Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

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Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

This discussion and analysis of financial condition and results of operations should be read in conjunction with the Moody’s Corporation consolidated financial statements and notes thereto included elsewhere in this quarterly report on Form 10–Q.

This Management’s Discussion and Analysis of Financial Condition and Results of Operations contains Forward-Looking Statements. See “Forward-Looking Statements” commencing on page 81 for a discussion of uncertainties, risks and other factors associated with these statements.

THE COMPANY

In a world shaped by increasingly interconnected risks, Moody's data, insights, and innovative technologies help customers develop a holistic view of their world and unlock opportunities. With a rich history of experience in global markets and a diverse workforce of approximately 16,000 across more than 40 countries, Moody's gives customers the comprehensive perspective needed to act with confidence and thrive. Moody’s has two reportable segments: MA and MIS.



Moody's Analytics			Moody's Investors Service

MA provides data, intelligence and analytical tools to help business and financial leaders make confident decisions.			For more than 115 years, MIS has been a leading provider of credit ratings, research, and risk analysis helping businesses, governments, and other entities around the globe.

MA is comprised of: i) a premier fixed income and economic research business (Research & Insights); ii) a data business powered by the world’s largest database on companies and credit (Data & Information); and iii) three cloud-based subscription businesses serving banking, insurance and KYC workflows (Decision Solutions).

MIS publishes credit ratings and provides assessment services on a wide range of debt obligations, programs and facilities, and the entities that issue such obligations in markets worldwide, including various corporate, financial institution and governmental obligations, and structured finance securities.

Critical Accounting Estimates

Moody’s discussion and analysis of its financial condition and results of operations are based on the Company’s consolidated financial statements, which have been prepared in accordance with GAAP. The preparation of these financial statements requires Moody’s to make estimates and judgments that affect reported amounts of assets and liabilities and related disclosures of contingent assets and liabilities at the dates of the financial statements and revenue and expenses during the reporting periods. These estimates are based on historical experience and on other assumptions that are believed to be reasonable under the circumstances. On an ongoing basis, Moody’s evaluates its estimates, including those related to revenue recognition, contingencies, goodwill and acquired intangible assets, pension and other retirement benefits, investments in non-consolidated affiliates, and income taxes. Actual results may differ from these estimates under different assumptions or conditions. Item 7, MD&A, in the Company’s annual report on Form 10-K for the year ended December 31, 2024, includes descriptions of some of the judgments that Moody’s makes in applying its accounting estimates in these areas. Since the date of the annual report on Form 10-K, there have been no material changes to the Company’s critical accounting estimates disclosures other than the update below relating to the Company's annual assessment of goodwill for impairment.

Goodwill

This update should be read in conjunction with the critical accounting estimate disclosures made in the Company's Form 10-K for the year ended December 31, 2024.

Moody’s evaluates its goodwill for impairment at the reporting unit level, defined as an operating segment (i.e., MA and MIS), or one level below an operating segment (i.e., a component of an operating segment). Prior to 2025, MA's reporting unit structure consisted of two reporting units comprised of businesses that offer: i) data and data-driven analytical solutions; and ii) risk-management software, workflow and CRE solutions. During the first quarter of 2025, MA reorganized its management and reporting structure, which affected the composition of the reporting units within the MA reportable segment. As a result, MA's reporting unit structure now consists of one reporting unit, which is consistent with the segment's current management structure and operating model. This reorganization did not result in a change to the Company's reportable segments. The Company performed assessments of the reporting units impacted by the reorganization immediately before and after the reorganization became effective and determined that it was not more likely than not that the fair value of any reporting unit was less than its carrying amount.

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Subsequent to the aforementioned reorganization of the MA reporting unit structure, the Company now has three reporting units: two within the Company’s ratings business (one for the ICRA business and one that encompasses all of Moody’s other ratings operations) and one reporting unit within MA.

Reportable Segments

The Company is organized into two reportable segments as of June 30, 2025: MA and MIS, which are more fully described in the section entitled “The Company” above and in Note 17 to the consolidated financial statements.

RESULTS OF OPERATIONS

The following footnotes are applicable throughout the discussion of the Company's results of operations:

(1) Refer to the section entitled "Non-GAAP Financial Measures" of this MD&A for the definition and methodology that the Company utilizes to calculate this metric.

(2) Refer to the section entitled "Key Performance Metrics" of this MD&A for the definition and methodology that the Company utilizes to calculate this metric.

Three months ended June 30, 2025 compared with three months ended June 30, 2024

Executive Summary

The following table provides an executive summary of key operating results for the quarter ended June 30, 2025. Following this executive summary is a more detailed discussion of the Company’s operating results as well as a discussion of the operating results of the Company’s reportable segments.

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	Three Months Ended June 30,
Financial measure:	2025			2024			% Change Favorable (Unfavorable)		Insight and Key Drivers of Change Compared to Prior Year
Moody's total revenue	$	1,898		$	1,817		4	%	— reflects revenue growth in both segments
MA external revenue	$	888		$	802		11	%	— sustained demand for KYC and insurance offerings and SaaS-based banking solutions; — continued demand for credit research product offerings; and — ongoing strong demand for ratings data feeds — Organic constant currency revenue(1) growth was 7% and ARR(2) increased 8%
MIS external revenue	$	1,010		$	1,015		—	%	— revenue was generally in line with a strong prior year comparative, primarily reflecting issuance declines in bank loans; offset by higher investment grade issuance and monitoring fees — Organic constant currency revenue(1) declined 2%.
Total operating and SG&A expenses	$	932		$	915		(2	%)	— higher salaries and benefits reflecting an increase in headcount as well as annual salary increases in both segments; and — unfavorable changes in FX translation rates; partially offset by — a decrease in incentive compensation, which aligns with actual/projected financial and operational performance
Depreciation and amortization	$	120		$	110		(9	%)	— amortization of recently acquired intangible assets; and — higher amortization of internally developed software, primarily related to the development of MA SaaS solutions
Restructuring	$	27		$	2		NM		— relates to the Company's restructuring programs. The Strategic and Operational Efficiency Restructuring Program is more fully discussed in Note 10 to the consolidated financial statements
Charges related to asset abandonment	$	1		$	15		93	%	— costs related to the Company's decision to outsource the production of certain sustainability content utilized in our product offerings, more fully discussed in Note 12 to the consolidated financial statements
Total non-operating (expense) income, net	$	(46)		$	(56)		18	%	— lower interest expense on borrowings reflecting the repayment of the $700M of Senior Notes in the first quarter of 2025; and — an increase in FX gains; partially offset by — a decrease in interest income reflecting lower cash and short-term investment balances and lower interest rates
Operating margin	43.1		%	42.7		%	40	BPS	— Operating margin and Adjusted Operating Margin(1) expansion reflects revenue growth coupled with benefits from the Company's restructuring programs and disciplined cost management
Adjusted Operating Margin(1)	50.9		%	49.6		%	130	BPS
ETR	25.0		%	23.1		%	190	BPS	— mainly attributable to higher non-U.S. and state income taxes, coupled with a decrease in Excess Tax Benefits related to stock-based compensation
Diluted EPS	$	3.21		$	3.02		6	%	— increase reflects the aforementioned revenue growth and margin expansion
Adjusted Diluted EPS(1)	$	3.56		$	3.28		9	%

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Moody's Corporation


	Three Months Ended June 30,						% Change Favorable (Unfavorable)
	2025			2024
Revenue:
United States	$	992		$	974		2	%
Non-U.S.:
EMEA	613			566			8	%
Asia-Pacific	174			164			6	%
Americas	119			113			5	%
Total Non-U.S.	906			843			7	%
Total	1,898			1,817			4	%
Expenses:
Operating	489			469			(4	%)
SG&A	443			446			1	%
Depreciation and amortization	120			110			(9	%)
Restructuring	27			2			NM
Charges related to asset abandonment	1			15			93	%



Total	1,080			1,042			(4	%)
Operating income	$	818		$	775		6	%
Adjusted Operating Income(1)	$	966		$	902		7	%
Interest expense, net	$	(61)		$	(63)		3	%
Other non-operating income, net	15			7			114	%
Non-operating (expense) income, net	$	(46)		$	(56)		18	%

Net income attributable to Moody's	$	578		$	552		5	%
Diluted weighted average shares outstanding	180.2			183.0			2	%
Diluted EPS attributable to Moody's common shareholders	$	3.21		$	3.02		6	%
Adjusted Diluted EPS(1)	$	3.56		$	3.28		9	%
Operating margin	43.1		%	42.7		%
Adjusted Operating Margin(1)	50.9		%	49.6		%
ETR	25.0		%	23.1		%

The table below shows Moody’s global staffing by geographic area:


		June 30,		Change
		2025	2024	%

MA	U.S.	2,934	2,881	2	%
	Non-U.S.	5,045	5,032	—	%
	Total	7,979	7,913	1	%
MIS	U.S.	1,560	1,513	3	%
	Non-U.S.	4,274	4,126	4	%
	Total	5,834	5,639	3	%


MSS	U.S.	694	727	(5	%)
	Non-U.S.	1,406	1,226	15	%
	Total	2,100	1,953	8	%

Total MCO	U.S.	5,188	5,121	1	%
	Non-U.S.	10,725	10,384	3	%
	Total	15,913	15,505	3	%

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GLOBAL REVENUE


Three months ended June 30,

2025**-----------------------------------------------------------------------------------**2024

_________________________________________********________________________________________

1119 1124 1133 1138


Global revenue ⇑ $81 million						U.S. Revenue ⇑ $18 million						Non-U.S. Revenue ⇑ $63 million

The increase in global revenue reflects growth in MA of 11%, partially offset by a modest revenue decline in MIS. On an organic constant currency basis, revenue(1) grew 2%. Refer to the section entitled “Segment Results” of this MD&A for a more comprehensive discussion of the Company’s segment revenue.


