Item 1. Financial Statements

MOODY’S CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

(Amounts in millions, except per share data)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2026		2025		2026		2025
Revenue	$	2,023	$	2,007	$	6,287	$	5,829
Expenses
Operating	524		492		1,573		1,472
Selling, general and administrative	442		453		1,382		1,335
Depreciation and amortization	124		123		372		356
Restructuring	27		21		86		81
Charges related to asset abandonment	—		1		—		4
Total expenses	1,117		1,090		3,413		3,248
Operating income	906		917		2,874		2,581
Non-operating income (expense), net
Interest expense, net	(54)		(58)		(178)		(180)
Other non-operating income, net	1		8		17		42
Gain on business divestitures	115		—		296		—
Total non-operating income (expense), net	62		(50)		135		(138)
Income before provision for income taxes	968		867		3,009		2,443
Provision for income taxes	232		220		733		592
Net income	736		647		2,276		1,851
Less: Net income attributable to noncontrolling interests	2		1		3		2
Net income attributable to Moody's	$	734	$	646	$	2,273	$	1,849
Earnings per share attributable to Moody's common shareholders
Basic	$	4.25	$	3.61	$	13.02	$	10.30
Diluted	$	4.24	$	3.60	$	12.98	$	10.26
Weighted average number of shares outstanding
Basic	172.8		178.9		174.6		179.5
Diluted	173.3		179.6		175.1		180.2

The accompanying notes are an integral part of the consolidated financial statements.

MOODY’S CORPORATION

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED)

(Amounts in millions)



	Three Months Ended September 30, 2026						Three Months Ended September 30, 2025
	Pre-tax amounts		Tax amounts		After-tax amounts		Pre-tax amounts		Tax amounts		After-tax amounts
Net Income					$	736					$	647
Other Comprehensive Income (Loss):
Foreign Currency Adjustments:
Foreign currency translation adjustments, net	$	(6)	$	—	(6)		$	(26)	$	1	(25)

Net gains (losses) on net investment hedges	30		(10)		20		8		(3)		5

Cash Flow Hedges:

Reclassification of losses included in net income	1		—		1				—		—
Pension and Other Retirement Benefits:

Net actuarial gains (losses)	(1)		—		(1)				—		—
Total other comprehensive income (loss)	$	24	$	(10)	$	14	$	(18)	$	(2)	$	(20)
Comprehensive income					750						627
Less: comprehensive income (loss) attributable to noncontrolling interests					3						(1)
Comprehensive Income Attributable to Moody's					$	747					$	628



	Nine Months Ended September 30, 2026						Nine Months Ended September 30, 2025

	Pre-tax amounts		Tax amounts		After-tax amounts		Pre-tax amounts		Tax amounts		After-tax amounts
Net Income					$	2,276					$	1,851
Other Comprehensive Income (Loss):
Foreign Currency Adjustments:
Foreign currency translation adjustments, net	$	(169)	$	1	(168)		$	586	$	—	586

Net gains (losses) on net investment hedges	159		(45)		114		(652)		163		(489)

Cash Flow Hedges:

Reclassification of losses included in net income	2		—		2		1		—		1
Pension and Other Retirement Benefits:
Amortization of actuarial gains and prior service credits included in net income	(2)		1		(1)		(1)		—		(1)
Net actuarial gains (losses)	6		(2)		4		(1)		—		(1)
Total other comprehensive (loss) income	$	(4)	$	(45)	$	(49)	$	(67)	$	163	$	96
Comprehensive income					2,227						1,947
Less: comprehensive loss attributable to noncontrolling interests					(5)						(4)
Comprehensive Income Attributable to Moody's					$	2,232					$	1,951

The accompanying notes are an integral part of the consolidated financial statements.

MOODY’S CORPORATION

CONSOLIDATED BALANCE SHEETS (UNAUDITED)

(Amounts in millions, except share and per share data)


	September 30, 2026		December 31, 2025
ASSETS
Current assets:
Cash and cash equivalents	$	1,513	$	2,384
Short-term investments	108		64
Accounts receivable, net of allowance for credit losses of $29 in 2026 and $29 in 2025	1,830		2,024
Other current assets	773		714

Total current assets	4,224		5,186
Property and equipment, net of accumulated depreciation of $1,650 in 2026 and $1,572 in 2025	782		722
Operating lease right-of-use assets	507		282
Goodwill	6,304		6,368
Intangible assets, net	1,694		1,866
Deferred tax assets, net	236		305
Other assets	1,083		1,101
Total assets	$	14,830	$	15,830
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued liabilities	$	1,219	$	1,304
Current portion of operating lease liabilities	93		95

Current portion of long-term debt	568		—
Deferred revenue	1,402		1,582

Total current liabilities	3,282		2,981
Non-current portion of deferred revenue	53		56
Long-term debt	6,343		6,994
Deferred tax liabilities, net	340		315
Uncertain tax positions	167		158
Operating lease liabilities	488		262
Other liabilities	745		859
Total liabilities	11,418		11,625
Contingencies (Note 15)
Shareholders' equity:
Preferred stock, par value $0.01 per share; 10,000,000 shares authorized; no shares issued and outstanding	—		—
Series common stock, par value $0.01 per share; 10,000,000 shares authorized; no shares issued and outstanding	—		—
Common stock, par value $0.01 per share; 1,000,000,000 shares authorized; 342,902,272 shares issued at September 30, 2026 and December 31, 2025, respectively	3		3
Capital surplus	1,817		1,676
Retained earnings	19,582		17,853
Treasury stock, at cost; 170,478,190 and 165,359,285 shares of common stock at September 30, 2026 and December 31, 2025, respectively	(17,593)		(14,978)
Accumulated other comprehensive loss	(541)		(500)
Total Moody's shareholders' equity	3,268		4,054
Noncontrolling interests	144		151
Total shareholders' equity	3,412		4,205
Total liabilities, noncontrolling interests and shareholders' equity	$	14,830	$	15,830

The accompanying notes are an integral part of the consolidated financial statements.

MOODY’S CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

(Amounts in millions)


	Nine Months Ended September 30,
	2026		2025
Cash flows from operating activities
Net income	$	2,276	$	1,851
Reconciliation of net income to net cash provided by operating activities:
Depreciation and amortization	372		356
Stock-based compensation	175		174
Deferred income taxes	50		40

Non-cash restructuring and abandonment-related charges	3		8
Provision for credit losses on accounts receivable	9		11



Gain on business divestitures	(296)		—



Changes in assets and liabilities:
Accounts receivable	166		63
Other current assets	(5)		13
Other assets	1		(16)
Lease obligations	(2)		(28)
Accounts payable and accrued liabilities	(123)		(317)
Deferred revenue	(172)		(130)
Uncertain tax positions and other non-current tax liabilities	10		17
Other liabilities	7		1
Net cash provided by operating activities	2,471		2,043
Cash flows from investing activities
Capital additions	(271)		(245)
Purchases of investments	(165)		(158)
Sales and maturities of investments	133		656
Purchases of investments in non-consolidated affiliates	(4)		(14)


Receipts from settlements of net investment hedges	—		32
Cash paid for acquisitions, net of cash acquired	(23)		(227)
Cash received upon business divestitures	200		—
Net cash (used in) provided by investing activities	(130)		44
Cash flows from financing activities

Repayment of notes	—		(700)




Proceeds from stock-based compensation plans	34		44
Repurchase of shares related to stock-based compensation and excise tax payments on share repurchases	(125)		(92)
Treasury shares	(2,553)		(1,170)

Dividends	(543)		(534)
Dividends to noncontrolling interests	(3)		(2)



Net cash used in financing activities	(3,190)		(2,454)

Effect of exchange rate changes on cash and cash equivalents	(22)		140
Decrease in cash and cash equivalents	(871)		(227)
Cash and cash equivalents, beginning of period	2,384		2,408
Cash and cash equivalents, end of period	$	1,513	$	2,181

The accompanying notes are an integral part of the consolidated financial statements.

MOODY’S CORPORATION

CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY (UNAUDITED)

(Amounts in millions, except per share data)


	Shareholders of Moody's Corporation
	Common Stock			Capital Surplus			Retained Earnings			Treasury Stock			Accumulated Other Comprehensive Loss		Total Moody's Shareholders' Equity		Non- Controlling Interests		Total Shareholders' Equity
	Shares	Amount				Shares			Amount
Balance at June 30, 2025	342.9	$	3	$	1,552		$	16,933		(163.5)	$	(14,020)	$	(519)	$	3,949	$	159	$	4,108
Net income							646								646		1		647
Dividends ($0.94 per share)							(169)								(169)		(4)		(173)
Stock-based compensation				59											59				59
Shares issued for stock-based compensation plans at average cost, net				6						—	2				8				8


Treasury shares repurchased, inclusive of excise tax of $4 million				—						(1.0)	(517)				(517)				(517)

Currency translation adjustment, net of net investment hedge activity (net of tax of $2 million)													(19)		(19)		(1)		(20)




Balance at September 30, 2025	342.9	$	3	$	1,617		$	17,410		(164.5)	$	(14,535)	$	(538)	$	3,957	$	155	$	4,112

The accompanying notes are an integral part of the consolidated financial statements.

MOODY'S CORPORATION

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (UNAUDITED)

(Amounts in millions, except per share data)


	Shareholders of Moody's Corporation
	Common Stock			Capital Surplus			Retained Earnings			Treasury Stock			Accumulated Other Comprehensive Loss		Total Moody's Shareholders' Equity		Non- Controlling Interests		Total Shareholders' Equity
	Shares	Amount				Shares			Amount
Balance at December 31, 2024	342.9	$	3	$	1,451		$	16,071		(162.6)	$	(13,322)	$	(638)	$	3,565	$	162	$	3,727
Net income							1,849								1,849		2		1,851
Dividends ($2.82 per share)							(510)								(510)		(5)		(515)
Stock-based compensation				180											180				180
Shares issued for stock-based compensation plans at average cost, net				(14)						0.5	(34)				(48)				(48)



Treasury shares repurchased, inclusive of excise tax of $9 million				—						(2.4)	(1,179)				(1,179)				(1,179)

Currency translation adjustment, net of net investment hedge activity (net of tax of $163 million)													101		101		(4)		97
Net actuarial losses													(1)		(1)				(1)
Amortization of actuarial gains and prior service credits													(1)		(1)				(1)
Amortization of losses on cash flow hedges													1		1				1
Balance at September 30, 2025	342.9	$	3	$	1,617		$	17,410		(164.5)	$	(14,535)	$	(538)	$	3,957	$	155	$	4,112

The accompanying notes are an integral part of the consolidated financial statements.

