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Pearson slumps as Goldman says it expects only slight growth acceleration in Q3

(Sharecast News) - Educational publisher Pearson slumped on Wednesday as Goldman Sachs said in a results preview that it expects only slight growth acceleration in the third quarter, with a focus on the fourth quartrer to deliver full-year guidance.

The bank updated its estimates for Pearson ahead of 9M25 results in late October. It forecasts 3.5% growth in third-quarter group organic revenue, below Visible Alpha consensus data at +4.6% and implying 2.2% growth in nine-month group organic revenue.

"In particular, we are below Q3 consensus on ELL, A&Q and Virtual Learning," said Goldman.

The bank continued: "We expect the market will focus on: (i) the visibility on the organic revenue growth acceleration into Q4 and any potential update to the FY25 organic growth/adj. operating profit company guidance, (ii) an update on volumes from the new Pearson VUE customer wins (Salesforce, ServiceNow, and the Association of Social Work Boards), (iii) commentary around Fall 2025 US & International college enrolment trends, particularly in the backdrop of broadly more restrictive student migration policies, (iv) an update on the challenging end market trends across the high stakes English testing market and outlook into 2026."

For FY25, GS forecasts group organic growth of 3.7%, down from 3.8% previously. This is slightly below Visible Alpha consensus data at 3.9% growth and company guidance of 4.4% growth.

"Our FY25 adjusted operating profit forecast of £614mn (unchanged) at USD/GBP of 1.32 is broadly in line with current company guidance of £611mn and Visible Alpha consensus at £612mn," Goldman said.

At 1510 BST, the shares were down 3.6% at 1,046.73p.

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