						Second Quarter Operating Expense ⇑ $20 million

1378


Compensation expenses of $362 million increased $16 million, reflecting:						Non-compensation expenses of $127 million were generally in line with the prior year
— higher salaries and benefits attributable to hiring to support continued growth in the business coupled with salary increases; partially offset by
— a decrease in incentive compensation which aligns with actual/projected financial and operational performance

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						Second Quarter SG&A Expense ⇓ $3 million

1383


Compensation expenses of $272 million increased $5 million, reflecting:			Non-compensation expenses of $171 million decreased $8 million, reflecting:
— higher salaries and benefits reflecting growth in headcount and annual salary increases; partially offset by			— reserves recorded in the prior year relating to a regulatory investigation, which was settled in the third quarter of 2024; partially offset by
— a decrease in incentive compensation which aligns with actual/projected financial and operational performance
— an increase in costs to support operating growth, including investments to support technology and innovation


Depreciation and amortization

The increase is primarily driven by amortization of recently acquired intangible assets as well as the amortization of internally developed software, which relates to the development of MA SaaS solutions.


Restructuring

The amounts reflect charges and adjustments related to the Company's restructuring programs. The Strategic and Operational Efficiency Restructuring Program is more fully discussed in Note 10 to the consolidated financial statements.


						Operating margin 43.1%, ⇑ 40 BPS									Adjusted Operating Margin(1) 50.9%, ⇑ 130 BPS

Operating margin and Adjusted Operating Margin(1) expansion reflects revenue growth coupled with benefits from the Company's restructuring programs and disciplined cost management.


									Interest Expense, net ⇓ $2 million									Other non-operating income ⇑ $8 million


The slight decrease in interest expense is due to:									Increase in income is primarily due to an increase in FX gains of $6 million
— lower interest expense on borrowings of $12 million reflecting the repayment of the $700M of Senior Notes in the first quarter of 2025; partially offset by
— a decrease in interest income of $10 million reflecting lower cash and short-term investment balances and lower interest rates


						ETR ⇑ 190 BPS

The ETR was higher than the prior year primarily attributable to higher non-U.S. and state income taxes, coupled with a decrease in Excess Tax Benefits related to stock-based compensation.


						Diluted EPS ⇑ $0.19												Adjusted Diluted EPS(1) ⇑ $0.28

Both diluted EPS and Adjusted Diluted EPS(1) growth is mostly attributable to the aforementioned revenue growth and margin expansion.

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Segment Results

Moody’s Analytics

The table below provides a summary of revenue and operating results, followed by further insight and commentary:


	Three Months Ended June 30,						% Change Favorable (Unfavorable)
	2025			2024
Revenue:
Decision Solutions (DS)	$	413		$	366		13	%
Research and Insights (R&I)	249			226			10	%
Data and Information (D&I)	226			210			8	%
Total external revenue	888			802			11	%
Intersegment revenue	3			4			(25	%)
Total MA revenue	891			806			11	%
Expenses:
Operating and SG&A (external)	555			527			(5	%)
Operating and SG&A (intersegment)	50			49			(2	%)
Total operating and SG&A	605			576			(5	%)











Adjusted Operating Income	$	286		$	230		24	%


Adjusted Operating Margin	32.1		%	28.5		%

Depreciation and amortization	97			90			(8	%)
Restructuring	18			1			NM
Charges related to asset abandonment	1			15			93	%

MOODY'S ANALYTICS REVENUE


Three months ended June 30,

2025**-----------------------------------------------------------------------------------**2024

_________________________________________********________________________________________

358 360 369 371


MA: Global revenue ⇑ $86 million			U.S. Revenue ⇑ $43 million			Non-U.S. Revenue ⇑ $43 million

The 11% increase in global MA revenue reflects growth both in the U.S. (13%) and internationally (9%).

–Organic constant currency revenue(1) growth was 7%.

–Recurring revenue growth and organic constant currency recurring revenue(1) growth was 12% and 8%, respectively.

–ARR(2) increased 8%.

The increases are reflective of growth across all LOBs, as discussed in further detail below.

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DECISION SOLUTIONS REVENUE


Three months ended June 30,

2025**-----------------------------------------------------------------------------------**2024

_________________________________________********________________________________________

748 752 753 755


DS: Global revenue ⇑ $47 million			U.S. Revenue ⇑ $24 million			Non-U.S. Revenue ⇑ $23 million

Global DS revenue for the three months ended June 30, 2025 and 2024 was comprised as follows:

840

Global DS revenue grew 13% compared to the second quarter of 2024 and reflects increases in the U.S. (17%) and internationally (10%). Organic constant currency revenue(1) and organic constant currency recurring revenue(1) growth for DS was 8% and 9%,respectively.

The most notable drivers of the growth are as follows:

–Insurance revenue grew 14%

–recurring revenue growth of 13% in Insurance was attributable to:

–continued demand resulting in new sales for subscription-based catastrophe and actuarial models; and

–revenue from Praedicat and CAPE Analytics, which the Company acquired in the third quarter of 2024 and first quarter of 2025, respectively

–Organic constant currency revenue(1) growth and organic constant currency recurring revenue(1) growth for Insurance was 6% and 5%, respectively

–ARR(2) grew 9% reflecting the continued demand that resulted in the aforementioned new sales for subscription-based catastrophe and actuarial models

–KYC revenue grew 22%

–recurring revenue growth of 23% reflects strong demand for our suite of KYC solutions, reflecting increased customer and supplier risk data usage, coupled with sales growth from new customers

–Organic constant currency revenue(1) growth and organic constant currency recurring revenue(1) growth in KYC was 18% and 20%, respectively

–ARR(2) grew 15%, reflecting the aforementioned strong demand for KYC solutions, however trailed organic constant currency recurring revenue(1) growth mainly due to certain isolated customer attrition events in 2025

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–Banking revenue grew 5%

–recurring revenue growth of 10% within Banking reflected:

–expansion of existing customer relationships to subscription-based banking offerings, which enable customers' lending, risk management and finance workflows; and

–revenue from Numerated, which the Company acquired in the fourth quarter of 2024;

partially offset by:

–a decline in transaction revenue of 11%, reflecting MA's continued strategic shift to subscription-based solutions

–Organic constant currency revenue(1) growth and organic constant currency recurring revenue(1) growth in Banking was 2% and 7%, respectively

–ARR(2) grew 7% reflecting the aforementioned expansion of existing customer relationships to subscription-based banking offerings

The aforementioned factors contributed to overall ARR(2) growth for DS of 10%.

RESEARCH AND INSIGHTS REVENUE


Three months ended June 30,

2025**-----------------------------------------------------------------------------------**2024

_________________________________________________****__ ________________________________________________

2531 2532 2533 2535


R&I: Global revenue ⇑ $23 million			U.S. Revenue ⇑ $15 million			Non-U.S. Revenue ⇑ $8 million

Global R&I revenue increased 10% compared to the second quarter of 2024 and reflects growth in both the U.S. (12%) and internationally (8%). Organic constant currency revenue(1) growth for R&I was 8%.

The revenue increase was mainly driven by sales growth and improved retention rates from the credit research product offering, which contributed to R&I ARR(2) growth of 7%.

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DATA AND INFORMATION REVENUE


Three months ended June 30,

2025**-----------------------------------------------------------------------------------**2024

______________________________________________********__________________________________________________

3026 3027 3028 3030


D&I: Global revenue ⇑ $16 million			U.S. Revenue ⇑ $4 million			Non-U.S. Revenue ⇑ $12 million

Global D&I revenue increased 8% compared to the second quarter of 2024 and reflects growth in both the U.S. (5%) and internationally (9%). Organic constant currency revenue(1) growth for D&I was 5%.

