Message from our CEO

Change is constant. Throughout Nielsen’s 92-year history, a key to our success has been our ability to embrace change and continuously renew ourselves to stay current with changing markets. In 2015, our Watch business saw an accelerated pace of change, largely driven by technology and resulting media fragmentation, leading to shifts in consumers’ viewing behavior across screens and platforms. Our Buy business saw continued globalization, the ongoing rise of e-commerce, client consolidation, and the growing strength of smaller players in the fast-moving consumer goods market. While these changes challenged us, they also helped propel our progress. In fact, the ability of our teams to leverage change as a means for progress is a competitive advantage and one of the keys to our steady, consistent business performance.

Mitch Barns
Chief Executive Officer
Leadership
Team

Even while we embrace change, we stay true to who we are: a global, independent measurement company. Measurement is the idea that Arthur Nielsen founded our company on decades ago. It's often true that a successful company's biggest idea is the one on which it was originally built. There is power in continually refocusing on that original idea. For us, that original idea is measurement. Now more than ever, our clients rely on us to provide high quality, independent, useful measurement of their performance. They put their trust in us every day, and some of them have been putting their trust in us for more than 80 years.

Our clients rely on us not only to measure their performance, but also to help them improve their performance. Measurement tells our clients what happened. But they also want to know why it happened and what next — what they need to do to improve. Our world-class analytics help our clients improve the efficiency and effectiveness of their marketing, advertising, sales, and innovation. To do this with more speed and scale, we're moving toward a platform-based, system-oriented approach that connects our core measurement data to explanatory and predictive analytics, all focused on our clients' key business questions. In short, we're building a performance improvement system that helps them turn Big Data into Smart Data to make it actionable.

Our objective is full coverage — full coverage of the Total Audience in our Watch business and the Total Consumer in our Buy business.

It all starts with high quality, independent measurement of consumers. Our objective is full coverage — full coverage of the Total Audience in our Watch business and the Total Consumer in our Buy business.

In Watch, the market is in the middle of an important transition: Consumers have a growing array of options for viewing their favorite content, and this is fundamentally changing the businesses of television, advertising, and measurement. Nielsen's Total Audience Measurement system enables media companies and advertisers to make the most of the evolving media landscape, providing them with a comprehensive view of their audience for both ads and content, in the form of independent, comparable, de-duplicated measurement across all screens and platforms.

In parallel, our Buy business is focused on Total Consumer Measurement. Our aim is to measure all consumer purchases as buying behavior continues to fragment across channels and segments. As consumers carve a path for a new way to buy — for instance, e-commerce, mobile devices, and subscription models — we too are carving out new ways to measure the full range of consumer purchasing, connecting our high quality panels with big data to provide the accuracy, granularity, and efficiency that our clients require.

We now measure media in 47 countries that together represent approximately 80% of global advertising spending.

While the United States is our largest market, we are a global company. In our Buy business, we cover 106 countries representing more than 90% of the world's population. This is a significant competitive advantage because only Nielsen is able to provide multinational corporations with a global view of their market share. Local and regional players are also important growth clients, particularly in China and a range of other markets across Asia, Africa, and Latin America.

We also have a strong and growing global presence in our Watch business. We now measure media in 47 countries that together represent approximately 80% of global advertising spending. Our digital audience measurement capability is a rapidly growing part of this footprint, and at the end of 2015 our Digital Ad Ratings metric covered 17 countries representing about 85% of global digital advertising spending. Looking ahead, you'll see us enter additional countries as we extend our Total Audience Measurement system worldwide. Media fragmentation is a global phenomenon; whether in the U.S., Southeast Asia, or elsewhere, media buyers and sellers need a complete picture of the audience across all screens and platforms, and we'll be there to provide it.

2015 HIGHLIGHTS

2015 was a banner year for Nielsen. On a constant currency basis, we posted another year of mid-single-digit revenue growth, solid margin expansion, and record free cash flow, despite the volatile economic backdrop. Steady, consistent, and resilient: That's who we are.

