Moody's Posts Double-Digit Revenue Growth In Q3, Beats Consensus

  • Moody's Corp MCO reported third-quarter FY21 revenue growth of 13% year-on-year to $1.526 billion, beating the consensus of $1.45 billion.
  • Moody's Investors Service revenue grew 12% Y/Y to $925 million; Moody's Analytics revenue grew 13% Y/Y to $601 million.
  • The operating expenses shot up 19% Y/Y to $850 million. The adjusted operating margin contracted 490 bps to 48.3%.
  • Adjusted EPS of $2.69 beat the consensus of $2.52.
  • Moody's held $2.3 billion in cash and equivalents. Moody's generated $1.7 billion in operating cash flow during the nine months ended September 30.
  • "In the third quarter, Moody's delivered impressive double-digit revenue growth and invested significantly in its capabilities and product development in order to better serve a number of high-growth markets," CEO Rob Fauber said.
  • Outlook: Moody's now projects full-year 2021 revenue to increase in the low-teens percent range (prior view low-double-digit percent range).
  • It sees full-year adjusted EPS of $12.15 - $12.35 (prior view $11.55 - $11.85), above the consensus of $11.95.
  • Price Action: MCO shares closed higher by 3.58% at $406.69 on Thursday.
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