EX-99.1 2 exh_991.htm EXHIBIT 99.1 EdgarFiling EXHIBIT 99.1 WTW Reports Second Quarter 2026 Earnings Revenue 1 increased 9% from prior year to $2.5 billion for the quarter Organic Revenue growth of 5% for the quarter Diluted Earnings per Share was $2.43 for the quarter, down 27% over prior year Adjusted Diluted Earnings per Share was $3.35 for the quarter, up 17% over prior year Operating Margin was 14.8% for the quarter, down 150 basis points from prior year Adjusted Operating Margin was 19.5% for the quarter, up 100 basis points from prior year Announced Propel, WTW's AI Acceleration Plan, to further scale AI and automation across WTW, targeting approximately 30% Adjusted Operating Margin 2 in 2028 while positioning the Company for future growth Increased existing share repurchase authority by $1.5 billion LONDON, July 30, 2026 (GLOBE NEWSWIRE) -- WTW (NASDAQ: WTW) (the “Company”), a leading global advisory, broking and solutions company, today announced financial results for the second quarter ended June 30, 2026. “WTW delivered solid second quarter results, reflecting business momentum and disciplined execution,” said Carl Hess, WTW’s Chief Executive Officer. “This performance underscores the meaningful progress we've made embedding AI and automation across our business, enabling us to deliver higher-value client solutions and a more compelling colleague experience. Propel, WTW's AI Acceleration Plan announced today, builds on that foundation and is intended to further accelerate performance and enhance efficiency, creating value for shareholders and further strengthening WTW's differentiated position in the market. We remain confident in delivering on our full-year 2026 guidance and achieving our new 2028 margin target.” Consolidated Results A s reported, USD millions, except % Key Metrics Q2-26 Q2-25 Y/Y Change Revenue 1 $2,466 $2,261 Reported 9% | CC 8% | Organic 5% Income from Operations $364 $368 (1)% Operating Margin % 14.8% 16.3% (150) bps Adjusted Operating Income $480 $419 15% Adjusted Operating Margin % 19.5% 18.5% 100 bps Net Income $231 $332 (30)% Adjusted Net Income $316 $285 11% Diluted EPS $2.43 $3.32 (27)% Adjusted Diluted EPS $3.35 $2.86 17% 1 The revenue amounts included in this release are presented on a U.S. GAAP basis except where stated otherwise. The segment discussion is on an organic basis. 2 See “WTW Non-GAAP Measures” below with respect to forward-looking non-GAAP measures. Revenue was $2.47 billion for the second quarter of 2026, an increase of 9% compared to $2.26 billion for the same period in the prior year. Excluding the impact of foreign currency, revenue increased 8%. On an organic basis, revenue increased 5%. See Supplemental Segment Information for additional detail on book-of-business settlements and interest income included in revenue. Net Income for the second quarter of 2026 was $231 million compared to $332 million in the prior-year second quarter. Adjusted EBITDA for the second quarter was $529 million, or 21.5% of revenue, an increase of 13%, compared to Adjusted EBITDA of $470 million, or 20.8% of revenue, in the prior-year second quarter. The U.S. GAAP tax rate for the second quarter was 19.8%, and the adjusted income tax rate for the second quarter used in calculating adjusted diluted earnings per share was 19.6%. Cash Flow and Capital Allocation Cash flows from operating activities were $474 million for the six months ended June 30, 2026, compared to $326 million in the prior year. Free cash flow for the six months ended June 30, 2026 and 2025 was $360 million and $217 million, respectively, an increase of $143 million. The increase was primarily driven by operating margin expansion. During the quarter ended June 30, 2026, the Company repurchased 1,733,574 of its outstanding shares for $450 million. Second Quarter 2026 Segment Highlights Health, Wealth & Career (“HWC”) As reported, USD millions, except % Health, Wealth & Career Q2-26 Q2-25 Y/Y Change Total Revenue $1,270 $1,180 Reported 8% | CC 7% | Organic 4% Operating Income $306 $280 9% Operating Margin % 24.1% 23.8% 30 bps The HWC segment had revenue of $1.27 billion in the second quarter of 2026, an increase of 8% (7% increase constant currency and organic growth of 4%) from $1.18 billion in the prior year. Health delivered organic revenue growth with positive contributions from all regions. Wealth generated organic revenue growth supported by higher levels of retirement work across all regions. Career revenue was flat on an organic basis as increased levels of communications project work and broad-based pay work were offset by constrained revenue in the Middle East due to the ongoing conflict. Benefits Delivery & Outsourcing (BD&O) revenue increased organically as expanded project work, new client wins and regulatory driven work in Outsourcing were partially offset by lower commissions in Individual Marketplace.   