We continued to leverage our measurement and analytics to help our clients make the important connections that drive their business. Our platform-based, system-oriented approach is nicely in sync with our clients' evolving needs related to their marketing, advertising, sales, and innovation activities. As a result, it helped drive a number of wins across our Watch and Buy segments in 2015.

Total Audience Measurement is perfectly aligned with what the market needs, and Nielsen is the only company that can provide it.

In our Watch segment, the market's need for a complete view of the consumer is greater than ever. In line with that, our top priority and biggest accomplishment in 2015 was Total Audience Measurement, our comprehensive system that provides independent, comparable, currency-grade ratings for both content and ads, across all screens and platforms. Total Audience Measurement is perfectly aligned with what the market needs, and Nielsen is the only company that can provide it. Our Watch segment's revenues increased nearly 5% on a constant currency basis, including a 6.4% increase in Audience Measurement of video and text as clients continue to adopt our expanded measurement offerings.

Our Buy segment continued to strengthen and expand in 2015, with revenues up 5% on a constant currency basis, led by Emerging Markets, which grew 8.5%, despite volatility in a number of economies. While that volatility is real, it doesn't change our investment thesis, supported by the strong long-term tailwinds of population growth, a growing middle class, and ongoing urbanization. All of these factors drive a need for more measurement coverage and granularity, which, in turn, drive growth for our business.

In Developed Markets, we continued to win new clients in the relatively faster-growing mid-tier and smaller client segments, adding to our historical strength with the big global players. Our teams also made outstanding progress with retailers, one of our top priorities. Retailers are long-time data partners for Nielsen, but they also have a growing need for our analytics to help with their advertising, marketing, and merchandising decisions, both offline and online. We're now working with over 100 e-commerce retailer clients worldwide.

Our Marketing Effectiveness practice saw another year of double-digit growth as we integrated our Watch and Buy assets to drive better marketing and advertising ROI. This is important to both buyers and sellers of media, and it appeals to not only our core consumer packaged goods and media clients, but also advertisers in a range of other verticals, including automotive, financial services, telecom, and retailing.

In total in 2015, we returned approximately $1.1 billion to shareholders.

In March 2015, we completed the acquisition of eXelate, a leading provider of data and technology to facilitate programmatic advertising, bringing precision, speed, and efficiency to both buyers and sellers. As part of Nielsen, eXelate's assets and capabilities also play an important role in the Nielsen Marketing Cloud, our enterprise marketing platform that connects and integrates a wide range of datasets, leveraged through apps that help our clients improve the precision and ROI of advertising.

We generated record free cash flow of more than $800 million in 2015, up 18% compared to the prior year. Our strong free cash flow enables us to invest consistently in our key growth initiatives while also delivering incremental value for our shareholders via a growing dividend and our ongoing share repurchase program. In total in 2015, we returned approximately $1.1 billion to shareholders. In December 2015, we announced an additional share repurchase authorization of $500 million, bringing the total remaining authorization to more than $850 million as of year-end 2015.

We were granted a record number of patents, ranking us among the top 300 companies in the U.S.

2015 was also an impressive year for innovation all across our company. We were granted a record number of patents, ranking us among the top 300 companies in the United States. Our Nielsen Innovate incubator near Tel Aviv thrived, with 15 technology-based start-ups working on promising new capabilities that could become part of our future product portfolio. Our innovation lab in Silicon Valley, created in collaboration with Stanford, showed enviable creativity and resource efficiency; this successful model has now been replicated in Singapore, in partnership with the government there. Our acquisitions of Innerscope and eXelate and our partnerships with leading firms like Adobe, Alibaba, Catalina, Intage, Tencent, and Facebook all added significantly to our innovation resume. And of course, our Nielsen teams innovate impressively every day all around the world on our products, processes, and systems.

As a result of our ongoing investments in leadership development and the strong engagement and dedication of our teams, we received external recognition from Chief Executive Magazine as one of their Top 40 Public Companies for Leaders, as well as from DiversityInc magazine as one of their Top 50 Companies for Diversity — both for the second year in a row. Our technology team won an Emmy Award for their innovative work on the watermarking technology used in our audience measurement system. Our Investor Relations team was rated #1 by Wall Street analysts among 86 companies in the business, education, and professional services segment. And in several markets around the world, Nielsen was recognized as agency of the year. Each of these is a remarkable achievement; taken all together, they reflect the overall progress and strength of our company.

