S&P Global(SPGI) - 2025 Q2 - Quarterly Results

Executive Summary S&P Global achieved strong Q2 2025 financial results, exceeding expectations with revenue and EPS growth, while advancing strategic initiatives and returning capital to shareholders Second Quarter 2025 Financial Highlights S&P Global exceeded Q2 2025 financial expectations, reporting 6% revenue growth to $3.755 billion and double-digit adjusted diluted EPS growth Key Financial Data for Q2 2025 | Metric | Q2 2025 | Q2 2024 | YoY Change | | :--------------------- | :--------------- | :--------------- | :------- | | Revenue | $3.755 billion | | 6% | | GAAP Net Income | $1.072 billion | | 6% | | GAAP Diluted EPS | $3.50 | | 9% | | Adjusted Net Income | $1.356 billion | | 7% | | Adjusted Diluted EPS | $4.43 | | 10% | - Net income growth was primarily driven by strong performance in Market Intelligence and S&P Dow Jones Indices[3] Strategic Initiatives The company is progressing with the Mobility division separation and OSTTRA joint venture divestiture, while appointing a new president and CEO - The Mobility division separation plan is on track, with Bill Eager appointed as President and CEO-elect of the future independent public company[4] - The divestiture of the OSTTRA joint venture is also on schedule for completion in 2025[4] CEO Commentary & Key Highlights CEO Martina Cheung highlighted strong Q2 financial performance, balancing expense management with strategic investments in technology and AI, expanding margins - The company achieved better-than-expected financial results in Q2, driven by the execution of client plans and resilience in debt and equity markets[5] - The company balanced expense management with investments in future growth, including technology and AI, while expanding profit margins[5] Key Operating Metrics for Q2 2025 | Metric | Change | | :--------------------- | :--- | | Quarterly Revenue YoY Growth | 6% | | GAAP Operating Margin Growth | 40 bps | | Adjusted Operating Margin Growth | 70 bps | | GAAP Diluted EPS Growth | 9% | | Adjusted Diluted EPS Growth | 10% | - The company expects to execute an additional up to $1.3 billion in accelerated share repurchases (ASR) in the coming weeks[6] Second Quarter 2025 Financial Performance This section details S&P Global's Q2 2025 financial performance, covering revenue, operating profit, expenses, margins, and diluted EPS Second Quarter 2025 Revenue Q2 2025 revenue grew 6% to $3.755 billion, primarily driven by Market Intelligence and S&P Dow Jones Indices, with subscription revenue up 7% Q2 2025 Revenue Overview | Metric | Amount | YoY Change | | :--- | :--- | :------- | | Total Revenue | $3.755 billion | 6% | | Subscription Revenue | | 7% | - Revenue growth was primarily driven by the Market Intelligence and S&P Dow Jones Indices divisions[3][9] Second Quarter 2025 Operating Profit, Expense, and Operating Margin Q2 operating margin increased 40 bps to 41.3%, and adjusted operating margin rose 70 bps to 51.4%, driven by Market Intelligence and S&P Dow Jones Indices Q2 2025 Operating Margins | Metric | Q2 2025 | Change | | :----------------- | :------------- | :--- | | Reported Operating Margin | 41.3% | +40 bps | | Adjusted Operating Margin | 51.4% | +70 bps | - Margin improvement was primarily driven by growth and margin expansion in the Market Intelligence and S&P Dow Jones Indices divisions[12] Second Quarter 2025 Diluted Earnings Per Share Q2 2025 GAAP diluted EPS grew 9% to $3.50, and adjusted diluted EPS increased 10% to $4.43, driven by net income growth and fewer shares Q2 2025 Diluted Earnings Per Share | Metric | Q2 2025 | Q2 2024 | YoY Change | | :----------------- | :--------------- | :--------------- | :------- | | GAAP Diluted EPS | $3.50 | $3.23 | 9% | | Adjusted