Moody's Surpasses Expectations with Strong Q3 Performance, Raises Earnings Guidance

Moody's Corporation reported a robust third-quarter performance on October 22, 2025, surpassing analyst expectations and raising its full-year earnings guidance. The company's strong results were driven by increased bond issuance and growth in its analytics division.

In the third quarter, Moody's achieved a profit of $646 million, or $3.60 per share. After adjusting for costs related to mergers, acquisitions, and restructuring, earnings were $3.92 per share, exceeding the anticipated $3.70. Revenue for the quarter reached $2.01 billion, surpassing the forecasted $1.96 billion. Consequently, Moody's raised its full-year earnings guidance to a range of $14.50 to $14.75 per share, up from the previous estimate of $13.50 to $14.00.

The Moody’s Investors Service (MIS) segment reported $2 billion in revenue, marking an 11% increase. This growth was attributed to a healthy issuance environment and record-tight spreads. CEO Rob Fauber highlighted the company's strategic investments in technology, analytical tools, and talent, stating, "The power of the Moody’s franchise was on full display this quarter, with strong top-line growth and significant operating leverage."

Moody's Analytics (MA) also demonstrated strong performance, with reported revenue growing 9% year-over-year. The segment maintained a 93% recurring revenue rate and a 93% retention rate, reflecting consistent growth at scale. The company has been actively reshaping its revenue mix by downsizing low-margin services and leveraging implementation partners across regions.

Moody's shares rose by 1.5% in premarket trading following the announcement and are up 2.4% year-to-date. The company's performance serves as a barometer for global fixed-income markets, indicating a robust environment for credit markets and analytics services.

In the broader context, Moody's has demonstrated resilience and adaptability in navigating market fluctuations. For instance, in April 2025, despite reporting an 8% increase in first-quarter profit, the company reduced its full-year profit forecast due to market volatility and uncertainties stemming from U.S. trade policy.

The current positive trajectory may be attributed to strategic investments and a favorable market environment, underscoring the importance of adaptability in the financial services sector.

Moody's Corporation, founded in 1909 by John Moody, is a global business and financial services company headquartered in New York City. It operates through two main divisions: Moody's Ratings, which provides credit ratings for various debt securities, and Moody's Analytics, which offers financial analysis software and services. The company has a workforce of approximately 16,000 employees across more than 40 countries.

The third-quarter results reflect a significant improvement compared to the same period in the previous year, where Moody's reported a profit of $534 million, or $2.93 per share. The 11% increase in revenue from the Moody's Investors Service segment indicates a strong demand for credit ratings, likely influenced by favorable market conditions and increased bond issuance.

Moody's performance is closely watched as a barometer for global fixed-income markets. The company's ability to exceed earnings expectations and raise guidance may signal a robust environment for credit markets and analytics services.