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MSCI (MSCI) Up 8.2% Since Last Earnings Report: Can It Continue?
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It has been about a month since the last earnings report for MSCI (MSCI - Free Report) . Shares have added about 8.2% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is MSCI due for a pullback? Well, first let's take a quick look at its latest earnings report in order to get a better handle on the recent catalysts for MSCI Inc before we dive into how investors and analysts have reacted as of late.
MSCI’s second-quarter 2025 adjusted earnings of $4.17 per share beat the Zacks Consensus Estimate by 0.24% and increased 14.6% year over year.
MSCI's revenues rose 9.1% year over year to $772.68 million, missing the consensus estimate by 0.12%. The year-over-year growth was driven by strong growth in recurring subscription revenues and asset-based fees. Organic operating revenues grew 8.3% year over year.
Recurring subscriptions of $562.8 million increased 7.9% year over year and contributed 72.8% to revenues. Asset-based fees of $184.1 million jumped 12.7% year over year and contributed 23.8% to revenues. Non-recurring revenues of $25.8 million increased 11.4% year over year and contributed 3.3% to revenues.
At the end of the reported quarter, average assets under management were $2.024 trillion in ETFs linked to MSCI equity indexes. The total retention rate was 94.4% in the reported quarter.
MSCI’s Top-Line Details
In the second quarter of 2025, Index revenues of $434.8 million increased 9.5% year over year. Recurring subscriptions and asset-based fees rose 8.6% and 12.7% on a year-over-year basis, respectively. Non-recurring revenues declined 10.5% year over year. Organically, Index operating revenue growth was 9.3%.
The uptick in recurring subscription revenues was driven by strong growth from market-cap-weighted Index products and ETFs linked to MSCI equity indexes.
Analytics operating revenues of $177.7 million increased 7.1% year over year. Recurring subscription revenues jumped 4.7% and non-recurring revenues increased 104.9% on a year-over-year basis. Organically, Analytics’ operating revenue growth was 6.6%.
The Sustainability and Climate segment’s (previously titled "ESG and Climate") operating revenues were $88.9 million, rising 11.3% year over year. Recurring subscriptions and non-recurring revenues increased 11.6% and 1.6% on a year-over-year basis, respectively. Organically, Sustainability and Climate operating revenue growth was 7.1%.
All Other – Private Assets operating revenues, which primarily comprise the Real Assets operating segment and the Private Capital Solutions (formerly known as Burgiss), were $71.2 million, up 9.7% year over year. Organic operating revenue growth for All Other – Private Assets was 8.2%.
MSCI’s Q2 Operating Details
Adjusted EBITDA increased 10.3% year over year to $474.3 million in the reported quarter. The adjusted EBITDA margin in the second quarter of 2025 was 61.4% compared with 60.7% in the second quarter of 2024.
Adjusted EBITDA expenses were $298.3 million, up 7.3% year over year, reflecting higher compensation and benefits costs due to higher headcount, as well as elevated severance costs.
Total operating expenses increased 6.8% on a year-over-year basis to $347.4 million due to higher compensation costs from a 2.5% increase in headcount.
Operating income improved 11.1% year over year to $425.2 million. The operating margin expanded 100 bps on a year-over-year basis to 55%.
MSCI’s Balance Sheet & Cash Flow
Total cash and cash equivalents, as of June 30, 2025, were $347.3 million compared with $360.7 million as of March 31, 2025.
Total debt was $4.5 billion as of June 30, 2025, compared with $4.5 billion as of March 31, 2025. The total debt-to-adjusted EBITDA ratio (based on trailing 12-month-adjusted EBITDA) was 2.5 times, lower than management’s target of 3-3.5 times.
As of June 30, 2025, the free cash flow was $301.6 million, down 6.3% year over year from $268.9 million as of March 31, 2025.
MSCI had $1.2 billion outstanding under its share-repurchase authorization as of July 21, 2025.
The company paid out dividends worth $139.3 million in the second quarter of 2025.
MSCI Maintains 2025 Guidance
For 2025, MSCI expects total operating expenses of $1.405-$1.445 billion.
Adjusted EBITDA expenses are anticipated to be between $1.220 billion and $1.250 billion.
Interest expenses are expected to be between $182 million and $186 million.
Net cash provided by operating activities and the free cash flow are expected to be $1.52-$1.57 billion and $1.400-$1.460 billion, respectively.
How Have Estimates Been Moving Since Then?
Since the earnings release, investors have witnessed a downward trend in estimates revision.
VGM Scores
Currently, MSCI has a average Growth Score of C, though it is lagging a lot on the Momentum Score front with an F. Following the exact same course, the stock was allocated a score of F on the value side, putting it in the bottom 20% quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions looks promising. Interestingly, MSCI has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
MSCI is part of the Zacks Financial - Investment Management industry. Over the past month, BlackRock (BLK - Free Report) , a stock from the same industry, has gained 0.7%. The company reported its results for the quarter ended June 2025 more than a month ago.
BlackRock reported revenues of $5.42 billion in the last reported quarter, representing a year-over-year change of +12.9%. EPS of $12.05 for the same period compares with $10.36 a year ago.
BlackRock is expected to post earnings of $11.78 per share for the current quarter, representing a year-over-year change of +2.8%. Over the last 30 days, the Zacks Consensus Estimate has changed +1.3%.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for BlackRock. Also, the stock has a VGM Score of D.