MOODY'S CORPORATION

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (UNAUDITED)

(Amounts in millions, except per share data)


	Shareholders of Moody's Corporation
	Common Stock			Capital Surplus			Retained Earnings			Treasury Stock			Accumulated Other Comprehensive Loss		Total Moody's Shareholders' Equity		Non- Controlling Interests		Total Shareholders' Equity
	Shares	Amount				Shares			Amount
Balance at June 30, 2026	342.9	$	3	$	1,753		$	19,027		(169.7)	$	(17,204)	$	(554)	$	3,025	$	141	$	3,166
Net income							734								734		2		736
Dividends ($1.03 per share)							(179)								(179)		—		(179)
Stock-based compensation				59											59				59
Shares issued for stock-based compensation plans at average cost, net				5						0.1	2				7				7


Treasury shares repurchased, inclusive of excise tax of $3 million										(0.9)	(391)				(391)				(391)
Currency translation adjustment, net of net investment hedge activity (net of tax of $10 million)													13		13		1		14
Net actuarial losses													(1)		(1)				(1)

Amortization of losses on cash flow hedges													1		1				1
Balance at September 30, 2026	342.9	$	3	$	1,817		$	19,582		(170.5)	$	(17,593)	$	(541)	$	3,268	$	144	$	3,412

The accompanying notes are an integral part of the consolidated financial statements.

MOODY'S CORPORATION

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (UNAUDITED)

(Amounts in millions, except per share data)


	Shareholders of Moody's Corporation
	Common Stock			Capital Surplus			Retained Earnings			Treasury Stock			Accumulated Other Comprehensive Loss		Total Moody's Shareholders' Equity		Non- Controlling Interests		Total Shareholders' Equity
	Shares	Amount				Shares			Amount
Balance at December 31, 2025	342.9	$	3	$	1,676		$	17,853		(165.4)	$	(14,978)	$	(500)	$	4,054	$	151	$	4,205
Net income							2,273								2,273		3		2,276
Dividends ($3.09 per share)							(544)								(544)		(8)		(552)

Stock-based compensation				179											179				179
Shares issued for stock-based compensation plans at average cost, net				(38)						0.5	(40)				(78)				(78)


Noncontrolling interest resulting from majority acquisition															—		6		6
Treasury shares repurchased, inclusive of excise tax of $22 million				—						(5.6)	(2,575)				(2,575)				(2,575)

Currency translation adjustment, net of net investment hedge activity (net of tax of $44 million)													(46)		(46)		(8)		(54)
Net actuarial gains (net of tax of $2 million)													4		4				4
Amortization of actuarial gains and prior service credits													(1)		(1)				(1)
Amortization of losses on cash flow hedges													2		2				2
Balance at September 30, 2026	342.9	$	3	$	1,817		$	19,582		(170.5)	$	(17,593)	$	(541)	$	3,268	$	144	$	3,412

The accompanying notes are an integral part of the consolidated financial statements.

MOODY’S CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

(tabular dollar and share amounts in millions, except per share data)

NOTE 1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION

Moody’s is a global provider of integrated perspectives on risk that empowers organizations and investors to make better decisions. Moody’s reports in two reportable segments: MA and MIS.

MA comprises three interconnected businesses: i) Research & Insights, which provides credit research, economic analysis and scenario modeling used in investment, risk, and regulatory decisions; ii) Data & Information, which is powered by the world's largest database on companies and credit and serves as a critical input to financial analysis and AI model development/risk assessment; and iii) Decision Solutions, a set of cloud-based platforms embedding Moody's data and analytics directly into regulated banking, insurance, and KYC workflows. Together, these businesses benefit from deep customer integration, long-term subscription structures, and data assets that are proprietary in sourcing, breadth, and historical depth.

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.

These interim financial statements have been prepared in accordance with the instructions to Form 10-Q and should be read in conjunction with the Company’s consolidated financial statements and related notes in the Company’s 2025 annual report on Form 10-K filed with the SEC on February 18, 2026. The results of interim periods are not necessarily indicative of results for the full year or any subsequent period. In the opinion of management, all adjustments (including normal recurring accruals) considered necessary for a fair presentation of financial position, results of operations and cash flows at the dates and for the periods presented have been included. The year-end consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by GAAP.

Certain reclassifications have been made to prior period amounts to conform to the current presentation.

Recently Issued Accounting Standards

In November 2024, the FASB issued ASU 2024-03, "Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses" ("ASU No. 2024-03"). The amendments in this ASU require more detailed disclosures about specific expense categories in the notes to financial statements (including employee compensation, depreciation and intangible asset amortization) and apply to both interim and annual reporting periods. ASU No. 2024-03 also requires disclosure of total selling expenses for both interim and annual reporting periods, with an additional requirement to provide an entity’s definition of selling expenses in annual reporting. This ASU is effective in fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. The amendments in this ASU should be applied either (1) prospectively for annual and interim reporting periods beginning after the aforementioned effective dates or (2) retrospectively to any or all prior periods presented in the financial statements. The Company is currently evaluating the impact of adopting this ASU on its consolidated financial statements and disclosures. The Company expects this guidance to result primarily in expanded disclosures and additional expense disaggregation.

In September 2025, the FASB issued ASU 2025-06 "Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software" ("ASU No. 2025-06"). This ASU eliminates prescriptive software development stages and requires capitalization of software costs when (1) management commits to funding the project, and (2) completion and intended use are probable, with consideration to when significant uncertainty associated with the development activities of the software no longer exists. This ASU also clarifies the disclosure requirements for internal-use software costs and supersedes prior guidance on website development costs. This ASU is effective for annual reporting periods beginning after December 15, 2027, with early adoption permitted. Entities may transition using prospective, modified prospective, or retrospective approaches. The Company is currently evaluating the impact of adopting this ASU on its consolidated financial statements and disclosures.

NOTE 2. REVENUES

Revenue by Category

The following table presents the Company’s revenues disaggregated by LOB:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2026		2025		2026		2025
MA:
Decision Solutions (DS)
Banking	$	118	$	140	$	370	$	419
Insurance	186		171		550		502
KYC	122		113		361		321
Total DS	426		424		1,281		1,242
Research and Insights (R&I)	260		252		771		737
Data and Information (D&I)	250		233		735		677
Total external revenue	936		909		2,787		2,656
Intersegment revenue	3		3		9		9
Total MA	939		912		2,796		2,665
MIS:
Corporate Finance (CFG)
Investment-grade	146		124		552		431
High-yield	68		114		269		266
Bank loans	113		155		399		413
Other accounts (1)	203		183		594		542
Total CFG	530		576		1,814		1,652
Structured Finance (SFG)
Asset-backed securities	43		35		126		105
RMBS	36		29		103		84
CMBS	26		25		73		78
Structured credit	46		55		135		149
Other accounts	2		2		4		3
Total SFG	153		146		441		419
Financial Institutions (FIG)
Banking	140		136		422		386
Insurance	49		52		134		151
Managed investments	21		17		62		43
Other accounts	3		3		11		10
Total FIG	213		208		629		590
Public, Project and Infrastructure Finance (PPIF)
Public finance / sovereign	82		68		238		215
Project and infrastructure	97		93		341		271
Total PPIF	179		161		579		486
Total ratings revenue	1,075		1,091		3,463		3,147
MIS Other	12		7		37		26
Total external revenue	1,087		1,098		3,500		3,173
Intersegment revenue	51		50		154		149
Total MIS	1,138		1,148		3,654		3,322
Eliminations	(54)		(53)		(163)		(158)
Total MCO	$	2,023	$	2,007	$	6,287	$	5,829

(1) 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 following tables present the Company’s revenues disaggregated by LOB and geographic area:



	Three Months Ended September 30, 2026						Three Months Ended September 30, 2025
	U.S.		Non-U.S.		Total		U.S.		Non-U.S.		Total
MA:
Decision Solutions	$	183	$	243	$	426	$	167	$	257	$	424
Research and Insights	139		121		260		137		115		252
Data and Information	93		157		250		82		151		233
Total MA	415		521		936		386		523		909
MIS:
Corporate Finance	378		152		530		405		171		576
Structured Finance	106		47		153		108		38		146
Financial Institutions	113		100		213		111		97		208
Public, Project and Infrastructure Finance	121		58		179		108		53		161
Total ratings revenue	718		357		1,075		732		359		1,091
MIS Other	1		11		12		—		7		7
Total MIS	719		368		1,087		732		366		1,098
Total MCO	$	1,134	$	889	$	2,023	$	1,118	$	889	$	2,007


	Nine Months Ended September 30, 2026						Nine Months Ended September 30, 2025
	U.S.		Non-U.S.		Total		U.S.		Non-U.S.		Total
MA:
Decision Solutions	$	536	$	745	$	1,281	$	496	$	746	$	1,242
Research and Insights	418		353		771		404		333		737
Data and Information	269		466		735		242		435		677
Total MA	1,223		1,564		2,787		1,142		1,514		2,656
MIS:
Corporate Finance	1,283		531		1,814		1,110		542		1,652
Structured Finance	304		137		441		299		120		419
Financial Institutions	334		295		629		305		285		590
Public, Project and Infrastructure Finance	385		194		579		319		167		486
Total ratings revenue	2,306		1,157		3,463		2,033		1,114		3,147
MIS Other	3		34		37		—		26		26
Total MIS	2,309		1,191		3,500		2,033		1,140		3,173
Total MCO	$	3,532	$	2,755	$	6,287	$	3,175	$	2,654	$	5,829