Diluted EPS | $4.43 | $4.04 | 10% | - GAAP diluted EPS growth was primarily due to a 6% increase in net income and a 2% reduction in diluted shares outstanding[14] - Adjusted diluted EPS growth was primarily due to a 7% increase in adjusted net income and a 2% reduction in diluted shares outstanding, with currency factors having a positive impact of $0.02 on adjusted diluted EPS[15] Full-Year 2025 Outlook and Capital Return This section details the company's updated full-year 2025 financial guidance and capital return strategy for shareholders Full-Year 2025 Outlook The company updated its full-year 2025 guidance, projecting 5%-7% revenue growth and adjusted diluted EPS of $17.00-$17.25 Full-Year 2025 Guidance | Metric | GAAP | Adjusted | | :---------------------- | :---------------- | :---------------- | | Revenue Growth | 5% - 7% | 5% - 7% | | Operating Margin | 42.5% - 43.5% | 48.5% - 49.5% | | Diluted EPS | $14.35 - $14.60 | $17.00 - $17.25 | | Net Cash Provided by Operating Activities Less Capital Expenditures and Distributions to Noncontrolling Interests | $5.4 - $5.6 billion | | | Adjusted Free Cash Flow (Excluding Certain Items) | | $5.6 - $5.8 billion | - The revenue growth guidance was raised, primarily based on higher expected contributions from Ratings, S&P Dow Jones Indices, and Mobility divisions, partially offset by a slightly lower expected contribution from Commodity Insights[17] - GAAP diluted EPS guidance was lowered from the previous $14.60-$15.10, primarily due to lower expected gains from asset sales; the low end of adjusted diluted EPS guidance was raised by $0.25, while the high end remained unchanged[17] - The guidance assumes the OSTTRA divestiture will be completed in the second half of 2025, and adjusted guidance excludes acquisition-related intangible asset amortization[18] Capital Return The company expects to return approximately 85% of adjusted free cash flow to shareholders in 2025 via dividends and share repurchases - For full-year 2025, the company expects to return approximately 85% of adjusted free cash flow to shareholders through dividends and share repurchases[19] - The Board of Directors has authorized a quarterly cash dividend of $0.96 per share[19] - The company expects to execute an additional up to $1.3 billion in accelerated share repurchases (ASR) in the coming weeks[19] Supplemental Information and Disclosures This section covers Q2 earnings call details, GAAP vs. non-GAAP financial comparisons, and important forward-looking statements Supplemental Information/Conference Call/Webcast Details A conference call on July 31, 2025, at 8:30 AM EDT will discuss Q2 earnings, with details on the investor relations website - The company will host a conference call on July 31, 2025, at 8:30 AM EDT to discuss Q2 earnings results[20] - Supplemental materials and the webcast are available at http://investor.spglobal.com/Quarterly-Earnings[20](index=20&type=chunk)[21] Comparison of Adjusted Information to U.S. GAAP Information The company provides both GAAP and non-GAAP financial metrics, with reconciliations, to offer supplementary information for investors and management - The company reports financial results in accordance with U.S. Generally Accepted Accounting Principles (GAAP) and also provides various non-GAAP financial measures, including adjusted net income, adjusted diluted EPS, and adjusted operating profit and margin[23] - Non-GAAP measures are intended to provide useful supplemental information to help investors compare company performance and for management's internal assessment of business performance and resource allocation[25] - The company has provided reconciliation tables for non-GAAP financial measures to the most directly comparable GAAP