The revenue increase was mainly driven by continued demand for ratings data feeds as well as favorable changes in FX translation rates.

ARR(2) grew 6% reflecting continued demand for ratings data feeds.


						MA: Second Quarter Operating and SG&A Expense ⇑ $28 million

3351


						Compensation expenses of $355 million increased $19 million, reflecting:												Non-compensation expenses of $200 million were generally in line with the prior year
						— growth in salaries and benefits reflecting higher headcount to support business growth, driven largely by recent acquisitions, coupled with annual salary increases


						MA: Adjusted Operating Margin 32.1% ⇑ 360 BPS

Adjusted Operating Margin expansion includes operational efficiency and cost savings from the Strategic and Operational Efficiency Restructuring Program and ongoing disciplined cost management.

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Depreciation and amortization

The increase in depreciation and amortization expense primarily reflects the amortization of recently acquired intangible assets as well as higher amortization of internally developed software relating to the development of SaaS-based solutions.


Restructuring

Moody’s Investors Service

The table below provides a summary of revenue and operating results, followed by further insight and commentary:


	Three Months Ended June 30,						% Change Favorable (Unfavorable)
	2025			2024
Revenue:
Corporate finance (CFG)	$	512		$	525		(2	%)
Structured finance (SFG)	135			131			3	%
Financial institutions (FIG)	191			195			(2	%)
Public, project and infrastructure finance (PPIF)	162			154			5	%
Total ratings revenue	1,000			1,005			—	%
MIS Other	10			10			—	%
Total external revenue	1,010			1,015			—	%
Intersegment revenue	50			49			2	%
Total MIS revenue	1,060			1,064			—	%
Expenses:
Operating and SG&A (external)	377			388			3	%
Operating and SG&A (intersegment)	3			4			25	%
Total operating and SG&A	380			392			3	%








Adjusted Operating Income	$	680		$	672		1	%


Adjusted Operating Margin	64.2		%	63.2		%

Depreciation and amortization	23			20			(15	%)
Restructuring	9			1			NM

The following chart presents changes in rated issuance volumes compared to the second quarter of 2024. To the extent that changes in rated issuance volumes had a material impact to MIS's revenue compared to the prior year, those impacts are discussed below.

388

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MOODY'S INVESTORS SERVICE REVENUE


Three months ended June 30,

2025**-----------------------------------------------------------------------------------**2024

_________________________________________********________________________________________

620 622 630 632


MIS: Global revenue ⇓ $5 million			U.S. Revenue ⇓ $25 million			Non-U.S. Revenue ⇑ $20 million

Total MIS revenue was in line with the prior year reflecting modest declines in CFG and FIG, offset by modest growth in PPIF and SFG.

Organic constant currency revenue(1) declined 2%.

CFG REVENUE


Three months ended June 30,

2025**-----------------------------------------------------------------------------------**2024

_________________________________________********________________________________________

934 936 944 946


CFG: Global revenue ⇓ $13 million			U.S. Revenue ⇓ $28 million			Non-U.S. Revenue ⇑ $15 million

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Global CFG revenue for the three months ended June 30, 2025 and 2024 was comprised as follows:

1032

Other includes: recurring monitoring fees of a rated debt obligation and/or entities that issue such obligations as well as fees from programs such as commercial paper, medium term notes, and ICRA corporate finance revenue.

The decrease in CFG revenue of 2% reflects declines in the U.S. (8%), offset by growth internationally (8%). Organic constant currency revenue(1) declined 4%.

Revenue decreased $13 million compared to the same period in the prior year, which primarily reflected:

–lower bank loan issuance (most notably in the U.S.) compared to a strong prior year comparative, attributable to heightened market volatility in 2025 coupled with subdued M&A activity;

partially offset by:

–higher investment-grade issuance activity reflecting strong investor demand as yields remained high coupled with continued tight credit spreads for high quality credits; and

–the impact of annual price increases.

SFG REVENUE


Three months ended June 30,

2025**---------------------------------------------------------------------------**2024

_________________________________________********________________________________________

1925 1930 1939 1944


SFG: Global revenue ⇑ $4 million			U.S. Revenue ⇓ $1 million			Non-U.S. Revenue ⇑ $5 million

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Global SFG revenue for the three months ended June 30, 2025 and 2024 was comprised as follows:

2031

SFG revenue was generally in line with the prior year across all asset classes.

FIG REVENUE


Three months ended June 30,

2025**-----------------------------------------------------------------------------------**2024

_________________________________________********________________________________________

2567 2572 2581 2586


FIG: Global revenue ⇓ $4 million			U.S. Revenue ⇓ $5 million			Non-U.S. Revenue ⇑ $1 million

Global FIG revenue for the three months ended June 30, 2025 and 2024 was comprised as follows:

2672

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The decrease in FIG revenue of 2% reflects a decline in the U.S. (5%), partially offset by an increase internationally (1%). Organic constant currency revenue(1) declined 4%.

Revenue decreased $4 million compared to the second quarter of 2024, primarily due to:

–lower volumes from infrequent issuers in the insurance sector in the U.S., compared to very strong activity in the prior year;

partially offset by:

–growth in banking issuance, most notably in the U.S.

PPIF REVENUE


Three months ended June 30,

2025**-----------------------------------------------------------------------------------**2024

_________________________________________********________________________________________

3257 3262 3270 3275


PPIF: Global revenue ⇑ $8 million			U.S. Revenue ⇑ $9 million			Non-U.S. Revenue ⇓ 1 million

Global PPIF revenue for the three months ended June 30, 2025 and 2024 was comprised as follows:

3362

The increase in PPIF revenue of 5% reflects growth in the U.S. (9%), partially offset by declines internationally (2%).

Revenue increased $8 million compared to the second quarter of 2024, reflecting:

–higher issuance in U.S. Public Finance in the state and local government and higher education sectors; and

–the impact of annual price increases.

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						MIS: Second Quarter Operating and SG&A Expense ⇓ $11 million

3813


						Compensation expenses of $280 million were in line with the prior year reflecting the following offsetting factors:												Non-compensation expenses of $97 million decreased $14 million:
						— growth in salaries and benefits reflecting higher headcount and annual salary increases; offset by												— the decrease is mostly attributable to reserves recorded in the prior year relating to a regulatory investigation, which was settled in the third quarter of 2024
						— a decrease in incentive compensation aligned with actual/projected financial and operating performance


												MIS: Adjusted Operating Margin 64.2% ⇑ 100 BPS

MIS Adjusted Operating Margin expansion primarily reflects the aforementioned impact of reserves recorded in the prior year relating to a regulatory investigation.


Restructuring

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Six months ended June 30, 2025 compared with six months ended June 30, 2024

Executive Summary

The following table provides an executive summary of key operating results for the six months ended June 30, 2025. Following this executive summary is a more detailed discussion of the Company’s operating results as well as a discussion of the operating results of the Company’s reportable segments.


	Six Months Ended June 30,
Financial measure:	2025			2024			% Change Favorable (Unfavorable)		Insight and Key Drivers of Change Compared to Prior Year
Moody's total revenue	$	3,822		$	3,603		6	%	— reflects revenue growth in both segments
MA external revenue	$	1,747		$	1,601		9	%	— sustained demand for insurance and KYC offerings and SaaS-based banking solutions; — continued demand for credit research product offerings; and — ongoing demand for ratings data feeds — Organic constant currency revenue(1) growth was 7%, and ARR(2) grew 8%
MIS external revenue	$	2,075		$	2,002		4	%	— strong investor demand and tight credit spreads supported revenue growth in investment-grade, U.S. public and project finance, and CMBS; partially offset by — declines in bank loans attributable to heightened market volatility and subdued M&A activity
Total operating and SG&A expenses	$	1,862		$	1,795		(4	%)	— higher salaries and benefits reflecting an increase in headcount and annual salary increases in both segments
Depreciation and amortization	$	233		$	210		(11	%)	— amortization of recently acquired intangible assets; and — higher amortization of internally developed software, primarily related to the development of MA SaaS solutions
Restructuring	$	60		$	7		NM		— relates to the Company's restructuring programs. The Strategic and Operational Efficiency Restructuring Program is more fully discussed in Note 10 to the consolidated financial statements
Charges related to asset abandonment	$	3		$	15		80	%	— costs related to the Company's decision to outsource the production of certain sustainability content utilized in our product offerings, which is more fully discussed in Note 12 to the consolidated financial statements
Total non-operating (expense) income, net	$	(88)		$	(105)		16	%	— primarily due to an increase in equity income recorded for the Company's investments in non-consolidated affiliates
Operating margin	43.5		%	43.7		%	(20 BPS)		— slight operating margin contraction is attributable to higher restructuring costs, offset by growth in revenue — Adjusted Operating Margin(1) expansion reflects revenue growth coupled with benefits from the Company's restructuring programs and disciplined cost management
Adjusted Operating Margin(1)	51.3		%	50.2		%	110 BPS
ETR	23.6		%	23.2		%	(40 BPS)		— in line with the prior year
Diluted EPS	$	6.66		$	6.16		8	%	— increase reflects the aforementioned revenue growth and margin expansion
Adjusted Diluted EPS(1)	$	7.38		$	6.65		11	%

