MSCI Reports Financial Results for Third Quarter and Nine Months 2024

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MSCI Inc. (“MSCI” or the “Company”) (NYSE: MSCI), a leading provider of critical decision support tools and services for the global investment community, today announced its financial results for the three months ended September 30, 2024 (“third quarter 2024”) and nine months ended September 30, 2024 (“nine months 2024”).

Financial and Operational Highlights for Third Quarter 2024

(Note: Unless otherwise noted, percentage and other changes are relative to the three months ended September 30, 2023 (“third quarter 2023”) and Run Rate percentage changes are relative to September 30, 2023).

Operating revenues of $724.7 million, up 15.9%; Organic operating revenue growth of 11.1%
Recurring subscription revenues up 15.4%; Asset-based fees up 19.5%
Operating margin of 55.4%; Adjusted EBITDA margin of 62.2%
Diluted EPS of $3.57, up 9.2%; Adjusted EPS of $3.86, up 11.9%
Organic recurring subscription Run Rate growth of 8.0%; Retention Rate of 94.2%
In third quarter 2024, a total of $198.7 million or 380,397 shares were repurchased at an average repurchase price of $522.47
Approximately $125.4 million in dividends were paid to shareholders in third quarter 2024; Cash dividend of $1.60 per share declared by MSCI Board of Directors (“MSCI Board”) for fourth quarter 2024
On October 28, 2024, the MSCI Board authorized an additional $1.5 billion share repurchase program

	Three Months Ended								Nine Months Ended
In thousands, except per share data (unaudited)	Sep. 30, 2024			Sep. 30, 2023			% Change		Sep. 30, 2024			Sep. 30, 2023			% Change
In thousands, except per share data (unaudited)	Sep. 30, 2024			Sep. 30, 2023			% Change		Sep. 30, 2024			Sep. 30, 2023			% Change
Operating revenues	$	724,705		$	625,439		15.9	%	$	2,112,619		$	1,838,814		14.9	%
Operating income	$	401,334		$	353,309		13.6	%	$	1,123,324		$	1,013,864		10.8	%
Operating margin %		55.4	%		56.5	%				53.2	%		55.1	%

Net income	$	280,901		$	259,659		8.2	%	$	803,613		$	745,212		7.8	%

Diluted EPS	$	3.57		$	3.27		9.2	%	$	10.15		$	9.32		8.9	%
Adjusted EPS	$	3.86		$	3.45		11.9	%	$	11.03		$	9.85		12.0	%

Adjusted EBITDA	$	450,702		$	386,289		16.7	%	$	1,264,230		$	1,108,324		14.1	%
Adjusted EBITDA margin %		62.2	%		61.8	%				59.8	%		60.3	%

“MSCI’s third-quarter results highlight the underlying strength of our business model and client footprint, as well as the essential role that our solutions play across the investment ecosystem. Among other achievements, we posted our best-ever Q3 for recurring sales in Index and Analytics, along with nearly 20% growth in asset-based-fee revenue, which was driven by record AUM balances in financial products linked to our indexes,” said Henry A. Fernandez, Chairman and CEO of MSCI.

“All of this demonstrates our single most important competitive advantage: the global, diversified, and integrated nature of our franchise. MSCI has always tried to capture the biggest trends reshaping our industry, and we are now better equipped than ever to harness those trends while supporting both traditional and newer client segments,” Fernandez added.

Third Quarter Consolidated Results

Operating Revenues: Operating revenues were $724.7 million, up 15.9%. Organic operating revenue growth was 11.1%. The $99.3 million increase was the result of $71.6 million in higher recurring subscription revenues and $27.6 million in higher asset-based fees.

Run Rate and Retention Rate: Total Run Rate at September 30, 2024 was $2,894.2 million, up 17.3%. Recurring subscription Run Rate increased by $287.9 million, and asset-based fees Run Rate increased by $137.9 million. Organic recurring subscription Run Rate growth was 8.0%. Retention Rate in third quarter 2024 was 94.2%, compared to 95.4% in third quarter 2023.

Expenses: Total operating expenses were $323.4 million, up 18.8%, including $37.8 million of operating expenses associated with Private Capital Solutions (formerly known as The Burgiss Group, LLC), Carbon Markets (formerly known as Trove Research Ltd), Fabric RQ Inc. (“Fabric”) and Foxberry Ltd (“Foxberry”).

Adjusted EBITDA expenses were $274.0 million, up 14.6%, primarily reflecting higher compensation and benefits costs related to higher headcount as a result of business growth and the recent acquisitions as well as increases in non-compensation costs, primarily reflecting higher professional fees, information technology and market data costs.

