$MCO · MOODYS CORP /DE/
Moody's Corporation filed its Q3 FY2026 10-Q, reporting revenue of $2.023B (+0.8% YoY) and diluted EPS of $4.24, up from $3.60 a year ago. The EPS jump was driven largely by a $115M gain on business divestitures; excluding that, operating income declined to $906M from $917M. Nine-month revenue reached $6.287B (+7.9% YoY) with $296M in total divestiture gains.
- Q3 revenue of $2.023B grew just 0.8% YoY, with MIS transaction revenue down 5.2% to $714M.
- Diluted EPS surged to $4.24 from $3.60, boosted by a $115M gain on business divestitures.
- Operating income declined to $906M from $917M as operating expenses rose to $524M from $492M.
- Nine-month revenue reached $6.287B (+7.9% YoY), with $296M in total divestiture gains lifting net income to $2.273B.
- Share count fell to 172.8M basic from 178.9M, amplifying per-share metrics.
Extended-hours trading shows MCO at $481.05, essentially flat (+0.05%) vs the regular close of $480.79. The muted reaction suggests the market had already priced in the divestiture gains and sluggish organic revenue growth.
The $115M divestiture gain masks an organic operating income decline, while the expanded restructuring program signals ongoing cost realignment that will pressure near-term margins.
Moody's flat Q3 revenue contrasts with the broader financial-data sector's mid-single-digit growth. The 99% recurring revenue mix in MA provides stability, but MIS transaction revenue — heavily tied to debt issuance volumes — remains the swing factor.
Restructuring charges of $27M in Q3 and $86M YTD under the Strategic and Operational Efficiency Restructuring Program, with total expected costs of $300M-$350M. A $36M reserve for international non-income tax obligations was also recorded in the nine-month period.
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