarivate: The Cheapest AI Stock Worth Buying? Responding to a question from Wolfe Research’s Scott Wurtzel about renewal timing, a Clarivate representative said the company does not view recent timing effects as evidence of longer renewal cycles. “It’s not always going to be linear,” the representative said of ACV progress, while adding that renewal rates remain strong and that the company sees opportunities to convert new products into sales. Clarivate said it expects ACV and organic recurring revenue growth to “inflect” in the second half. The company noted that its Academic and Government business had secured 75% of its business for the year as of the end of July, a level similar to the prior year. Management said the fall is an important renewal period and that it has good visibility into the remainder of the year. → Refiner Stocks Are Near Record Highs—Can Iran-Driven Margins Keep Them There? Top 5 Stocks to Watch for AI-Driven Gains That Aren’t NVIDIA In response to Morgan Stanley analyst Toni Kaplan’s question about the company’s Model Context Protocol, or MCP, opportunity, Clarivate said it is pursuing AI innovation through both native products and the incorporation of its proprietary data into customers’ AI environments. The company said it is working on 19 initiatives involving external and new products. Management described AI enablement of existing products as an opportunity to support new customer wins, retention and AI-specific pricing for new offerings. → Innovative ETF Strategies That Are Paying Off This Summer Clarivate identified Web of Science Research Intelligence, Harmaspecto and IPOne as potential new revenue streams. It also referenced Nexus Connect in its Academic and Government segment as a product involving MCP. Management said larger customers may be more likely to seek to embed Clarivate capabilities and proprietary data into their own corporate AI products and infrastructure through MCP. Smaller customers may instead use the company’s products within Clarivate’s own environment, though the company characterized the opportunity as being in its early stages. Clarivate also said its products and data are being embedded into platforms including Anthropic, ChatGPT and other general-purpose large language models. Management expressed optimism about both its Intellectual Property and Academic & Government businesses. In IP, the company said recurring revenue returned to flat growth in the second quarter and is expected to improve in the second half. The company said Simon, who has spent 20 years in the industry and recently rejoined Clarivate, will support efforts to accelerate the IP turnaround. Management pointed to its annuity, software and intelligence assets, as well as AI innovation, as factors supporting that effort. Clarivate highlighted RiskMark, which it said won three awards, and IPOne, which management described as an agentic environment for IP professionals that combines agentic capabilities with proprietary data. The company said it aims to compete in the IP market through those capabilities rather than relying solely on traditional data offerings. In Academic and Government, management cited Web of Science Research Intelligence, Harmaspecto, Nexus Connect and other product-hub innovations as drivers of building momentum. Clarivate said transactional revenue faced pressure in the second quarter, including headwinds in its life sciences business. Management said the life sciences business remained part of the company’s organic results for the quarter because the agreement to sell the business was reached after quarter-end. The company said it has been working to shift certain transactional offerings toward subscription models. It cited Web of Science backfiles as one example and said this effort should gradually increase subscription rates beyond 92%. Management also said transaction-based revenue can be uneven from quarter to quarter. In its other two businesses, Clarivate said it had anticipated comparisons against several second-quarter items that would create headwinds, but expects those pressures to ease in the second half. Clarivate’s full-year guidance assumes transactional revenue will decline slightly year over year, though management expects improvement in the second half. Addressing a question about whether customer losses affected life sciences results, the company said there was no discrete client loss or individual issue to highlight. Regarding the pending sale of the life sciences division, management said the process is proceeding as expected. It said required approvals are customary, are expected in coming months, and that the transaction is expected to close before year-end. CEO Matti Shem Tov concluded that Clarivate has “building block[s] in place to accelerate organic growth” and remains focused on driving long-term shareholder value. Clarivate plc is a global information and analytics company that provides insights and workflow solutions to accelerate the pace of innovation. The company delivers proprietary data, analytics, and expertise to support research and development in the life sciences, intellectual property management, academic institutions, government agencies, and corporations. Its core offerings include citation and patent databases, drug pipeline analytics, trademark research tools, regulatory compliance solutions, and market intelligence platforms. Originally part of Thomson Reuters' Intellectual Property & Science division, Clarivate was established as an independent entity in 2016 following a spin-off transaction. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Clarivate Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for July 2026.

