Total Revenue

+4.5% " "

Total Revenue’s modest increase was driven by robust growth in Moody’s Analytics segments that more than offset a nearly flat Moody’s Investors Service performance, coupled with strong international demand; this builds on prior period trends of accelerated Analytics revenue and subdued MIS activity. " "

Moody's Analytics Revenue

+10.7% " " "

Moody’s Analytics revenue surged due to expanded subscription-based solutions and recurring revenue streams—especially in Decision Solutions, Research & Insights, and Data & Information—which continued prior momentum from Q2 2024 with enhanced product offerings and customer retention. " " "

Decision Solutions

+12.8% " " "

Decision Solutions grew strongly as a result of increased demand for KYC, banking, and insurance solutions supported by new product investments and a higher recurring revenue base, further advancing the growth experienced in the previous period. " " "

Research and Insights Revenue

+10.2% " " "

Research and Insights revenue increased owing to an improved sales pipeline and enhancements in credit research products such as Research Assistant, building on the credit research strengths from Q2 2024 and leading to stronger market uptake. " " "

Data and Information Revenue

+7.6% " " "

Data and Information revenue’s rise reflects increased demand for ratings data and company feeds along with better pricing and customer retention, following the positive pricing and sales dynamics seen in Q2 2024. " " "

Moody's Investors Service

–0.5% " " "

MIS revenue remained nearly flat with a slight decline likely due to softer issuance activity and market uncertainties, continuing a trend where stable operational performance was achieved despite variable market conditions from the previous period. " " "

Non-U.S. Revenue

+7.5% " " "

Robust international performance drove a 7.5% increase in Non-U.S. revenue, as growth in regions like EMEA and Asia-Pacific—fueled by increased issuance activity and strong demand for Moody’s products—further built on previous period gains outside the U.S.. " " "

U.S. Revenue

+1.8% " "

Modest U.S. revenue gains were achieved through steady transaction activity and smaller-scale growth in key segments, reflecting a steadier U.S. market compared to the stronger international expansion seen in Q2 2024. " "

MIS Revenue Growth

FY 2025

flat to mid single-digit percent "

low to mid single-digit percent "

raised

MCO Adjusted Operating Margin

FY 2025

49% to 50% " "

49% to 50% "

no change

MIS Adjusted Operating Margin

FY 2025

61% to 62% " "

61% to 62% "

no change

MA Adjusted Operating Margin

FY 2025

mid‑30s range "

32% to 33% "

lowered

Adjusted Diluted EPS

FY 2025

$13.25 to $14 (9% growth) "

10% growth "

raised

MA Revenue Growth

FY 2025

high single‑digit percent "

high single‑digit percent "

no change

MA ARR Growth

FY 2025

high single‑digit percent "

high single‑digit percent "

no change

Incentive Compensation

FY 2025

$400M–$425M full‑year ($100M/quarter) "

$100M per remaining quarter "

no change

Private Credit Growth

In Q4 2024, executives highlighted Moody’s active involvement in rating nearly 400 private credit transactions and a 30% share in first‐time FIG mandates. " " In Q3 2024, the focus was on revenue contributions from BDCs, fund finance and structured finance along with estimates of large growth potential. " "

In Q2 2025, Moody’s reported 75% YoY revenue growth in private credit, an increase of 50% in first‐time mandates, and strategic deals like a £1.5 billion transaction—emphasizing its growing prominence. " " " "

**Consistent and accelerating growth with increased strategic focus and higher profile deals. " " " " **

Regulatory Risks

Q4 2024 discussions centered on enhanced internal controls and risk management initiatives. " " In Q3 2024, although regulatory issues were mentioned only in relation to a 50 basis point headwind from a settlement " , the focus was less pronounced.