Adjusted EBITDA expense included $23.8 million of expenses associated with Private Capital Solutions, Carbon Markets, Fabric and Foxberry. Approximately $3.1 million in integration costs and $10.9 million of depreciation and amortization related to these acquisitions were excluded from Adjusted EBITDA expense.

Total operating expenses excluding the impact of foreign currency exchange rate fluctuations (“ex-FX”) and adjusted EBITDA expenses ex-FX increased 18.9% and 14.7%, respectively.

Operating Income: Operating income was $401.3 million, up 13.6%. Operating income margin in third quarter 2024 was 55.4%, compared to 56.5% in third quarter 2023.

Headcount: As of September 30, 2024, we had 6,118 employees, reflecting a 22.2% increase, which was primarily driven by our recent acquisitions. Approximately 31.5% and 68.5% of employees are located in developed market and emerging market locations, respectively.

Other Expense (Income), Net: Other expense (income), net was $44.4 million, up 24.5%, primarily driven by lower interest income reflecting lower average cash balances and the impact of foreign currency exchange rate fluctuations.

Income Taxes: The effective tax rate was 21.3% in the third quarter 2024 compared to 18.3% in third quarter 2023. The increase was primarily driven by higher statutory tax rates and unfavorable discrete items related to prior years.

Net Income: As a result of the factors described above, net income was $280.9 million, up 8.2%.

Adjusted EBITDA: Adjusted EBITDA was $450.7 million, up 16.7%. Adjusted EBITDA margin in third quarter 2024 was 62.2%, compared to 61.8% in third quarter 2023.

Index Segment:

Table 1A: Results (unaudited)

	Three Months Ended								Nine Months Ended
In thousands	Sep. 30, 2024			Sep. 30, 2023			% Change		Sep. 30, 2024			Sep. 30, 2023			% Change
In thousands	Sep. 30, 2024			Sep. 30, 2023			% Change		Sep. 30, 2024			Sep. 30, 2023			% Change
Operating revenues:
Recurring subscriptions	$	223,945		$	206,453		8.5	%	$	653,929		$	603,845		8.3	%
Asset-based fees		168,622			141,066		19.5	%		482,162			412,354		16.9	%
Non-recurring		12,315			14,603		(15.7	)%		39,855			47,621		(16.3	)%
Total operating revenues		404,882			362,122		11.8	%		1,175,946			1,063,820		10.5	%
Adjusted EBITDA expenses		90,734			84,450		7.4	%		277,048			255,396		8.5	%
Adjusted EBITDA	$	314,148		$	277,672		13.1	%	$	898,898		$	808,424		11.2	%
Adjusted EBITDA margin %		77.6	%		76.7	%				76.4	%		76.0	%

Index operating revenues were $404.9 million, up 11.8% and included $0.21 million from the acquisition of Foxberry. The $42.8 million increase was driven by $27.6 million in higher asset-based fees and $17.5 million in higher recurring subscription revenues, partially offset by $2.3 million in lower non-recurring revenues. Organic operating revenue growth for Index was 11.8%.

The growth in recurring subscription revenues was primarily driven by growth from market-cap weighted indexes and factor, ESG and climate index products.

The growth in revenues attributed to asset-based fees were primarily driven by ETFs linked to MSCI equity indexes and non-ETF indexed funds linked to MSCI indexes, primarily due to an increase in average AUM.

Index Run Rate as of September 30, 2024, was $1.6 billion, up 15.2%. The $209.4 million increase was comprised of a $137.9 million increase in asset-based fees Run Rate and a $71.5 million increase in recurring subscription Run Rate. The increase in asset-based fees Run Rate primarily reflected higher AUM in both ETFs linked to MSCI equity indexes and non-ETF indexed funds linked to MSCI indexes. The increase in recurring subscription Run Rate was primarily driven by growth from market cap-weighted and custom Index products and special packages. The increase reflected growth across all regions. Organic recurring subscription Run Rate growth for Index was 8.5%.