Clarivate PLC (CLVT) came out with quarterly earnings of $0.19 per share, beating the Zacks Consensus Estimate of $0.17 per share. This compares to earnings of $0.18 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +11.77%. A quarter ago, it was expected that this company would post earnings of $0.14 per share when it actually produced earnings of $0.18, delivering a surprise of +28.57%. Over the last four quarters, the company has surpassed consensus EPS estimates four times. Clarivate, which belongs to the Zacks Computers - IT Services industry, posted revenues of $587.3 million for the quarter ended June 2026, surpassing the Zacks Consensus Estimate by 0.04%. This compares to year-ago revenues of $621.4 million. The company has topped consensus revenue estimates four times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Clarivate shares have lost about 28.1% since the beginning of the year versus the S&P 500's gain of 8.5%. While Clarivate has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Clarivate was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.18 on $586.34 million in revenues for the coming quarter and $0.76 on $2.36 billion in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Computers - IT Services is currently in the top 34% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. Nutanix (NTNX), another stock in the same industry, has yet to report results for the quarter ended July 2026. This enterprise cloud platform services provider is expected to post quarterly earnings of $0.48 per share in its upcoming report, which represents a year-over-year change of +29.7%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. Nutanix's revenues are expected to be $737.46 million, up 12.9% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Clarivate PLC (CLVT) : Free Stock Analysis Report Nutanix (NTNX) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Management is executing a Value Creation Plan (VCP) focused on shifting the business model from transactional to high-quality recurring subscription revenue. The divestiture of the Life Sciences & Healthcare (LS&H) segment is a key strategic pivot to simplify the operating model and concentrate capital on the Academia & Government (A&G) and Intellectual Property (IP) markets. Clarivate is leveraging its proprietary, curated datasets as a competitive moat, applying agentic AI to embed intelligence directly into customer research and IP workflows. The IP segment is undergoing a leadership-led turnaround focused on improving retention across annuities and software while accelerating AI innovation like the IP-1 platform. A&G performance is being driven by the global launch of Web of Science Research Intelligence, which utilizes publisher-neutral data to provide editorial provenance for research strategy. Operational discipline and cost management successfully mitigated revenue headwinds from inorganic disposals and lower transactional volumes, maintaining adjusted EBITDA margins. Management expects sequential improvement in recurring organic growth through the second half of 2026, with continued momentum projected into 2027. The pro forma revenue mix is expected to reach approximately 92% recurring revenue following the LS&H divestiture, enhancing predictability and cash-flow visibility. Guidance assumes the LS&H transaction closes at year-end 2026, with net proceeds earmarked for debt reduction to strengthen the balance sheet and extend maturities. The company anticipates a return to growth in the IP segment by year-end, supported by increased commercial intensity and the rollout of new AI-driven products. Free cash flow for the full year is expected at the low end of the range due to one-time transaction costs and restructuring expenses intended to capture 2027 savings. A non-cash impairment charge of $269 million was triggered in Q2 by the definitive agreement to divest the LS&H segment. The company expects to incur approximately $70 million in one-time transaction costs at the closing of the LS&H divestiture, which are not expected to recur in the following fiscal year. Foreign exchange fluctuations presented a $7 million adjusted EBITDA headwind in Q2 due to the appreciation of various foreign currencies against the U.S. dollar. The appointment of Michael Easton as the new CFO, effective August 8, 2026, aims to maintain financial discipline during the next phase of organic growth acceleration. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management clarified that Q2 results were in line with expectations and the slight pullback in recurring growth was not due to elongated sales cycles. The company has good visibility into the second half of the year, noting that 75% of the A&G business for the year was already secured by the end of July. AI innovation is driving new revenue streams through specific pricing for AI-native products like Web of Science Research Intelligence and IP-1. Larger customers are increasingly seeking to embed Clarivate's proprietary data into their own corporate AI infrastructures via MCP (Model Context Protocol) capabilities. The decline in transactional revenue is partly a deliberate strategic shift to migrate customers toward more predictable subscription models. Management acknowledged some idiosyncratic headwinds in the Life Sciences segment during Q2 but expects transactional performance to improve in the second half of the year.

