MSCI Delivers Strong Q1 2025 Results Amid Market Turmoil
MSCI, a leading provider of critical investment decision support tools and solutions, has reported strong financial metrics in its first quarter (Q1) 2025 results. Despite market volatility, the company demonstrated resilience and delivered growth across key areas.
In a recent conference call, Henry Fernandez, Chairman and CEO of MSCI, presented the company's Q1 performance, highlighting notable achievements. Organic revenue growth was impressive at 4%, with adjusted EBITDA and earnings per share growing by 11% and almost 14%, respectively. The company also successfully executed its capital allocation policy, repurchasing $225 million worth of shares during the quarter.
MSCI's operating metrics showcased durability, with a retention rate exceeding 95% and organic subscription run rate growth of 8%. Asset-based fee gross revenue grew by a remarkable 18%, driven by strong cash flows into ETF products linked to MSCI Indices. This surge in demand reflects the growing importance of MSCI Indices in the investment landscape.
The company's client segments, including hedge funds, asset owners, banks, and broker-dealers, as well as wealth managers, experienced a strong quarter. Retention rates for Index and Analytics products exceeded 96% and 95%, respectively, with recurring net new sales growth surpassing 60% for each product line.
MSCI is well-positioned to provide customized solutions for portfolio diversification and personalization. The company has built momentum in custom indices, which will be further supported by its integration of the Foxberry F9 platform. Net new recurring subscription sales in Private Capital Solutions grew by an impressive 24%, underscoring MSCI's growing presence in this asset class.
A key partnership with Moody's to develop independent credit risk assessments for private credit represents a significant step forward in addressing market needs. By combining Moody's credit risk modeling solutions with MSCI's investment data, the company aims to drive greater clarity and confidence in this asset class, especially during periods of market stress.
MSCI's business model is designed to withstand periods of global turmoil, capitalizing on client demand for mission-critical data, models, and technology. With 88% of subscription run rates coming from clients using multiple MSCI product lines, the company is poised to deliver consistent financial results despite market volatility.