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Moody’s Corporation


	Six Months Ended June 30,						% Change Favorable (Unfavorable)
	2025			2024
Revenue:
United States	$	2,057		$	1,943		6	%
Non-U.S.:
EMEA	1,182			1,108			7	%
Asia-Pacific	341			319			7	%
Americas	242			233			4	%
Total Non-U.S.	1,765			1,660			6	%
Total	3,822			3,603			6	%
Expenses:
Operating	980			936			(5	%)
SG&A	882			859			(3	%)
Depreciation and amortization	233			210			(11	%)
Restructuring	60			7			NM
Charges related to asset abandonment	3			15			80	%


Total	2,158			2,027			(6	%)
Operating income	$	1,664		1,576			6	%
Adjusted Operating Income (1)	$	1,960		1,808			8	%
Interest expense, net	$	(122)		(125)			2	%
Other non-operating income, net	34			20			70	%
Non-operating (expense) income, net	$	(88)		(105)			16	%

Net income attributable to Moody’s	$	1,203		$	1,129		7	%
Diluted weighted average shares outstanding	180.5			183.2			1	%
Diluted EPS attributable to Moody’s common shareholders	$	6.66		$	6.16		8	%
Adjusted Diluted EPS (1)	$	7.38		$	6.65		11	%
Operating margin	43.5		%	43.7		%
Adjusted Operating Margin (1)	51.3		%	50.2		%
Effective tax rate	23.6		%	23.2		%

GLOBAL REVENUE


Six months ended June 30,

2025**-----------------------------------------------------------------------------------**2024

_________________________________________********________________________________________

563 568 577 579

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Global revenue ⇑ $219 million						U.S. Revenue ⇑ $114 million						Non-U.S. Revenue ⇑ $105 million

Growth in global revenue reflected increases in both MA and MIS, both in the U.S. and internationally. Refer to the section entitled “Segment Results” of this MD&A for a more comprehensive discussion of the Company’s segment revenue.


						YTD Operating Expense ⇑ $44 million

819


Compensation expenses of $730 million increased $38 million, reflecting:						Non-compensation expenses of $250 million were generally in line with the prior year
— higher salaries and benefits attributable to hiring and salary increases to support continued growth in the business


						YTD SG&A Expense ⇑ $23 million

825


Compensation expenses of $547 million increased $17 million, reflecting:			Non-compensation expenses of $335 million were generally in line with the prior year, with the following offsetting factors:
— higher salaries and benefits attributable to an increase in headcount and annual salary increases			— reserves recorded in the prior year relating to a regulatory investigation, which was settled in the third quarter of 2024; partially offset by
			— an increase in costs to support operating growth, including investments to support technology and innovation

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Depreciation and amortization

The increase in depreciation and amortization expense is driven by the amortization of recently acquired intangible assets as well as the amortization of internally developed software, which is primarily related to the development of MA SaaS solutions.


Restructuring


Charges related to asset abandonment

Reflects costs related to the Company's decision to outsource the production of certain sustainability content utilized in our product offerings, which is more fully discussed in Note 12 to the consolidated financial statements.


						Operating margin 43.5%, ⇓ 20 BPS									Adjusted Operating Margin(1) 51.3%, ⇑ 110 BPS

Slight operating margin contraction is attributable to the increase in restructuring costs compared to the prior year, offset by growth in revenue.

Adjusted Operating Margin(1) expansion reflects revenue growth coupled with benefits from the Company's restructuring programs and disciplined cost management.


						Interest Expense, net ⇓ $3 million									Other non-operating income ⇑ $14 million


The decrease in interest expense is primarily due to:						Increase in income is primarily due to:
— lower interest expense on borrowings of $14 million reflecting the repayment of the $700M of Senior Notes in the first quarter of 2025; partially offset by						— an increase in equity income related to the Company's investments in non-consolidated affiliates of $12 million
— lower interest income of $8 million reflecting lower cash and short-term investment balances and lower interest rates


						ETR ⇑ 40 BPS

The ETR was generally in line with the prior year.


						Diluted EPS ⇑ $0.50									Adjusted Diluted EPS(1) ⇑ $0.73

Both diluted EPS and Adjusted Diluted EPS(1) growth is mostly attributable to the aforementioned growth in revenue and operating income/adjusted operating income(2).

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Moody’s Analytics

The table below provides a summary of revenue and operating results, followed by further insight and commentary:


	Six Months Ended June 30,						% Change Favorable (Unfavorable)
	2025			2024
Revenue:
Decision Solutions (DS)	$	818		$	731		12	%
Research and Insights (R&I)	485			448			8	%
Data and Information (D&I)	444			422			5	%
Total external revenue	1,747			1,601			9	%
Intersegment revenue	6			7			(14	%)
Total MA Revenue	1,753			1,608			9	%
Expenses:
Operating and SG&A (external)	1,109			1,044			(6	%)
Operating and SG&A (intersegment)	99			96			(3	%)


Total operating and SG&A expense	1,208			1,140			(6	%)


Adjusted Operating Income	$	545		$	468		16	%

Adjusted Operating Margin	31.1		%	29.1		%

Depreciation and amortization	191			172			(11	%)
Restructuring	44			3			NM
Charges related to asset abandonment	3			15			80	%

MOODY'S ANALYTICS REVENUE


Six months ended June 30,

2025**-----------------------------------------------------------------------------------**2024

_________________________________________********________________________________________

357 359 368 370


MA: Global revenue ⇑ $146 million			U.S. Revenue ⇑ $81 million			Non-U.S. Revenue ⇑ $65 million

The 9% increase in global MA revenue reflects growth both in the U.S. (12%) and internationally (7%).

–Organic constant currency revenue(1) growth was 7%.

–Recurring revenue growth and organic constant currency recurring revenue(1) growth was 10% and 8%, respectively.

–ARR(2) increased 8%.

These increases are reflective of growth across all LOBs, as discussed in further detail below.

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DECISION SOLUTIONS REVENUE


Six months ended June 30,

2025**-----------------------------------------------------------------------------------**2024

_________________________________________********________________________________________

770 774 775 777


DS: Global revenue ⇑ $87 million			U.S. Revenue ⇑ $53 million			Non-U.S. Revenue ⇑ $34 million

Global DS revenue for the six months ended June 30, 2025 and 2024 was comprised as follows:

846

Global DS revenue grew 12% compared to the first half of 2024 and reflects increases in both the U.S. (19%) and internationally (7%). Organic constant currency revenue(1) and organic constant currency recurring revenue(1) growth for DS was 8% and 11%, respectively. ARR(2) growth was 10%.

The most notable drivers of the growth are as follows:

–Insurance revenue grew 14%

–recurring revenue growth of 15% in Insurance was attributable to:

–continued demand resulting in new sales for subscription-based revenue for catastrophe and actuarial modeling tools; and

–revenue from Praedicat and CAPE Analytics, which the Company acquired in the third quarter of 2024 and first quarter of 2025, respectively

–Organic constant currency revenue(1) and organic constant currency recurring revenue(1) growth for Insurance was 7% and 8%, respectively

–ARR(2) grew 9%, reflecting the aforementioned continued demand that resulted in new sales for subscription-based revenue for catastrophe and actuarial modeling tools

–KYC revenue grew 19%

–recurring revenue growth of 21% in KYC reflects strong demand for KYC and compliance solutions reflecting increased customer and supplier risk data usage

–Organic constant currency revenue(1) and organic constant currency recurring revenue(1) growth for KYC was 18% and 20%, respectively

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–Banking revenue grew 5%

–recurring revenue growth of 10% within Banking reflected:

–expansion of existing customer relationships to subscription-based banking offerings, which enable customers' lending, risk management and finance workflows; and

–revenue from Numerated, which the Company acquired in the fourth quarter of 2024;

partially offset by:

–a decline in transaction revenue of 11%, reflecting MA's continued strategic shift to subscription-based solutions

–Organic constant currency revenue(1) and organic constant currency recurring revenue(1) growth for Banking was 3% and 7%, respectively

–ARR(2) grew 7%

RESEARCH AND INSIGHTS REVENUE


Six months ended June 30,

2025**-----------------------------------------------------------------------------------**2024

_________________________________________********________________________________________

2326 2327 2328 2330


R&I: Global revenue ⇑ $37 million			U.S. Revenue ⇑ $21 million			Non-U.S. Revenue ⇑ $16 million

Global R&I revenue increased 8% compared to the first half of 2024 and reflects growth in both the U.S. (9%) and internationally (8%).

