Moody’s (MCO) Q2 2026 earnings summary

Executive summary

• Revenue for Q2 2026 increased 15% year-over-year to $2.19 billion, driven by 25% growth in MIS and 4% in MA, with organic constant currency growth of 16%.

• Adjusted operating income grew 25%, and adjusted diluted EPS increased 31% to $4.68, while diluted EPS rose 57% to $5.03.

• Adjusted operating margin expanded by 440 basis points to 55.3%, reflecting strong revenue and disciplined cost management.

• Raised select full-year 2026 guidance metrics, including adjusted diluted EPS to $16.50–$17.00 and share repurchases up to $3.0 billion.

• Gain on divestiture of the MA Regulatory Solutions business contributed $181 million to non-operating income.

Financial highlights

• Q2 2026 consolidated revenue reached $2.19 billion, up from $1.90 billion in Q2 2025.

• Adjusted operating income for Q2 2026 was $1.21 billion, up from $966 million in Q2 2025.

• Free cash flow for the first half of 2026 was $1.53 billion, up from $1.14 billion in the prior year.

• MA segment revenue grew 4% (8% organic constant currency), with recurring revenue up 7% and representing 99% of MA revenue.

• MIS segment revenue surged 25% year-over-year, with transaction revenue up 34% and over $2 trillion of debt rated for the second consecutive quarter.

Outlook and guidance

• Full-year 2026 adjusted diluted EPS guidance raised to $16.50–$17.00, with revenue growth expected in the high-single-digit percent range.

• Free cash flow forecasted at $2.7–$2.9 billion; share repurchases up to $3.0 billion.

• Strategic and Operational Efficiency Restructuring Program expected to generate $300–$350 million in annualized savings by end of 2027.

• MA ARR expected to grow in the high-single-digit percent range, reaching $3.7 billion, with 95% retention.

• Assumptions include moderate global GDP growth, stable inflation, and central banks maintaining a tightening bias.