MSCI Accelerates Growth in Q2 2026, Setting Stage for Strong Second Half
The MSCI second quarter earnings conference call provided a glimpse into the company's impressive performance, driven by strong financial results and an acceleration in growth across key engines. Chairman and CEO Henry Fernandez highlighted the delivery of very strong financial results, accompanied by a significant uptick in run rate growth in both index and private assets.
MSCI demonstrated strength in recurring net new sales across client segments and geographies, despite ongoing challenges in sustainability. The company's record ETF and non-ETF AUM balances, linked to MSCI indices, contributed to achieving the best-ever asset-based fee run rate.
The Q2 financial metrics included organic revenue growth of over 12%, adjusted EPS growth of nearly 19%, and adjusted EBITDA growth of 14%. The company's commitment to driving attractive shareholder returns was evident through the repurchase of $147 million in MSCI shares at an average price of approximately $558 per share during the quarter.
MSCI's operating metrics revealed total run rate growth of 12%, fueled by ABF (asset-based fee) run rate of $948 million, growing 25%. This was underpinned by record AUM levels in both ETF and non-ETF products linked to MSCI indices, supported by another quarter of solid inflows of nearly $40 billion in ETF linked to MSCI indices.
The incredible scale of MSCI's ABF franchise and the recent volumes of inflows into products linked to MSCI indices serve as a testament to trust in the company's IP (intellectual property), research, and standards. MSCI achieved organic subscription run rate growth of over 8% with a retention rate of over 95%, driven by success in scaling its footprint across key client segments.
Among traders and hedge funds, MSCI delivered subscription run rate growth of 15%. Specifically, the company posted its best quarter on record among hedge funds, with 19% subscription run rate growth and nearly $15 million in recurring net new sales for a growth of 75%, including three separate seven-figure deals in index analytics. Notably, MSCI secured a significant index deal with one of the world's largest multi-strategy hedge funds covering custom index modules, along with constituent AUM packages.
MSCI more than tripled its index recurring net new sales with hedge funds from a year earlier, reaching $8 million in Q2 2026. This remarkable performance sets the stage for a strong second half of 2026, driven by MSCI's momentum and exciting AI-fueled innovation."