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MSCI (MSCI) Up 8.2% Since Last Earnings Report: Can It Continue?
It has been about a month since the last earnings report for MSCI (MSCI - Free Report) . Shares have added about 8.2% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is MSCI due for a pullback? Well, first let's take a quick look at its latest earnings report in order to get a better handle on the recent catalysts for MSCI Inc before we dive into how investors and analysts have reacted as of late.
MSCI Q2 Earnings Beat Estimates, Revenues Rise Y/Y
MSCI’s second-quarter 2025 adjusted earnings of $4.17 per share beat the Zacks Consensus Estimate by 0.24% and increased 14.6% year over year.
MSCI's revenues rose 9.1% year over year to $772.68 million, missing the consensus estimate by 0.12%. The year-over-year growth was driven by strong growth in recurring subscription revenues and asset-based fees. Organic operating revenues grew 8.3% year over year.
Recurring subscriptions of $562.8 million increased 7.9% year over year and contributed 72.8% to revenues. Asset-based fees of $184.1 million jumped 12.7% year over year and contributed 23.8% to revenues. Non-recurring revenues of $25.8 million increased 11.4% year over year and contributed 3.3% to revenues.
At the end of the reported quarter, average assets under management were $2.024 trillion in ETFs linked to MSCI equity indexes. The total retention rate was 94.4% in the reported quarter.
MSCI’s Top-Line Details
In the second quarter of 2025, Index revenues of $434.8 million increased 9.5% year over year. Recurring subscriptions and asset-based fees rose 8.6% and 12.7% on a year-over-year basis, respectively. Non-recurring revenues declined 10.5% year over year. Organically, Index operating revenue growth was 9.3%.
The uptick in recurring subscription revenues was driven by strong growth from market-cap-weighted Index products and ETFs linked to MSCI equity indexes.
Analytics operating revenues of $177.7 million increased 7.1% year over year. Recurring subscription revenues jumped 4.7% and non-recurring revenues increased 104.9% on a year-over-year basis. Organically, Analytics’ operating revenue growth was 6.6%.
The Sustainability and Climate segment’s (previously titled "ESG and Climate") operating revenues were $88.9 million, rising 11.3% year over year. Recurring subscriptions and non-recurring revenues increased 11.6% and 1.6% on a year-over-year basis, respectively. Organically, Sustainability and Climate operating revenue growth was 7.1%.
All Other – Private Assets operating revenues, which primarily comprise the Real Assets operating segment and the Private Capital Solutions (formerly known as Burgiss), were $71.2 million, up 9.7% year over year. Organic operating revenue growth for All Other – Private Assets was 8.2%.
MSCI’s Q2 Operating Details
Adjusted EBITDA increased 10.3% year over year to $474.3 million in the reported quarter. The adjusted EBITDA margin in the second quarter of 2025 was 61.4% compared with 60.7% in the second quarter of 2024.
Adjusted EBITDA expenses were $298.3 million, up 7.3% year over year, reflecting higher compensation and benefits costs due to higher headcount, as well as elevated severance costs.
Total operating expenses increased 6.8% on a year-over-year basis to $347.4 million due to higher compensation costs from a 2.5% increase in headcount.
Operating income improved 11.1% year over year to $425.2 million. The operating margin expanded 100 bps on a year-over-year basis to 55%.
MSCI’s Balance Sheet & Cash Flow
Total cash and cash equivalents, as of June 30, 2025, were $347.3 million compared with $360.7 million as of March 31, 2025.
Total debt was $4.5 billion as of June 30, 2025, compared with $4.5 billion as of March 31, 2025. The total debt-to-adjusted EBITDA ratio (based on trailing 12-month-adjusted EBITDA) was 2.5 times, lower than management’s target of 3-3.5 times.
As of June 30, 2025, the free cash flow was $301.6 million, down 6.3% year over year from $268.9 million as of March 31, 2025.
MSCI had $1.2 billion outstanding under its share-repurchase authorization as of July 21, 2025.
The company paid out dividends worth $139.3 million in the second quarter of 2025.
MSCI Maintains 2025 Guidance
For 2025, MSCI expects total operating expenses of $1.405-$1.445 billion.
Adjusted EBITDA expenses are anticipated to be between $1.220 billion and $1.250 billion.
Interest expenses are expected to be between $182 million and $186 million.
Net cash provided by operating activities and the free cash flow are expected to be $1.52-$1.57 billion and $1.400-$1.460 billion, respectively.
How Have Estimates Been Moving Since Then?
Since the earnings release, investors have witnessed a downward trend in estimates revision.
VGM Scores
Currently, MSCI has a average Growth Score of C, though it is lagging a lot on the Momentum Score front with an F. Following the exact same course, the stock was allocated a score of F on the value side, putting it in the bottom 20% quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions looks promising. Interestingly, MSCI has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
MSCI is part of the Zacks Financial - Investment Management industry. Over the past month, BlackRock (BLK - Free Report) , a stock from the same industry, has gained 0.7%. The company reported its results for the quarter ended June 2025 more than a month ago.
BlackRock reported revenues of $5.42 billion in the last reported quarter, representing a year-over-year change of +12.9%. EPS of $12.05 for the same period compares with $10.36 a year ago.
BlackRock is expected to post earnings of $11.78 per share for the current quarter, representing a year-over-year change of +2.8%. Over the last 30 days, the Zacks Consensus Estimate has changed +1.3%.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for BlackRock. Also, the stock has a VGM Score of D.