The revenue increase was attributable to sales growth for credit research product offerings, which contributed to ARR(2) growth of 7%.

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DATA AND INFORMATION REVENUE


Six months ended June 30,

2025**-----------------------------------------------------------------------------------**2024

_________________________________________********________________________________________

2823 2824 2825 2827


D&I: Global revenue ⇑ $22 million			U.S. Revenue ⇑ $7 million			Non-U.S. Revenue ⇑ $15 million

Global D&I revenue increased 5% compared to the first half of 2024 and reflects growth in both the U.S. (5%) and internationally (6%). This growth was mainly driven by continued strong demand for ratings data feeds and company data applications, which contributed to ARR(2) growth of 6% for D&I.


						MA: YTD Operating and SG&A Expense ⇑ $65 million

3097


						Compensation expenses of $717 million increased $44 million:												Non-compensation expenses of $392 million increased $21 million:
						— the growth in salaries and benefits reflects higher headcount to support business growth, including from recent acquisitions, coupled with annual salary increases												— the increase is mainly attributable to costs to support operating growth, including investments to support technology, innovation and product development

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						MA: Adjusted Operating Margin 31.1% ⇑ 200 BPS

Adjusted Operating Margin expansion includes operational efficiency and cost savings from the Strategic and Operational Efficiency Restructuring Program and ongoing disciplined cost management.


Depreciation and amortization


Restructuring


Charges related to asset abandonment

Moody’s Investors Service

The table below provides a summary of revenue and operating results, followed by further insight and commentary:


	Six Months Ended June 30,						% Change Favorable (Unfavorable)
	2025			2024
Revenue:
Corporate finance (CFG)	$	1,076		$	1,054		2	%
Structured finance (SFG)	273			245			11	%
Financial institutions (FIG)	382			390			(2	%)
Public, project and infrastructure finance (PPIF)	325			295			10	%
Total ratings revenue	2,056			1,984			4	%
MIS Other	19			18			6	%
Total external revenue	2,075			2,002			4	%
Intersegment royalty	99			96			3	%
Total	2,174			2,098			4	%
Expenses:
Operating and SG&A (external)	753			751			—	%
Operating and SG&A (intersegment)	6			7			14	%
Total operating and SG&A expense	759			758			—	%

Adjusted Operating Income	$	1,415		$	1,340		6	%

Adjusted Operating Margin	65.1		%	63.9		%

Depreciation and amortization	42			38			(11	%)
Restructuring	16			4			(300	%)

The following chart presents changes in rated issuance volumes compared to the first half of 2024. To the extent that changes in rated issuance volumes had a material impact to MIS's revenue compared to the prior year, those impacts are discussed below.

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388

MOODY'S INVESTORS SERVICE REVENUE


Six months ended June 30,

2025**-----------------------------------------------------------------------------------**2024

_________________________________________********________________________________________

619 621 629 631


MIS: Global revenue ⇑ $73 million			U.S. Revenue ⇑ $33 million			Non-U.S. Revenue ⇑ $40 million

The increase in global MIS revenue reflects growth across all ratings LOBs, excluding FIG.

CFG REVENUE


Six months ended June 30,

2025**-----------------------------------------------------------------------------------**2024

_________________________________________********________________________________________

916 918 926 928

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CFG: Global revenue ⇑ $22 million			U.S. Revenue ⇓ 9 million			Non-U.S. Revenue ⇑ $31 million

Global CFG revenue for the six months ended June 30, 2025 and 2024 was comprised as follows:

995

Other includes: recurring monitoring fees of a rated debt obligation and/or entities that issue such obligations as well as fees from programs such as commercial paper, medium term notes, and ICRA corporate finance revenue.

The increase in CFG revenue of 2% reflects growth internationally (9%), partially offset by a modest decline in the U.S. (1%), with the most notable drivers reflecting:

–higher issuance activity for investment-grade bonds, which reflected continued tight credit spreads and continued investor demand; and

–the impact of annual price increases;

partially offset by:

–declines in bank loans attributable to ongoing market volatility and subdued M&A activity.

SFG REVENUE


Six months ended June 30,

2025**-----------------------------------------------------------------------------------**2024

_________________________________________********________________________________________

2007 2009 2018 2019


SFG: Global revenue ⇑ $28 million			U.S. Revenue ⇑ $23 million			Non-U.S. Revenue ⇑ $5 million

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Global SFG revenue for the six months ended June 30, 2025 and 2024 was comprised as follows:

2087

The increase in SFG revenue of 11% reflects growth in both the U.S. (14%) and internationally (6%).

The increase reflected growth across all asset classes, most notably from increased issuance activity in CMBS, supported by tight spreads and strong investor demand.

FIG REVENUE


Six months ended June 30,

2025**-----------------------------------------------------------------------------------**2024

_________________________________________********________________________________________

2795 2797 2806 2808


FIG: Global revenue ⇓ $8 million			U.S. Revenue ⇓ $8 million			Non-U.S. Revenue was in line with prior year

Global FIG revenue for the six months ended June 30, 2025 and 2024 was comprised as follows:

2875

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The decrease in FIG revenue of 2% reflects a decline in the U.S. (4%).

Revenue decreased $8 million compared to the same period in the prior year, primarily due to:

–lower volumes from infrequent issuers in the insurance sector, compared to strong activity in the prior year;

partially offset by:

–growth in banking revenue, which came mainly from issuers in the U.S.

PPIF REVENUE


Six months ended June 30,

2025**-----------------------------------------------------------------------------------**2024

****_______****___

3438 3440 3449 3451


PPIF: Global revenue ⇑ $30 million			U.S. Revenue ⇑ $27 million			Non-U.S. Revenue ⇑ $3 million

Global PPIF revenue for the six months ended June 30, 2025 and 2024 was comprised as follows:

3521

The 10% increase in PPIF revenue reflects increases in both the U.S. (15%) and internationally (3%), with the most notable drivers of the growth reflecting:

–higher issuance in U.S. Public Finance, primarily reflecting increased activity in the state and local government and higher education sectors; and

–higher U.S. Project Finance activity supported by ongoing funding requirements for large-scale infrastructure projects.

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						MIS: YTD Operating and SG&A Expense was in line with the prior year

4046


						Compensation expenses of $560 million increased $11 million, reflecting:												Non-compensation expenses of $193 million decreased $9 million with the most notable driver of the growth reflecting:
						— growth in salaries and benefits reflecting higher headcount and annual salary increases; partially offset by:												— reserves recorded in the prior year relating to a regulatory investigation, which was settled in the third quarter of 2024
						— a decrease in incentive compensation aligned with actual/projected financial and operating performance


						Adjusted Operating Margin of 65.1% ⇑ 120 BPS

MIS Adjusted Operating Margin expansion primarily reflected the impact of reserves recorded in the prior year related to a regulatory investigation, further supported by the aforementioned 4% increase in revenue.


Restructuring Charges

LIQUIDITY AND CAPITAL RESOURCES

Moody's remains committed to using its cash flow to create value for shareholders by both investing in the Company's employees and growing the business through targeted organic initiatives and inorganic acquisitions aligned with strategic priorities. Additional excess capital is returned to the Company’s shareholders via a combination of dividends and share repurchases.

Cash Flow

The Company is currently financing its operations, capital expenditures and share repurchases from operating and financing cash flows.

The following is a summary of the changes in the Company’s cash flows followed by a brief discussion of these changes:


	Six Months Ended June 30,				$ Change Favorable (Unfavorable)
	2025		2024
Net cash provided by operating activities	$	1,300	$	1,461	$	(161)
Net cash provided by (used in) investing activities	$	98	$	(191)	$	289
Net cash used in financing activities	$	(1,780)	$	(731)	$	(1,049)
Free Cash Flow (1)	$	1,140	$	1,290	$	(150)

(1) Free Cash Flow is a non-GAAP measure and is defined by the Company as net cash provided by operating activities minus cash paid for capital expenditures. Refer to “Non-GAAP Financial Measures” of this MD&A for further information on this financial measure.

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Net cash provided by operating activities

Net cash flows from operating activities for the six months ended June 30, 2025 decreased by $161 million compared to the same period in 2024, with the most notable drivers reflecting:

–$198 million in higher income tax payments in the current year;

–approximately $100 million in higher incentive compensation payments in the first half of 2025 (based on full-year 2024 financial and operating results) compared to payments made in the prior year (based on full-year 2023 financial and operating results);

partially offset by:

–growth in operating income of $88 million coupled with various changes in working capital.

