Moodys Corp /De/ 10-Q Filing

Ticker: MCO · Form: 10-Q · Filed: Jul 24, 2024 · CIK: 1059556

Moodys Corp /De/ 10-Q Filing Summary
FieldDetail
CompanyMoodys Corp /De/ (MCO)
Form Type10-Q
Filed DateJul 24, 2024
Pages16
Reading Time19 min
Key Dollar Amounts$0.01, $1 billion
Sentimentneutral

Sentiment: neutral

FAQ

What type of filing is this?

This is a 10-Q filing submitted by Moodys Corp /De/ (ticker: MCO) to the SEC on Jul 24, 2024.

What are the key financial figures in this filing?

Key dollar amounts include: $0.01 (ich registered Common Stock, par value $0.01 per share MCO New York Stock Exchange); $1 billion (o privately place CP up to a maximum of $1 billion for which the maturity may not exceed 3).

How long is this filing?

Moodys Corp /De/'s 10-Q filing is 16 pages with approximately 4,769 words. Estimated reading time is 19 minutes.

Where can I view the full 10-Q filing?

The complete filing is available on SEC EDGAR. You can also read the AI-decoded analysis with risk assessment and key highlights on ReadTheFiling.

Filing Stats: 4,769 words · 19 min read · ~16 pages · Grade level 19.8 · Accepted 2024-07-24 16:26:11

Key Financial Figures

  • $0.01 — ich registered Common Stock, par value $0.01 per share MCO New York Stock Exchange
  • $1 billion — o privately place CP up to a maximum of $1 billion for which the maturity may not exceed 3

Filing Documents

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION Item 1.

Financial Statements

Financial Statements Consolidated Statements of Operations (Unaudited) for the Three and Six Months Ended June 30, 2024 and 2023 6 Consolidated Statements of Comprehensive Income (Unaudited) for the Three and Six Months Ended June 30, 2024 and 2023 7 Consolidated Balance Sheets (Unaudited) at June 30, 2024 and December 31, 2023 8 Consolidated Statements of Cash Flows (Unaudited) for the Six Months Ended June 30, 2024 and 2023 9 Consolidated Statements of Shareholders' Equity (Unaudited) for the Three and Six Months Ended June 30, 2024 and 2023 10 Notes to the Consolidated Financial Statements (Unaudited) 14 Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations The Company 38 Sustainability 38 Critical Accounting Estimates 39 Reportable Segments 39 Results of Operations 40 Liquidity and Capital Resources 67 Non-GAAP Financial Measures 69 Recently Issued Accounting Standards 72 Contingencies 72

Forward-Looking Statements

Forward-Looking Statements 73 Item 3.

Quantitative and Qualitative Disclosures about Market Risk

Quantitative and Qualitative Disclosures about Market Risk 74 Item 4.

Controls and Procedures

Controls and Procedures 74

OTHER INFORMATION

PART II. OTHER INFORMATION Item 1.

Legal Proceedings

Legal Proceedings 75 Item 1A.

Risk Factors

Risk Factors 75 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 75 Item 5. Other Information 75 Item 6. Exhibits 76

SIGNATURES

SIGNATURES 77 2 Table of Contents GLOSSARY OF TERMS AND ABBREVIATIONS The following terms, abbreviations and acronyms are used to identify frequently used terms in this report: TERM DEFINITION ABS Asset backed securities; a component of SFG Acquisition-Related Intangible Amortization Expense Amortization of definite-lived intangible assets acquired by the Company from all business combination transactions Adjusted Diluted EPS Diluted EPS excluding the impact of certain items as detailed in the section entitled "Non-GAAP Financial Measures" Adjusted Net Income Net Income excluding the impact of certain items as detailed in the section entitled "Non-GAAP Financial Measures" Adjusted Operating Income Operating income excluding the impact of certain items as detailed in the section entitled "Non-GAAP Financial Measures" Adjusted Operating Margin Adjusted Operating Income divided by revenue Americas Represents countries within North and South America, excluding the U.S. ARR Annualized Recurring Revenue; a supplemental performance metric to provide additional insight on the estimated value of MA's recurring revenue contracts at a given point in time, excluding the impact of FX and contracts related to acquisitions ASC The FASB Accounting Standards Codification; the sole source of authoritative GAAP as of July 1, 2009 except for rules and interpretive releases of the SEC, which are also sources of authoritative GAAP for SEC registrants Asia-Pacific Represents Australia and countries in Asia including but not limited to: China, India, Indonesia, Japan, Republic of South Korea, Malaysia, Singapore, Sri Lanka and Thailand ASU The FASB Accounting Standards Update to the ASC. Provides background information for accounting guidance and the bases for conclusions on the changes in the ASC. ASUs are not considered authoritative until codified into the ASC AUD Australian dollar BitSight A provider that helps global market participants

