Q1 2024 Moody's Corp Earnings Call Transcript
Key Points
- Moody's Corporation reported a strong first quarter with a 21% revenue growth, driven by robust demand in both its Moody's Investors Service (MIS) and Moody's Analytics (MA) segments.
- MIS experienced a significant 35% revenue growth year-over-year, with transactional revenue growing by 57%, highlighting the division's strong performance and market demand.
- Moody's Analytics continued its consistent performance with a 10% Annual Recurring Revenue (ARR) growth, marking 65 consecutive quarters of revenue growth.
- The company successfully executed on strategic investments in technology and GenAI enablement, which are expected to drive future growth and maintain competitive advantage.
- Moody's Corporation is on track to return over $1.6 billion to stockholders through share repurchases and dividends, demonstrating strong financial health and shareholder value focus.
- Despite the strong quarter, Moody's Corporation has maintained a cautious outlook for the full year due to potential market uncertainties including U.S. elections, tensions in the Middle East, and inflation concerns.
- The first quarter's robust issuance levels were partly due to favorable market conditions that may not persist, leading to potential volatility in future performance.
- There was a noted pull forward in issuance, which might result in a softer performance in subsequent quarters if the favorable conditions change.
- Moody's Analytics' Research & Insights segment showed a slower growth rate, affected by timing of revenue recognition and a shift from on-premise to SaaS subscriptions, indicating potential challenges in this line of business.
- The company faces ongoing pressures from cost-conscious clients, particularly in the financial sector, which could impact sales and retention rates.
Good day, everyone, and welcome to the Moody's Corporation First Quarter 2024 Earnings Call. At this time, I would like to inform you that this conference is being recorded. (Operator Instructions)
I will now turn the call over to Shivani Kak, Head of Investor Relations. Please go ahead.
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Thank you. Good morning, and thank you for joining us today. I'm Shivani Kak, Head of Investor Relations. This morning, Moody's released its results for the first quarter 2024 as well as our revised outlook for select metrics for full year 2024. The earnings press release and the presentation to accompany this teleconference are both available on our website at ir.moodys.com.
During this call, we will also be presenting non-GAAP or adjusted figures. Please refer to the tables at the end of our earnings press release filed this morning for a reconciliation between all adjusted measures referenced during this call in U.S. GAAP.
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