RELX shares plunge 5% on full-year revenue miss despite profit growth
Adjusted operating profit rises 9% and dividend increased 7%, but sales growth disappoints analysts
RELX PLC shares tumbled 5.3% on Thursday after the London-based information analytics provider reported full-year revenue that fell short of analyst expectations, overshadowing stronger profit growth and an increased dividend payout.
The company behind LexisNexis reported revenue of £9.59 billion for 2025, missing analysts' expectations of £9.65 billion by 1.66%, according to Bloomberg. The shortfall prompted investors to sell the stock, with trading volume surging to 4.42 million shares, significantly above average levels.
Despite the revenue disappointment, RELX's adjusted operating profit rose 9% to £3.34 billion, demonstrating continued operational efficiency and margin expansion. The board responded to the mixed performance by increasing the total dividend by 7% to 67.5 pence per share, up from 63.0 pence in the prior year according to the company's investor materials.
The sharp decline has pushed RELX's stock into technically oversold territory, with the Relative Strength Index (RSI) falling to 12.05, a level that typically signals shares may be due for a rebound. The stock, which trades as an American Depositary Receipt on the NYSE under the ticker RELX, fell to $27.73, marking its worst single-day performance in months and bringing it closer to its 52-week low of $29.09.
RELX's diverse business portfolio, which spans scientific, technical, and legal publishing through brands like LexisNexis, Elsevier, and Reed Exhibitions, has been transitioning toward data analytics and artificial intelligence services. The company's LexisNexis Risk Solutions unit provides critical data and analytics services that the company is actively refining with AI capabilities. Additionally, its Lexis+ AI platform offers generative AI tools for legal professionals, featuring conversational search, intelligent drafting, and document analysis.
The revenue miss comes at a time when RELX has been emphasizing its transformation into an AI-driven analytics company. While the company's profit growth and dividend increase demonstrate underlying business strength, investors appear concerned about the pace of revenue expansion amid a competitive technology landscape.
Analysts maintain a generally positive outlook on the stock, with three buy ratings and no sell or hold recommendations according to recent data. The consensus analyst target price stands at $53.95, suggesting significant upside potential from current levels, though today's earnings miss may prompt some to reassess those targets.
The company's profit margin of 20.2% and operating margin of 30.9% indicate robust business quality, while its price-to-earnings ratio of 20.91 reflects market expectations for continued growth. The dividend increase, which raises the yield to approximately 2.2%, signals management's confidence in cash flow generation despite the revenue headwind.
Looking ahead, investors will be focused on whether RELX can accelerate revenue growth through its AI initiatives and whether today's oversold conditions present a buying opportunity. The company's ability to convert its data assets into recurring subscription revenue through advanced analytics platforms will be critical to regaining market confidence and closing the gap between its current share price and analyst targets.