Analytics Segment:

Table 1B: Results (unaudited)

	Three Months Ended								Nine Months Ended
In thousands	Sep. 30, 2024			Sep. 30, 2023			% Change		Sep. 30, 2024			Sep. 30, 2023			% Change
In thousands	Sep. 30, 2024			Sep. 30, 2023			% Change		Sep. 30, 2024			Sep. 30, 2023			% Change
Operating revenues:
Recurring subscriptions	$	168,150		$	151,269		11.2	%	$	490,829		$	443,276		10.7	%
Non-recurring		4,226			2,999		40.9	%		11,508			7,943		44.9	%
Total operating revenues		172,376			154,268		11.7	%		502,337			451,219		11.3	%
Adjusted EBITDA expenses		82,089			82,487		(0.5	)%		258,166			253,509		1.8	%
Adjusted EBITDA	$	90,287		$	71,781		25.8	%	$	244,171		$	197,710		23.5	%
Adjusted EBITDA margin %		52.4	%		46.5	%				48.6	%		43.8	%

Analytics operating revenues were $172.4 million, up 11.7%. The $18.1 million increase was primarily driven by growth from recurring subscriptions related to both Multi-Asset Class and Equity Analytics products, which also benefited from subscription revenue impacted by client implementations. The increase was also driven by an increase in non-recurring revenues driven by one-time deals related to both Multi-Asset Class and Equity products as well as a number of implementations which were completed in the quarter. Organic operating revenue growth for Analytics was 11.7%.

Analytics Run Rate as of September 30, 2024, was $691.3 million, up 8.1%. The increase of $51.9 million was primarily driven by growth in both Multi-Asset Class and Equity Analytics products, and reflected growth across all regions and client segments. Organic recurring subscription Run Rate growth for Analytics was 7.1%.

ESG and Climate Segment:

Table 1C: Results (unaudited)

	Three Months Ended								Nine Months Ended
In thousands	Sep. 30, 2024			Sep. 30, 2023			% Change		Sep. 30, 2024			Sep. 30, 2023			% Change
In thousands	Sep. 30, 2024			Sep. 30, 2023			% Change		Sep. 30, 2024			Sep. 30, 2023			% Change
Operating revenues:
Recurring subscriptions	$	81,536		$	71,744		13.6	%	$	235,954		$	207,523		13.7	%
Non-recurring		2,107			1,294		62.8	%		5,428			3,792		43.1	%
Total operating revenues		83,643			73,038		14.5	%		241,382			211,315		14.2	%
Adjusted EBITDA expenses		53,654			47,598		12.7	%		166,372			145,201		14.6	%
Adjusted EBITDA	$	29,989		$	25,440		17.9	%	$	75,010		$	66,114		13.5	%
Adjusted EBITDA margin %		35.9	%		34.8	%				31.1	%		31.3	%

ESG and Climate operating revenues were $83.6 million, up 14.5%. The $10.6 million increase was primarily driven by growth from recurring subscriptions related to Ratings, Climate and Screening products. Organic operating revenue growth for ESG and Climate was 11.0%.

ESG and Climate Run Rate as of September 30, 2024, was $344.0 million, up 15.7%. The $46.7 million increase primarily reflects growth from Ratings, Climate and Screening products with contributions across all regions and client segments. Organic recurring subscription Run Rate growth for ESG and Climate was 11.2%.

All Other – Private Assets Segment:

Table 1D: Results (unaudited)

	Three Months Ended								Nine Months Ended
In thousands	Sep. 30, 2024			Sep. 30, 2023			% Change		Sep. 30, 2024			Sep. 30, 2023			% Change
In thousands	Sep. 30, 2024			Sep. 30, 2023			% Change		Sep. 30, 2024			Sep. 30, 2023			% Change
Operating revenues:
Recurring subscriptions	$	62,991		$	35,531		77.3	%	$	190,434		$	111,292		71.1	%
Non-recurring		813			480		69.4	%		2,520			1,168		115.8	%
Total operating revenues		63,804			36,011		77.2	%		192,954			112,460		71.6	%
Adjusted EBITDA expenses		47,526			24,615		93.1	%		146,803			76,384		92.2	%
Adjusted EBITDA	$	16,278		$	11,396		42.8	%	$	46,151		$	36,076		27.9	%
Adjusted EBITDA margin %		25.5	%		31.6	%				23.9	%		32.1	%

All Other – Private Assets operating revenues, which reflect the Real Assets and Private Capital Solutions operating segments, were $63.8 million, up 77.2% The growth in revenue is primarily driven by revenues attributable to the step acquisition of Burgiss. Organic operating revenue growth for All Other – Private Assets was 1.0%.

All Other – Private Assets Run Rate, which reflects the Real Assets and Private Capital Solutions operating segments, was $268.6 million as of September 30, 2024, up 78.2%, and included $110.1 million from Private Capital Solutions. The remaining growth in the run rate was primarily driven by Index Intel products. Organic recurring subscription Run Rate growth for All Other – Private Assets was 2.4%.

Select Balance Sheet Items and Capital Allocation

Cash Balances and Outstanding Debt: Cash and cash equivalents was $501.0 million as of September 30, 2024. MSCI typically seeks to maintain minimum cash balances globally of approximately $225.0 million to $275.0 million for general operating purposes.

