Moody's Corporation (MCO): History, Ownership, Mission, How It Works & Makes Money

How does a 116-year-old financial giant like Moody's Corporation (MCO) maintain its grip on global capital markets, especially with its TTM revenue hitting $7.50 Billion through Q3 2025? The company, which is partly owned by a major investor like Berkshire Hathaway, holding around 13.5% of its shares, is more than just a credit rating agency; it's a dual-engine machine with Moody's Analytics driving subscription-based growth alongside its core Moody's Investors Service. You need to understand how this integrated risk assessment model, which delivered a 23% increase in diluted EPS in Q3 2025, decodes complexity and uncovers opportunity in the present-day market for investors and businesses alike.

Moody's Corporation (MCO) History

You're looking for the bedrock of Moody's Corporation, and honestly, the story starts not with a corporation, but with a person who saw a fundamental need for transparency in the capital markets. The company you see today, a global integrated risk assessment firm, is the result of over a century of evolution, punctuated by a few defintely transformative decisions. It all traces back to a single financial analyst, John Moody, who invented the modern credit rating business.

Given Company's Founding Timeline

Year established

The company's origins date back to 1900 when John Moody first established John Moody & Company. The current corporate structure, Moody's Corporation (MCO), was formally established in 2000 following its spin-off from Dun & Bradstreet.

Original location

The original company, John Moody & Company, was founded in New York City, U.S., which remains the location of Moody's Corporation's global headquarters today.

Founding team members

The company was founded by a single visionary, John Moody, who is credited with inventing the modern bond credit rating system.

Initial capital/funding

While the exact dollar amount of the initial capital for John Moody's 1900 venture is not publicly disclosed, the original business was sold due to a shortage of capital during the 1907 financial crisis. Moody returned in 1909 with a new company, Moody's Analyses Publishing Company, focusing on a more resilient model. That's a real-world example of how even great ideas need a solid capital structure to survive a market downturn.

Given Company's Evolution Milestones

Given Company's Transformative Moments

The company's journey from a manual publisher to a global integrated risk assessor hinges on a few bold, strategic pivots. The most important was the decision to diversify beyond the core credit rating business.

Here's the quick math: The 2007 split created Moody's Analytics, which now provides stable, recurring revenue-about 95% of its total revenue, which is a powerful counter-balance to the cyclical nature of the ratings business. This move changed the entire risk profile of the company.

• The 2000 Spin-off: Becoming a public company (MCO) allowed for aggressive global expansion and strategic acquisitions, like the 2002 purchase of KMV, a quantitative risk-modeling firm, which was a clear signal of the shift toward data and software.
• The Analytics Engine: The formation of Moody's Analytics in 2007 was a masterstroke, turning proprietary data and models into high-margin software-as-a-service (SaaS) products for banks and insurers. This is the part of the business that has delivered a record 68 consecutive quarters of expansion heading into 2025.
• The AI and Risk Integration Pivot (2019-2025): Leadership made a recent strategic decision to integrate generative Artificial Intelligence (GenAI) across its platforms. This isn't just a tech upgrade; it's a systematic transformation to create an AI-driven risk operating system. This focus has already reduced financial analysis time by 30% and allowed teams to process 60% more research, fundamentally changing how risk is assessed. This is the competitive edge right now.

If you want to dig deeper into who owns the company now and how these shifts impact shareholder value, you should be Exploring Moody's Corporation (MCO) Investor Profile: Who's Buying and Why?

Moody's Corporation (MCO) Ownership Structure

Moody's Corporation is a widely held public company, meaning its ownership is distributed among millions of shareholders, but the vast majority of its stock is controlled by large institutional investors. This structure ensures broad market governance, but it also means a few major firms hold significant sway over strategic decisions.

The company is governed by a Board of Directors elected by shareholders, and its day-to-day operations are steered by its executive leadership team, all while operating as a publicly traded entity on the New York Stock Exchange (NYSE: MCO).

Moody's Corporation's Current Status

Moody's Corporation is a publicly traded company, listed on the New York Stock Exchange (NYSE) under the ticker symbol MCO. Being public means the company is subject to the stringent reporting requirements of the U.S. Securities and Exchange Commission (SEC), ensuring a high degree of financial transparency for investors.

