Shares in Pearson PLC (LSE:PSON) fell 8% to 992.4p after the group’s trading update, as investors focused less on a strong finish to 2025 and more on what was missing about the year ahead.
Pearson said it ended 2025 with momentum. Underlying sales growth accelerated to 8% in the fourth quarter and reached 4% for the full year. Adjusted operating profit is expected to be £610 million to £615 million, up about 6%, while cash generation remained strong, with more than 95% of profits converted into cash.
That was not enough to reassure the market. Pearson did not give specific guidance for 2026 and confirmed the loss of a US student assessment contract in New Jersey, which will weigh on performance in the first half of the year.
In a market anxious about how artificial intelligence could disrupt education, and specifically, Pearson's revenue trajectory, investors were looking for clearer signals.
The company has pointed to partnerships with Microsoft and IBM, and work with Google Cloud, as evidence of progress. But the update did little to shift concerns that parts of the business are underperforming.
The pressure now moves to the full-year results in February, when investors will want firmer proof that AI is more opportunity than threat.