SPGI Dives 6.67% as FactSet's Weak Earnings Spark Sector Sell-Off

S&P Global Inc. (SPGI) plunged 6.67% on Sept. 19, 2025, hitting its lowest level since June 2025 amid a sector-wide selloff triggered by FactSet Research Systems Inc.’s (FDS) weak earnings guidance. The financial data giant’s stock fell nearly 7.54% intraday as investors reacted to FactSet’s 2026 adjusted earnings forecast of $16.90–$17.60 per share, which lagged analysts’ estimates of $18.26. The move spilled over to peers including Moody’s, with SPGI’s decline reflecting broader concerns about slowing client spending, intensifying competition, and the rising costs of AI-driven innovations in the sector.

FactSet’s CEO highlighted the “AI arms race” as a key challenge, with competitors including startups and traditional firms escalating investments in data analytics. This prompted fears of margin compression and prolonged sales cycles, as noted by FactSet’s CFO, who cited stricter client approval processes. While S&P Global has prioritized AI integration and maintained consistent dividend yields, the market’s overreaction to FactSet’s guidance overshadowed its recent operational updates, such as the introduction of S&P Capital IQ Identifiers and adherence to IOSCO principles.

Institutional investor activity showed mixed signals, with entities like Vancity Investment Management and AQR Capital Management increasing SPGI holdings, while others reduced stakes. However, these transactions were not directly linked to the sharp selloff, which was primarily driven by sector-wide reassessment. Retail investors on platforms like Stocktwits initially viewed the decline as an overreaction, citing SPGI’s “sticky” platform and long-term growth potential. Yet broader skepticism persisted, reflecting lingering doubts about the sector’s ability to sustain margins amid rising AI-driven competition.

The sell-off underscores the interconnectedness of the financial data industry, where one firm’s performance can ripple across peers. Despite efforts to highlight limited operational overlap between FactSet and S&P Global, the market’s focus on sector-wide risks—such as economic uncertainties and AI cost pressures—dominated investor sentiment. With SPGI’s year-to-date total return of +2.51% lagging the S&P 500’s +12.76%, the recent decline amplified concerns about its resilience in a shifting competitive landscape.