The following table presents the Company’s reportable segment revenues disaggregated by segment and geographic region:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2026		2025		2026		2025
MA:
U.S.	$	415	$	386	$	1,223	$	1,142
Non-U.S.:
EMEA	365		358		1,100		1,036
Asia-Pacific	92		96		273		276
Americas	64		69		191		202
Total Non-U.S.	521		523		1,564		1,514
Total MA	936		909		2,787		2,656
MIS:
U.S.	719		732		2,309		2,033
Non-U.S.:
EMEA	231		236		761		740
Asia-Pacific	86		84		278		245
Americas	51		46		152		155
Total Non-U.S.	368		366		1,191		1,140
Total MIS	1,087		1,098		3,500		3,173
Total MCO	$	2,023	$	2,007	$	6,287	$	5,829

The following tables summarize the split between Transaction Revenue and Recurring Revenue:




	Three Months Ended September 30,
	2026									2025
	Transaction			Recurring			Total			Transaction			Recurring			Total
Decision Solutions
Banking	$	3		$	115		$	118		$	25		$	115		$	140
	3		%	97		%	100		%	18		%	82		%	100		%
Insurance	$	2		$	184		$	186		$	3		$	168		$	171
	1		%	99		%	100		%	2		%	98		%	100		%
KYC	$	—		$	122		$	122		$	1		$	112		$	113
	—		%	100		%	100		%	1		%	99		%	100		%
Total Decision Solutions	$	5		$	421		$	426		$	29		$	395		$	424
	1		%	99		%	100		%	7		%	93		%	100		%
Research and Insights	$	2		$	258		$	260		$	3		$	249		$	252
	1		%	99		%	100		%	1		%	99		%	100		%
Data and Information	$	1		$	249		$	250		$	2		$	231		$	233
	—		%	100		%	100		%	1		%	99		%	100		%
Total MA (1)	$	8		$	928		$	936		$	34		$	875		$	909
	1		%	99		%	100		%	4		%	96		%	100		%
Corporate Finance	$	374		$	156		$	530		$	433		$	143		$	576
	71		%	29		%	100		%	75		%	25		%	100		%
Structured Finance	$	88		$	65		$	153		$	86		$	60		$	146
	58		%	42		%	100		%	59		%	41		%	100		%
Financial Institutions	$	122		$	91		$	213		$	123		$	85		$	208
	57		%	43		%	100		%	59		%	41		%	100		%
Public, Project and Infrastructure Finance	$	126		$	53		$	179		$	111		$	50		$	161
	70		%	30		%	100		%	69		%	31		%	100		%
MIS Other	$	4		$	8		$	12		$	—		$	7		$	7
	33		%	67		%	100		%	—		%	100		%	100		%
Total MIS	$	714		$	373		$	1,087		$	753		$	345		$	1,098
	66		%	34		%	100		%	69		%	31		%	100		%
Total Moody's Corporation	$	722		$	1,301		$	2,023		$	787		$	1,220		$	2,007
	36		%	64		%	100		%	39		%	61		%	100		%


	Nine Months Ended September 30,
	2026									2025
	Transaction			Recurring			Total			Transaction			Recurring			Total
Decision Solutions
Banking	$	12		$	358		$	370		$	76		$	343		$	419
	3		%	97		%	100		%	18		%	82		%	100		%
Insurance	$	9		$	541		$	550		$	15		$	487		$	502
	2		%	98		%	100		%	3		%	97		%	100		%
KYC	$	1		$	360		$	361		$	1		$	320		$	321
	—		%	100		%	100		%	—			100		%	100		%
Total Decision Solutions	$	22		$	1,259		$	1,281		$	92		$	1,150		$	1,242
	2		%	98		%	100		%	7		%	93		%	100		%
Research and Insights	$	7		$	764		$	771		$	9		$	728		$	737
	1		%	99		%	100		%	1		%	99		%	100		%
Data and Information	$	6		$	729		$	735		$	6		$	671		$	677
	1		%	99		%	100		%	1		%	99		%	100		%
Total MA (1)	$	35		$	2,752		$	2,787		$	107		$	2,549		$	2,656
	1		%	99		%	100		%	4		%	96		%	100		%
Corporate Finance	$	1,352		$	462		$	1,814		$	1,225		$	427		$	1,652
	75		%	25		%	100		%	74		%	26		%	100		%
Structured Finance	$	250		$	191		$	441		$	238		$	181		$	419
	57		%	43		%	100		%	57		%	43		%	100		%
Financial Institutions	$	362		$	267		$	629		$	340		$	250		$	590
	58		%	42		%	100		%	58		%	42		%	100		%
Public, Project and Infrastructure Finance	$	422		$	157		$	579		$	340		$	146		$	486
	73		%	27		%	100		%	70		%	30		%	100		%
MIS Other	$	9		$	28		$	37		$	5		$	21		$	26
	24		%	76		%	100		%	19		%	81		%	100		%
Total MIS	$	2,395		$	1,105		$	3,500		$	2,148		$	1,025		$	3,173
	68		%	32		%	100		%	68		%	32		%	100		%
Total Moody's Corporation	$	2,430		$	3,857		$	6,287		$	2,255		$	3,574		$	5,829
	39		%	61		%	100		%	39		%	61		%	100		%

(1) Revenue from software implementation services and risk management advisory projects, while classified by management as transactional revenue, is recognized over time under GAAP.

The following tables present the timing of revenue recognition:


	Three Months Ended September 30, 2026						Nine Months Ended September 30, 2026
	MA		MIS		Total		MA		MIS		Total
Revenue recognized at a point in time	$	16	$	714	$	730	$	57	$	2,395	$	2,452
Revenue recognized over time	920		373		1,293		2,730		1,105		3,835
Total	$	936	$	1,087	$	2,023	$	2,787	$	3,500	$	6,287



	Three Months Ended September 30, 2025						Nine Months Ended September 30, 2025
	MA		MIS		Total		MA		MIS		Total
Revenue recognized at a point in time	$	21	$	753	$	774	$	65	$	2,148	$	2,213
Revenue recognized over time	888		345		1,233		2,591		1,025		3,616
Total	$	909	$	1,098	$	2,007	$	2,656	$	3,173	$	5,829

Unbilled receivables, deferred revenue and remaining performance obligations

Unbilled receivables

For certain MA arrangements, the timing of when the Company has the unconditional right to consideration and recognizes revenue occurs prior to invoicing the customer. In addition, certain MIS arrangements contain contractual terms whereby the customers are billed in arrears for annual monitoring services, requiring revenue to be accrued as an unbilled receivable as such services are provided.

The following table presents the Company's unbilled receivables, which are included within accounts receivable, net, at September 30, 2026 and December 31, 2025:


	As of September 30, 2026				As of December 31, 2025
	MA		MIS		MA		MIS
Unbilled Receivables	$	95	$	604	$	106	$	500

Deferred revenue

The Company recognizes deferred revenue when a contract requires a customer to pay consideration to the Company in advance of when revenue related to that contract is recognized. This deferred revenue is relieved when the Company satisfies the related performance obligation and revenue is recognized.

Significant changes in the deferred revenue balances during the three and nine months ended September 30, 2026 and 2025 are as follows:



	Three Months Ended September 30, 2026						Three Months Ended September 30, 2025
	MA		MIS		Total		MA		MIS		Total
Balance at June 30,	$	1,301	$	347	$	1,648	$	1,285	$	350	$	1,635
Changes in deferred revenue:
Revenue recognized that was included in the deferred revenue balance at the beginning of the period	(646)		(123)		(769)		(612)		(123)		(735)
Increases due to amounts billable excluding amounts recognized as revenue during the period	480		94		574		491		87		578



Reclassification to liabilities held-for-sale	—		—		—		(23)		—		(23)

Effect of exchange rate changes	2		—		2		(27)		(1)		(28)
Total changes in deferred revenue	(164)		(29)		(193)		(171)		(37)		(208)
Balance at September 30,	$	1,137	$	318	$	1,455	$	1,114	$	313	$	1,427


	Nine Months Ended September 30, 2026						Nine Months Ended September 30, 2025
	MA		MIS		Total		MA		MIS		Total
Balance at December 31,	$	1,368	$	270	$	1,638	$	1,243	$	268	$	1,511
Changes in deferred revenue:
Revenue recognized that was included in the deferred revenue balance at the beginning of the period	(1,228)		(196)		(1,424)		(1,074)		(205)		(1,279)
Increases due to amounts billable excluding amounts recognized as revenue during the period	1,020		246		1,266		910		239		1,149
Adjustment related to divestiture of business (1)	(4)		—		(4)		—		—		—
Reclassification to liabilities held-for-sale	—		—		—		(23)		—		(23)
Increases due to acquisitions during the period	—		—		—		15		—		15
Effect of exchange rate changes	(19)		(2)		(21)		43		11		54
Total changes in deferred revenue	(231)		48		(183)		(129)		45		(84)
Balance at September 30,	$	1,137	$	318	$	1,455	$	1,114	$	313	$	1,427
Deferred revenue - current	$	1,136	$	266	$	1,402	$	1,113	$	256	$	1,369
Deferred revenue - non-current	$	1	$	52	$	53	$	1	$	57	$	58

(1) Reflects adjustments to the deferred revenue balance that was disposed of pursuant to the divestiture of the MA Regulatory Solutions business, which was divested in the second quarter of 2026, as more fully discussed in Note 11.

For the MA segment, the decrease in deferred revenue for the three months ended September 30, 2026 and 2025 was primarily due to the recognition of annual subscription and maintenance revenue for the period, for which billing occurs in December and January. For the nine months ended September 30, 2026 and 2025, the decrease in the deferred revenue balance is attributable to recognition of revenues related to the aforementioned December billings, partially offset by the impact of the high concentration of billings in the first quarter.

For the MIS segment, the change in the deferred revenue balance for all periods presented was primarily related to the significant portion of contract renewals that occur during the first quarter and are generally recognized over a one year period.