Clarivate posted Q1 revenue of $586 million with adjusted EBITDA of $241 million (a 41% margin), generated $79 million of free cash flow, saw adjusted diluted EPS rise to $0.18, and noted its subscription mix has moved to 89% as management credited progress under the Value Creation Plan. The company used cash to deleverage and return capital—retiring about $143 million of debt in Q1 (including redeeming the remaining $100 million of 2026 bonds), repurchasing ~$43 million of 2028/2029 bonds and 7 million shares—and expects to reduce net leverage from 4 turns to about 2.5 turns over the next few years. Clarivate reaffirmed full-year guidance, targeting organic ACV growth of 2–3%, an adjusted EBITDA margin near 43%, adjusted EPS of $0.75, and roughly $400 million of free cash flow, while accelerating AI product adoption and evaluating a potential sale of its Life Sciences & Healthcare business that could affect guidance if completed. Interested in Clarivate PLC? Here are five stocks we like better. Bargains Galore? 3 Stocks With Insider Buying in the Millions Clarivate (NYSE:CLVT) reported first-quarter 2026 results that management said marked a fifth consecutive quarter of improved performance, supported by progress under its Value Creation Plan (VCP) and a continued shift toward subscription-based offerings. CEO Matti Shem Tov told investors the company is “off to a solid start to the year” and said the quarter’s results keep Clarivate “on pace to achieve our full-year guidance.” Clarivate posted Q1 revenue of $586 million. Shem Tov said performance was supported by “continued VCP progress and execution across the portfolio,” with the company emphasizing improving revenue quality through a subscription-first approach. → Palantir Is Down 30%: Noise? Or a Signal to Accumulate? Clarivate: The Cheapest AI Stock Worth Buying? Organic annual contract value (ACV) growth was 1.6%, and subscription organic revenue growth was 1.7%, which Shem Tov attributed to “increased adoption of subscription-based solution across Clarivate.” Adjusted EBITDA was $241 million, representing a 41% margin, up “almost 200 basis points year-over-year,” according to Shem Tov. CFO Jonathan Collins said the margin expansion was driven by “disciplined cost management” and was consistent with the company’s full-year outlook. → Corning Beats Q1 Estimates but Drops 9% on Guidance Miss Top 5 Stocks to Watch for AI-Driven Gains That Aren’t NVIDIA Clarivate generated about $79 million of free cash flow in the quarter. Shem Tov said the cash flow performance allowed the company to retire $143 million of debt during Q1. Collins said the year-over-year revenue change was shaped by disposals, modest organic growth, and a favorable currency impact. He noted that Q1 revenue changes versus the prior year were “due to the inorganic disposals, partially offset by organic growth and a favorable foreign exchange impact.” → Did Qualcomm Just Put Apple in Check? Clarivate reported a net loss of $40 million, which Collins said was a $64 million improvement from the prior year, driven by a foreign exchange benefit and lower restructuring, income tax, and interest expenses. Adjusted diluted EPS increased nearly 30% year-over-year to $0.18. Collins attributed the improvement to adjusted EBITDA growth, lower interest and tax expense, and a lower share count due to repurchases completed last year. Operating cash flow was $135 million in Q1, with Collins citing higher working capital usage tied to incentive compensation payments, partially offset by higher adjusted EBITDA. Collins said Clarivate used free cash flow and excess cash to take several balance-sheet actions during the quarter: Redeemed the remaining $100 million of bonds due later in 2026 Repurchased $43 million of bonds due in 2028 and 2029 at a blended discount of about 10% Repurchased 7 million shares to offset dilution from stock-based compensation Looking forward, Collins said the company intends to direct free cash flow toward further deleveraging, including early retirement of bonds. He outlined an expectation to retire secured notes before their July 2028 maturity and then begin retiring 2029 notes. Collins also said these actions are expected to reduce net leverage from 4 turns at the end of Q1 to about 2.5 turns “in a few years.” Shem Tov reiterated that the VCP—launched in early 2025—centers on four pillars: business model optimization, improved sales execution, accelerated AI innovation using proprietary data assets, and portfolio rationalization. He said those priorities are visible in “subscription mix, margin expansion, and debt reduction.” In closing remarks, Shem Tov said the company’s subscription mix has moved to 89%. In Academia & Government (A&G), Shem Tov described continued strength in recurring revenue and highlighted adoption of ProQuest subscriptions, saying the company sold “over 600 new subscriptions” in the last 12 months. He also cited a multi-product institutional win with Fuyao