Net cash provided by (used in) investing activities

The $289 million increase in cash provided by investing activities in the six months ended June 30, 2025 compared to the same period in 2024 was primarily due to:

–a $467 million increase in net sales and maturities of investments, primarily due to the maturity of certificates of deposit in the first quarter of 2025;

partially offset by:

–higher cash paid for acquisitions, net of cash acquired, of $211 million due to the acquisition of CAPE Analytics in the first quarter of 2025.

Net cash used in financing activities

The $1,049 million increase in cash used in financing activities in the six months ended June 30, 2025 compared to the same period in the prior year was primarily attributed to:

*–*a $700 million repayment of notes payable in 2025; and

– higher cash paid for treasury share repurchases in 2025 of $273 million compared to the same period in the prior year.

Cash and cash equivalents and short-term investments

The Company’s aggregate cash and cash equivalents and short-term investments of $2.3 billion at June 30, 2025 included approximately $1.7 billion located outside of the U.S. Approximately 40% of the Company’s aggregate cash and cash equivalents and short-term investments is denominated in euros and GBP. The Company manages both its U.S. and non-U.S. cash flow to maintain sufficient liquidity in all regions to effectively meet its operating needs.

As a result of the Tax Act, all previously net undistributed foreign earnings have now been subject to U.S. tax. The Company continues to evaluate which entities it will indefinitely reinvest earnings outside the U.S. The Company has provided deferred taxes for those entities whose earnings are not considered indefinitely reinvested. Accordingly, the Company continues to repatriate a portion of its non-U.S. cash in these subsidiaries and will continue to repatriate certain of its offshore cash in a manner that addresses compliance with local statutory requirements, sufficient offshore working capital and any other factors that may be relevant in certain jurisdictions. Notwithstanding the Tax Act, which generally eliminated federal income tax on future cash repatriation to the U.S., cash repatriation may be subject to state and local taxes or withholding or similar taxes.

Material Cash Requirements

The Company's material cash requirements consist of the following contractual and other obligations:

Financing Arrangements

Indebtedness

At June 30, 2025, Moody’s had $7.2 billion of outstanding principal on debt and approximately $1 billion of additional capacity available under the Company’s CP Program, which is backstopped by the $1.25 billion 2024 Facility.

The repayment schedule for the Company’s borrowings outstanding at June 30, 2025 is as follows:

448

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For additional information on the Company's outstanding debt, refer to Note 14 to the consolidated financial statements.

Future interest payments and fees associated with the Company's debt and credit facility are expected to be $4.4 billion, of which approximately $300 million is expected to be paid in each of the next five years, and the remaining amount expected to be paid thereafter.

Management may consider pursuing additional long-term financing when it is appropriate in light of cash requirements for operations, share repurchases and other strategic opportunities, which could result in higher financing costs.

Purchase Obligations

Purchase obligations generally include multi-year agreements with vendors to purchase goods or services and mainly include data center/cloud hosting fees and fees for information technology licensing and maintenance. As of June 30, 2025, these purchase obligations totaled approximately $700 million, of which approximately 50% is expected to be paid in the next twelve months and another approximate 45% expected to be paid over the next two subsequent years, with the remainder to be paid thereafter.

Leases

The Company has remaining payments relating to its operating leases of $487 million at June 30, 2025, primarily related to real estate leases, of which $109 million in payments are expected over the next twelve months. For more information on the expected cash flows relating to the Company's operating leases, refer to Note 15 to the consolidated financial statements.

Pension and Other Retirement Plan Obligations

The Company does not anticipate making significant contributions to its funded pension plan in the next twelve months. This plan is overfunded at June 30, 2025, and accordingly holds sufficient investments to fund future benefit obligations. Payments for the Company's unfunded plans are not expected to be material in either the short or long-term.

Dividends and share repurchases

On July 22, 2025, the Board approved the declaration of a quarterly dividend of $0.94 per share for Moody’s common stock, payable September 5, 2025 to shareholders of record at the close of business on August 15, 2025. The continued payment of dividends at this rate, or at all, is subject to the discretion of the Board.

On October 15, 2024, the Board approved $1.5 billion in share repurchase authority. At June 30, 2025, the Company had approximately $0.9 billion of remaining authority under this authorization. There is no established expiration date for the remaining authorization.

Restructuring

As more fully discussed in Note 10 to the consolidated financial statements, the Company is currently in the process of executing the Strategic and Operational Efficiency Restructuring Program. Future cash outlays associated with this program are expected to be approximately $120 million to $150 million, which are expected to be paid out through 2027.

Sources of Funding to Satisfy Material Cash Requirements

The Company believes that it has the financial resources needed to meet its cash requirements and expects to have positive operating cash flow over the next twelve months. Cash requirements for periods beyond the next twelve months will depend, among other things, on the Company’s profitability and its ability to manage working capital requirements. The Company may also borrow from various sources as described above.

NON-GAAP FINANCIAL MEASURES

In addition to its reported results, Moody’s has included in this MD&A certain adjusted results that the SEC defines as “Non-GAAP financial measures.” Management believes that such adjusted financial measures, when read in conjunction with the Company’s reported results, can provide useful supplemental information for investors analyzing period-to-period comparisons of the Company’s performance, facilitate comparisons to competitors’ operating results and can provide greater transparency to investors of supplemental information used by management in its financial and operational decision-making. These adjusted measures, as defined by the Company, are not necessarily comparable to similarly defined measures of other companies. Furthermore, these adjusted measures should not be viewed in isolation or used as a substitute for other GAAP measures in assessing the operating performance or cash flows of the Company. Below are brief descriptions of the Company’s adjusted financial measures accompanied by a reconciliation of the adjusted measure to its most directly comparable GAAP measure:

Adjusted Operating Income and Adjusted Operating Margin**:**

The Company presents Adjusted Operating Income and Adjusted Operating Margin because management deems these metrics to be useful measures to provide additional perspective on Moody's operating performance. Adjusted Operating Income excludes the impact of: i) depreciation and amortization; ii) restructuring charges/adjustments, and iii) charges related to asset abandonment. Depreciation and amortization are excluded because companies utilize productive assets of different estimated useful lives and use different methods of acquiring and depreciating productive assets. Restructuring charges/adjustments and charges related to asset abandonment, which the Company believes are not reflective of its ongoing operating cost structure, are excluded as the frequency and magnitude of these charges may vary widely across periods and companies. Refer to Notes 10 and 12 to the consolidated

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financial statements for further information regarding the nature of the Company’s restructuring programs and asset abandonment, respectively.

Management believes that the exclusion of the aforementioned items, as detailed in the reconciliation below, allows for an additional perspective on the Company’s operating results from period to period and across companies. The Company defines Adjusted Operating Margin as Adjusted Operating Income divided by revenue.


	Three Months Ended June 30,						Six Months Ended June 30,
	2025			2024			2025			2024
Operating income	$	818		$	775		$	1,664		$	1,576
Adjustments:
Depreciation and amortization	120			110			233			210
Restructuring	27			2			60			7
Charges related to asset abandonment	1			15			3			15
Adjusted Operating Income	$	966		$	902		$	1,960		$	1,808
Operating margin	43.1		%	42.7		%	43.5		%	43.7		%
Adjusted Operating Margin	50.9		%	49.6		%	51.3		%	50.2		%

Adjusted Net Income and Adjusted Diluted EPS attributable to Moody's common shareholders:

The Company presents Adjusted Net Income and Adjusted Diluted EPS because management deems these metrics to be useful measures to provide additional perspective on Moody’s operating performance. Adjusted Net Income and Adjusted Diluted EPS exclude the impact of: i) amortization of acquired intangible assets; ii) restructuring charges/adjustments; and iii) charges related to asset abandonment.

The Company excludes the impact of amortization of acquired intangible assets as companies utilize intangible assets with different estimated useful lives and have different methods of acquiring and amortizing intangible assets. These intangible assets were recorded as part of acquisition accounting and contribute to revenue generation. The amortization of intangible assets related to acquisitions will recur in future periods until such intangible assets have been fully amortized. Furthermore, the timing and magnitude of business combination transactions are not predictable and the purchase price allocated to amortizable intangible assets and the related amortization period are unique to each acquisition and can vary significantly from period to period and across companies. Restructuring charges/adjustments and charges related to asset abandonment, which the Company believes are not reflective of its ongoing operating cost structure, are excluded as the frequency and magnitude of these items may vary widely across periods and companies.

The Company excludes the aforementioned items to provide additional perspective when comparing net income and diluted EPS from period to period and across companies as the frequency and magnitude of similar transactions may vary widely across periods.