Operating margin in the HWC segment increased 30 basis points from the prior-year second quarter to 24.1%. The increase was primarily driven by improved operating leverage and expense discipline. Risk & Broking (“R&B”) As reported, USD millions, except % Risk & Broking Q2-26 Q2-25 Y/Y Change Total Revenue $1,164 $1,047 Reported 11% | CC 10% | Organic 7% Operating Income $258 $222 16% Operating Margin % 22.2% 21.2% 100 bps The R&B segment had revenue of $1.16 billion in the second quarter of 2026, an increase of 11% (10% increase constant currency and organic growth of 7%) from $1.05 billion in the prior year. Corporate Risk & Broking (CRB) had organic revenue growth driven by new business activity and strong client retention globally. Insurance Consulting and Technology (ICT) delivered organic revenue growth primarily from strong software sales in the Technology practice. Operating margin in the R&B segment increased 100 basis points from the prior-year second quarter to 22.2%. The increase was primarily driven by operating leverage. Share Repurchase Program Today, the Company announced that its Board of Directors approved an increase to the existing share repurchase authority in the amount of $1.5 billion. The $1.5 billion increase is in addition to the approximately $500 million remaining on the current open-ended repurchase authority. The Company is authorized to repurchase shares, by way of redemption or otherwise, and will consider whether to do so from time to time, based on many factors, including market and economic conditions, applicable legal requirements and other business considerations.  Propel Concurrent with its second quarter results, WTW announced Propel to embed artificial intelligence and automation across the enterprise, expected to be completed by the end of 2028. Supported by the Company's ongoing investments in AI, data and technology, including the acquisition of Newfront, Propel is expected to enhance client service and create additional opportunities for growth as well as streamline core operating processes. WTW expects these efforts to accelerate performance and enhance efficiency, reinforcing WTW's strengths. The Company expects to invest approximately $625 million of cash and incur approximately $25 million in non-cash charges to generate approximately $400 million in run-rate savings, delivering a cash-cost-to-achieve ratio of approximately 1.6 times. After reinvesting approximately $50 million to support growth, the Company expects to deliver approximately $350 million in net run-rate savings and approximately 30% adjusted operating margin in 2028. The Company’s full-year 2026 guidance remains unchanged. Please refer to the most recent supplemental slides in the Investor Relations section of the Company's website for further details. Select 2026 Financial Considerations Adjusted operating margin: Continued annual margin expansion at the enterprise level driven by: ~100 basis points of annual margin expansion in R&B Incremental annual margin expansion in HWC Segment organic revenue: Health, Wealth & Career: Mid-single digits (MSD) Health: High-single digits (HSD) Wealth: Low-single digits (LSD) Career: LSD to MSD BD&O: LSD Risk & Broking: MSD CRB: MSD ICT: LSD to MSD Willis Re joint venture: Expected to be a headwind on Adjusted Diluted EPS of ~$0.30 The remaining equity investments in the interest in earnings of associates line are not expected to be material in 2026 Newfront acquisition: Expected to be ~$0.10 dilutive to Adjusted EPS in 2026 Expected 2026 post-close revenue of ~$250M and an adjusted EBITDA margin of ~26% Newfront’s Total Rewards business segment (~42%) will be included in HWC and Newfront’s Business Insurance business segment (~58%) will be included in R&B Capital allocation: Expect share repurchases of $1.0B or greater, subject to market conditions and potential capital allocation to organic and inorganic investment opportunities Free cash flow: Continual improvement in FCF margin primarily from operating margin expansion along with evolving our business mix Foreign exchange: Expect an incremental foreign currency tailwind on Adjusted Diluted EPS of ~$0.05 for the remainder of 2026, resulting in a ~$0.35 tailwind for the full year 2026 at today's rates The 2026 Financial Considerations above include Non-GAAP financial measures. We do not reconcile forward-looking Non-GAAP measures for reasons explained under "WTW Non-GAAP Measures" below. Conference Call The Company will host a conference call to discuss the financial results for the second quarter 2026, including an update on strategic priorities. It will be held on Thursday, July 30, 2026, beginning at 9:00 a.m. Eastern Time. A live, listen-only webcast of the conference call will be available on WTW’s website . Analysts and institutional investors may participate in the conference call’s question-and-answer session by registering in advance here. An online replay will be available at investors.wtwco.com shortly after the call concludes. About WTW At WTW (NASDAQ: WTW), we provide