Moody's Sets New Benchmark with Record-Breaking Q2 Performance
Moody's Corporation has just reported its most impressive second-quarter results to date, with the company achieving a 15% revenue growth and expanding adjusted operating margin by an astonishing 440 basis points to 55.3%. This phenomenal performance is a testament to the enduring value of Moody's ratings in complex financing markets.
Transaction revenue in Moody's Investor Service (MIS) grew by a staggering 34%, with the company rating over $2 trillion of debt for the second consecutive quarter. MIS also delivered an adjusted operating margin of 68.3%, a significant increase of 410 basis points from last year. This reflects both the rebound in market activity and the growing demand for Moody's ratings.
Moody's Analytics (MA) has continued to perform exceptionally well, with Annual Recurring Revenue (ARR) reaching approximately $3.7 billion – up nearly 9% from the prior year. MA also expanded adjusted operating margin by 150 basis points to 33.6%. This demonstrates the ongoing demand for decision-grade intelligence in risk management, productivity improvement, and better decision-making.
Rob, Head of Investor Relations at Moody's, highlighted that these results reflect the power of the Moody's model, a franchise capable of capitalizing on strong issuance activity, durable recurring revenue growth in analytics, and disciplined execution across the company. He also emphasized that the trends shaping the business reinforce the long-term opportunity for Moody's.
Capital markets are evolving, risks are becoming more interconnected, and AI is transforming workflows across industries. In this environment, customers are increasingly turning to Moody's intelligence, ratings, analytics, and insights to make consequential decisions with greater confidence – creating meaningful opportunities across the business.
The company has raised select full-year 2026 guidance metrics, including its rated issuance expectations and capital return guidance. By narrowing its adjusted diluted EPS range, Moody's has increased the midpoint of its range to $16.75. This represents a significant increase from previous estimates and reflects the company's confidence in its future prospects.
Moody's Investor Service also saw a 25% revenue growth with broad-based strength across all asset classes. Global issuance was driven by multiple funding deep currents, including refinancing, AI-related investment, private credit, digital finance, energy transition, and emerging markets. The company has upgraded its issuance growth outlook to mid-single-digit percent growth for the full year.
The Moody's model is demonstrating its power in capitalizing on strong issuance activity, durable recurring revenue growth in analytics, and disciplined execution across the company. This quarter's results are a testament to the enduring value of Moody's ratings and intelligence in complex financing markets, positioning the company for continued success in the years to come.
