MCO 8-K — Smart Summary

Moody's Corporation reported record first quarter 2026 results on April 22, 2026, with MCO revenue of $2.1 billion, up 8% year-over-year, driven by strong performance in both the MIS and MA segments. The company reaffirmed its full-year 2026 revenue growth guidance in the high-single digit percent range and raised its full-year share repurchase guidance to approximately $2.5 billion. Moody's also announced the appointment of Christina Kosmowski as CEO of Moody's Analytics, effective June 2026.

• MCO revenue of $2,079 million, up 8% YoY (6% on an organic constant currency basis)
• MCO operating income of $922 million vs. $846 million in prior-year period; operating margin of 44.3% vs. 44.0% (up 30 bps)
• MCO Adjusted Operating Margin expanded 150 bps to 53.2% from 51.7%
• Diluted EPS of $3.73, up 8% YoY; Adjusted Diluted EPS of $4.33, up 13% YoY
• Net income attributable to Moody's of $661 million vs. $625 million in prior-year period
• Operating cash flow of $939 million, up 24% YoY; Free Cash Flow of $844 million, up 26% YoY
• Operating expenses grew 7% YoY, including 3% related to a reserve for an international non-income tax obligation and a 2% unfavorable FX impact
• Effective Tax Rate was 24.0% vs. 22.3% in prior-year period

• MIS revenue of $1,153 million, up 8% YoY (6% organic constant currency), marking the highest quarter on record; MIS Adjusted Operating Margin of 66.7%, up 70 bps YoY
• MIS Corporate Finance revenue $633 million, up 12%; Structured Finance $137 million, down 1%; Financial Institutions $194 million, up 2%; Public, Project and Infrastructure Finance $176 million, up 8%; MIS Other $13 million, up 44%
• MIS transactional revenue of $790 million, up 8%; recurring revenue of $363 million, up 9%
• MA revenue of $926 million, up 8% YoY (6% organic constant currency); MA Adjusted Operating Margin of 32.5%, up 250 bps YoY
• MA Decision Solutions revenue $432 million, up 7% (7% organic constant currency); Research and Insights $255 million, up 8% (6% organic constant currency); Data and Information $239 million, up 10% (5% organic constant currency)
• MA recurring revenue $909 million, up 11% YoY (7% organic constant currency), representing 98% of total MA revenue; transactional revenue $17 million, down 54% YoY
• MA ARR of $3,607 million, up 8% YoY; Decision Solutions ARR up 10%, Research and Insights up 7%, Data and Information up 6%

• Moody's returned approximately $1.7 billion to shareholders in Q1 2026, including $1.5 billion in share repurchases and $185 million in dividends
• Treasury shares repurchases of $1,471 million in Q1 2026 vs. $373 million in Q1 2025
• On April 20, 2026, the Board declared a regular quarterly dividend of $1.03 per share of MCO Common Stock, payable June 5, 2026, to shareholders of record at close of business May 15, 2026
• Cash and cash equivalents of $1,469 million as of March 31, 2026, down from $2,384 million as of December 31, 2025
• Long-term debt of $6,387 million as of March 31, 2026, vs. $6,994 million as of December 31, 2025
• Full-year 2026 share repurchase guidance raised to approximately $2.5 billion

• "Both MIS and MA delivered strong results this quarter with sustained growth and powerful operating leverage. MIS achieved record revenues of $1.2 billion on over $2 trillion in rated issuance and delivered an adjusted operating margin of 67%. MA continued its growth momentum with 8% ARR growth and 250 basis points of adjusted operating margin expansion. As AI adoption accelerates, it is driving demand for Moody's decision-grade connected intelligence in high-stakes environments." — Rob Fauber, President and Chief Executive Officer, Moody's Corporation