Remaining performance obligation

Remaining performance obligations in the MA segment include both amounts recorded as deferred revenue on the balance sheet as of September 30, 2026 as well as amounts not yet invoiced to customers as of September 30, 2026, largely reflecting future revenue related to signed multi-year arrangements for hosted and installed subscription-based products. As of September 30, 2026, the aggregate amount of the transaction price allocated to remaining performance obligations was approximately $4.4 billion. The Company expects to recognize into revenue approximately 55% of this balance within one year, approximately 25% of this balance between one to two years and the remaining amount thereafter.

Remaining performance obligations in the MIS segment largely reflect deferred revenue related to monitoring fees for certain structured finance products, primarily CMBS, where the issuers can elect to pay the monitoring fees for the life of the security in advance. As of September 30, 2026, the aggregate amount of the transaction price allocated to remaining performance obligations was approximately $89 million. The Company expects to recognize into revenue approximately 25% of this balance within one year, approximately 55% of this balance between one to five years and the remaining amount thereafter. With respect to the remaining performance obligations for the MIS segment, the Company has applied a practical expedient set forth in ASC Topic 606 permitting the omission of unsatisfied performance obligations relating to contracts with an original expected length of one year or less.

NOTE 3. STOCK-BASED COMPENSATION

Presented below is a summary of the stock-based compensation cost and associated tax benefit included in the accompanying consolidated statements of operations:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2026		2025		2026		2025
Stock-based compensation cost	$	58	$	58	$	175	$	176
Tax benefit	$	12	$	13	$	38	$	38

During the first nine months of 2026, the Company granted 0.1 million employee stock options, which had a weighted average grant date fair value of $133.17 per share. The Company also granted 0.5 million shares of restricted stock in the first nine months of 2026, which had a weighted average grant date fair value of $444.87 per share. Both the employee stock options and restricted stock generally vest ratably over four years. Additionally, the Company granted 0.1 million shares of performance-based awards whereby the number of shares that ultimately vest is based on the achievement of certain non-market-based performance metrics of the Company over three years. The weighted average grant date fair value of these awards was $436.24 per share.

The following weighted average assumptions were used in determining the fair value using the Black-Scholes option-pricing model for options granted in 2026:


Expected dividend yield	0.93	%
Expected stock volatility	27	%
Risk-free interest rate	3.74	%
Expected holding period	5.7 years

Unrecognized stock-based compensation expense at September 30, 2026 was $10 million and $310 million for unvested stock options and restricted stock, respectively, which is expected to be recognized over a weighted average period of 1.9 years and 2.5 years, respectively. Additionally, there was $60 million of unrecognized stock-based compensation expense relating to the aforementioned non-market-based performance-based awards, which is expected to be recognized over a weighted average period of 2.1 years.

The following table summarizes information relating to stock option exercises and restricted stock vesting:


	Nine months ended September 30,
	2026		2025
Exercise of stock options:
Proceeds from stock option exercises	$	19	$	26
Aggregate intrinsic value	$	21	$	42
Tax benefit realized upon exercise	$	5	$	9
Number of shares exercised	0.1		0.1
Vesting of restricted stock:
Fair value of shares vested	$	211	$	245
Tax benefit realized upon vesting	$	52	$	60
Number of shares vested	0.5		0.5
Vesting of performance-based restricted stock:
Fair value of shares vested	$	72	$	8
Tax benefit realized upon vesting	$	12	$	1
Number of shares vested (1)	0.2		—

(1) The number of shares vested in 2025 was approximately 15 thousand.

NOTE 4. INCOME TAXES

Moody’s ETR was 24.0% and 25.4% for the three months ended September 30, 2026 and 2025, respectively, and was 24.4% and 24.2% for the nine months ended September 30, 2026 and 2025, respectively. The decrease in ETR for the three months ended September 30, 2026 compared to the same period in the prior year of 1.4% primarily reflects tax benefits recognized pursuant to the lapse of a statute of limitations related to tax exposures assumed in a prior-year M&A transaction, for which the sellers had indemnified Moody's coupled with certain non-U.S.-related tax benefits. The benefit related to the indemnified tax exposures, including the associated reduction to Interest expense, net, was offset by the release of the related indemnification asset within Other non-operating income, net, resulting in no impact to net income. The Company’s year-to-date provision for income taxes is computed by applying its estimated annual ETR to the pre-tax earnings and adjusting for specific tax events recognized in the period in which they occur.

The Company classifies interest related to UTPs in interest expense, net in its consolidated statements of operations. Penalties, if incurred, would be recognized in other non-operating income, net. The Company had a net decrease in its UTP reserves of $3 million, net of federal tax, during the third quarter of 2026 and a net increase of $9 million ($6 million, net of federal tax) during the first nine months of 2026.

Moody’s is subject to U.S. federal income tax as well as income tax in various state, local and foreign jurisdictions. The Company’s U.S. federal income tax returns for 2023 through 2025 remain open to examination. Currently, the Company's New York State tax returns for 2022 through 2024 are under examination. Additionally, New York City tax returns for the years 2018 through 2022 are also under examination, while returns for 2023 and 2024 are open for examination. Furthermore, the Company's U.K. corporate income tax returns are under audit for the years 2017 through 2023, with the 2024 return still open for examination.

The following table shows the amount the Company paid for income taxes:


	Nine Months Ended September 30,
	2026		2025
Income taxes paid	$	653	$	644

NOTE 5. RECONCILIATION OF WEIGHTED AVERAGE SHARES OUTSTANDING

Below is a reconciliation of basic to diluted shares outstanding:


	Three Months Ended September 30,		Nine Months Ended September 30,
	2026	2025	2026	2025
Basic	172.8	178.9	174.6	179.5
Dilutive effect of shares issuable under stock-based compensation plans	0.5	0.7	0.5	0.7
Diluted	173.3	179.6	175.1	180.2
Anti-dilutive options to purchase common shares and restricted stock as well as contingently issuable restricted stock which are excluded from the table above	0.3	0.2	0.3	0.2

The calculation of basic shares outstanding is based on the weighted average number of shares of common stock outstanding during the reporting period. The calculation of diluted EPS requires certain assumptions regarding the use of both cash proceeds and assumed proceeds that would be received upon the exercise of stock options and vesting of restricted stock outstanding as of September 30, 2026 and 2025.

NOTE 6. CASH EQUIVALENTS AND INVESTMENTS

The table below provides additional information on the Company’s cash equivalents and investments:


	As of September 30, 2026
							Balance sheet location
	Cost		Gains/(Losses)		Fair Value		Cash and cash equivalents		Short-term investments		Other assets
Certificates of deposit and money market deposit accounts/funds (1)	$	951	$	—	$	951	$	842	$	108	$	1
Mutual funds	$	81	$	10	$	91	$	—	$	—	$	91


	As of December 31, 2025
							Balance sheet location
	Cost		Gains/(Losses)		Fair Value		Cash and cash equivalents		Short-term investments		Other assets

Certificates of deposit and money market deposit accounts/funds (1)	$	1,459	$	—	$	1,459	$	1,393	$	64	$	2
Mutual funds	$	95	$	13	$	108	$	—	$	—	$	108

(1) Consists of time deposits, money market deposit accounts and money market funds. The remaining contractual maturities for the certificates of deposits classified as short-term investments are one month to 12 months at both September 30, 2026 and December 31, 2025. The remaining contractual maturities for the certificates of deposits classified in other assets are 13 months to 18 months at September 30, 2026 and 13 months to 22 months at December 31, 2025. Time deposits with a maturity of less than 90 days at time of purchase are classified as cash and cash equivalents.

In addition, the Company invested in COLI. As of September 30, 2026 and December 31, 2025, the contract value of the COLI was $48 million and $50 million respectively.

NOTE 7. DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

The Company is exposed to global market risks, including risks from changes in FX rates and changes in interest rates. Accordingly, the Company uses derivatives in certain instances to manage financial exposures that occur in the normal course of business. The Company does not hold or issue derivatives for speculative purposes.

Derivatives and non-derivative instruments designated as accounting hedges:

Fair Value Hedges

Interest Rate Swaps

The Company has entered into interest rate swaps to convert the fixed interest rate on certain of its long-term debt to a floating interest rate based on the SOFR. The purpose of these hedges is to mitigate the risk associated with changes in the fair value of the long-term debt, thus the Company has designated these swaps as fair value hedges. The fair value of the swaps is adjusted quarterly with a corresponding adjustment to the carrying value of the debt. The changes in the fair value of the swaps and the underlying hedged item generally offset and the net cash settlements on the swaps are recorded each period within interest expense, net in the Company’s consolidated statements of operations.

The following table summarizes the Company’s interest rate swaps designated as fair value hedges:


		Notional Amount
Hedged Item	Nature of Swap	As of September 30, 2026		As of December 31, 2025		Floating Interest Rate
2014 Senior Notes due 2044	Pay Floating/Receive Fixed	$	300	$	300	SOFR
2017 Senior Notes due 2028	Pay Floating/Receive Fixed	—		500		SOFR
2018 Senior Notes due 2029	Pay Floating/Receive Fixed	400		400		SOFR
2018 Senior Notes due 2048	Pay Floating/Receive Fixed	300		300		SOFR

2022 Senior Notes due 2052	Pay Floating/Receive Fixed	500		500		SOFR
2022 Senior Notes due 2032	Pay Floating/Receive Fixed	250		250		SOFR
Total		$	1,750	$	2,250

Refer to Note 13 for information on the cumulative amount of fair value hedging adjustments included in the carrying amount of the above hedged items.

