Adjusted earnings topped estimates as strong debt issuance lifted ratings revenue and prompted Moody's to raise the lower end of its annual profit forecast.
Moody's reported a sharp increase in second-quarter profit as heavy bond issuance boosted its ratings business, while adjusted earnings per share of $4.68 beat estimates by more than 10%. Revenue from Moody's Investors Service, which issues credit ratings, rose 25% to $1.26 billion from a year earlier, helping lift total quarterly sales 15% to $2.19 billion. Rated issuance volume climbed 33% on broad-based strength across business lines as historically low credit spreads supported debt market activity. Revenue from the analytics segment, which mainly relies on fixed subscriptions, increased 4%. Profit attributable to Moody's rose to $878 million, or $5.03 per share, in the three months ended June 30, from $578 million, or $3.21 per share, a year earlier. CEO Rob Fauber said customers were increasingly relying on the company as capital markets evolved, risks became more interconnected and AI changed workflows. Moody's also lifted the lower end of its annual profit forecast to $16.50 from $16.40, while still expecting revenue growth in the high-single-digit percent range in 2026. The stock had fallen 3.9% this year through the last close.