data-driven, insight-led solutions in the areas of people, risk and capital. Leveraging the global view and local expertise of our colleagues serving 140 countries and markets, we help organizations sharpen their strategy, enhance organizational resilience, motivate their workforce and maximize performance. Working shoulder to shoulder with our clients, we uncover opportunities for sustainable success—and provide perspective that moves you. Learn more at www.wtwco.com . WTW Non-GAAP Measures In order to assist readers of our consolidated financial statements in understanding the core operating results that WTW’s management uses to evaluate the business and for financial planning, we present the following non-GAAP measures: (1) Constant Currency Change, (2) Organic Change, (3) Adjusted Operating Income/Margin, (4) Adjusted EBITDA/Margin, (5) Adjusted Net Income, (6) Adjusted Diluted Earnings Per Share, (7) Adjusted Income Before Taxes, (8) Adjusted Income Taxes/Tax Rate, (9) Free Cash Flow and (10) Free Cash Flow Margin. We believe that those measures are relevant and provide pertinent information widely used by analysts, investors and other interested parties in our industry to provide a baseline for evaluating and comparing our operating performance, and in the case of free cash flow, our liquidity results. Within the measures referred to as ‘adjusted’, we adjust for significant items which will not be settled in cash, or which we believe to be items that are not core to our current or future operations. Some of these items may not be applicable for the current quarter, however they may be part of our full-year results. Additionally, we have historically adjusted for certain items which are not described below, but for which we may adjust in a future period when applicable. Items applicable to the quarter or full year results, or the comparable periods, include the following: Transaction and integration expenses – Management believes it is appropriate to adjust for significant acquisition-related transaction and integration expenses including changes in significant estimated acquisition earnouts payable and acquisition-related compensation charges. We believe the adjustment is necessary to present how the Company is performing, both now and in the future when the incurrence of these costs will have concluded. Gains and losses on disposals of operations – Adjustment to remove the gains or losses resulting from disposed operations that have not been classified as discontinued operations. Net periodic pension and postretirement benefits – Adjustment to remove the recognition of net periodic pension and postretirement benefits (including pension settlements), other than service costs. We evaluate our revenue on an as reported (U.S. GAAP), constant currency and organic basis. We believe presenting constant currency and organic information provides valuable supplemental information regarding our comparable results, consistent with how we evaluate our performance internally. We consider Constant Currency Change, Organic Change, Adjusted Operating Income/Margin, Adjusted EBITDA/Margin, Adjusted Net Income, Adjusted Diluted Earnings Per Share, Adjusted Income Before Taxes, Adjusted Income Taxes/Tax Rate and Free Cash Flow to be important financial measures, which are used to internally evaluate and assess our core operations and to benchmark our operating and liquidity results against our competitors. These non-GAAP measures are important in illustrating what our comparable operating and liquidity results would have been had we not incurred transaction-related and non-recurring items. Reconciliations of these measures are included in the accompanying tables with the following exception: The Company does not reconcile its forward-looking non-GAAP financial measures to the corresponding U.S. GAAP measures, due to variability and difficulty in making accurate forecasts and projections and/or certain information not being ascertainable or accessible; and because not all of the information, such as foreign currency impacts necessary for a quantitative reconciliation of these forward-looking non-GAAP financial measures to the most directly comparable U.S. GAAP financial measure, is available to the Company without unreasonable efforts. For the same reasons, the Company is unable to address the probable significance of the unavailable information. The Company provides non-GAAP financial measures that it believes will be achieved, however it cannot accurately predict all of the components of the adjusted calculations and the U.S. GAAP measures may be materially different than the non-GAAP measures. Our non-GAAP measures and their accompanying definitions are presented as follows: Constant Currency Change – Represents the year-over-year change in revenue excluding the impact of foreign currency fluctuations. To calculate this impact, the prior-year local currency results are first translated using the current year monthly average