The following table summarizes the impact to the statements of operations of the Company’s interest rate swaps designated as fair value hedges:


Total amounts of financial statement line item presented in the statements of operations in which the effects of fair value hedges are recorded				Amount of income/(loss) recognized in the consolidated statements of operations
	Three Months Ended September 30,			Nine Months Ended September 30,
	2026		2025			2026	2025
Interest expense, net				$	(54)		$	(58)	$	(178)	$	(180)

Description		Location on Consolidated Statements of Operations
Net interest settlements and accruals on interest rate swaps		Interest expense, net		$	(9)		$	(15)	$	(25)	$	(48)
Fair value changes on interest rate swaps		Interest expense, net		$	(28)		$	13	$	(41)	$	75
Fair value changes on hedged debt		Interest expense, net		$	28		$	(13)	$	41	$	(75)

Net investment hedges

Debt designated as net investment hedges

The Company has designated €500 million of the 2015 Senior Notes due 2027 and €750 million of the 2019 Senior Notes due 2030 as net investment hedges to mitigate FX exposure related to a portion of the Company’s euro net investment in certain foreign subsidiaries against changes in euro/USD exchange rates. These hedges are designated as accounting hedges under the applicable sections of ASC Topic 815 and will end upon the repayment of the notes in 2027 and 2030, respectively, unless terminated early at the discretion of the Company.

Cross currency swaps designated as net investment hedges

The Company enters into cross-currency swaps to mitigate FX exposure related to a portion of the Company’s net investment in certain foreign subsidiaries against changes in exchange rates. The following tables provide information on the cross-currency swaps designated as net investment hedges under ASC Topic 815:


As of September 30, 2026
	Pay			Receive
Nature of Swap	Notional Amount (1)		Weighted Average Interest Rate	Notional Amount		Weighted Average Interest Rate
Pay Fixed/Receive Fixed	€	2,197	2.63%	$	2,353	4.11%
Pay Floating/Receive Floating	€	1,688	Based on ESTR	$	1,750	Based on SOFR
Pay Fixed/Receive Fixed	HK$	3,907	—%	$	500	0.64%
Pay Fixed/Receive Fixed	S$	389	—%	HK$	2,350	0.62%


As of December 31, 2025
	Pay			Receive
Nature of Swap	Notional Amount (1)		Weighted Average Interest Rate	Notional Amount		Weighted Average Interest Rate
Pay Fixed/Receive Fixed	€	1,997	2.48%	$	2,114	3.98%
Pay Floating/Receive Floating	€	1,688	Based on ESTR	$	1,750	Based on SOFR
Pay Fixed/Receive Fixed	HK$	3,907	—%	$	500	0.64%
Pay Fixed/Receive Fixed	S$	389	—%	HK$	2,350	0.62%

(1) € = euro, HK$ = Hong Kong dollar, S$ = Singapore dollar

As of September 30, 2026 these hedges will expire and the notional amounts will be settled as follows unless terminated early at the discretion of the Company:


	EUR/USD				HKD/USD				SGD/HKD
Years Ending December 31,	Notional Amount (Pay) (1)		Notional Amount (Receive)		Notional Amount (Pay) (1)		Notional Amount (Receive)		Notional Amount (Pay) (1)		Notional Amount (Receive) (1)
2027	€	530	$	550	HK$	—	$	—	S$	—	HK$	—
2028	588		600		—		—		—		—
2029	573		614		—		—		—		—
2030	662		700		—		—		—		—
2031	481		500		—		—		—		—
2032	481		500		3,907		500		389		2,350
2033	370		400		—		—		—		—
2036	200		239		—		—		—		—
Total	€	3,885	$	4,103	HK$	3,907	$	500	S$	389	HK$	2,350

(1) € = euro, HK$ = Hong Kong dollar, S$ = Singapore dollar

The following table provides information on the gains/(losses) on the Company’s net investment and cash flow hedges:


Derivative and Non-Derivative Instruments in Net Investment Hedging Relationships		Amount of Gain/(Loss) Recognized in AOCL on Derivative, net of Tax						Amount of Loss Reclassified from AOCL into Income, net of Tax						Gain Recognized in Income on Derivative (Amount Excluded from Effectiveness Testing)
	Three Months Ended September 30,						Three Months Ended September 30,						Three Months Ended September 30,
	2026			2025			2026			2025			2026			2025

Cross currency swaps		$	13		$	6		$	—		$	—		$	14		$	17
Long-term debt		7			(1)			—			—			—			—
Total net investment hedges		$	20		$	5		$	—		$	—		$	14		$	17
Derivatives in Cash Flow Hedging Relationships
Cross currency swap		$	—		$	—		$	—		$	1		$	—		$	—
Interest rate contracts		$	—		$	—		$	(1)		$	(1)		$	—		$	—
Total cash flow hedges		$	—		$	—		$	(1)		$	—		$	—		$	—
Total		$	20		$	5		$	(1)		$	—		$	14		$	17


Derivative and Non-Derivative Instruments in Net Investment Hedging Relationships		Amount of Gain/(Loss) Recognized in AOCL on Derivative, net of Tax					Amount of Loss Reclassified from AOCL into Income, net of Tax					Gain Recognized in Income on Derivative (Amount Excluded from Effectiveness Testing)
	Nine Months Ended September 30,					Nine Months Ended September 30,					Nine Months Ended September 30,
		2026		2025			2026		2025			2026		2025

Cross currency swaps		$	78	$	(359)		$	—	$	—		$	42	$	46
Long-term debt		36		(130)			—		—			—		—
Total net investment hedges		$	114	$	(489)		$	—	$	—		$	42	$	46
Derivatives in Cash Flow Hedging Relationships
Cross currency swaps		$	—	$	—		$	—	$	1		$	—	$	—
Interest rate contracts		—		—			(2)		(2)			—		—
Total cash flow hedges		$	—	$	—		$	(2)	$	(1)		$	—	$	—
Total		$	114	$	(489)		$	(2)	$	(1)		$	42	$	46

The cumulative amount of net investment hedge and cash flow hedge gains (losses) remaining in AOCL is as follows:


	Cumulative Gains (Losses), net of tax
	September 30, 2026		December 31, 2025
Net investment hedges
Cross currency swaps	$	(83)	$	(161)
FX forwards	29		29
Long-term debt	(26)		(62)
Total net investment hedges	$	(80)	$	(194)
Cash flow hedges
Interest rate contracts	$	(40)	$	(42)
Cross currency swaps	1		1
Total cash flow hedges	(39)		(41)
Total net gain in AOCL	$	(119)	$	(235)

Derivatives not designated as accounting hedges:

Foreign exchange forwards

The Company also enters into foreign exchange forward contracts to mitigate the change in fair value on certain assets and liabilities denominated in currencies other than a subsidiary’s functional currency. These forward contracts are not designated as accounting hedges under the applicable sections of ASC Topic 815. Accordingly, changes in the fair value of these contracts are recognized immediately in other non-operating income, net, in the Company’s consolidated statements of operations along with the FX gain or loss recognized on the assets and liabilities denominated in a currency other than the subsidiary’s functional currency. These contracts have expiration dates at various times through December 2026.

The following table summarizes the notional amounts of the Company’s outstanding foreign exchange forwards:


	September 30, 2026				December 31, 2025
Notional amount of currency pair (1):	Sell		Buy		Sell		Buy
Contracts to sell USD for GBP	$	679	£	503	$	693	£	522
Contracts to sell USD for JPY	$	15	¥	2,400	$	17	¥	2,700
Contracts to sell USD for CAD	$	29	C$	40	$	39	C$	53
Contracts to sell USD for SGD	$	60	S$	76	$	39	S$	50
Contracts to sell USD for EUR	$	265	€	229	$	107	€	91

Contracts to sell USD for INR	$	26	₹	2,481	$	26	₹	2,400

Contracts to sell EUR for USD	€	—	$	—	€	21	$	25

Contracts to sell AUD for USD	A$	5	$	4	A$	—	$	—


(1) € = euro, £ = British pound, S$ = Singapore dollar, $ = U.S. dollar, ¥ = Japanese yen, C$ = Canadian dollar, ₹= Indian Rupee, A$ = Australian dollar

Total Return Swaps

The Company has entered into total return swaps to mitigate market-driven changes in the value of certain liabilities associated with the Company's deferred compensation plans. The fair value of these swaps at September 30, 2026 and related gains in the three and nine months ended September 30, 2026 were not material. The notional amount of the total return swaps as of September 30, 2026 and December 31, 2025 was $71 million and $72 million, respectively.

The following table summarizes the impact to the consolidated statements of operations relating to the gains (losses) on the Company’s derivatives which are not designated as hedging instruments:


Derivatives not designated as accounting hedges	Location on Consolidated Statements of Operations		Three Months Ended September 30,				Nine Months Ended September 30,
		2026	2025		2026			2025
FX forwards	Other non-operating income, net		$	9	$	(17)		$	(22)	$	49
Total return swaps	Operating expense		$	(1)	$	2		$	3	$	5
Total return swaps	SG&A expense		$	—	$	—		$	1	$	1

The table below shows the classification between assets and liabilities on the Company’s consolidated balance sheets for the fair value of the derivative instrument as well as the carrying value of its non-derivative debt instruments designated and qualifying as net investment hedges:


	Derivative and Non-Derivative Instruments
	Balance Sheet Location	September 30, 2026		December 31, 2025
Assets:
Derivatives designated as accounting hedges:

Cross-currency swaps designated as net investment hedges	Other assets	$	5	$	—



Derivatives not designated as accounting hedges:
FX forwards on certain assets and liabilities	Other current assets	—		9

Total assets		$	5	$	9
Liabilities:
Derivatives designated as accounting hedges:
Cross-currency swaps designated as net investment hedges	Accounts payable and accrued liabilities	$	52	$	—
Interest rate swaps designated as fair value hedges	Accounts payable and accrued liabilities	4		—
Cross-currency swaps designated as net investment hedges	Other liabilities	298		456
Interest rate swaps designated as fair value hedges	Other liabilities	122		84
Total derivatives designated as accounting hedges		476		540
Non-derivatives designated as accounting hedges:
Debt designated as net investment hedge	Current portion of long-term debt	568		—
Debt designated as net investment hedge	Long-term debt	852		1,468
Total non-derivatives designated as accounting hedges		1,420		1,468
Derivatives not designated as accounting hedges:
FX forwards on certain assets and liabilities	Accounts payable and accrued liabilities	17		—
Total liabilities		$	1,913	$	2,008