measures in Exhibits 5, 7, and 8[24] Forward-Looking Statements This press release contains forward-looking statements, subject to inherent risks and uncertainties that may cause actual results to differ - This press release contains forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995, reflecting management's current views regarding future events, trends, contingencies, or outcomes[26] - Forward-looking statements are subject to inherent risks and uncertainties that could cause actual results to differ materially from expectations[27] - Risk factors include: - Global economic, financial, political, and regulatory conditions, such as slowing GDP growth, inflation, and geopolitical uncertainties[27][28] - Volatility in debt, equity, commodity, energy, and automotive markets[27] - The company's ability to maintain information and data security, and potential risks from system disruptions or data breaches[27] - The impact of competitive products, including those utilizing generative AI, and the ability to develop new products or technologies[27] - Risks that the Mobility division separation may not be completed as anticipated or at all, and potential loss of synergies post-separation[27][31] - The company's ability to execute acquisitions and divestitures, and to successfully integrate acquired businesses[27] About S&P Global This section provides an overview of S&P Global, its mission, and contact information for investor relations and media Company Overview S&P Global (NYSE: SPGI) provides essential intelligence through data, expertise, and technology for confident decision-making - S&P Global (NYSE: SPGI) delivers essential intelligence through data, expertise, and connected technology, empowering governments, businesses, and individuals to make decisions with confidence[29] - The company provides credit ratings, benchmarks, analytics, and workflow solutions across global capital, commodity, and automotive markets[30] Investor & Media Contacts Detailed contact information for investor relations and media representatives is provided - Investor Relations Contact: Mark Grant, Senior Vice President, Investor Relations & Treasurer, Phone: +1 (347) 640-1521, Email: mark.grant@spglobal.com[31] - Media Contact: Christina Twomey, Chief Communications Officer, Phone: +1 (410) 382-3316, Email: christina.twomey@spglobal.com[31] Exhibits This section presents supplementary financial exhibits, including condensed consolidated statements of income, balance sheets, cash flows, and segment operating results Exhibit 1 Condensed Consolidated Statements of Income The condensed consolidated statements of income detail S&P Global's Q2 2025 and 2024 financial performance, showing 6% revenue and net income growth Condensed Consolidated Statements of Income (Three/Six Months, $ millions) | Metric | Q2 2025 | Q2 2024 | YoY Change | Six Months 2025 | Six Months 2024 | YoY Change | | :--------------------------------- | :--------------- | :--------------- | :------- | :--------------- | :--------------- | :------- | | Revenue | $3,755 | $3,549 | 6% | $7,532 | $7,040 | 7% | | Expenses | $2,218 | $2,110 | 5% | $4,428 | $4,222 | 5% | | Operating Profit | $1,551 | $1,452 | 7% | $3,129 | $2,837 | 10% | | Net Income Attributable to S&P Global Inc. | $1,072 | $1,011 | 6% | $2,161 | $2,002 | 8% | | Diluted EPS | $3.50 | $3.23 | 9% | $7.04 | $6.38 | 10% | Exhibit 2 Condensed Consolidated Balance Sheets The condensed consolidated balance sheets present assets, liabilities, and equity as of June 30, 2025, and December 31, 2024 Condensed Consolidated Balance Sheets ($ millions) | Metric | June 30, 2025 | December 31, 2024 | | :--------------------------------- | :--------------- | :--------------- | | Assets: | | | | Cash, Cash