Unprecedented Global Footprint

OUR FUTURE

Our systems will grow more connected to our clients’ systems. our interests will grow ever more connected to the markets and clients we serve, the partners we collaborate with, and the communities we operate in.

As we look to the future, three major trends will guide our investments and drive our growth in 2016 and beyond.

The first is the well-known trend of audience fragmentation. We'll continue to follow the consumer, to measure the audience in a comparable manner across all screens and platforms. Our focus in 2016 is on continuing to gain broad marketplace adoption of our Total Audience Measurement system by both buyers and sellers of media, while helping the video market move to an updated, broader definition of the currency.

The second trend is that consumers are reacting to ads and brands differently, and they are buying in new ways and across new channels. Advertisers want to harness the power of big data to enable them to market to those changing consumers with greater precision and with proven ROI on their marketing spend. This is what our Nielsen Marketing Cloud enables.

The third trend is that the information and analytics needs of our clients are growing and changing. Clients need answers to the fundamental questions of What happened, why it happened, and what next. They want data and systems that answer those questions and help them to act, and they want it all with more precision, speed, and efficiency. This is the basis for our investment in a performance improvement system that aligns and connects the wide array of measurement and analytics data we provide to our clients in the world of fast-moving consumer goods.

In all three areas, our platform-oriented, system-based approach provides scalability, flexibility, and speed, especially when our systems connect directly to our clients' systems. And because we have the essential core data, no one is better positioned than Nielsen.

This ties into a common theme that you will hear us talk about more in 2016 and beyond: connected. Driven by the steadily growing role of technology, systems, and platforms in our business, our products will grow more connected to one another. Our systems will grow more connected to our clients' systems. Our interests will grow ever more connected to the markets and clients we serve, the partners we collaborate with, and the communities we operate in. And our colleagues will continue to grow more connected to each other by a culture of collaboration, innovation, and shared sense of purpose.

Through our global corporate social responsibility program, Nielsen Cares, we act on our commitment to make an uncommon impact in the communities where we live and work. Our associates leverage their talent and experience to create shared value in our communities through skills-based volunteering and in-kind giving projects focused on our priority cause areas of Hunger & Nutrition, Education, Diversity & Inclusion, and Technology. As part of our Data for Good initiative, we are connecting with the United Nations Foundation, Salesforce.com, and Accenture to support Project 8 to help forecast international development needs, and we are connecting our data to academia, via the University of Chicago's Kilts Center for Marketing, in support of academic and social research.

We also take this idea of connection a step further by committing to help our Nielsen colleagues around the world, supported by our newly established Nielsen Global Support Fund. Our employees all over the world are contributing to the fund, which is then available to any employee, anywhere in the world, during times of disaster or personal hardship.

•••••••••

We are a company with a clear sense of who we are, where we play, where we are going, and why we do what we do. We are a company connected with purpose and meaning.

In 2016, we look forward with confidence that our business will continue its steady and consistent performance, delivering value to our clients and our shareholders. We have an outstanding brand, a rich and storied history, a powerful business model, great data, and world-class talent. We have better technology available to us every day to more fully realize the potential of what we do, continuously making exciting new things possible. In short, the world is aligned in our favor. There has never been a better time to do what we do, and we've never been better positioned to do it.

Thank you for your investment and trust in our company.

MITCH BARNS
CHIEF EXECUTIVE OFFICER

Leadership Team

From left to right:
Eric Dale Chief Legal Officer
Steve Hasker Global President and Chief Operating Officer
Jamere Jackson Chief Financial Officer
Mitch barns Chief Executive Officer
JAMES POWELL Chief Technology Officer
Mary Liz Finn Chief Human Resources Officer
Rick Kash Vice Chair
John Tavolieri Global President, Operations
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