NOTE 8. GOODWILL AND OTHER ACQUIRED INTANGIBLE ASSETS

The following table summarizes the activity in goodwill for the periods indicated:


	Nine Months Ended September 30, 2026
	MA						MIS						Consolidated
	Gross goodwill		Accumulated impairment charge		Net goodwill		Gross goodwill		Accumulated impairment charge		Net goodwill		Gross goodwill		Accumulated impairment charge		Net goodwill
Balance at beginning of year	$	5,997	$	(12)	$	5,985	$	383	$	—	$	383	$	6,380	$	(12)	$	6,368
Additions/ adjustments (1)	—		—		—		32		—		32		32		—		32
Foreign currency translation adjustments	(88)		—		(88)		(15)		—		(15)		(103)		—		(103)
Adjustment related to divestiture of business (2)	7		—		7		—		—		—		7		—		7

Ending balance	$	5,916	$	(12)	$	5,904	$	400	$	—	$	400	$	6,316	$	(12)	$	6,304


	Year Ended December 31, 2025
	MA						MIS						Consolidated
	Gross goodwill		Accumulated impairment charge		Net goodwill		Gross goodwill		Accumulated impairment charge		Net goodwill		Gross goodwill		Accumulated impairment charge		Net goodwill
Balance at beginning of year	$	5,626	$	(12)	$	5,614	$	380	$	—	$	380	$	6,006	$	(12)	$	5,994
Additions/ adjustments (3)	135		—		135		8		—		8		143		—		143
Foreign currency translation adjustments	334		—		334		(5)		—		(5)		329		—		329
Reclassification to assets held-for-sale (2)	(89)		—		(89)		—		—		—		(89)		—		(89)
Divestiture of business (4)	(9)		—		(9)		—		—		—		(9)		—		(9)
Ending balance	$	5,997	$	(12)	$	5,985	$	383	$	—	$	383	$	6,380	$	(12)	$	6,368

(1) The 2026 additions relate to the acquisitions of Fintellix and MERIS in 2026.

(2) The 2025 reclassification to assets held for sale for the MA segment relates to the divestiture of the MA Regulatory Solutions business. The 2026 change reflects adjustment to the goodwill allocated to the MA Regulatory Solutions business, which was divested in the second quarter of 2026, as more fully discussed in Note 11.

(3) The 2025 additions/adjustments primarily relate to the acquisition of CAPE Analytics and ICR Chile in 2025.

(4) The 2025 divestiture of business for the MA segment in the table above relates to the divestiture of the MA Learning Solutions Business.

Acquired intangible assets and related amortization consisted of:


	September 30, 2026		December 31, 2025
Customer relationships	$	2,133	$	2,165
Accumulated amortization	(780)		(724)
Net customer relationships	1,353		1,441
Software/product technology	743		774
Accumulated amortization	(553)		(526)
Net software/product technology	190		248
Database	164		164
Accumulated amortization	(113)		(103)
Net database	51		61
Trade names	195		201
Accumulated amortization	(101)		(96)
Net trade names	94		105
Other (1)	63		64
Accumulated amortization	(57)		(53)
Net other	6		11
Total acquired intangible assets, net	$	1,694	$	1,866

(1) Other intangible assets primarily consist of trade secrets, covenants not to compete, and acquired ratings methodologies and models.

Amortization expense relating to acquired intangible assets is as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2026		2025		2026		2025
Amortization expense	$	51	$	55	$	157	$	163

NOTE 9. RESTRUCTURING

On December 19, 2024, the CEO of Moody’s approved the Strategic and Operational Efficiency Restructuring Program, the scope of which was expanded in July 2026. The Company currently estimates that upon completion, the program will result in annualized savings of $300 million to $350 million. This program relates to the Company's strategy to realign its operations toward high priority growth areas and to foster operating efficiency/leverage via simplification of organizational structures and technology enablement. This program will primarily include a reduction in staff, the rationalization and exit of certain leased office spaces, the retirement of certain legacy software applications, and the exit of certain businesses and product offerings, including the divestiture of the MA Regulatory Solutions business. The program includes $285 million to $330 million of expected pre-tax personnel and related restructuring charges, an amount that includes severance and other costs primarily determined under the Company's existing severance plans, expense related to the modification of equity awards, and additional costs to support the execution of the restructuring program. In addition, the program is expected to result in $5 million of non-cash charges from the exit from certain leased office spaces and $10 million to $15 million of non-cash charges related to incremental amortization of internally developed software due to a reduction in the useful life of the software assets. The savings generated from the Strategic and Operational Efficiency Restructuring Program are expected to strengthen the Company's operating margin, with a portion being deployed to support strategic investments. The Strategic and Operational Efficiency Restructuring Program is expected to be substantially complete by the end of 2027. Cash outlays associated with this program are expected to be $285 million to $330 million, which are expected to be paid through 2028.

Total expense included in the accompanying consolidated statements of operations relating to the aforementioned restructuring program is below:


	Three months ended September 30,				Nine months ended September 30,				Cumulative expense incurred
	2026		2025		2026		2025
Strategic and Operational Efficiency Restructuring Program
Personnel and related costs (1)	$	26	$	21	$	83	$	75	$	229
Real estate-related costs (2)	—		—		1		4		5
Internally developed software-related charges (3)	1		—		2		2		5
Total Restructuring	$	27	$	21	$	86	$	81	$	239

(1) Primarily includes severance costs, expense related to the modification of equity awards, professional service fees for assistance with the reorganization of the Company's workforce and operating model and costs associated with the divestiture of the MA Regulatory Solutions business.

(2) Includes the incremental amortization of ROU Assets that have been abandoned or for which abandonment is planned in future periods.

(3) Includes the incremental amortization in the period relating to a change in estimated useful lives for certain internally developed software that has been abandoned or for which abandonment is planned in future periods.

Changes to the restructuring liability for the aforementioned restructuring program were as follows:



Balance as of December 31, 2025	$	41











Strategic and Operational Efficiency Restructuring Program:
Cost incurred and adjustments	83
Cash payments	(75)
Balance as of September 30, 2026 (1)	$	49

(1) Restructuring liability is primarily comprised of employee termination costs and other severance-related charges.

As of September 30, 2026, substantially all of the remaining $49 million restructuring liability is expected to be paid out in the next twelve months.

NOTE 10. FAIR VALUE

The tables below present information about items that are carried at fair value at September 30, 2026 and December 31, 2025:


	Fair Value Measurement as of September 30, 2026
Description	Balance		Level 1		Level 2
Assets:
Derivatives (1)	$	5	$	—	$	5
Money market funds/mutual funds	347		347		—
Total	$	352	$	347	$	5
Liabilities:
Derivatives (1)	$	493	$	—	$	493
Total	$	493	$	—	$	493


	Fair Value Measurement as of December 31, 2025
Description	Balance		Level 1		Level 2
Assets:
Derivatives (1)	$	9	$	—	$	9
Money market funds/mutual funds	113		113		—
Total	$	122	$	113	$	9
Liabilities:
Derivatives (1)	$	540	$	—	$	540
Total	$	540	$	—	$	540

(1) Represents fair value of certain derivative contracts as more fully described in Note 7 to the consolidated financial statements.

The following are descriptions of the methodologies utilized by the Company to estimate the fair value of its derivative contracts, money market mutual funds and mutual funds:

Derivatives:

In determining the fair value of the derivative contracts in the table above, the Company utilizes industry standard valuation models. Where applicable, these models project future cash flows and discount the future amounts to a present value using spot rates, forward points, currency volatilities, interest rates as well as the risk of non-performance of the Company and the counterparties with whom it has derivative contracts. The Company established strict counterparty credit guidelines and only enters into transactions with financial institutions that adhere to these guidelines. Accordingly, the risk of counterparty default is deemed to be minimal.

Money market funds and mutual funds:

The mutual funds in the table above are deemed to be equity securities with readily determinable fair values with changes in the fair value recognized through net income under ASC Topic 321. The fair value of these instruments is determined using Level 1 inputs as defined in the ASC Topic 820.

NOTE 11. OTHER BALANCE SHEET AND STATEMENTS OF OPERATIONS INFORMATION

The following tables contain additional detail related to certain balance sheet captions:


	September 30, 2026		December 31, 2025
Other current assets:
Prepaid taxes	$	143	$	139
Prepaid expenses	221		184
Capitalized costs to obtain and fulfill sales contracts	149		143
Foreign exchange forwards on certain assets and liabilities	—		9

Interest receivable on interest rate and cross currency swaps	63		95
Assets held-for-sale	—		98
Consideration receivable from divestiture of business(1)	154		—
Other	43		46
Total other current assets	$	773	$	714

Other assets:
Investments in non-consolidated affiliates	$	489	$	489
Deposits for real-estate leases	16		16
Indemnification assets related to acquisitions	29		35
Mutual funds, certificates of deposit and money market deposit accounts/funds	92		110
Company owned life insurance (at contract value)	48		50
Capitalized costs to obtain sales contracts	261		253
Derivative instruments designated as accounting hedges	5		—
Pension and other retirement employee benefits	82		74
Other	61		74
Total other assets	$	1,083	$	1,101

Accounts payable and accrued liabilities:
Salaries and benefits	$	135	$	126
Incentive compensation	298		390
Customer credits, advanced payments and advanced billings	135		163

Dividends	17		8
Professional service fees	39		49
Interest accrued on debt	52		86
Accounts payable	62		62
Income taxes	160		146
Reserve for international non-income tax obligation	16		—
Pension and other retirement employee benefits	11		9
Accrued royalties	14		20
Foreign exchange forwards on certain assets and liabilities	17		—
Derivative instruments designated as accounting hedges	56		—
Restructuring liability	44		41


Interest payable on interest rate and cross currency swaps	50		66
Liabilities held-for-sale	—		36
Other	113		102
Total accounts payable and accrued liabilities	$	1,219	$	1,304
(1) Represents the consideration related to the sale of the MA Regulatory Solutions business that became realizable during the second quarter and third quarter of 2026 following achievement of certain post-closing conditions, as discussed further in the "Gain on business divestitures" section below.