Total principal amounts of debt outstanding as of September 30, 2024, were $4.5 billion. The total debt to net income ratio (based on trailing twelve months net income) was 3.7x. The total debt to adjusted EBITDA ratio (based on trailing twelve months adjusted EBITDA) was 2.7x.

MSCI seeks to maintain total debt to adjusted EBITDA in a target range of 3.0x to 3.5x.

In September and October 2024, MSCI repaid $25.0 million and $125.0 million, respectively, of the revolving loans under the Revolving Credit Facility.

Capex and Cash Flow: Capex was $27.6 million, and net cash provided by operating activities increased by 44.8% to $421.6 million, primarily reflecting higher cash collections from clients, partially offset by higher operating expenses. Free cash flow for third quarter 2024 was up 45.8% to $394.0 million.

Share Count and Share Repurchases: Weighted average diluted shares outstanding were 78.7 million in third quarter 2024, down 1.0% year-over-year. Total share repurchases during the quarter were $198.7 million or 380,397 shares at an average repurchase price of $522.47. Total shares outstanding as of September 30, 2024 were 78.4 million. A total of approximately $1.9 billion remains on the outstanding share repurchase authorization as of October 28, 2024, following the MSCI Board’s approval of the 2024 share repurchase program.

Dividends: Approximately $125.4 million in dividends were paid to shareholders in third quarter 2024. On October 28, 2024, the MSCI Board declared a cash dividend of $1.60 per share for fourth quarter 2024, payable on November 29, 2024, to shareholders of record as of the close of trading on November 15, 2024.

Full-Year 2024 Guidance

MSCI’s guidance for the year ending December 31, 2024 (“Full-Year 2024”) is based on assumptions about a number of factors, in particular related to macroeconomic factors and the capital markets. These assumptions are subject to uncertainty, and actual results for the year could differ materially from our current guidance, including as a result of the uncertainties, risks and assumptions discussed in the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of our Annual Report on Form 10-K, as updated in quarterly reports on Form 10-Q and current reports on Form 8-K filed or furnished with the SEC. See “Forward-Looking Statements” below.

Guidance Item	Current Guidance for Full-Year 2024	Prior Guidance for Full-Year 2024
Operating Expense	$1,305 to $1,345 million	$1,305 to $1,345 million
Adjusted EBITDA Expense	$1,130 to $1,160 million	$1,130 to $1,160 million
Interest Expense (including amortization of financing fees)⁽¹⁾	$183 to $186 million	$185 to $189 million
Depreciation & Amortization Expense	$175 to $185 million	$175 to $185 million
Effective Tax Rate	18.0% to 19.5%	18% to 21%
Capital Expenditures	$105 to $115 million	$95 to $105 million
Net Cash Provided by Operating Activities	$1,420 to $1,470 million	$1,330 to $1,380 million
Free Cash Flow	$1,305 to $1,365 million	$1,225 to $1,285 million
(1) A portion of our annual interest expense is from our variable rate indebtedness under our Revolving Credit Facility, while the majority is from fixed rate senior unsecured notes. Changes to the secured overnight funding rate (“SOFR”) and indebtedness levels can cause our annual interest expense to vary.

Conference Call Information

MSCI’s senior management will review the third quarter 2024 results on Tuesday, October 29, 2024 at 11:00 AM Eastern Time. To listen to the live event via webcast, visit the events and presentations section of MSCI’s Investor Relations website, https://ir.msci.com/events-and-presentations, or via telephone, dial +1-888-596-4144 conference ID 9979278 within the United States. International callers may dial +1-646-968-2525 conference ID 9979278. The teleconference will also be webcast with an accompanying slide presentation that can be accessed through MSCI’s Investor Relations website.

About MSCI Inc.

MSCI is a leading provider of critical decision support tools and services for the global investment community. With over 50 years of expertise in research, data and technology, we power better investment decisions by enabling clients to understand and analyze key drivers of risk and return and confidently build more effective portfolios. We create industry-leading research-enhanced solutions that clients use to gain insight into and improve transparency across the investment process. To learn more, please visit www.msci.com. MSCI#IR

Forward-Looking Statements

This earnings release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including without limitation, MSCI’s Full-Year 2024 guidance. These forward-looking statements relate to future events or to future financial performance and involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these statements. In some cases, you can identify forward-looking statements by the use of words such as “may,” “could,” “expect,” “intend,” “plan,” “seek,” “anticipate,” “believe,” “estimate,” “predict,” “potential” or “continue,” or the negative of these terms or other comparable terminology. You should not place undue reliance on forward-looking statements because they involve known and unknown risks, uncertainties and other factors that are, in some cases, beyond MSCI’s control and that could materially affect actual results, levels of activity, performance or achievements.

