Thomson Reuters Corp. (TRI) on Thursday reported a leap in first-quarter revenue and earnings as the purchase of Reuters last year added to results, but the company's businesses in the financial world continued to struggle amid the economic turmoil.

Shares of the information giant dropped 5.5% to $29.86 in recent trading as it reiterated its full-year outlook, but showed results in its markets division worsened from the prior quarter as investment clients and financial institutions pared costs and workers, lowering demand for services. Sales in the division, which makes up roughly 60% of overall revenue, were down 7%, a steeper fall than the fourth quarter, while profits were flat, compared to a 7% gain in the previous quarter. Asia led revenue growth with a 5% rise while the Americas fell 4%.

Still, Thomson Reuters said it had been expecting the weakness, and pointed out that excluding currency exchanges, revenue would have edged up 0.4% in the quarter.

On its conference call with investors, the company also said a more important result was that recurring subscription revenue was up 2%, calling the number the "engine." High-margin transaction revenue tumbled 12% and dragged down the segment, but the company said that the subscription figure showed the slope of the decline was not that steep.

"We are pleased that the large engine ... has shown a shallower trend in the recession and therefore gives us confidence and some of the visibility," Chief Executive Thomas Glocer said. "We still feel positive for the year."

Thomson's profit for the quarter rose to $228 million from $194 million. But per-share earnings fell to 27 cents from 30 cents as shares outstanding jumped 30% on the merger. Excluding acquisition and other costs, profit fell to 40 cents from 44 cents, but was better than the 35 cents analysts had been expecting, according to a Thomson Reuters survey.

Revenue jumped 70% to $3.12 billion, short of the $3.18 billion analysts were predicting.

The company's professional business recorded 2% revenue and profit growth amid gains in online, software and services revenue. Excluding currency exchanges, the revenue growth was 5%.

For Thomson Reuters' legal business, which includes the Westlaw research service, revenue slipped 1% as law firms cut headcounts and reduced spending, and fewer people took the bar exam because lending for law students has all but dried up, Thomson said. Again, excluding currency exchanges the revenue would have been positive, up 3%, and profits rose 3%.

PiperJaffray analyst Peter Appert said the quarter was in line with his expectations, and that he didn't really see any surprises.

"They are navigating through a very challenging macro environment and posting very respectable operating results," he said.

Looking ahead, Thomson Reuters affirmed its full-year guidance, though it added it will still be tough going. It said it expects its legal division results to be positive for the year, despite a majority of law firms planning to cut spending, and believed 2010 would be better for the legal business.

In the markets division, transaction revenue cannot be predicted and the company said it couldn't be "clairvoyant" though it continues to be confident the company as a whole will grow.

-By David Benoit and Mike Barris, Dow Jones Newswires; 201-938-2472; david.benoit@dowjones.com