MSCI(MSCI) - 2025 Q1 - Quarterly Results

Financial Performance - Operating revenues for Q1 2025 were $745.8 million, an increase of 9.7% compared to Q1 2024, with organic operating revenue growth of 9.9%[6] - Net income rose to $288.6 million, reflecting a 12.8% increase year-over-year, while diluted EPS increased by 15.2% to $3.71[6] - Recurring subscription revenues grew by 7.7%, and asset-based fees increased by 18.1%[6] - Adjusted EBITDA for Q1 2025 was $425.6 million, up 11.0%, with an adjusted EBITDA margin of 57.1%[13] - The Index segment reported operating revenues of $421.7 million, a 12.8% increase, driven by higher asset-based fees and recurring subscription revenues[14] - The Analytics segment's operating revenues were $172.2 million, up 5.0%, primarily from recurring subscriptions[17] - Sustainability and Climate segment revenues increased by 8.6% to $84.6 million, with organic growth of 9.2%[22] - Recurring subscriptions revenue grew by 9.6% to $233.330 million in Q1 2025 from $212.995 million in Q1 2024[67] - Adjusted EBITDA for Q1 2025 was $311.571 million, up from $277.760 million in Q1 2024, reflecting a growth of 12.2%[67] - The adjusted EBITDA margin for Q1 2025 was 73.9%, slightly down from 74.3% in Q1 2024[67] - Consolidated adjusted EBITDA for the three months ended March 31, 2025, was $425,641, compared to $383,573 in 2024, representing an increase of 11.0%[79] Expenses and Guidance - Total operating expenses were $368.8 million, an increase of 8.3%, primarily due to higher compensation and benefits costs[9] - MSCI's Full-Year 2025 guidance includes operating expenses projected between $1,405 million and $1,445 million[34] - Adjusted EBITDA expenses are expected to be in the range of $1,220 million to $1,250 million for Full-Year 2025[34] - The effective tax rate is anticipated to be between 17.5% and 20.0%[34] - Capital expenditures are forecasted to be between $115 million and $125 million[34] Cash Flow and Shareholder Returns - Approximately $139.7 million in dividends were paid to shareholders in Q1 2025, with a cash dividend of $1.80 per share declared for Q2 2025[31] - Net cash provided by operating activities is projected to be between $1,525 million and $1,575 million[34] - Free cash flow is expected to range from $1,400 million to $1,460 million[34] - Free cash flow for the three months ended March 31, 2025, was $268,876, slightly down from $275,900 in the same period last year[84] - The company repurchased $213.093 million worth of common stock during Q1 2025, compared to $69.991 million in Q1 2024, indicating a significant increase in share buybacks[65] Assets and Liabilities - Total current assets decreased to $1.236 billion as of March 31, 2025, down from $1.344 billion at the end of 2024, a decline of 8.0%[63] - Total liabilities decreased slightly to $6.303 billion from $6.385 billion at the end of 2024, a reduction of 1.3%[63] - Cash and cash equivalents at the end of Q1 2025 were $360.671 million, down from $409.351 million at the end of 2024, a decrease of 11.8%[65] Sales and Retention - The total retention rate improved to 95.3% from 92.8% year-over-year, indicating stronger customer loyalty[74] - The net new recurring subscription sales increased by 60.8% to $14.17 million compared to $8.81 million in the same quarter of 2024[74] - New recurring subscription sales decreased by 4.6% to $22.42 million from $23.51 million in the previous year[74] - Non-recurring sales for the three months ended March 31, 2025, were $12.37 million, a decline of 3.4% from $12.81 million in the same period of 2024[74] - The total gross sales for the quarter were $70.14 million, down 6.9% from $75.37 million year-over-year[74] Market Performance - The period-end AUM in ETFs linked to MSCI equity indexes was $1,783.1 billion as of March 31, 2025, reflecting a market appreciation of $16.4 billion during the quarter[75] - Total Run Rate as of March 31, 2025, reached $2,979,248, reflecting a 9.3% increase from $2,726,484 in 2024[77] - Recurring subscriptions amounted to $948,387, up 9.0% from $869,931 in the previous year[77] - Organic operating revenue growth for the consolidated segment was 9.9%, with recurring subscription growth at 7.9% and asset-based fees growth at 18.1%[85]