Equivalents, and Restricted Cash | $1,847 | $1,666 | | Other Current Assets | $4,030 | $3,793 | | Total Current Assets | $5,877 | $5,459 | | Property and Equipment, Net | $275 | $265 | | Operating Lease Right-of-Use Assets | $405 | $413 | | Goodwill and Other Intangible Assets, Net | $51,150 | $51,473 | | Equity Investments in Unconsolidated Subsidiaries | $1,846 | $1,774 | | Other Non-Current Assets | $842 | $837 | | Total Assets | $60,395 | $60,221 | | Liabilities and Equity: | | | | Short-Term Debt | $3 | $4 | | Unearned Revenue | $3,871 | $3,694 | | Other Current Liabilities | $2,108 | $2,694 | | Long-Term Debt | $11,385 | $11,394 | | Operating Lease Liabilities — Non-Current | $512 | $535 | | Deferred Tax Liabilities — Non-Current | $3,175 | $3,397 | | Pensions, Other Postretirement Benefits, and Other Non-Current Liabilities | $1,380 | $995 | | Total Liabilities | $22,434 | $22,713 | | Redeemable Noncontrolling Interests | $4,465 | $4,252 | | Total Equity | $33,496 | $33,256 | | Total Liabilities and Equity | $60,395 | $60,221 | Exhibit 3 Condensed Consolidated Statements of Cash Flows The condensed consolidated statements of cash flows detail cash movements for the six months ended June 30, 2025 and 2024 Condensed Consolidated Statements of Cash Flows (Six Months, $ millions) | Activity Category | Six Months 2025 | Six Months 2024 | | :--------------------- | :--------------- | :--------------- | | Net Cash Provided by Operating Activities | $2,398 | $2,504 | | Net Cash Used in Investing Activities | ($131) | ($319) | | Net Cash Used in Financing Activities | ($2,162) | ($1,405) | | Net Change in Cash, Cash Equivalents, and Restricted Cash | $181 | $748 | | Cash, Cash Equivalents, and Restricted Cash at End of Period | $1,847 | $2,039 | Exhibit 4 Operating Results by Segment This exhibit details S&P Global's segment-level revenue, expenses, and operating profit for Q2 2025 and 2024 Segment Revenue (Q2 2025, $ millions) | Segment | Q2 2025 Revenue | Q2 2024 Revenue | YoY Change | | :----------------- | :----------------- | :----------------- | :------- | | Market Intelligence | $1,217 | $1,155 | 5% | | Ratings | $1,148 | $1,135 | 1% | | Commodity Insights | $555 | $516 | 8% | | Mobility | $438 | $400 | 10% | | Indices | $446 | $389 | 15% | | Total Revenue | $3,755 | $3,549 | 6% | Segment Operating Profit (Q2 2025, $ millions) | Segment | Q2 2025 Operating Profit | Q2 2024 Operating Profit | YoY Change | | :----------------- | :--------------------- | :--------------------- | :------- | | Market Intelligence | $259 | $230 | 12% | | Ratings | $715 | $725 | (1)% | | Commodity Insights | $233 | $206 | 13% | | Mobility | $104 | $80 | 30% | | Indices | $309 | $263 | 18% | | Total Operating Profit | $1,551 | $1,452 | 7% | Exhibit 5 Operating Results - Reported vs. Adjusted This exhibit compares reported (GAAP) and adjusted (non-GAAP) operating results, including expenses, operating profit, and EPS Adjusted Expenses (Q2 2025, $ millions) | Segment | Q2 2025 Expenses | Q2 2024 Expenses | YoY Change | | :----------------- | :----------------- | :----------------- | :------- | | Market Intelligence | $787 | $775 | 2% | | Ratings | $396 | $388 | 2% | | Commodity Insights | $285 | $272 | 5% | | Mobility | $253 | $236 | 7% | | Indices | $128 | $114 | 12% | | Total Adjusted Expenses | $1,823 | $1,749 | 4% | Adjusted Operating Profit (Q2 2025, $ millions) | Segment | Q2 2025 Adjusted Operating Profit | Q2 2024 Adjusted Operating Profit | YoY Change | | :----------------- | :--------------------------- | :--------------------------- | :------- | | Market Intelligence | $430 | $380 | 13% | | Ratings | $752 | $747 | 1% | | Commodity Insights | $270 | $244 | 10% | | Mobility | $185 | $164 | 13% | | Indices | $318 | $275 | 16% | | Total Adjusted Operating Profit | $1,931 | $1,800 | 7% | Adjusted Diluted EPS (Three/Six Months, $ millions except per share amounts) | Metric | Q2 2025 | Q2 2024 | YoY Change | Six Months 2025 | Six Months 2024 | YoY Change | | :------------------------- | :--------------- | :--------------- | :------- | :--------------- | :--------------- | :------- | | Adjusted Net Income Attributable to SPGI | $1,356 | $1,267 | 7% | $2,699 | $2,525 | 7% | | Adjusted Diluted EPS | $4.43 | $4.04 | 10% | $8.80 | $8.05 | 9% | Exhibit 6 Revenue Information This exhibit breaks down segment revenue by type, including subscription, non-subscription/transactional, and various fee structures Revenue by Type (Q2 2025, $ millions) | Revenue Type | Q2 2025 | Q2 2024 | YoY Change | | :--------------------- | :--------------- | :--------------- | :------- | | Subscription Revenue | $1,954 | $1,821 | 7% | | Non-Subscription/Transactional Revenue | $745 | $777 | (4)% | | Non-Transactional Revenue | $502 | $463 | 8% | | Sales-Based Usage Royalties | $286 | $245 | 17% | | Asset-Linked Fees | $110 | $96 | 15% | | Recurring Variable Revenue | $158 | $147 | 8% | - Subscription revenue primarily derives from data distribution, valuation services, analytics, third-party research, credit rating-related information, market data and insights, and software term licenses and core information products for Mobility[61] - Non-subscription/transactional revenue is primarily associated with public debt and bank loan ratings[62] Exhibit 7 Non-GAAP Financial Information This exhibit provides free cash flow, adjusted free cash flow, and organic, constant currency revenue for S&P Global and its segments Free Cash Flow and Adjusted Free Cash Flow (Three/Six Months, $ millions) | Metric | Q2 2025 | Q2 2024 | Six Months 2025 | Six Months 2024 | | :--------------------------------- | :--------------- | :--------------- | :--------------- | :--------------- | | Net Cash Provided by Operating Activities | $1,445 | $1,556 | $2,398 | $2,504 | | Capital Expenditures | ($61) | ($32) | ($104) | ($56) | | Distributions to Noncontrolling Interest Holders | ($74) | ($60) | ($168) | ($133) | | Free Cash Flow | $1,310 | $1,464 | $2,126 | $2,315 | | Adjusted Free Cash Flow (Excluding Certain Items) | $1,357 | $1,539 | $2,258 | $2,557 | S&P Global Organic, Constant Currency Revenue (Three/Six Months, $ millions) | Metric | Q2 2025 | Q2 2024 | YoY Change | Six Months 2025 | Six Months 2024 | YoY Change | | :----------------------- | :--------------- | :--------------- | :------- | :--------------- | :--------------- | :------- | | Total Revenue | $3,755 | $3,549 | 6% | $7,532 | $7,040 | 7% | | Total Organic Revenue | $3,730 | $3,508 | 6% | $7,482 | $6,974 | 7% | | Organic Revenue (Constant Currency Basis) | $3,715 | $3,508 | 6% | $7,480 | $6,974 | 7% | Segment Organic, Constant Currency Revenue (Q2 2025, $ millions) | Segment | Organic Revenue (Constant Currency Basis) | YoY Change | | :----------------- | :----------------------- | :------- | | Market Intelligence | $1,189 | 7% | | Ratings | $1,137 | —% | | Commodity Insights | $555 | 8% | | Mobility | $438 | 10% | | Indices | $445 | 15% | Exhibit 8 Non-GAAP Guidance This exhibit reconciles 2025 GAAP diluted EPS to non-GAAP adjusted diluted EPS guidance, detailing various adjustment items 2025 Non-GAAP Guidance Reconciliation ($ per share) | Metric | Low End | High End | | :----------------------- | :----- | :----- | | GAAP Diluted EPS | $14.35 | $14.60 | | Acquisition-Related Amortization | $2.71 | $2.71 | | OSTTRA Potential Divestiture Gain | ($0.47) | ($0.47) | | Premium Amortization Benefit | ($0.06) | ($0.06) | | Tax Rate and Other | $0.47 | $0.47 | | Non-GAAP Adjusted Diluted EPS | $17.00 | $17.25 |