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations M&A Mergers and acquisitions MIS Moody's Investors Service - a reportable segment of MCO; MIS publishes credit ratings and provides assessment services on a wide range of debt obligations, programs and facilities, and the entities that issue such obligations in markets worldwide, including various corporate, financial institution and governmental obligations, and structured finance securities; consists of five LOBs - SFG; CFG; FIG; PPIF; and MIS Other MIS Other Consists of financial instruments pricing services in the Asia-Pacific region, ICRA non-ratings revenue, and revenue from professional services. These businesses are components of MIS; MIS Other is an LOB of MIS Moody's Moody's Corporation and its subsidiaries; MCO; the Company MSS Moody's Shared Services; primarily consists of information technology and support staff such as finance, human resources and legal that support both MA and MIS 4 Table of Contents TERM DEFINITION Net Income Net income attributable to Moody's Corporation, which excludes net income from consolidated noncontrolling interests belonging to the minority interest holder NM Percentage change is not meaningful Non-GAAP A financial measure not in accordance with GAAP; these measures, when read in conjunction with the Company's reported results, can provide useful supplemental information for investors analyzing period-to-period comparisons of the Company's performance, facilitate comparisons to competitors' operating results and to provide greater transparency to investors of supplemental information used by management in its financial and operational decision making NRSRO Nationally Recognized Statistical Rating Organization, which is a credit rating agency registered with the SEC OECD Organization for Economic Co-operation and Development; an international organization that promotes policies that improve economic and so

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION

Financial Statements

Item 1. Financial Statements MOODY'S CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) (Amounts in millions, except per share data) Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Revenue $ 1,817 $ 1,494 $ 3,603 $ 2,964 Expenses Operating 469 426 936 854 Selling, general, and administrative 446 415 859 801 Depreciation and amortization 110 93 210 181 Restructuring 2 10 7 24 Charges related to asset abandonment 15 — 15 — Total expenses 1,042 944 2,027 1,860 Operating income 775 550 1,576 1,104 Non-operating (expense) income, net Interest expense, net ( 63 ) ( 71 ) ( 125 ) ( 119 ) Other non-operating income, net 7 13 20 13 Total non-operating (expense) income, net ( 56 ) ( 58 ) ( 105 ) ( 106 ) Income before provision for income taxes 719 492 1,471 998 Provision for income taxes 166 115 341 120 Net income 553 377 1,130 878 Less: Net income attributable to noncontrolling interests 1 — 1 — Net income attributable to Moody's $ 552 $ 377 $ 1,129 $ 878 Earnings per share attributable to Moody's common shareholders Basic $ 3.03 $ 2.05 $ 6.19 $ 4.79 Diluted $ 3.02 $ 2.05 $ 6.16 $ 4.77 Weighted average number of shares outstanding Basic 182.3 183.5 182.5 183.4 Diluted 183.0 184.1 183.2 184.1 The accompanying notes are an integral part of the consolidated financial statements. 6 Table of Contents MOODY'S CORPORATION CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED) (Amounts in millions) Three Months Ended June 30, 2024 Three Months Ended June 30, 2023 Pre-tax amounts Tax amounts After-tax amounts Pre-tax amounts Tax amounts After-tax amounts Net Income $ 553 $ 377 Other Comprehensive Income (Loss): Foreign Currency Adjustments: Foreign currency translation adjustments, net $ ( 39 ) $ — ( 39 ) $ 51 $ — 51 Net gains (losses) on net investment hedges 43 ( 11 ) 32 ( 37 ) 9 ( 28 ) Cash Flow Hedges: Reclassification of gains (losses) included in net income — — — — ( 1

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (tabular dollar and share amounts in millions, except per share data) NOTE 1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION Moody's is a global integrated risk assessment firm that empowers organizations to anticipate, adapt and thrive in a new era of exponential risk. Our data, analytical solutions and insights help decision-makers identify opportunities and manage the risks of doing business with others. Moody's reports in two reportable segments: MA and MIS. MA is a global provider of: i) decision solutions; ii) research and insights; and iii) data and information, which help companies make better and faster decisions. MA leverages its unique assets and specialized industry knowledge across multiple risks such as credit, market, financial crime, supply chain, catastrophe and climate to deliver integrated risk assessment solutions that enable business leaders to identify, measure and manage the implications of interrelated risks and opportunities. MIS publishes credit ratings and provides assessment services on a wide range of debt obligations, programs and facilities, and the entities that issue such obligations in markets worldwide, including various corporate, financial institution and governmental obligations, and structured finance securities. These interim financial statements have been prepared in accordance with the instructions to Form 10-Q and should be read in conjunction with the Company's consolidated financial statements and related notes in the Company's 2023 annual report on Form 10-K filed with the SEC on February 14, 2024. The results of interim periods are not necessarily indicative

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