MSCI 8-K — Smart Summary

89% reduction

MSCI Inc. reported third quarter 2025 results for the period ended September 30, 2025, with operating revenues of $793.4 million (up 9.5% YoY) and net income of $325.4 million (up 15.8% YoY). The filing also discloses a new $3.0 billion share repurchase program authorized by the Board of Directors on October 25, 2025, superseding the prior program authorized in October 2024.

Item 2.02 — Results of Operations and Financial Condition

Financial Highlights

Operating revenues: $793.4 million, up 9.5% YoY; organic operating revenue growth of 9.0%
Recurring subscription revenues: $579.1 million, up 7.9% YoY; asset-based fees: $197.5 million, up 17.1% YoY; non-recurring revenues: $16.9 million, down 13.4% YoY
Operating income: $447.7 million, up 11.6% YoY; operating margin of 56.4% vs. 55.4% in Q3 2024
Net income: $325.4 million, up 15.8% YoY; effective tax rate of 17.9% vs. 21.3% in Q3 2024
Diluted EPS: $4.25, up 19.0% YoY; Adjusted EPS: $4.47, up 15.8% YoY
Adjusted EBITDA: $494.4 million, up 9.7% YoY; Adjusted EBITDA margin: 62.3% vs. 62.2% in Q3 2024
Net cash provided by operating activities: $449.4 million, up 6.6% YoY; free cash flow (non-GAAP): $423.3 million, up 7.4% YoY; Capex: $26.1 million

Segment Results

Index: revenues $451.2 million, up 11.4% YoY (organic 11.4%); recurring subscriptions $242.6 million (+8.3%), asset-based fees $197.5 million (+17.1%), non-recurring $11.1 million (-10.1%); Adjusted EBITDA margin 77.6%
Analytics: revenues $182.2 million, up 5.7% YoY (organic 5.6%); recurring subscriptions $178.3 million (+6.0%), non-recurring $3.9 million (-8.2%); Adjusted EBITDA margin 49.4% vs. 52.4% in Q3 2024
Sustainability and Climate: revenues $90.1 million, up 7.7% YoY (organic 5.1%); recurring subscriptions $88.7 million (+8.8%), non-recurring $1.4 million (-31.2%); Adjusted EBITDA margin 38.6% vs. 35.9% in Q3 2024
All Other – Private Assets: revenues $70.0 million, up 9.7% YoY (organic 8.3%); recurring subscriptions $69.5 million (+10.4%), non-recurring $0.4 million (-45.0%); Adjusted EBITDA margin 27.6% vs. 25.5% in Q3 2024
Total Run Rate as of September 30, 2025: $3,186.5 million, up 10.1% YoY; organic Run Rate growth 9.7%; total Retention Rate 94.7% vs. 94.2% in Q3 2024

Capital Allocation

Cash and cash equivalents: $400.1 million as of September 30, 2025; MSCI targets minimum cash of ~$225–$275 million for general operating purposes
Total principal debt outstanding: $5.6 billion as of September 30, 2025; total debt to adjusted EBITDA ratio of 3.0x (target range 3.0x–3.5x); total debt to net income ratio (TTM) of 4.5x
On August 8, 2025, issued $1.25 billion of 5.25% Senior Unsecured Notes due 2035; proceeds used to repay all outstanding revolving credit facility borrowings
On August 20, 2025, amended credit agreement upsizing revolving credit facility to $1.6 billion (from $1.25 billion) and extending availability to August 2030
Share repurchases in Q3 2025: $1,225.7 million (2,189,289 shares) at average price of $559.85; through October 27, 2025, total Q3 + subsequent repurchases of $1,248.9 million (2,230,397 shares) at average price of $559.95; weighted average diluted shares outstanding of 76.6 million, down 2.7% YoY; total shares outstanding 75.2 million as of September 30, 2025
Board authorized new $3.0 billion share repurchase program on October 25, 2025, superseding prior October 28, 2024 program
Dividends paid in Q3 2025: ~$137.4 million; Q4 2025 cash dividend declared at $1.80 per share, payable November 28, 2025 to shareholders of record as of November 14, 2025

Management Commentary

"In the third quarter, MSCI delivered strong financial and sales performance, including record Q3 recurring sales in our two largest product lines — Index and Analytics — and also with hedge funds and banks. In addition, we achieved a record asset-based-fee run rate driven by 17 percent growth, which reflected record AUM levels of about $6.4 trillion combined in ETF and non-ETF products linked to our indexes." — Henry A. Fernandez, Chairman and CEO
"Our Q3 results affirm that MSCI's indexes, analytics, and data are foundational to investment portfolios around the world, demonstrating our role as a global standard setter. Meanwhile, our expansion with newer client segments highlights the benefits of our relentless innovation. By enhancing our focus on individual segments, we will further accelerate innovation across product lines and asset classes." — Henry A. Fernandez, Chairman and CEO

Guidance

Operating Expense: $1,415–$1,445 million (prior: $1,405–$1,445 million)
Adjusted EBITDA Expense: $1,230–$1,250 million (prior: $1,220–$1,250 million)
Effective Tax Rate: 16.0%–18.0% (prior: 17.5%–20.0%)
Capital Expenditures: $120–$130 million (prior: $115–$125 million)
Net Cash Provided by Operating Activities: $1,540–$1,590 million (prior: $1,525–$1,575 million)
Free Cash Flow: $1,410–$1,470 million (prior: $1,400–$1,460 million)

Item 8.01 — Other Events

Share Repurchase

New share repurchase program authorized October 25, 2025 for up to $3.0 billion of common stock
New authorization supersedes and replaces the prior program authorized October 28, 2024
Repurchases may be made via open market transactions, privately negotiated transactions, accelerated share repurchase transactions, trading plans, or derivative transactions
Authorization may be modified, suspended, or terminated at any time
During Q3 2025 and through October 27, 2025: $1,248.9 million / 2,230,397 shares repurchased at average price of $559.95
Total shares outstanding as of September 30, 2025: 75.2 million

Debt & Credit Facilities

Total principal debt outstanding as of September 30, 2025: $5.6 billion
Total debt to adjusted EBITDA ratio (trailing twelve months): 3.0x; target range 3.0x–3.5x
August 8, 2025: issued $1.25 billion aggregate principal of 5.25% Senior Unsecured Notes due September 1, 2035
August 20, 2025: amended credit agreement, upsized revolving credit facility to $1.6 billion (from $1.25 billion), extended availability to August 2030
Proceeds from 2035 Senior Notes used to repay in full all outstanding borrowings under prior credit agreement
Full-Year 2025 interest expense guidance (including amortization of financing fees): $205–$209 million

Dividend

Cash dividend of $1.80 per share declared for Q4 2025
Payable November 28, 2025 to shareholders of record as of November 14, 2025
Approximately $137.4 million in dividends paid to shareholders in Q3 2025

Item 8 01

On October 25, 2025, MSCI's Board of Directors authorized a new share repurchase program for the repurchase of up to an aggregate of $3.0 billion of its common stock
This new authorization supersedes and replaces the prior share repurchase program authorized on October 28, 2024
Timing, price, and amount of repurchases will depend on market conditions, available capital resources, applicable securities laws, and other factors
Repurchases may be made through open market transactions, privately negotiated transactions, accelerated share repurchase transactions, trading plans, or derivative transactions
The authorization may be modified, suspended, or terminated at any time

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