• Full-year 2026 MCO revenue growth reaffirmed in the high-single-digit percent range (NC vs. prior guidance)
• Full-year 2026 MCO operating margin guidance updated to approximately 45% (from 45%-46%)
• Full-year 2026 MCO Adjusted Operating Margin guidance of 52%-53% (NC)
• Full-year 2026 Diluted EPS guidance raised to $16.00-$16.60 (from $15.00-$15.60)
• Full-year 2026 Adjusted Diluted EPS guidance of $16.40-$17.00 (NC)
• Full-year 2026 operating cash flow guidance of $3.25-$3.45 billion (NC); Free Cash Flow guidance of $2.8-$3.0 billion (NC)
• Full-year 2026 share repurchase guidance raised to approximately $2.5 billion (from approximately $2.0 billion)
• Full-year 2026 net interest expense guidance updated to $220-$240 million (from $210-$230 million)
• Full-year 2026 Non-operating (Expense)/Income updated to $70-$90 million (from ($180-$200 million)), inclusive of expected gain from pending divestiture of MA Regulatory Solutions business
• MA revenue growth guidance: mid-single-digit percent range (NC); MA organic constant currency revenue: high-single-digit percent range (NC); MA ARR: high-single-digit percent range (NC); MA Adjusted Operating Margin: 34%-35% (NC)
• MIS revenue growth guidance: high-single-digit percent range (NC); MIS Adjusted Operating Margin: approximately 65% (NC)
• Macroeconomic assumptions updated: U.S. rate cut expectations pushed out to end of year or beyond; U.S. high yield spreads expected to widen to around 460 bps; GBP/USD rate of $1.32 for remainder of year; EUR/USD rate of $1.15 for remainder of year; global speculative grade default rate to finish at around 3% by year-end

• MCO revenue was $2,079 million in Q1 2026, up 8% year-over-year (6% on an organic constant currency basis); MCO operating margin was 44.3% and Adjusted Operating Margin expanded 150 bps to 53.2%.
• Diluted EPS was $3.73, up 8% from $3.46; Adjusted Diluted EPS was $4.33, up 13% from $3.83 in Q1 2025.
• Operating cash flow was $939 million, up 24%; Free Cash Flow was $844 million, up 26% from the prior-year period.
• Capital returns totaled approximately $1.7 billion in Q1 2026, including $1.5 billion in share repurchases and $185 million in dividends; full-year share repurchase guidance raised to approximately $2.5 billion.
• On April 20, 2026, Moody's Board declared a quarterly dividend of $1.03 per share of MCO Common Stock, payable June 5, 2026, to shareholders of record at the close of business on May 15, 2026.
• MIS revenue was $1,153 million, up 8% year-over-year, marking the highest quarter on record; MIS Adjusted Operating Margin was 66.7%, up 70 bps; MIS transactional revenue was $790 million, up 8%; total rated issuance volume grew 6%.
• MA revenue was $926 million, up 8% year-over-year (6% organic constant currency); MA ARR grew 8% to $3,607 million as of March 31, 2026, led by Decision Solutions at 10% growth; MA Adjusted Operating Margin expanded 250 bps to 32.5%.
• Full-year 2026 guidance reaffirmed: MCO revenue growth in the high-single-digit percent range; Adjusted Diluted EPS of $16.40–$17.00; updated Diluted EPS guidance to $16.00–$16.60 (from $15.00–$15.60); Operating Cash Flow guidance of $3.25–$3.45 billion; Free Cash Flow guidance of $2.8–$3.0 billion.
• Macroeconomic assumption updates include: U.S. rate cut expectations pushed out to end of year or beyond; U.S. high yield spreads expected to widen to around 460 bps; GBP/USD rate revised to $1.32 for remainder of year (from $1.35); EUR/USD revised to $1.15 for remainder of year (from $1.17); global speculative grade default rate expected to finish at around 3% by year-end.
• Christina Kosmowski named as CEO of Moody's Analytics, effective June 2026; pending divestiture of MA Regulatory Solutions business expected to close in Q2 2026, with an expected gain contributing approximately ($1.25) to Diluted EPS adjustments.