	September 30, 2026		December 31, 2025
Other liabilities:
Pension and other retirement employee benefits	$	209	$	216
Interest accrued on UTPs	49		43
MAKS indemnification provisions	19		19

Derivative instruments designated as accounting hedges	420		540
Restructuring liability - non-current portion	5		—
Other	43		41
Total other liabilities	$	745	$	859

Investments in non-consolidated affiliates:

The following table provides additional detail regarding Moody's investments in non-consolidated affiliates, as included in other assets in the consolidated balance sheets:


	September 30, 2026		December 31, 2025
Equity method investments (1)	$	117	$	121
Investments measured using the measurement alternative (2)	350		350
Other	22		18
Total investments in non-consolidated affiliates	$	489	$	489
(1) Equity securities in which the Company has significant influence over the investee but does not have a controlling financial interest in accordance with ASC Topic 323.
(2) Equity securities without readily determinable fair value for which the Company has elected to apply the measurement alternative in accordance with ASC Topic 321.

Moody's holds various investments accounted for under the equity method, the most significant of which is the Company's minority investment in CCXI. Moody's also holds various investments measured using the measurement alternative, the most significant of which is the Company's minority interest in BitSight.

Earnings from non-consolidated affiliates, which are included within other non-operating income, net, are disclosed within the table below.

Other non-operating income, net:

The following table summarizes the components of other non-operating income, net:


	Three months ended September 30,				Nine Months Ended September 30,
	2026		2025		2026		2025
FX losses	$	(2)	$	(7)	$	(17)	$	(10)
Net periodic pension income - non-service and non-interest cost components	10		9		29		27
Income from investments in non-consolidated affiliates	4		4		18		18
Gain on investments	—		3		7		8
Other	(11)		(1)		(20)		(1)
Total	$	1	$	8	$	17	$	42

Gain on business divestitures:

MA Regulatory Solutions business

In the second quarter of 2026, the Company completed the sale of the MA Regulatory Solutions business, which resulted in a pre-tax gain of $179 million. During the third quarter of 2026, the Company recognized an additional pre-tax gain of $115 million related to the sale of this business, resulting in a cumulative pre-tax gain of $294 million on the transaction. The additional gain recognized during the third quarter of 2026 reflected additional consideration that became realizable upon satisfaction of certain post-closing conditions.

The Company's accounting policy is to recognize contingent consideration related to the sale of a business as a gain contingency in accordance with ASC 450, Contingencies. Under this policy, contingent consideration is excluded from the initial measurement of gain or loss upon the divestiture of a business and is recognized in earnings when the contingency is resolved and the consideration becomes realizable.

MA Learning Solutions business

During the nine months ended September 30, 2026, the Company recorded an incremental $2 million pre-tax gain resulting from customary post-close purchase price adjustments related to the MA Learning Solutions business, which was divested in the fourth quarter of 2025. As a result, the total pre-tax gain on the divestiture of the MA Learning Solutions business was $25 million.

NOTE 12. COMPREHENSIVE INCOME AND ACCUMULATED OTHER COMPREHENSIVE LOSS

The amounts reclassified out of AOCL, as shown in the consolidated statements of comprehensive income, were not material for all periods presented.

The following tables show changes in AOCL by component (net of tax):



	Three Months Ended September 30,
	2026										2025
Gains/(Losses)	Pension and Other Retirement Benefits		Cash Flow Hedges		Foreign Currency Translation Adjustments		Net Investment Hedges		Total		Pension and Other Retirement Benefits		Cash Flow Hedges		Foreign Currency Translation Adjustments		Net Investment Hedges		Total
Balance at June 30,	$	(30)	$	(40)	$	(384)	$	(100)	$	(554)	$	(41)	$	(41)	$	(218)	$	(219)	$	(519)
Other comprehensive income (loss) before reclassifications	(1)		—		(7)		20		12						(24)		5		(19)
Amounts reclassified from AOCL	—		1		—		—		1						—		—		—
Other comprehensive income (loss)	(1)		1		(7)		20		13		—		—		(24)		5		(19)
Balance at September 30,	$	(31)	$	(39)	$	(391)	$	(80)	$	(541)	$	(41)	$	(41)	$	(242)	$	(214)	$	(538)


	Nine Months Ended September 30,

	2026										2025
	Pension and Other Retirement Benefits		Cash Flow Hedges		Foreign Currency Translation Adjustments		Net Investment Hedges		Total		Pension and Other Retirement Benefits		Cash Flow Hedges		Foreign Currency Translation Adjustments		Net Investment Hedges		Total
Balance at December 31,	$	(34)	$	(41)	$	(231)	$	(194)	$	(500)	$	(39)	$	(42)	$	(832)	$	275	$	(638)
Other comprehensive income (loss) before reclassifications	4		—		(160)		114		(42)		(1)		—		590		(489)		100
Amounts reclassified from AOCL	(1)		2		—		—		1		(1)		1		—		—		—

Other comprehensive income (loss)	3		2		(160)		114		(41)		(2)		1		590		(489)		100
Balance at September 30,	$	(31)	$	(39)	$	(391)	$	(80)	$	(541)	$	(41)	$	(41)	$	(242)	$	(214)	$	(538)

NOTE 13. INDEBTEDNESS

The Company’s debt is recorded at its carrying value, which represents the issuance amount plus or minus any issuance premium or discount, except for certain debt as depicted in the table below, which is recorded at the carrying value adjusted for the fair value of an interest rate swap used to hedge the fair value of the note.

The following table summarizes total indebtedness:


September 30, 2026
Notes Payable:	Principal Amount		Fair Value of Interest Rate Swaps (1)		Unamortized (Discount) Premium		Unamortized Debt Issuance Costs		Carrying Value
5.25% 2014 Senior Notes, due 2044	$	600	$	(20)	$	3	$	(4)	$	579
1.75% 2015 Senior Notes, due 2027	568		—		—		—		568
3.25% 2017 Senior Notes, due 2028	500		—		(1)		(1)		498
4.25% 2018 Senior Notes, due 2029	400		(27)		(1)		(1)		371
4.875% 2018 Senior Notes, due 2048	400		(24)		(6)		(3)		367
0.950% 2019 Senior Notes, due 2030	852		—		(1)		(2)		849
3.25% 2020 Senior Notes, due 2050	300		—		(4)		(3)		293
2.55% 2020 Senior Notes, due 2060	300		—		(2)		(3)		295
2.00% 2021 Senior Notes, due 2031	600		—		(4)		(2)		594
2.75% 2021 Senior Notes, due 2041	600		—		(11)		(4)		585
3.10% 2021 Senior Notes, due 2061	500		—		(6)		(5)		489
3.75% 2022 Senior Notes, due 2052	500		(51)		(8)		(4)		437
4.25% 2022 Senior Notes, due 2032	500		(4)		(1)		(2)		493
5.00% 2024 Senior Notes, due 2034	500		—		(3)		(4)		493
Total debt	$	7,120	$	(126)	$	(45)	$	(38)	$	6,911
Current portion									(568)
Total long-term debt									$	6,343


December 31, 2025
Notes Payable:	Principal Amount		Fair Value of Interest Rate Swaps (1)		Unamortized (Discount) Premium		Unamortized Debt Issuance Costs		Carrying Value
5.25% 2014 Senior Notes, due 2044	$	600	$	(18)	$	3	$	(4)	$	581
1.75% 2015 Senior Notes, due 2027	587		—		—		—		587
3.25% 2017 Senior Notes, due 2028	500		—		(1)		(1)		498
4.25% 2018 Senior Notes, due 2029	400		(19)		(1)		(1)		379
4.875% 2018 Senior Notes, due 2048	400		(21)		(6)		(3)		370
0.950% 2019 Senior Notes, due 2030	881		—		(2)		(3)		876
3.25% 2020 Senior Notes, due 2050	300		—		(4)		(3)		293
2.55% 2020 Senior Notes, due 2060	300		—		(2)		(3)		295
2.00% 2021 Senior Notes, due 2031	600		—		(5)		(3)		592
2.75% 2021 Senior Notes, due 2041	600		—		(11)		(4)		585
3.10% 2021 Senior Notes, due 2061	500		—		(7)		(5)		488
3.75% 2022 Senior Notes, due 2052	500		(23)		(8)		(4)		465
4.25% 2022 Senior Notes, due 2032	500		(3)		(1)		(3)		493
5.00% 2024 Senior Notes, due 2034	500		—		(4)		(4)		492
Total long-term debt	$	7,168	$	(84)	$	(49)	$	(41)	$	6,994

(1) The fair value of interest rate swaps in the tables above represents the cumulative amount of fair value hedging adjustments included in the carrying value of the hedged debt.

Notes Payable

At September 30, 2026, the Company was in compliance with all covenants contained within all of the debt agreements. All of the debt agreements contain cross default provisions which state that default under one of the aforementioned debt instruments could in turn permit lenders under other debt instruments to declare borrowings outstanding under those instruments to be immediately due and payable. As of September 30, 2026, there were no such cross defaults.

The repayment schedule for the Company’s borrowings is as follows:


Year Ending December 31,	Year Ending Total
2026 (After September 30,)	$	—
2027	568
2028	500
2029	400
2030	852
Thereafter	4,800
Total	$	7,120

Interest expense, net

The following table summarizes the components of interest as presented in the consolidated statements of operations and the cash paid for interest:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2026		2025		2026		2025
Income	$	9	$	14	$	30	$	51
Expense on borrowings(1)	(55)		(59)		(165)		(193)
Expense on UTPs and other tax related liabilities(2)	(1)		(6)		(22)		(17)
Net periodic pension costs - interest component	(7)		(7)		(21)		(21)
Interest expense, net	$	(54)	$	(58)	$	(178)	$	(180)
Interest paid(3)	$	65	$	56	$	172	$	192

(1) Expense on borrowings includes interest on long-term debt, as well as realized gains/losses related to interest rate and cross currency swaps, which are more fully discussed in Note 7.

