CLVT

Core Value Creation Plan Progress (Launched late 2024)

• Business model optimization: Meaningfully shifted the company's revenue mix toward recurring subscription-based models, improving revenue visibility, predictability, and quality
• Go-to-market improvement: Sharpened sales and customer service strategies, building stronger momentum for the recurring business and a stronger foundation for future bookings
• AI innovation acceleration: Built a robust, growing portfolio of new AI-powered products that deepen customer value and reinforce competitive positioning
• Portfolio rationalization: Executed deliberate divestments of non-core assets to concentrate capital and management focus on the company's two core core growth markets

AI Product Milestones

• Launched Web of Science Research Intelligence globally, an AI-native platform for research strategy, impact, and funding built on publisher-neutral, fully provenance-d Web of Science data. It has already generated a multi-million dollar ACV pipeline and secured 77 paying customers.
• Introduced Nexus Connect, an AI-native gateway that integrates Clarivate's proprietary data with consumer AI chat agents like ChatGPT, embedding the company's intelligence into existing academic research workflows to create new revenue streams
• Announced development of IP1, a unified AI platform combining purpose-built AI agents with private, trusted IP data to simplify complex workflows across the entire IP lifecycle, developed in collaboration with leading corporate IP teams and law firms
• RiskMark, an AI-powered trademark risk assessment tool, won its second major industry award (2026 CODI Award for Best AI Tool for Lawyers), validating market demand for the company's AI IP solutions

Strategic Divestiture of LS&H

• Announced an agreement to sell the LS&H segment to Alteros in early July 2026, as part of the company's portfolio rationalization effort
• Pro forma for the transaction, recurring revenue share will increase from 89% to ~92%, improving revenue predictability, customer retention, and cash flow visibility
• Net proceeds from the sale will be used to reduce outstanding debt, extending average debt maturity, strengthening the balance sheet, and increasing financial flexibility for future shareholder value creation

Leadership Update

• Appointed Michael Easton, current Chief Accounting Officer, as the next Chief Financial Officer effective August 8, 2026. Easton has 25+ years of finance and leadership experience and deep expertise in Clarivate's operations
• Outgoing CFO Jonathan Collins oversaw integration of three major acquisitions that formed modern Clarivate, established the current segment operating structure, and transformed the finance organization
• Added Simon Webster as President of the IP segment; Webster is a 20+ year veteran of the global IP ecosystem, and previously served as CEO of CPA Global (acquired by Clarivate in 2020)

• Full-year 2026 guidance ranges remain unchanged from prior updates, with refinements to the expected positioning within the ranges to reflect the upcoming LS&H divestiture, which is expected to close by the end of 2026
• Full-year organic ACV growth is expected to land in the lower half of the prior range, with A&G approaching 3% growth and IP returning to growth by year end, blending to a full-year organic ACV growth rate of ~2.25%. Recurring organic full-year growth is still expected to be ~1.5%, near the midpoint of the prior range, which represents a 1pp improvement over 2025
• Full-year total revenue is expected to land just below the midpoint of the prior range at $2.35 billion, driven entirely by foreign exchange impacts. Recurring organic revenue share is expected to hit ~92%, above the high end of the original guidance range, following the classification of LS&H as discontinued operations
• Adjusted EBITDA is still expected to land just over $1 billion, representing a profit margin of nearly 43% at the midpoint of the range. Adjusted diluted EPS is still expected to grow ~9% year-over-year to 75 cents at the midpoint
• Free cash flow is now expected to land at the low end of the prior range, due to one-time transaction costs for the LS&H divestiture and incremental restructuring costs that will deliver full cost savings in 2027
• Adjusted EBITDA margin is still expected to expand ~200 basis points year-over-year, driven by returning organic growth, continued cost discipline, and completion of strategic disposals. The 200bps expansion comes equally from $25 million of cost savings to offset inflation and $25 million of profit improvement from inorganic disposals
• Management expects sequential improvement in recurring organic growth in the second half of 2026, with continued growth momentum building into 2027. The company expects organic growth acceleration for both the A&G and IP segments in 2027
• Full-year 2026 debt reduction is expected to total ~$900 million, combining second half free cash flow and net LS&H divestiture proceeds to retire near-term debt maturities

1. Academia and Government (A&G): Delivered 2% organic Annual Contract Value (ACV) growth. New AI product launches have already built a multi-million dollar ACV pipeline with 77 secured paying customers, supporting incremental growth momentum. This segment is expected to approach 3% organic ACV growth by the end of 2026.
2. Life Sciences and Health (LS&H): Delivered 2% organic ACV growth in Q2 2026. This segment has a higher share of transactional revenue compared to other segments, which contributed to year-over-year transactional revenue declines in the quarter. The segment has entered an agreement to be sold to Alteros, and will be classified as discontinued operations following transaction close.
3. Intellectual Property (IP): Recurring organic revenue improved to flat in Q2 2026, following prior periods of contraction. Management expects this segment to return to positive growth by the end of 2026, supported by new AI innovation and new segment leadership.

