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Jun 30, 2020
Moody's Q2 2020 Earnings Report
Moody's reported an 18% increase in revenue and a 66% increase in diluted EPS compared to the prior-year period. The company raised its full-year adjusted diluted EPS guidance due to the stronger-than-expected results.
Key Takeaways
Moody's Corporation reported strong second-quarter results, with revenue up 18% and diluted EPS up 66% year-over-year. Moody's Investors Service exhibited robust top-line growth, while Moody's Analytics growth remained resilient. The company raised its full-year adjusted diluted EPS guidance.
Moody's Corporation reported revenue of $1.4 billion, up 18% from the prior-year period.
Moody's Investors Service revenue was $938 million, up 27% from the prior-year period.
Moody's Analytics revenue was $497 million, up 5% from the prior-year period.
Diluted EPS was $2.69, up 66% from the prior-year period; adjusted diluted EPS was $2.81, up 36%.
Moody's
Moody's
Moody's Revenue by Segment
Moody's Revenue by Geographic Location
Revenue by Segment
Corporate Finance Revenue
CapyFin.comStructured Finance Revenue
CapyFin.comFinancial Institutions Revenue
CapyFin.comPublic & Infrastructure Revenue
CapyFin.comMIS Other Revenue
CapyFin.comRevenue by Geographic Location
United States Revenue
CapyFin.comNon-U.S. Revenue
CapyFin.com Forward Guidance
Moody's updated outlook for 2020 reflects numerous assumptions about many factors that could affect its business based on information reviewed by management through and as of today’s date, including observations and assumptions regarding the impact of COVID-19.
Positive Outlook
- Revenue increase in the low-single-digit percent range
- Operating expenses approximately flat
- Operating margin 43% - 44%
- Adjusted operating margin 48% - 49%
- Diluted EPS $8.15 to $8.55
Challenges Ahead
- Approximately 6% and 9% declines in 2020 U.S. and Euro Zone GDPs, respectively
- High yield interest rate spreads peaking in excess of 650 bps
- U.S. unemployment ending 2020 at approximately 10%
- The high yield default rate rising to approximately 9% by the end of 2020
- Assumes an anticipated restructuring program in the second half of 2020 around the rationalization and exit of certain real estate leases estimated to result in total pre-tax charges of $25 to $35 million.
Revenue & Expenses
Visualization of income flow from segment revenue to net income