(2) Interest expense on UTPs and other tax related liabilities in 2026 includes interest accrued relating to a reserve pursuant to an international non-income tax obligation.

(3) Interest paid includes net settlements on interest rate and cross currency swaps, which are more fully discussed in Note 7.

The fair value and carrying value of the Company’s debt as of September 30, 2026 and December 31, 2025 are as follows:


	September 30, 2026				December 31, 2025
	Carrying Value		Estimated Fair Value		Carrying Value		Estimated Fair Value
Total debt	$	6,911	$	5,821	$	6,994	$	6,245

The fair value of the Company’s debt is estimated based on quoted prices in active markets as of the reporting date, which are considered Level 1 inputs within the fair value hierarchy.

NOTE 14. LEASES

The Company has operating leases, substantially all of which relate to the lease of office space. The Company’s leases which are classified as finance leases are not material to the consolidated financial statements. Certain of the Company’s leases include options to renew, with renewal terms that can extend the lease term from one year to 20 years at the Company’s discretion.

The following table presents the components of the Company’s lease cost:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2026		2025		2026		2025
Operating lease cost	$	27	$	22	$	74	$	66
Sublease income	(1)		(2)		(3)		(6)
Variable lease cost	5		5		17		15
Total lease cost	$	31	$	25	$	88	$	75

The following tables present other information related to the Company’s operating leases:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2026		2025			2026		2025
Cash paid for amounts included in the measurement of operating lease liabilities	$	26	$	30		$	77	$	91
Right-of-use assets obtained in exchange for new operating lease liabilities	$	22	$	95		$	290	$	142


	September 30, 2026		September 30, 2025
Weighted-average remaining lease term	12.0 Years		6.5 Years
Weighted-average discount rate applied to operating leases	5.3	%	4.6	%

The following table presents a maturity analysis of the future minimum lease payments included within the Company’s operating lease liabilities at September 30, 2026:


Year Ending December 31,	Operating Leases
2026 (After September 30,)	$	26
2027	18
2028	68
2029	73
2030	68
After 2030	601
Total lease payments (undiscounted) (1)	854
Less: Interest	273
Present value of lease liabilities:	$	581
Lease liabilities - current	$	93
Lease liabilities - noncurrent	$	488

(1) Future minimum lease payments are presented net of tenant improvement allowance the Company expects to receive.

In the fourth quarter of 2025, the Company entered into an operating lease for a new headquarters in New York City. During the nine months ended September 30, 2026, the Company was granted access to approximately 90% of the leased floors, resulting in lease commencement for those floors. Accordingly, the related ROU assets and operating lease liabilities were recognized and are reflected in the consolidated balance sheet as of September 30, 2026.

The Company has not yet been granted access to one remaining leased floor. Accordingly, the ROU assets and operating lease liabilities as of September 30, 2026 do not yet reflect the amounts associated with that floor. Future minimum lease payments related to the floor are approximately $50 million.

NOTE 15. CONTINGENCIES

Given the nature of the Company's activities, Moody’s and its subsidiaries are subject to legal and tax proceedings, governmental, regulatory and legislative investigations, subpoenas and other inquiries, and claims and litigation by governmental and private parties that are based on ratings assigned by MIS or that are otherwise incidental to the Company’s business. Moody’s and MIS also are subject to periodic reviews, inspections, examinations and investigations by regulators in the U.S. and other jurisdictions, any of which may result in claims, legal proceedings, assessments, fines, penalties or restrictions on business activities. Moody’s also is subject to ongoing tax audits as addressed in Note 4 to the consolidated financial statements.

Management periodically assesses the Company’s liabilities and contingencies in connection with these matters based upon the latest information available. For claims, litigation and proceedings and governmental investigations and inquiries not related to income taxes, the Company records liabilities in the consolidated financial statements when it is both probable that a liability has been incurred and the amount of loss can be reasonably estimated and periodically adjusts these as appropriate. When the reasonable estimate of the loss is within a range of amounts, the minimum amount of the range is accrued unless some higher amount within the range is a better estimate than another amount within the range. In instances when a loss is reasonably possible but uncertainties exist related to the probable outcome and/or the amount or range of loss, management does not record a liability but discloses the contingency if material. As additional information becomes available, the Company adjusts its assessments and estimates of such matters accordingly. Moody’s also discloses material pending legal proceedings pursuant to SEC rules and other pending matters as it may determine to be appropriate.

In view of the inherent difficulty of assessing the potential outcome of legal proceedings, governmental, regulatory and legislative investigations and inquiries, claims and litigation and similar matters and contingencies, particularly when the claimants seek large or indeterminate damages or assert novel legal theories or the matters involve a large number of parties, the Company often cannot predict what the eventual outcome of the pending matters will be or the timing of any resolution of such matters. The Company also may be unable to predict the impact (if any) that any such matters may have on how its business is conducted, on its competitive position or on its financial position, results of operations or cash flows. As the process to resolve any pending matters progresses, management will continue to review the latest information available and assess its ability to predict the outcome of such matters and the effects, if any, on its operations and financial condition and to accrue for and disclose such matters as and when required. However, because such matters are inherently unpredictable and unfavorable developments or resolutions can occur, the ultimate outcome of such matters, including the amount of any loss, may differ from those estimates.

NOTE 16. SEGMENT INFORMATION

The Company is organized into two operating segments: MA and MIS and accordingly, the Company reports in two reportable segments: MA and MIS.

Revenue for MA and expenses for MIS include an intersegment fee charged to MIS from MA for certain MA products and services utilized in MIS’s ratings process. Additionally, revenue for MIS and expenses for MA include intersegment fees charged to MA for the rights to use and distribute content, data and products developed by MIS. These intersegment fees are generally based on the market value of the products and services being transferred between the segments.

Overhead expenses include costs such as rent and occupancy, information technology and support staff such as finance, human resources and legal. Such costs and corporate expenses that exclusively benefit one segment are fully charged to that segment.

For overhead costs and corporate expenses that benefit both segments, costs are generally allocated to each segment based on historical/budgeted revenue amounts.

“Eliminations” in the following table represent intersegment revenue/expense. Moody’s does not report the Company’s assets by reportable segment, as this metric is not used by the CODM to allocate resources to the segments. Consequently, it is not practical to show assets by reportable segment.

Financial Information by Segment

The table below shows revenue, significant expenses regularly provided to the CODM and Adjusted Operating Income by reportable segment. The CODM, identified as the Company's CEO, utilizes the Adjusted Operating Income measure to assess the profitability of the Company and each of its reportable segments each quarter. Adjusted Operating Income is used in our budgeting and forecasting process, enabling the allocation of capital resources across the Company's strategic initiatives.


	Three Months Ended September 30,
	2026				2025
	MA		MIS			Eliminations		Consolidated		MA		MIS		Eliminations		Consolidated
Total external revenue	$	936	$	1,087		$	—	$	2,023	$	909	$	1,098	$	—	$	2,007
Intersegment revenue	3		51			(54)		—		3		50		(53)		—
Revenue	939		1,138			(54)		2,023		912		1,148		(53)		2,007
Compensation expense	352		299			—		651		353		284		—		637
Non-compensation expense	205		103			—		308		196		112		—		308
Intersegment expense	51		3			(54)		—		50		3		(53)		—
Total	608		405			(54)		959		599		399		(53)		945
Adjusted Operating Income	$	331	$	733		$	—	$	1,064	$	313	$	749	$	—	$	1,062
Less:
Depreciation and amortization	102		22			—		124		101		22		—		123

Restructuring	22		5			—		27		15		6		—		21

Duplicate Rent	3		4			—		7		—		—		—		—
Charges related to asset abandonment	—		—			—		—		1		—		—		1
Operating Income								$	906							$	917
Non-operating income (expense), net								$	62							$	(50)
Income before provision for income taxes								$	968							$	867

	Nine Months Ended September 30,
	2026				2025
	MA		MIS			Eliminations		Consolidated		MA		MIS		Eliminations		Consolidated
Total external revenue	$	2,787	$	3,500		$	—	$	6,287	$	2,656	$	3,173	$	—	$	5,829
Intersegment revenue	9		154			(163)		—		9		149		(158)		—
Revenue	2,796		3,654			(163)		6,287		2,665		3,322		(158)		5,829
Compensation expense	1,083		912			—		1,995		1,070		844		—		1,914
Non-compensation expense	614		301			—		915		588		305		—		893
Intersegment expense	154		9			(163)		—		149		9		(158)		—
Total	1,851		1,222			(163)		2,910		1,807		1,158		(158)		2,807
Adjusted Operating Income	$	945	$	2,432		$	—	$	3,377	$	858	$	2,164	$	—	$	3,022
Less:
Depreciation and amortization	304		68			—		372		292		64		—		356
Restructuring	69		17			—		86		59		22		—		81
Reserve for international non-income tax obligation	36		—			—		36		—		—		—		—
Duplicate Rent	4		5			—		9		—		—		—		—
Charges related to asset abandonment	—		—			—		—		4		—		—		4
Operating Income								$	2,874							$	2,581
Non-operating income (expense), net								$	135							$	(138)
Income before provision for income taxes								$	3,009							$	2,443

The table below shows cumulative restructuring expense incurred through September 30, 2026 by reportable segment.


	MA		MIS		Total




Strategic and Operational Efficiency Restructuring Program	$	180	$	59	$	239

The costs expected to be incurred related to the Strategic and Operational Efficiency Restructuring Program are $215 million to $240 million for the MA segment and $85 million to $110 million for the MIS segment, which include allocations of charges associated with corporate functions. This restructuring program is more fully discussed in Note 9.

Consolidated Revenue Information by Geographic Area


	Three Months Ended September 30,				Nine Months Ended September 30,
	2026		2025		2026		2025
United States	$	1,134	$	1,118	$	3,532	$	3,175
Non-U.S.:
EMEA	596		594		1,861		1,776
Asia-Pacific	178		180		551		521
Americas	115		115		343		357
Total Non-U.S.	889		889		2,755		2,654
Total	$	2,023	$	2,007	$	6,287	$	5,829

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