Pearson education sales surge thanks to artificial intelligence boost

Pearson has credited its recent investment in artificial intelligence with helping drive sales growth during the most recent quarter.

The educational publisher saw underlying revenue rise 4 percent in the three months ending in September, bringing its total growth for the first nine months of 2024 to 2 percent.

The FTSE 100 group saw double-digit turnover growth in higher education products in the first three quarters of the year, and its AI study tools recorded 5 million student interactions.

While sales at Pearson’s higher education business have stagnated so far this year, they returned to growth in the third quarter with a 4 percent rebound.

The company’s virtual learning arm also posted a 4 percent increase in the July-September period, supported by rising enrollment numbers at its schools.

Pearson said AI applications had been integrated into its virtual schools to give struggling students “step-by-step help to guide them through difficult material.”

Omar Abbosh, CEO of Pearson, said: “We are accelerating our AI capabilities across the business and starting to see the commercial benefit.”

In early October, the company launched a Generative AI Foundations certification for physical testing centers and its online testing platform, OnVUE.

It introduced the qualification to equip people with the skills necessary to work with generative AI technologies, which are increasingly desired among companies.

In addition to this, Pearson said it is “infusing AI” into its English language learning arm by creating Teaching Pal to deliver “personalized lesson content and activities.”

Mark Crouch, market analyst at eToro, said Pearson “has freed itself from what turned out to be an inefficient and outdated business model.”

He added: “The next test for Pearson will be to sustain growth… If Pearson’s Grade A run is to continue, the company will have to show the same incisiveness that the market expects.”

Following the latest trading period, Pearson said it was on track to hit full-year guidance, with adjusted operating profits expected to be around £598m.

It also forecasts earnings of 61.6 pence per share and that organic revenue will be 2.7 per cent higher at constant exchange rates.

pearson actions They rose 3.5 per cent to £11.09 on Friday afternoon, making them one of the best performers on the FTSE 100 index.