University of Science and Technology in China. On AI-enabled customer outcomes, Shem Tov said Clarivate’s academic AI solutions are “optimizing key library workflows,” producing “30%-60% decrease in manual repetitive work” and “doubling or even quadrupling throughput.” In Q&A, he added that agentic AI deployments in the Alma Prime Library product have enabled customers to “quadruple the throughput.” In Intellectual Property (IP), Shem Tov said Clarivate is seeing “encouraging signs” from greater renewal discipline. He stated renewal rates improved about 100 basis points in Q1, helping organic ACV trends improve to “nearly flat.” Collins added that organic ACV in IP is now “getting pretty close to flat after a few years of decline.” Clarivate also cited wins with national IP offices, including a “major trademark analytics contract and large-scale digitization programs” with the U.S. Patent and Trademark Office. The company also released Brand Image Search, which Shem Tov said adds AI capabilities such as clustering and multilingual support. In Life Sciences & Healthcare (LS&H), Shem Tov said the shift from transactional sales to subscription is “on track” and that Q1 included an “almost 1% rise in organic revenue.” He highlighted a new top 20 global pharmaceutical customer win for DRG Fusion, described as a real-world data analytics platform, and a six-figure subscription win for a biotech customer for OFF-X, a safety intelligence platform. Clarivate also emphasized partnerships intended to extend its content into customer AI workflows. Shem Tov said the company integrated Cortellis Regulatory Intelligence with Anthropic Claude, combining Clarivate data with AI reasoning. He further noted that Clarivate announced a new A&G product, Nexus Connect, designed to bring institutional content into tools such as “ChatGPT” and “Copilot,” enabling customers to access content through their preferred large language models. As part of portfolio rationalization, Shem Tov reiterated that Clarivate announced in February it is “actively pursuing the sales of the life science and healthcare business.” He said the process is ongoing and cautioned there is “no guarantee of the outcome.” Collins noted that full-year guidance assumes Clarivate will own LS&H for the entire year and said guidance may need to be revised later in 2026 if a sale agreement is reached. Collins reaffirmed Clarivate’s full-year guidance, unchanged from February. He said the company expects organic ACV growth of 2% to 3% and recurring organic growth of about 1.5% at the midpoint. Due “entirely to the wind down of the businesses we are disposing,” Clarivate expects revenue to decline by about $100 million at the midpoint to $2.36 billion. At the midpoint, Clarivate expects adjusted EBITDA margin to rise to nearly 43%, adjusted diluted EPS to reach $0.75, and free cash flow to increase about 10% to $400 million. In discussion of quarterly dynamics, Collins said recurring organic revenue growth in Q1 of 1% came in higher than expected due to patent renewal timing, and he anticipates “a slight pullback in Q2” from phasing before growth accelerates in the second half. He also noted transactional revenues declined a “couple percent” in Q1, driven primarily by A&G, and said the full-year outlook assumes transactional revenue will be “down slightly” year-over-year. Collins attributed some of the A&G transaction softness to the timing of software implementations, which he said “can be a little lumpy quarter to quarter.” During Q&A, Shem Tov said Clarivate is seeing AI product adoption across segments, citing “more than 400 institution” using academic AI solutions and “over 10,000 researchers and users” using AI product innovation in life sciences. He also pointed to growth momentum in China, saying Clarivate sold 15 new Web of Science businesses in China last year and is seeing momentum in Web of Science and Web of Science Research Intelligence. Collins said the company expects to provide more detail later in the year on the size of internal AI efficiency opportunities, but added management is confident that AI-enabled efficiencies can support continued margin expansion and cash flow growth. Clarivate plc is a global information and analytics company that provides insights and workflow solutions to accelerate the pace of innovation. The company delivers proprietary data, analytics, and expertise to support research and development in the life sciences, intellectual property management, academic institutions, government agencies, and corporations. Its core offerings include citation and patent databases, drug pipeline analytics, trademark research tools, regulatory compliance solutions, and market intelligence platforms. Originally part of Thomson Reuters' Intellectual Property & Science division, Clarivate was established as an independent entity in 2016 following a spin-off transaction. The article "Clarivate Q1 Earnings Call Highlights" was originally published by MarketBeat.