As of the 2025 fiscal year, the company's governance is heavily influenced by a core group of institutional money managers-the big players you read about every day. This is defintely a case where institutional holdings dictate the direction of the company.

For a deeper dive into the company's guiding principles, you can check out the Mission Statement, Vision, & Core Values of Moody's Corporation (MCO).

Moody's Corporation's Ownership Breakdown

The ownership breakdown for Moody's Corporation as of late 2025 shows a high concentration of shares in the hands of institutional investors, which is typical for a large, established S&P 500 company. This concentration means that firms like Berkshire Hathaway, Vanguard, and BlackRock hold the voting power.

Here's the quick math: with approximately 178 million total shares outstanding, a small number of institutions control the majority of the votes.

Moody's Corporation's Leadership

The organization is steered by a seasoned executive team, whose focus is on navigating the complex landscape of global risk assessment and data services. Their strategy balances the core credit ratings business with the expansion of the Moody's Analytics segment, which is the growth engine.

The leadership team, as of November 2025, is headed by:

• Rob Fauber: President and Chief Executive Officer (CEO). He also serves on the Board of Directors.
• Noémie Heuland: Chief Financial Officer (CFO). She manages the financial strategy and reporting for the company.

The Board of Directors, which oversees the executive team and long-term strategy, had nine directors elected at the 2025 Annual Meeting of Stockholders in April. This board structure ensures that the interests of major institutional shareholders are represented in the company's governance.

Moody's Corporation (MCO) Mission and Values

Moody's Corporation's core purpose moves beyond simple credit ratings; it is about decoding complexity to help organizations act with confidence in a world of interconnected, exponential risk. This mission is grounded in a deep commitment to integrity and intellectual leadership, which are the bedrock of their analytical services.

Moody's Corporation's Core Purpose

You're not just looking for a rating agency; you need a partner who can map out the unseen risks-the 'exponential risk' that defines the modern financial landscape. Moody's Corporation's mission and values are designed to meet this need head-on, focusing on providing clarity when markets are defintely at their most uncertain.

Official mission statement

The formal mission is simple and direct, reflecting their focus on being the primary source of critical, forward-looking insights:

• Be the leading source of relevant insights on exponential risk.

This means moving past traditional credit analysis into areas like cyber risk, climate risk, and supply chain disruptions. For instance, the company is actively investing in new technology, like its GenAI relationship with Microsoft, to process massive, complex datasets and deliver on this mission.

Vision statement

Their vision is to be the 'compass' for understanding in a world where certainty is a luxury. They aim to empower their clients with a holistic view of the global financial ecosystem.

• Provide a compass for understanding, decoding complexity, and uncovering opportunity amid exponential risk.

This vision is backed by capital allocation decisions. For the 2025 fiscal year, Moody's Corporation expects to generate free cash flow between $2.3 billion and $2.5 billion, a significant portion of which is reinvested into their technology and data platform to build those complex, risk-decoding tools.

Moody's Corporation slogan/tagline

While the internal language is rich with terms like 'bold, clear, and perceptive,' the most actionable tagline speaks directly to the client outcome, which is what matters to you as a decision-maker.

• Empowering our customers to make better, faster decisions.

This isn't just a feel-good line. The company's success in 2025 proves the market is buying into this value proposition. Following strong third-quarter results, Moody's Corporation raised its full-year 2025 adjusted earnings per share (EPS) outlook to a range of $14.50 to $14.75, showing that their insights translate into tangible financial performance. That's a clear signal that the market values their risk assessment tools. If you want to dive deeper into how those numbers break down, check out Breaking Down Moody's Corporation (MCO) Financial Health: Key Insights for Investors.

Core Values

The company operates on five core values that dictate how they approach their work, especially the independence required for a credit rating agency (CRA). These values ensure the integrity of the data you rely on.

• Uphold trust through integrity: Never take shortcuts, ensuring the 115-year legacy remains intact.
• Invest in every relationship: Prioritize long-term value over short-term wins with customers and employees.
• Lead with curiosity: Combine analytical rigor with an open mind to stay ahead of the curve.
• Champion diverse perspectives: Unite experience and expertise across the organization for smarter decisions.
• Turn inputs into actions: Harness expert judgment and technology to translate data into confident, actionable solutions.

