Moody's Q1 2025: Key Contradictions in M&A Growth, Private Credit, and AI Revenue Trajectory

M&A contribution to revenue growth, private credit contribution to revenue, data & information ARR growth and impact of government contracts, AI-related revenue trajectory, and MA ARR growth and impact of KYC products are the key contradictions discussed in Moody's latest 2025Q1 earnings call.



Revenue and Earnings Growth:
- Moody's Corporation reported revenue of $3.4 billion for Q1 2025, up 9% year-over-year, with adjusted EPS of $2.18, rising by 12% year-over-year.
- Growth was driven by strong performance across its credit ratings, research, and analytics segments, with particular Notably, the Credit Ratings segment experienced a 12% increase in revenue, largely due to growth in public obligation ratings and continued strength in corporate credit ratings.

Credit Ratings and Public Obligations:
- The Credit Ratings segment reported a revenue increase of 12% year-over-year, with growth primarily driven by public obligation ratings.
- This growth was supported by an increase in new public obligation rating assignments, reflecting a broader market recovery and increased issuance activity.

Analytics and Research Performance:
- The Research and Analytics segment reported a revenue increase of 7% year-over-year, driven by strong performance in Moody's Analytics Solutions and Risk & Economic Research & Data offerings.
- The growth in these segments was attributed to increased demand for risk management solutions and economic research data, particularly in light of evolving market conditions.