	Three Months Ended June 30,								Six Months Ended June 30,
Amounts in millions	2025				2024				2025				2024
Net Income attributable to Moody's common shareholders			$	578			$	552			$	1,203			$	1,129



Pre-tax Acquisition-Related Intangible Amortization Expenses	$	55			$	48			$	108			$	97
Tax on Acquisition-Related Intangible Amortization Expenses	(13)				(12)				(26)				(24)
Net Acquisition-Related Intangible Amortization Expenses			42				36				82				73

Pre-tax restructuring	$	27			$	2			$	60			$	7
Tax on restructuring	(7)				(1)				(15)				(2)
Net restructuring			20				1				45				5

Pre-tax charges related to asset abandonment	$	1			$	15			$	3			$	15
Tax on charges related to asset abandonment	(1)				(4)				(1)				(4)
Net charges related to asset abandonment			—				11				2				11



Adjusted Net Income			$	640			$	600			$	1,332			$	1,218

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	Three Months Ended June 30,								Six Months Ended June 30,
	2025				2024				2025				2024
Diluted earnings per share attributable to Moody's common shareholders			$	3.21			$	3.02			$	6.66			$	6.16



Pre-tax Acquisition-Related Intangible Amortization Expenses	$	0.31			$	0.26			$	0.60			$	0.53
Tax on Acquisition-Related Intangible Amortization Expenses	(0.07)				(0.07)				(0.14)				(0.13)
Net Acquisition-Related Intangible Amortization Expenses			0.24				0.19				0.46				0.40

Pre-tax restructuring	$	0.15			$	0.01			$	0.33			$	0.04
Tax on restructuring	(0.04)				—				(0.08)				(0.01)
Net restructuring			0.11				0.01				0.25				0.03

Pre-tax charges related to asset abandonment	$	0.01			$	0.08			$	0.02			$	0.08
Tax on charges related to asset abandonment	(0.01)				(0.02)				(0.01)				(0.02)
Net charges related to asset abandonment			—				0.06				0.01				0.06



Adjusted Diluted EPS			$	3.56			$	3.28			$	7.38			$	6.65

Note: the tax impacts in the table above were calculated using tax rates in effect in the jurisdiction for which the item relates.

Free Cash Flow*:*

The Company defines Free Cash Flow as net cash provided by operating activities minus cash paid for capital additions. Management believes that Free Cash Flow is a useful metric in assessing the Company’s cash flows to service debt, pay dividends and to fund acquisitions and share repurchases. Management deems capital expenditures essential to the Company’s product and service innovations and maintenance of Moody’s operational capabilities. Accordingly, capital expenditures are deemed to be a recurring use of Moody’s cash flow. Below is a reconciliation of the Company’s net cash flows from operating activities to Free Cash Flow:


	Six Months Ended June 30,
	2025		2024
Net cash provided by operating activities	$	1,300	$	1,461
Capital additions	(160)		(171)
Free Cash Flow	$	1,140	$	1,290
Net cash provided by (used in) investing activities	$	98	$	(191)
Net cash used in financing activities	$	(1,780)	$	(731)

Organic Constant Currency Revenue Growth (Decline):

The Company presents organic constant currency revenue growth (decline) as its non-GAAP measure of revenue growth (decline). Management deems this measure to be useful in providing additional perspective in assessing the Company's revenue growth (decline) excluding both the inorganic revenue impacts from certain acquisition activity and the impacts of changes in foreign exchange rates. The Company calculates the dollar impact of foreign exchange as the difference between the translation of its current period non-USD functional currency results using comparative prior period weighted average foreign exchange translation rates and current year reported results.

Below is a reconciliation of the Company's reported revenue and growth (decline) rates to its organic constant currency revenue growth (decline) measures:


	Three Months Ended June 30,							Six Months Ended June 30,
Amounts in millions	2025		2024		Change		Growth	2025		2024		Change		Growth
MCO revenue	$	1,898	$	1,817	$	81	4%	$	3,822	$	3,603	$	219	6%
FX impact	(27)		—		(27)			(13)		—		(13)
Inorganic revenue from acquisitions	(17)		—		(17)			(32)		—		(32)
Organic constant currency MCO revenue	$	1,854	$	1,817	$	37	2%	$	3,777	$	3,603	$	174	5%

MA revenue	$	888	$	802	$	86	11%	$	1,747	$	1,601	$	146	9%
FX impact	(15)		—		(15)			(7)		—		(7)
Inorganic revenue from acquisitions	(14)		—		(14)			(25)		—		(25)
Organic constant currency MA revenue	$	859	$	802	$	57	7%	$	1,715	$	1,601	$	114	7%

Decision Solutions revenue	$	413	$	366	$	47	13%	$	818	$	731	$	87	12%
FX impact	(5)		—		(5)			(2)		—		(2)
Inorganic revenue from acquisitions	(14)		—		(14)			(25)		—		(25)
Organic constant currency Decision Solutions revenue	$	394	$	366	$	28	8%	$	791	$	731	$	60	8%

Banking revenue	$	138	$	131	$	7	5%	$	279	$	265	$	14	5%
FX impact	(1)		—		(1)			—		—		—
Inorganic revenue from acquisitions	(3)		—		(3)			(5)		—		(5)
Organic constant currency Banking revenue	$	134	$	131	$	3	2%	$	274	$	265	$	9	3%

Insurance revenue	$	168	$	147	$	21	14%	$	331	$	291	$	40	14%
FX impact	(1)		—		(1)			—		—		—
Inorganic revenue from acquisitions	(11)		—		(11)			(20)		—		(20)
Organic constant currency Insurance revenue	$	156	$	147	$	9	6%	$	311	$	291	$	20	7%

KYC revenue	$	107	$	88	$	19	22%	$	208	$	175	$	33	19%
FX impact	(3)		—		(3)			(2)		—		(2)

Constant currency KYC revenue	$	104	$	88	$	16	18%	$	206	$	175	$	31	18%

Research and Insights revenue	$	249	$	226	$	23	10%	$	485	$	448	$	37	8%
FX impact	(4)		—		(4)			(3)		—		(3)
Constant currency Research and Insights revenue	$	245	$	226	$	19	8%	$	482	$	448	$	34	8%

Data and Information revenue	$	226	$	210	$	16	8%	$	444	$	422	$	22	5%
FX impact	(6)		—		(6)			(2)		—		(2)

Constant currency Data and Information revenue	$	220	$	210	$	10	5%	$	442	$	422	$	20	5%


	Three Months Ended June 30,							Six Months Ended June 30,
Amounts in millions	2025		2024		Change		Growth	2025		2024		Change		Growth
MIS revenue	$	1,010	$	1,015	$	(5)	—%	$	2,075	$	2,002	$	73	4%
FX impact	(12)		—		(12)			(6)		—		(6)
Inorganic revenue from acquisitions	(3)		—		(3)			(7)		—		(7)
Organic constant currency MIS revenue	$	995	$	1,015	$	(20)	(2)%	$	2,062	$	2,002	$	60	3%

CFG revenue	$	512	$	525	$	(13)	(2)%	$	1,076	$	1,054	$	22	2%
FX impact	(7)		—		(7)			(4)		—		(4)
Inorganic revenue from acquisitions	(1)		—		(1)			(2)		—		(2)
Organic constant currency CFG revenue	$	504	$	525	$	(21)	(4)%	$	1,070	$	1,054	$	16	2%

FIG revenue	$	191	$	195	$	(4)	(2)%	$	382	$	390	$	(8)	(2)%
FX impact	(2)		—		(2)			—		—		—
Inorganic revenue from acquisitions	(2)		—		(2)			(5)		—		(5)
Organic constant currency FIG revenue	$	187	$	195	$	(8)	(4)%	$	377	$	390	$	(13)	(3)%

MA recurring revenue	$	852	$	764	$	88	12%	$	1,674	$	1,516	$	158	10%
FX impact	(15)		—		(15)			(8)		—		(8)
Inorganic recurring revenue from acquisitions	(13)		—		(13)			(24)		—		(24)
Organic constant currency MA recurring revenue	$	824	$	764	$	60	8%	$	1,642	$	1,516	$	126	8%

Decision Solutions recurring revenue	$	382	$	333	$	49	15%	$	755	$	657	$	98	15%
FX impact	(5)		—		(5)			(2)		—		(2)
Inorganic recurring revenue from acquisitions	(13)		—		(13)			(24)		—		(24)
Organic constant currency Decision Solutions recurring revenue	$	364	$	333	$	31	9%	$	729	$	657	$	72	11%

Banking recurring revenue	$	113	$	103	$	10	10%	$	228	$	208	$	20	10%
FX impact	(1)		—		(1)			—		—		—
Inorganic recurring revenue from acquisitions	(2)		—		(2)			(5)		—		(5)
Organic constant currency Banking recurring revenue	$	110	$	103	$	7	7%	$	223	$	208	$	15	7%

Insurance recurring revenue	$	162	$	143	$	19	13%	$	319	$	277	$	42	15%
FX impact	(1)		—		(1)			—		—		—
Inorganic recurring revenue from acquisitions	(11)		—		(11)			(19)		—		(19)
Organic constant currency Insurance recurring revenue	$	150	$	143	$	7	5%	$	300	$	277	$	23	8%

KYC recurring revenue	$	107	$	87	$	20	23%	$	208	$	172	$	36	21%
FX impact	(3)		—		(3)			(2)		—		(2)

Constant currency KYC recurring revenue	$	104	$	87	$	17	20%	$	206	$	172	$	34	20%

Key Performance Metrics:

The Company presents ARR on an organic constant currency basis for its MA business as a supplemental performance metric to provide additional insight on the estimated value of MA's recurring revenue contracts at a given point in time. The Company uses ARR to manage and monitor performance of its MA operating segment and believes that this metric is a key indicator of the trajectory of MA's recurring revenue base.

