We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
MSCI Q4 Earnings Beat Estimates, Revenues Rise Y/Y, Shares Down
Read MoreHide Full Article
Key Takeaways
MSCI posted Q4 adjusted EPS of $4.66, up 11.5% Y/Y and ahead of estimates on steady revenue growth.
MSCI revenue rose 10.6% to $822.5M, driven by higher recurring subscriptions and asset-based fees.
MSCI shares fell nearly 5% even as operating income, margins, and free cash flow increased year over year.
MSCI’s (MSCI - Free Report) fourth-quarter 2025 adjusted earnings of $4.66 per share beat the Zacks Consensus Estimate by 0.86% and increased 11.5% year over year.
MSCI’s revenues rose 10.6% year over year to $822.5 million, in line with the Zacks Consensus Estimate. The year-over-year improvement was driven by strong growth in recurring subscription revenues and asset-based fees. Organic operating revenues grew 10.2% year over year.
Recurring subscriptions of $584.2 million increased 7.5% year over year and contributed 71% to revenues. Asset-based fees of $211.7 million jumped 20.7% year over year and contributed 25.7% to revenues. Non-recurring revenues of $26.6 million increased 7.1% year over year and contributed 3.2% to revenues.
At the end of the reported quarter, average assets under management were $2.340 trillion in ETFs linked to MSCI equity indexes. The total retention rate was 93.4% in the reported quarter.
In fourth-quarter 2025, Index revenues of $479.1 million increased 14% year over year. Recurring subscriptions and asset-based fees rose 7.8% and 20.7% on a year-over-year basis, respectively. Non-recurring revenues increased 28.2% year over year. Organically, Index’s operating revenue growth was 14%.
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 $182.3 million increased 5.5% year over year. Recurring subscription revenues jumped 7.1% and non-recurring revenues decreased 46.1% on a year-over-year basis. Organically, Analytics’ operating revenue growth was 5.5%.
The Sustainability and Climate segment’s (previously titled "ESG and Climate") operating revenues were $90.3 million, rising 5.9% year over year. While recurring subscriptions increased 6.1% year over year, non-recurring revenues declined 1.7% on a year-over-year basis. Organically, Sustainability and Climate operating revenue growth was 3.1%.
All Other – Private Assets operating revenues, which primarily comprise the Real Assets operating segment and the Private Capital Solutions (formerly known as Burgiss), were $70.9 million, up 8.4% year over year. Organic operating revenue growth for All Other – Private Assets was 6.6%.
MSCI’s Q4 Operating Details
Adjusted EBITDA increased 13.2% year over year to $512 million in the reported quarter. The adjusted EBITDA margin in the fourth quarter of 2025 was 62.2% compared with 60.8% in the fourth quarter of 2024.
Adjusted EBITDA expenses were $310.5 million, up 6.6% year over year, reflecting higher compensation and benefits costs due to higher headcount, as well as elevated severance costs.
Total operating expenses increased 6.1% on a year-over-year basis to $358.9 million due to higher compensation costs from a 2.2% increase in headcount.
Operating income improved 14.4% year over year to $463.6 million. The operating margin expanded 190 bps on a year-over-year basis to 56.4%.
MSCI’s Balance Sheet & Cash Flow
Total cash and cash equivalents, as of Dec. 31, 2025, were $515.3 million compared with $400.1 million as of Sept. 30, 2025.
Total debt was $6.2 billion as of Dec. 31, 2025, compared with $5.6 billion as of Sept 30, 2025. The total debt-to-adjusted EBITDA ratio (based on trailing 12-month-adjusted EBITDA) was 3.3 times. Management targets total debt to adjusted EBITDA of 3-3.5 times.
As of Dec. 31, 2025, the free cash flow was $464.8 million, up 17.8% year over year from $423.3 million as of Sept. 30, 2025.
The company paid out dividends worth $134.7 million in the fourth quarter of 2025.
MSCI Initiates 2026 Guidance
For 2026, MSCI expects total operating expenses in the range of $1.490-$1.530 billion.
Adjusted EBITDA expenses are anticipated to be between $1.305 billion and $1.335 billion.
Interest expenses are expected to be between $274 million and $280 million.
Net cash provided by operating activities and the free cash flow are expected to be $1.64-$1.69 billion and $1.47-$1.53 billion, respectively.
Sandisk is set to report second-quarter fiscal 2026 results on Jan. 29. Its shares have skyrocketed 1021.4% in the trailing six-month period.
Western Digital is slated to report second-quarter fiscal 2026 results on Jan. 29. Its shares have skyrocketed 257.8% in the trailing six-month period.
Amkor Technology is set to report fourth-quarter 2025 results on Feb. 9. Its shares have surged 102.3% in the trailing six-month period.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
MSCI Q4 Earnings Beat Estimates, Revenues Rise Y/Y, Shares Down
Key Takeaways
MSCI’s (MSCI - Free Report) fourth-quarter 2025 adjusted earnings of $4.66 per share beat the Zacks Consensus Estimate by 0.86% and increased 11.5% year over year.