The focus on 'Turn inputs into actions' is key for investors. They are executing a Strategic and Operational Efficiency Restructuring Program, which is a concrete action, expected to result in cash outlays of $165 million to $195 million through 2027 to streamline operations and deliver those faster solutions.

Moody's Corporation (MCO) How It Works

Moody's Corporation operates as a critical two-part engine for global capital markets: a leading credit rating agency and a provider of sophisticated risk and financial analytics. Its value creation rests on decoding complexity for customers, enabling confident decisions in an environment of Breaking Down Moody's Corporation (MCO) Financial Health: Key Insights for Investors and interconnected risks.

The company generates revenue primarily through two segments: Moody's Investors Service (MIS), which is cyclical and tied to debt issuance volume, and Moody's Analytics (MA), a more stable, high-growth, subscription-based business. For the third quarter of 2025, Moody's reported total revenue of $2.01 billion, with MIS contributing $1.10 billion and MA adding $909 million.

Moody's Corporation's Product/Service Portfolio

Moody's Corporation's Operational Framework

The operational framework focuses on three pillars: maintaining the integrity of the ratings process, scaling the high-margin analytics business, and embedding advanced technology like Artificial Intelligence (AI) across both segments. The ratings process is defintely a high-touch, analyst-driven operation, but the analytics side is a technology-forward growth engine.

• Dual-Engine Model: MIS provides the foundational, cyclical revenue stream from debt issuance fees, while MA offers a predictable, recurring revenue base, with Annualized Recurring Revenue (ARR) reaching approximately $3.4 billion as of Q3 2025.
• Technology Integration: AI is being embedded in workflow solutions across MA, with approximately 40% of the MA product portfolio by ARR now including GenAI enablement, accelerating customer adoption and monetization.
• Operational Leverage: Disciplined cost management and efficiency initiatives have driven margin expansion. Management expects the full-year 2025 adjusted operating margin to be approximately 51%, demonstrating tremendous operating leverage.

Here's the quick math: the MA segment's recurring revenue, which is 96% of its total, acts as a crucial counter-cyclical buffer when global debt issuance-the primary driver for MIS-slows down.

Moody's Corporation's Strategic Advantages

Moody's market success is built on a durable competitive moat (a sustainable competitive advantage) that is difficult for competitors to breach, giving it significant pricing power.

• Regulatory and Brand Moat: As one of the three major Nationally Recognized Statistical Rating Organizations (NRSROs) in the U.S., Moody's benefits from an established, regulated position in the global capital markets.
• High Switching Costs: Financial institutions are deeply integrated with Moody's data and software platforms for regulatory compliance and risk modeling, making it costly and complex to switch providers.
• Diversified Business Mix: The shift to a diversified company-where the MA segment provides stable, high-growth analytics-mitigates the inherent cyclicality of the traditional ratings business.
• Data Depth and Scale: The company leverages one of the world's largest credit and company databases (over 450 million entities and growing) to continuously enhance its analytical products and insights.

What this estimate hides is that the full-year 2025 adjusted diluted EPS guidance of $14.50 to $14.75 is heavily reliant on continued strong performance in leveraged finance and private credit deals. Anyway, the core business is remarkably resilient.

Moody's Corporation (MCO) How It Makes Money

Moody's Corporation makes money through a dual-engine model: the cyclically-driven credit rating business and the stable, subscription-based analytics and risk-management software business. The company essentially sells trust and data, charging fees to debt issuers for ratings and selling proprietary software and data to financial institutions for risk assessment.

Moody's Corporation's Revenue Breakdown

The company's revenue is split between its two core segments, Moody's Investors Service (MIS) and Moody's Analytics (MA). Based on year-to-date (YTD) results through September 30, 2025, the split clearly favors the ratings business, but the analytics side provides critical stability.

Here's the quick math: YTD 2025 revenue was $5.829 billion, with MIS contributing $3.173 billion and MA contributing $2.656 billion. MIS revenue is expected to increase in the high-single-digit range for the full fiscal year 2025, driven by a rebound in issuance volume. MA's recurring revenue, which is 96% of its total, grew 11% on a reported basis in Q3 2025, which shows a defintely strong, predictable trajectory.