The Company calculates ARR by taking the total recurring contract value for each active renewable contract as of the reporting date, divided by the number of days in the contract and multiplied by 365 days to create an annualized value. The Company defines renewable contracts as subscriptions, term licenses, maintenance and renewable services. ARR excludes transaction sales including one-time training, services and perpetual licenses. In order to compare period-over-period ARR excluding the effects of foreign currency translation, the Company bases the calculation on currency rates utilized in its current year operating budget and holds these FX rates constant for the duration of all current and prior periods being reported. Additionally, ARR excludes contracts related to acquisitions to provide additional perspective in assessing growth excluding the impacts from certain acquisition activity.

The Company’s definition of ARR may differ from definitions utilized by other companies reporting similarly named measures, and this metric should be viewed in addition to, and not as a substitute for, financial measures presented in accordance with GAAP.


Amounts in millions	June 30, 2025		June 30, 2024		Change		Growth






MA ARR
Decision Solutions
Banking	$	456	$	427	$	29	7%
Insurance	616		563		53		9%
KYC	395		342		53		15%
Total Decision Solutions	$	1,467	$	1,332	$	135	10%
Research and Insights	956		892		64		7%
Data and Information	874		827		47		6%
Total MA ARR	$	3,297	$	3,051	$	246	8%

RECENTLY ISSUED ACCOUNTING STANDARDS

Refer to Note 1 to the consolidated financial statements located in Part I of this Form 10-Q for a discussion on the impact to the Company relating to recently issued accounting pronouncements.

CONTINGENCIES

Legal proceedings in which the Company is involved also may impact Moody’s liquidity or operating results. No assurance can be provided as to the outcome of such proceedings. In addition, litigation inherently involves significant costs. For information regarding legal proceedings, see Item 1 - "Financial Statements," Note 16 "Contingencies” in this Form 10-Q.

FORWARD-LOOKING STATEMENTS

Certain statements contained in this quarterly report on Form 10-Q are forward-looking statements and are based on future expectations, plans and prospects for the Company's business and operations that involve a number of risks and uncertainties. Such statements involve estimates, projections, goals, forecasts, assumptions and uncertainties that could cause actual results or outcomes to differ materially from those contemplated, expressed, projected, anticipated or implied in the forward-looking statements. Those statements appear at various places throughout this quarterly report on Form 10-Q, including in the sections entitled “Contingencies” under Item 2, “MD&A,” commencing on page 44 of this quarterly report on Form 10-Q, under “Legal Proceedings” in Part II, Item 1, of this Form 10-Q, and elsewhere in the context of statements containing the words “believe,” “expect,” “anticipate,” “intend,” “plan,” “will,” “predict,” “potential,” “continue,” “strategy,” “aspire,” “target,” “forecast,” “project,” “estimate,” “should,” “could,” “may,” and similar expressions or words and variations thereof relating to the Company’s views on future events, trends and contingencies or otherwise convey the prospective nature of events or outcomes generally indicative of forward-looking statements. Stockholders and investors are cautioned not to place undue reliance on these forward-looking statements. The forward-looking statements and other information in this document are made as of the date of this quarterly report on Form 10-Q, and the Company undertakes no obligation (nor does it intend) to publicly supplement, update or revise such statements on a going-forward basis, whether as a result of subsequent developments, changed expectations or otherwise, except as required by applicable law or regulation. In connection with the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, the Company is identifying certain factors that could cause actual results to differ, perhaps materially, from those indicated by these forward-looking statements.

Those factors, risks and uncertainties include, but are not limited to:

the uncertain effects of U.S. and foreign government actions affecting international trade and economic policy, including changes in volatility in tariffs and trade policies and retaliatory actions, on credit markets, customers, and customer retention, and demand for our products and services;
the impact of general economic conditions (including significant government debt and deficit levels and inflation or recessions and related monetary policy actions by governments in response thereto) on worldwide credit markets and on economic activity, including on the level of merger and acquisition activity, and their effects on the volume of debt and other securities issued in domestic and/or global capital markets;
the uncertain effect of U.S. and foreign government initiatives and monetary policy to respond to the current economic climate, including instability of financial institutions, credit quality concerns, and other potential impacts of volatility in financial and credit markets;
the impacts of geopolitical events and actions, such as the Russia-Ukraine military conflict and military conflict in the Middle East, and of tensions and disputes in political and global relations, on volatility in world financial markets, on general economic conditions and GDP in the U.S. and worldwide and on the Company's own operations and personnel;
other matters that could affect the volume of debt and other securities issued in domestic and/or global capital markets, including regulation, increased utilization of technologies that have the potential to intensify competition and accelerate disruption and disintermediation in the financial services industry, as well as the number of issuances of securities without ratings or securities which are rated or evaluated by non-traditional parties;
the level of merger and acquisition activity in the U.S. and abroad;
the impact of MIS’s withdrawal of its credit ratings on countries or entities within countries and of Moody’s no longer conducting commercial operations in countries where political instability warrants such actions;
concerns in the marketplace affecting our credibility or otherwise affecting market perceptions of the integrity or utility of independent credit agency ratings;
the introduction or development of competing and/or emerging technologies and products;
pricing pressure from competitors and/or customers;
the level of success of new product development and global expansion;
the impact of regulation as an NRSRO, the potential for new U.S., state and local legislation and regulations;
the potential for increased competition and regulation in the jurisdictions in which we operate, including the EU;
exposure to litigation related to our rating opinions, as well as any other litigation, government and regulatory proceedings, investigations and inquiries to which Moody’s may be subject from time to time;
provisions in U.S. legislation modifying the pleading standards and EU regulations modifying the liability standards, applicable to CRAs in a manner adverse to CRAs;
provisions of EU regulations imposing additional procedural and substantive requirements on the pricing of services and the expansion of supervisory remit to include non-EU ratings used for regulatory purposes;
uncertainty regarding the future relationship between the U.S. and China;
the possible loss of key employees and the impact of the global labor environment;
failures or malfunctions of our operations and infrastructure;
any vulnerabilities to cyber threats or other cybersecurity concerns;
the timing and effectiveness of our restructuring programs;
currency and foreign exchange volatility;
the outcome of any review by tax authorities of Moody’s global tax planning initiatives;
exposure to potential criminal sanctions or civil remedies if Moody’s fails to comply with foreign and U.S. laws and regulations that are applicable in the jurisdictions in which Moody’s operates, including data protection and privacy laws, sanctions laws, anti-corruption laws, and local laws prohibiting corrupt payments to government officials;
the impact of mergers, acquisitions, or other business combinations and the ability of Moody’s to successfully integrate acquired businesses;
the level of future cash flows;
the levels of capital investments; and
a decline in the demand for credit risk management tools by financial institutions, corporate or government entities.

These factors, risks and uncertainties as well as other risks and uncertainties that could cause Moody’s actual results to differ materially from those contemplated, expressed, projected, anticipated or implied in the forward-looking statements are described in greater detail under “Risk Factors” in Part I, Item 1A of Moody’s annual report on Form 10-K for the year ended December 31, 2024, and in other filings made by the Company from time to time with the SEC or in materials incorporated herein or therein. Stockholders and investors are cautioned that the occurrence of any of these factors, risks and uncertainties may cause the Company’s actual results to differ materially from those contemplated, expressed, projected, anticipated or implied in the forward-looking statements, which could have a material and adverse effect on the Company’s business, results of operations and financial condition. New factors may emerge from time to time, and it is not possible for the Company to predict new factors, nor can the Company assess the potential effect of any new factors on it. Forward-looking and other statements in this document may also address our corporate responsibility progress, plans, and goals (including sustainability and environmental matters), and the inclusion of such statements is not an indication that these contents are necessarily material to investors or required to be disclosed in the Company’s filings with the Securities and Exchange Commission. In addition, historical, current, and forward-looking sustainability-related statements may be based on standards for measuring progress that are still developing, internal controls and processes that continue to evolve, and assumptions that are subject to change in the future.

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