MSCI’s revenues rose 10.6% year over year to $822.5 million, in line with the Zacks Consensus Estimate. The year-over-year improvement was driven by strong growth in recurring subscription revenues and asset-based fees. Organic operating revenues grew 10.2% year over year.
Recurring subscriptions of $584.2 million increased 7.5% year over year and contributed 71% to revenues. Asset-based fees of $211.7 million jumped 20.7% year over year and contributed 25.7% to revenues. Non-recurring revenues of $26.6 million increased 7.1% year over year and contributed 3.2% to revenues.
At the end of the reported quarter, average assets under management were $2.340 trillion in ETFs linked to MSCI equity indexes. The total retention rate was 93.4% in the reported quarter.
MSCI Inc Price, Consensus and EPS Surprise
MSCI Inc price-consensus-eps-surprise-chart | MSCI Inc Quote
MSCI shares lost 4.99% in the pre-market trading.
MSCI’s Top-Line Details
In fourth-quarter 2025, Index revenues of $479.1 million increased 14% year over year. Recurring subscriptions and asset-based fees rose 7.8% and 20.7% on a year-over-year basis, respectively. Non-recurring revenues increased 28.2% year over year. Organically, Index’s operating revenue growth was 14%.
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 $182.3 million increased 5.5% year over year. Recurring subscription revenues jumped 7.1% and non-recurring revenues decreased 46.1% on a year-over-year basis. Organically, Analytics’ operating revenue growth was 5.5%.
The Sustainability and Climate segment’s (previously titled "ESG and Climate") operating revenues were $90.3 million, rising 5.9% year over year. While recurring subscriptions increased 6.1% year over year, non-recurring revenues declined 1.7% on a year-over-year basis. Organically, Sustainability and Climate operating revenue growth was 3.1%.
All Other – Private Assets operating revenues, which primarily comprise the Real Assets operating segment and the Private Capital Solutions (formerly known as Burgiss), were $70.9 million, up 8.4% year over year. Organic operating revenue growth for All Other – Private Assets was 6.6%.
MSCI’s Q4 Operating Details
Adjusted EBITDA increased 13.2% year over year to $512 million in the reported quarter. The adjusted EBITDA margin in the fourth quarter of 2025 was 62.2% compared with 60.8% in the fourth quarter of 2024.
Adjusted EBITDA expenses were $310.5 million, up 6.6% year over year, reflecting higher compensation and benefits costs due to higher headcount, as well as elevated severance costs.
Total operating expenses increased 6.1% on a year-over-year basis to $358.9 million due to higher compensation costs from a 2.2% increase in headcount.
Operating income improved 14.4% year over year to $463.6 million. The operating margin expanded 190 bps on a year-over-year basis to 56.4%.
MSCI’s Balance Sheet & Cash Flow
Total cash and cash equivalents, as of Dec. 31, 2025, were $515.3 million compared with $400.1 million as of Sept. 30, 2025.
Total debt was $6.2 billion as of Dec. 31, 2025, compared with $5.6 billion as of Sept 30, 2025. The total debt-to-adjusted EBITDA ratio (based on trailing 12-month-adjusted EBITDA) was 3.3 times. Management targets total debt to adjusted EBITDA of 3-3.5 times.
As of Dec. 31, 2025, the free cash flow was $464.8 million, up 17.8% year over year from $423.3 million as of Sept. 30, 2025.
The company paid out dividends worth $134.7 million in the fourth quarter of 2025.
MSCI Initiates 2026 Guidance
For 2026, MSCI expects total operating expenses in the range of $1.490-$1.530 billion.
Adjusted EBITDA expenses are anticipated to be between $1.305 billion and $1.335 billion.
Interest expenses are expected to be between $274 million and $280 million.
Net cash provided by operating activities and the free cash flow are expected to be $1.64-$1.69 billion and $1.47-$1.53 billion, respectively.
MSCI’s Zacks Rank & Other Stocks to Consider
MSCI currently carries a Zacks Rank #2 (Buy).
Some other top-ranked stocks in the broader Zacks Computer and Technology sector are Sandisk Corporation (SNDK - Free Report) , Western Digital (WDC - Free Report) , and Amkor Technology (AMKR - Free Report) . Each stock sports a Zack Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Sandisk is set to report second-quarter fiscal 2026 results on Jan. 29. Its shares have skyrocketed 1021.4% in the trailing six-month period.
Western Digital is slated to report second-quarter fiscal 2026 results on Jan. 29. Its shares have skyrocketed 257.8% in the trailing six-month period.
Amkor Technology is set to report fourth-quarter 2025 results on Feb. 9. Its shares have surged 102.3% in the trailing six-month period.