MSCI Surpasses Q3 Expectations with Robust Revenue Growth
MSCI Inc. (NYSE: MSCI), a leading provider of investment research and data, delivered a strong performance in the third quarter of fiscal 2024, exceeding analysts’ expectations. The company reported a 15.9% year-over-year increase in revenue, reaching $724.7 million, surpassing the consensus estimate of $715.7 million. MSCI’s adjusted earnings per share (EPS) also outperformed, coming in at $3.86 against an anticipated $3.77.
Key Drivers of Growth
The company’s growth was driven by several key factors:
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Index and Analytics:
MSCI’s index operating revenues surged 11.8% year-over-year, reaching $404.9 million, fueled by higher recurring subscription revenues and asset-based fees. Similarly, analytics operating revenues climbed 11.7% to $172.4 million, supported by increased recurring subscription revenues for Equity and Multi-Asset Class Analytics products.*
ESG and Climate Focus:
MSCI’s commitment to ESG and climate solutions also contributed significantly to the company’s success. ESG and Climate operating revenues witnessed a 14.5% year-over-year rise, reaching $83.6 million, driven by solid growth in Ratings, Screening, and Climate products.*
Private Assets Growth:
MSCI’s expansion into the private assets market is gaining momentum. All Other – Private Assets operating revenues demonstrated a remarkable 77.2% year-over-year increase, reaching $63.8 million.Financial Strength and Outlook
MSCI’s financial position remains strong. The company generated $394 million in free cash flow and held $501 million in cash and equivalents as of September 30, 2024. Furthermore, the board declared a dividend per share of $1.60 for the fourth quarter.
MSCI’s CEO, Henry A. Fernandez, expressed satisfaction with the company’s performance, highlighting the record Q3 for recurring sales in Index and Analytics, along with a near 20% growth in asset-based fee revenue. This growth was attributed to record AUM balances in financial products linked to MSCI’s indexes.
For the full fiscal year 2024, MSCI reaffirmed its guidance, projecting operating expenses between $1.305 billion and $1.345 billion, capex of $105–$115 million, and free cash flow ranging from $1.305 billion to $1.365 billion.
Positive Market Response
MSCI’s strong financial performance was reflected in the stock market. On Monday, MSCI’s stock closed higher by 1.11% at $595.27.
