Pearson’s virtual schools slow amid tech drive for publisher
Educational publisher Pearson has reported a 20 per cent slowdown in its virtual learning unit in its full financial year as it attempts to pivot to become a tech-first company.
The company, which is embracing AI to modernise its educational products, said the slowed growth was mainly because of an 87 per cent decrease in its Online Program Management (OPM) arm. Pearson sold OPM to private equity firm Regent last year.
Shares in the FTSE 100 company dipped two per cent on Wednesday morning following the market open.
Sales in the Virtual Schools business declined two per cent in the full year, although they were up five per cent in the fourth quarter of 2023.
Pearson’s international course-ware local publishing businesses, which the publisher is winding down, slowed by 125 per cent in the fourth quarter and 74 per cent in the full year.
Excluding both this and the OPM unit, sales grew five per cent in 2023, led by a 30 per cent uptick in English Language Learning sales.
The group said it achieved an adjusted operating profit of £570-575m for the full financial year, up 30 per cent compared to 2022, on an underlying basis.
Last year, investors got excited when Pearson announced the introduction of AI across its products. On Wednesday, it said it is “encouraged by how students are engaging with our generative AI study tools”.
Pearson plans to expand its AI offering by autumn 2024.