Consolidated Q2 2026 total revenue was $587 million, with first half 2026 total revenue reaching nearly $1.2 billion. Consolidated adjusted diluted EPS was 19 cents in Q2 2026, up 1 cent year-over-year, and 38 cents for the first half, representing a 19% year-over-year increase. Adjusted EBITDA margin was maintained at prior year levels despite a total revenue decline, and expanded by nearly 1 full percentage point in the first half of 2026.

• Forward-looking statements about growth acceleration, product adoption, and transaction close timing are subject to inherent risks and uncertainties that could cause actual results to differ materially from expectations, as detailed in Clarivate's SEC filings
• Foreign exchange rate volatility creates top and bottom line headwinds; appreciation of non-USD currencies against the U.S. dollar created a $7 million adjusted EBITDA headwind in Q2 2026
• Transactional revenue remains lumpy quarter-to-quarter, creating short-term pressure on top line growth
• New AI product adoption and market acceptance is still in early stages, and long-term revenue contributions from new products are not yet guaranteed
• The LS&H divestiture is subject to customary regulatory and closing approvals, and there is uncertainty around the final closing timing
• The implementation of a new corporate tax in Jersey is expected to increase full-year cash taxes by $5 to $10 million compared to 2025

Q: Scott Wurzel (Wolf Research) asked if the observed timing impacts on Q2 2026 renewal growth were caused by longer sales cycles, and if these impacts would persist into the second half of 2026. / A: Jonathan Collins confirmed that Q2 results were in line with management's original expectations, and the pullback in recurring organic growth was anticipated, not caused by elongated sales cycles. ACV growth has improved steadily over six quarters, with strong renewal rates and good visibility for new product conversions. A&G already has 75% of full-year 2026 revenue booked, matching last year's pace at this point, and management remains confident that organic growth will inflect upward in the second half as expected.

Q: Tony Kaplan (Morgan Stanley) asked about customer adoption trends for MCP-enabled embedded data offerings, how MCP contributes to growth, and whether MCP is priced separately or included in existing subscriptions. / A: Mati Shem Tov explained that MCP capabilities are part of the company's broader 19-initiative AI innovation roadmap, alongside standalone new AI products. Larger enterprise customers generally prefer to embed Clarivate's proprietary data via MCP into their internal corporate AI platforms, while smaller customers typically use Clarivate's AI products directly on the company's own platform. New AI products like Nexus Connect, Web of Science Research Intelligence, and IP1 represent separate, incremental new revenue streams, with dedicated AI-specific pricing.

Q: Manav Patnak (Barclays) asked for additional detail on the expected 100 basis point sequential organic growth acceleration, including segment-specific outlooks and expectations for 2027 growth. / A: Mati Shem Tov stated management is optimistic about growth acceleration in both core segments. IP returned to flat recurring organic growth in Q2, and new segment leadership from Simon Webster combined with new AI innovation like IP1 and RiskMark positions IP to return to growth faster than prior forecasts. A&G is already seeing strong momentum from new AI product launches, with a solid multi-million dollar pipeline of new business, so both segments will contribute to acceleration in the second half of 2026 and into 2027.

Q: George Tong (Goldman Sachs) asked whether the ongoing transactional revenue declines stem from industry-wide factors or idiosyncratic execution issues, and when performance will improve. / A: Mati Shem Tov explained that transactional declines are intentional, part of the company's strategic shift to a subscription-first model; the company has already divested pure-play transactional non-core businesses, and is working to convert remaining legacy transactional revenue to subscriptions. Jonathan Collins added that LS&H (which has a higher transactional share) saw temporary Q2 headwinds, and overall transactional revenue is lumpy quarter-to-quarter due to lapping large prior-year deals. Management expects transactional declines to moderate in the second half, and full-year guidance already contemplates a slight full-year transactional decline.