Summary
Moody's Corporation (MCO) reported a strong third quarter of 2023, with total revenue increasing by 15% year-over-year to $1.47 billion. This growth was driven by robust performance in both its Moody's Analytics (MA) and Moody's Investors Service (MIS) segments. MA's revenue rose 13% to $776 million, fueled by demand across its Decision Solutions, Research & Insights, and Data & Information lines of business, with particular strength in SaaS-based banking and KYC solutions. MIS revenue grew 18% to $696 million, benefiting from increased rated issuance volumes across most LOBs, especially in Corporate Finance and Financial Institutions, compared to a subdued prior year. Net income attributable to Moody's increased by 28% to $389 million, resulting in diluted EPS of $2.11, up from $1.65 in the prior year. The company also demonstrated strong operating leverage, with operating margin expanding by 390 basis points to 36.3%, and Adjusted Operating Margin improving by 560 basis points to 44.6%. For the first nine months of the year, revenue grew 6% to $4.44 billion, and net income increased 12% to $1.27 billion. The company highlighted its continued commitment to returning capital to shareholders through dividends and share repurchases, with $572 million remaining share repurchase authority.
Financial Highlights
54 data points| Revenue | $1.47B |
| Cost of Revenue | $412.00M |
| Gross Profit | $1.06B |
| SG&A Expenses | $403.00M |
| Operating Expenses | $937.00M |
| Operating Income | $535.00M |
| Net Income | $389.00M |
| EPS (Basic) | $2.12 |
| EPS (Diluted) | $2.11 |
| Shares Outstanding (Basic) | 183.30M |
| Shares Outstanding (Diluted) | 184.00M |
Key Highlights
- 1Total revenue increased by 15% year-over-year to $1.47 billion for Q3 2023.
- 2Moody's Analytics (MA) revenue grew 13% to $776 million, driven by strong demand for SaaS-based solutions and KYC offerings.
- 3Moody's Investors Service (MIS) revenue increased 18% to $696 million, benefiting from a rebound in rated issuance volumes.
- 4Net income attributable to Moody's rose 28% to $389 million, with diluted EPS increasing to $2.11 from $1.65.
- 5Operating margin expanded significantly by 390 basis points to 36.3%, reflecting strong revenue growth outpacing expense increases.
- 6For the first nine months of 2023, revenue was up 6% to $4.44 billion, and net income grew 12% to $1.27 billion.
- 7The company maintained a strong free cash flow of $1.48 billion for the first nine months of 2023, underscoring its robust cash generation capabilities.