Willis Towers Watson surprised many by reporting better-than-expected profits for the second quarter, boosted by a strong risk and brokerage segment. The company posted an adjusted net income of $285 million, or $2.86 per share, for the quarter ending June 30. This is up from $247 million, or $2.39 per share, recorded a year earlier. Analysts had predicted earnings of $2.60 per share, so the results were a solid beat.
Even though insurance premiums are rising, businesses are spending more to protect themselves. The increasing number and severity of extreme weather events have made financial protection a top priority for many companies. This helped drive revenue growth in Willis Towers Watson’s risk and broking unit, which saw a 7% increase to $1.05 billion. This unit helps clients manage risk and secure insurance deals, and demand is also growing due to worries about a possible trade war.
On the other hand, the company’s health, wealth, and career division, which is its biggest segment, saw revenue drop to $1.18 billion from $1.26 billion a year ago. This decline mainly came from the sale of TRANZACT. Despite these shifts, total revenue for the quarter remained steady at $2.26 billion.
Shares of Willis Towers Watson have fallen roughly 3.6% this year. This compares to smaller declines for some competitors, like Aon, which dropped 1.1%, and Marsh & McLennan, which lost 5.6%.
Overall, Willis Towers Watson’s second-quarter results show that strong demand for risk management and insurance services is helping the company stay on solid ground, even with some setbacks elsewhere in its business.