LONDON - Clarivate Plc (NYSE:CLVT) reported third quarter results that fell short of analyst expectations on the top line, sending shares down sharply, by 8.5%, in premarket trading Wednesday.
The provider of analytics and intelligence services said revenue for the quarter ended September 30 declined 3.9% year-over-year to $622.2 million, missing the consensus estimate of $640.49 million. Adjusted earnings per share came in at $0.19, in line with analyst forecasts.
Organic revenue decreased 2.6% compared to the prior year period, as growth in subscription revenues was offset by declines in re-occurring and transactional revenues.
"Clarivate's third quarter results are unsatisfactory and reflect an overdependency on fluctuating transactional revenue and areas of the business with low margin characteristics," said CEO Matti Shem Tov.
The company removed its full-year 2024 financial outlook, citing the recent CEO transition and ongoing work on its Value Creation Plan.
For the quarter, adjusted EBITDA fell 6% to $264.4 million, while adjusted EBITDA margin contracted 100 basis points to 42.5%.
Looking ahead, Shem Tov said the company will focus on increasing subscription and re-occurring revenue, improving sales execution, accelerating innovation and rationalizing its portfolio of solutions.
"We will leverage Clarivate's strong foundation, unique product offerings and talented team to take the necessary actions to improve predictability and drive profitable growth," he added.
The company ended the quarter with cash and cash equivalents of $388.5 million, up from $370.7 million at the end of 2023.
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