exchange rates. The change is calculated by comparing the prior year revenue, translated at the current year monthly average exchange rates, to the current year as reported revenue, for the same period. We believe constant currency measures provide useful information to investors because they provide transparency to performance by excluding the effects that foreign currency exchange rate fluctuations have on period-over-period comparability given volatility in foreign currency exchange markets. Organic Change – Excludes the impact of fluctuations in foreign currency exchange rates, as described above and the period-over-period impact of acquisitions and divestitures on current-year revenue. We believe that excluding transaction-related items from our U.S. GAAP financial measures provides useful supplemental information to our investors, and it is important in illustrating what our core operating results would have been had we not included these transaction-related items, since the nature, size and number of these transaction-related items can vary from period to period. Adjusted Operating Income/Margin – Income from operations adjusted for amortization, transaction and integration and non-recurring items that, in management’s judgment, significantly affect the period-over-period assessment of operating results. Adjusted operating income margin is calculated by dividing adjusted operating income by revenue. We consider adjusted operating income/margin to be important financial measures, which are used internally to evaluate and assess our core operations and to benchmark our operating results against our competitors. Adjusted EBITDA/Margin – Net Income adjusted for provision for income taxes, interest expense, depreciation and amortization, transaction and integration, gains and losses on disposals of operations, net periodic pension and postretirement benefits, and non-recurring items that, in management’s judgment, significantly affect the period-over-period assessment of operating results. Adjusted EBITDA Margin is calculated by dividing adjusted EBITDA by revenue. We consider adjusted EBITDA/margin to be important financial measures, which are used internally to evaluate and assess our core operations, to benchmark our operating results against our competitors and to evaluate and measure our performance-based compensation plans. Adjusted Net Income – Net Income Attributable to WTW adjusted for amortization, transaction and integration, gains and losses on disposals of operations, net periodic pension and postretirement benefits, and non-recurring items that, in management’s judgment, significantly affect the period-over-period assessment of operating results and the related tax effect of those adjustments and the tax effects of significant adjustments. This measure is used solely for the purpose of calculating adjusted diluted earnings per share. Adjusted Diluted Earnings Per Share – Adjusted Net Income divided by the weighted-average number of ordinary shares, diluted. Adjusted diluted earnings per share is used to internally evaluate and assess our core operations and to benchmark our operating results against our competitors. Adjusted Income Before Taxes – Income from operations before income taxes and interest in earnings of associates adjusted for amortization, transaction and integration, gains and losses on disposals of operations, net periodic pension and postretirement benefits, and non-recurring items that, in management’s judgment, significantly affect the period-over-period assessment of operating results. Adjusted income before taxes is used solely for the purpose of calculating the adjusted income tax rate. Adjusted Income Taxes/Tax Rate – Provision for income taxes adjusted for taxes on certain items of amortization, transaction and integration, gains and losses on disposals of operations, net periodic pension and postretirement benefits, the tax effects of significant adjustments and non-recurring items that, in management’s judgment, significantly affect the period-over-period assessment of operating results, divided by adjusted income before taxes. Adjusted income taxes is used solely for the purpose of calculating the adjusted income tax rate. Management believes that the adjusted income tax rate presents a rate that is more closely aligned to the rate that we would incur if not for the reduction of pre-tax income for the adjusted items and the tax effects of significant adjustments, which are not core to our current and future operations. Free Cash Flow – Cash flows from operating activities less cash used to purchase fixed assets and software. Management believes that free cash flow presents the core operating performance and cash-generating capabilities of our business operations. Free Cash Flow Margin – Free Cash Flow as a percentage of revenue, which represents how much of revenue would be realized on a cash basis. We consider this measure to be a meaningful metric for tracking cash c