Business Economics

The economics of Moody's Corporation are defined by its powerful regulatory moat and pricing power, which allows it to maintain high margins despite global economic cycles. The two segments operate on fundamentally different economic drivers, which is the genius of the overall model.

• Moody's Investors Service (MIS) Moat: This segment benefits from a regulatory oligopoly (a market dominated by a few firms). Issuers pay MIS a fee to rate their debt because a rating is a prerequisite for most institutional investors to buy the bond. This is a classic toll-booth business.
• Pricing and Volatility: MIS revenue is highly transactional, tied directly to global debt issuance volume. When interest rates drop or the economy is strong, issuance surges, and MIS revenue follows. When issuance is slow, recurring monitoring fees-charged annually to maintain the rating-provide a base.
• Moody's Analytics (MA) Stability: MA is a subscription-based software and data business, with recurring revenue making up about 96% of its total. This provides a stable, predictable cash flow stream that smooths out the cyclical volatility of MIS.
• Growth Driver: MA's growth is fueled by demand for risk-management solutions, credit modeling, and regulatory compliance tools, especially in areas like Know Your Customer (KYC) and climate risk. Annualized Recurring Revenue (ARR) for MA was a substantial $3.4 billion as of Q3 2025, showing its scale.

Moody's Corporation's Financial Performance

The company's financial health in 2025 reflects the operating leverage inherent in its model-meaning revenue growth translates efficiently into profit growth. The updated full-year guidance from October 2025 paints a clear picture of this strength.

• Adjusted EPS: Full-year 2025 adjusted diluted Earnings Per Share (EPS) is projected to be in the range of $14.50 to $14.75, representing an approximate 17% year-over-year growth at the midpoint.
• Profitability: The total company's adjusted operating margin for 2025 is expected to be approximately 51%. This is a phenomenal margin for any business.
• Segment Margins: The ratings business (MIS) is the profit engine, with an expected adjusted operating margin of 63% to 64%. The analytics business (MA) is lower but still strong at approximately 33%.
• Cash Generation: Moody's is a cash-flow machine, with projected full-year 2025 free cash flow of $2.50 billion. This cash is used for acquisitions, share repurchases, and dividends.

The high margins in MIS demonstrate the pricing power of the ratings duopoly, while the consistent, high-single-digit growth in MA, backed by its recurring revenue model, provides the defensive ballast. For a deeper look at the balance sheet and valuation, check out Breaking Down Moody's Corporation (MCO) Financial Health: Key Insights for Investors.

Moody's Corporation (MCO) Market Position & Future Outlook

Moody's Corporation maintains a dominant duopoly position in the essential credit rating industry, and its future trajectory is increasingly tied to the high-margin, recurring revenue growth of its Moody's Analytics segment.

You should view the company's outlook through a lens of resilient market infrastructure and strategic expansion into complex risk areas like private credit and climate-related disclosures, which are key growth drivers for its $7.088 billion projected revenue for the 2025 fiscal year.

Competitive Landscape

Moody's operates within a tightly controlled global credit rating market, often referred to as the 'Big Three,' where its brand equity and Nationally Recognized Statistical Rating Organization (NRSRO) designation create a powerful economic moat.

Opportunities & Challenges

The company is defintely targeting growth in non-cyclical, subscription-based services to balance the inherent volatility of its core ratings business, which makes up about 40% of its revenue.

Industry Position

Moody's is positioned as a critical infrastructure provider in global capital markets, with its two core segments-Moody's Ratings (formerly Moody's Investors Service) and Moody's Analytics-creating a synergistic model.

• Dominance in Ratings: Along with S&P Global, Moody's rates over 80% of the world's public debt, a testament to its regulatory-protected market position.
• Analytics as a Growth Engine: The Moody's Analytics segment is the primary driver for long-term growth, with management targeting at least 10% annual revenue growth over the next few years.
• Profitability Edge: The company maintains high operating margins, ranging from 37% to 42%, due to the asset-light, high-barrier-to-entry nature of its business model.
• Focus on Risk: The company is leveraging its expertise to become a leader in assessing exponential risks, including cyber, climate-related, and Know Your Customer (KYC) compliance, which are becoming mandatory for financial institutions.

To understand the investor sentiment and ownership structure driving this market position, you can read more at Exploring Moody's Corporation (MCO) Investor Profile: Who's Buying and Why?