Q2 2025 saw explicit reference to regulatory risks, notably a letter from Senator Warren and emphasis on rigorous, regulated processes in private credit methodologies. "

**An increased focus on transparency and risk oversight compared to earlier periods. " " **

AI and GenAI Integration

Q4 2024 featured product launches such as Research Assistant and “Navigators,” highlighting efficiency gains and higher customer engagement. " " " Q3 2024 introduced Moody’s first AI-enabled products with strong pipeline indicators despite slower adoption by larger institutions. " " "

Q2 2025 reported accelerated GenAI rollout with 40% of products enabled, stronger customer spend ($200 million ARR growth pace), and a strategic partnership with Microsoft. " "

**An accelerated and deeper integration of AI capabilities, with enhanced product adoption and strategic partnerships. " " **

Banking Pipeline and ARR Performance Divergence

Q3 2024 discussions pointed to a divergence with a 7% ARR growth versus higher growth in lending products and a strong renewal pipeline " " ; Q4 2024 emphasized the revenue/ARR gap amid platform transitions. "

In Q2 2025, Moody’s highlighted a 15% increase in banking pipeline and detailed strong growth in flagship products like Credit Lens, with continued divergence between revenue and ARR across product lines. " "

**Steady divergence remains with notable improvements in pipeline strength and lending performance. " " **

Moody’s Analytics Demand Versus Transactional Revenue Challenges

Q3 2024 noted robust growth in recurring revenue (up 9–10%) despite a double-digit decline in low‐margin transactional revenue. " " Q4 2024 reiterated strong demand and a headwind from declining transactional revenue due to on-premise legacy platforms. " "

Q2 2025 reported an 11% revenue growth in Moody’s Analytics with 8–12% recurring revenue growth, maintaining strong demand while managing transactional revenue challenges. "

**Stable recurring revenue demand persists despite ongoing transactional headwinds, reflecting consistent overall sentiment. " " **

Favorable Issuance Conditions and M&A Activity Assumptions

In Q3 2024, Moody’s cited tight spreads, low spec-grade default rates, and modest pick-up in M&A activity. " Q4 2024 assumed constructive market conditions with aggressive M&A assumptions (up to 50% increase) driving favorable revenue mix. " " "

Q2 2025 described a favorable issuance environment in May–June, a mix supported by stronger spreads and less adverse refinancing issues, while expecting 15% growth in announced M&A activity with flat rated issuance. " " "

**A shift toward more favorable issuance conditions coupled with moderate M&A expectations, indicating cautious optimism. " " **

KYC and Insurance Segment Dynamics

In Q3 2024, KYC grew 14–19% and insurance ARR grew 13% with initiatives such as new product launches and integrations like RMS and Praedicat. " " " Q4 2024 emphasized 17% KYC growth and 12% insurance ARR growth driven by strong demand for catastrophe modeling and enhanced platforms. " " "

Q2 2025 reported KYC ARR growth of 15% (a slight moderation due to strategic partnership terminations) and insurance ARR growth of 9% (impacted by an account loss but supported by a robust new business pipeline and positive integration of Cape Analytics). " " "

**Steady growth continues with strong cross‐sell and pipeline opportunities, while integration of new capabilities supports future potential despite minor deceleration. " " **

Operational Efficiency and Margin Expansion Through Automation Investments

Q4 2024 detailed significant cost savings and margin expansion targets via efficiency programs and automation investments (e.g., increased operating margins by 420 bps, potential 200–250 million cost savings). " " " " Q3 2024 discussed technology investments that indirectly supported margin expansion and operational discipline. "

Q2 2025 emphasized the deployment of productivity tools and GenAI Copilot usage (80% in engineering), with Moody’s Analytics expanding operating margins by 360 bps as a direct result of automation and cost discipline. "

**An ongoing emphasis on automation and efficiency continues to drive margin expansion, with an increased use of GenAI tools in current operations. " " **

Earnings Guidance and Incentive Compensation Pressures

Q3 2024 raised full-year adjusted diluted EPS guidance to $11.90–$12.10 (up 21%) and noted higher quarterly incentive compensation accruals ($150 million in Q3), reflecting strong ratings revenue. " " " Q4 2024 provided guidance with high single-digit revenue growth for MIS and detail on incentive compensation adjustments, with 2024 totals around $507 million. " " "

Q2 2025 updated full-year guidance indicating low to mid-single-digit revenue shifts (with a noted Q3 dip and Q4 rebound) and maintained incentive compensation around $100 million per remaining quarter as part of an efficiency program offset by cost savings. " "

**Guidance remains stable with careful management of incentive compensation pressures; slight adjustments in near-term revenue outlook are balanced by strong cost discipline. " " **