10-KPeriod: FY2024

MOODYS CORP /DE/ Annual Report, Year Ended Dec 31, 2024

Filed February 14, 2025For Securities:MCO

Summary

Moody's Corporation (MCO) reported a strong 2024, with total revenue increasing by 20% year-over-year, driven by robust growth in both its Moody's Analytics (MA) and Moody's Investors Service (MIS) segments. MIS saw a significant 33% revenue surge, largely due to favorable market conditions in debt capital markets, including tight credit spreads and declining interest rates, which stimulated strong refinancing activity. The MA segment experienced a more moderate 8% revenue growth, supported by sustained demand for its KYC and insurance offerings, along with continued uptake of its data and research products. The company demonstrated solid profitability, with its operating margin improving to 40.6% and adjusted operating margin reaching 48.1%. This expansion was attributed to strong revenue growth outpacing expense increases. Moody's also maintained a proactive approach to capital allocation, repurchasing shares and returning capital to shareholders, while investing in strategic initiatives such as technology and product development. The company is well-positioned to leverage trends like the enablement of Generative AI and the increasing need for integrated risk assessment solutions.

Financial Highlights

55 data points
Beta

Revenue

$7.09B

72.6% Gross Margin

Net Income

$2.06B

29.0% Net Margin

EPS (Diluted)

$11.26

Total Assets

$15.51B

Cash & Equivalents

$2.41B

Free Cash Flow

$2.52B

Financial Statements
Beta
Revenue$7.09B
Cost of Revenue$1.95B
Gross Profit$5.14B
SG&A Expenses$1.74B
Operating Expenses$4.21B
Operating Income$2.88B
Net Income$2.06B
EPS (Basic)$11.32
EPS (Diluted)$11.26
Shares Outstanding (Basic)181.80M
Shares Outstanding (Diluted)182.70M

Key Highlights

  • 1Total revenue surged by 20% to $7.09 billion in 2024, demonstrating broad-based growth across both segments.
  • 2Moody's Investors Service (MIS) revenue grew by an impressive 33% to $3.79 billion, driven by strong debt capital markets activity.
  • 3Moody's Analytics (MA) revenue increased by 8% to $3.30 billion, reflecting consistent demand for its data, research, and solutions.
  • 4Operating margin improved significantly to 40.6%, with an adjusted operating margin of 48.1%, showcasing enhanced profitability.
  • 5Diluted EPS grew by 29% to $11.26, and Adjusted Diluted EPS increased by 26% to $12.47.
  • 6The company actively returned capital to shareholders, with approximately $1.6 billion remaining under its share repurchase program at year-end.
  • 7Moody's is strategically investing in new technologies like Generative AI to enhance its offerings and client value.

Frequently Asked Questions

Moody's reported a 20% increase in total revenue, primarily driven by a robust 33% growth in Moody's Investors Service (MIS), fueled by favorable debt capital markets conditions. Moody's Analytics (MA) also contributed with an 8% revenue increase, supported by steady demand for its subscription-based solutions and data products.

Moody's is actively investing in new products, services, content, and technology, including Generative AI, to meet evolving customer demands. The company believes it is well-positioned to benefit from the capabilities of Gen AI to provide deeper, more integrated perspectives on risk to its customers.

Moody's remains committed to creating shareholder value by investing in its employees and business growth through organic initiatives and acquisitions. Additionally, it returns excess capital to shareholders through dividends and share repurchases, with approximately $1.6 billion of repurchase authority remaining at the end of 2024.

The report mentions several risks including extensive legal and regulatory scrutiny, potential competition from new technologies, pricing pressures, and the need to protect intellectual property. Additionally, the company faces operational risks related to cybersecurity and infrastructure, and its financial performance is tied to the volume of debt securities issued in global capital markets.