Moody’s (MCO) Barclays 22nd Annual Global Financial Services Conference 2024 summary

Executive background and strategic priorities

• New CFO brings extensive international tech and SaaS transformation experience, previously at SAP and Dayforce.

• Focus on leveraging Moody's data assets and technology, including GenAI, to drive efficiencies and innovation.

• Emphasis on maintaining Moody's reputation as a trusted advisor and expanding beyond credit risk to broader risk management.

• Plans to align capital allocation with growth investments and shareholder returns.

• Seeks investor feedback to refine disclosures and business strategy.

Ratings business performance and outlook

• Strong surge in issuance captured, with Q2 MIS revenue exceeding $1 billion, the second-largest quarter on record.

• Transaction revenue grew 56% in H1, outpacing 43% issuance growth, driven by favorable mix and pricing.

• Raised full-year guidance, but expects a more muted second half due to pull-forward activity and election-related caution.

• Margin expansion supported by workflow investments and efficiency gains; GenAI not yet used in ratings but digitalization ongoing.

• Continued investment in new markets like sustainable finance and private credit.

Capital allocation and M&A strategy

• Prioritizes growth investments, especially in ratings workflow and MA bolt-on acquisitions.

• Recent acquisitions include Praedicat (insurance analytics) and GCR (African ratings agency), expanding geographic and product reach.

• Focus remains on bolt-on deals, with openness to larger opportunities as they arise.

• Increased share repurchase guidance, aiming to return 90% of capital to shareholders this year.