Other factors that could materially affect actual results, levels of activity, performance or achievements can be found in MSCI’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023 filed with the Securities and Exchange Commission (“SEC”) on February 9, 2024 and in quarterly reports on Form 10-Q and current reports on Form 8-K filed or furnished with the SEC. If any of these risks, uncertainties or other matters materialize, or if MSCI’s underlying assumptions prove to be incorrect, actual results may vary significantly from what MSCI projected. Any forward-looking statement in this earnings release reflects MSCI’s current views with respect to future events and is subject to these and other risks, uncertainties and assumptions relating to MSCI’s operations, results of operations, growth strategy and liquidity. MSCI assumes no obligation to publicly update or revise these forward-looking statements for any reason, whether as a result of new information, future events, or otherwise, except as required by law.

Website and Social Media Disclosure

MSCI uses its Investor Relations homepage and its Corporate Responsibility homepage as channels of distribution of company information. The information MSCI posts through these channels may be deemed material. Accordingly, investors should monitor these channels, in addition to following MSCI’s press releases, SEC filings and public conference calls and webcasts. In addition, you may automatically receive email alerts and other information about MSCI when you enroll your email address by visiting the “Email Alerts” section of MSCI’s Investor Relations homepage at http://ir.msci.com/email-alerts. The contents of MSCI’s website, including its quarterly updates, blog, podcasts and social media channels are not, however, incorporated by reference into this earnings release.

Notes Regarding the Use of Operating Metrics

MSCI has presented supplemental key operating metrics as part of this earnings release, including Retention Rate, Run Rate, subscription sales, subscription cancellations and non-recurring sales.

Retention Rate is an important metric because subscription cancellations decrease our Run Rate and ultimately our future operating revenues over time. The annual Retention Rate represents the retained subscription Run Rate (subscription Run Rate at the beginning of the fiscal year less actual cancels during the year) as a percentage of the subscription Run Rate at the beginning of the fiscal year.

The Retention Rate for a non-annual period is calculated by annualizing the cancellations for which we have received a notice of termination or for which we believe there is an intention not to renew or discontinue the subscription during the non-annual period, and we believe that such notice or intention evidences the client’s final decision to terminate or not renew the applicable agreement, even though such termination or non-renewal may not be effective until a later date. This annualized cancellation figure is then divided by the subscription Run Rate at the beginning of the fiscal year to calculate a cancellation rate. This cancellation rate is then subtracted from 100% to derive the annualized Retention Rate for the period.

Retention Rate is computed by operating segment on a product/service-by-product/service basis. In general, if a client reduces the number of products or services to which it subscribes within a segment, or switches between products or services within a segment, we treat it as a cancellation for purposes of calculating our Retention Rate except in the case of a product or service switch that management considers to be a replacement product or service. In those replacement cases, only the net change to the client subscription, if a decrease, is reported as a cancel. In the Analytics and the ESG and Climate operating segments, substantially all product or service switches are treated as replacement products or services and netted in this manner, while in our Index and Real Assets operating segments, product or service switches that are treated as replacement products or services and receive netting treatment occur only in certain limited instances. In addition, we treat any reduction in fees resulting from a down-sell of the same product or service as a cancellation to the extent of the reduction. We do not calculate Retention Rate for that portion of our Run Rate attributable to assets in index-linked investment products or futures and options contracts, in each case, linked to our indexes.

Run Rate estimates at a particular point in time the annualized value of the recurring revenues under our client license agreements (“Client Contracts”) for the next 12 months, assuming all Client Contracts that come up for renewal, or reach the end of the committed subscription period, are renewed and assuming then-current currency exchange rates, subject to the adjustments and exclusions described below. For any Client Contract where fees are linked to an investment product’s assets or trading volume/fees, the Run Rate calculation reflects, for ETFs, the market value on the last trading day of the period, for futures and options, the most recent quarterly volumes and/or reported exchange fees, and for other non-ETF products, the most recent client-reported assets. Run Rate does not include fees associated with “one-time” and other non-recurring transactions. In addition, we add to Run Rate the annualized fee value of recurring new sales, whether to existing or new clients, when we execute Client Contracts, even though the license start date, and associated revenue recognition, may not be effective until a later date. We remove from Run Rate the annualized fee value associated with products or services under any Client Contract when we (i) have received a notice of termination, non-renewal or an indication the client does not intend to continue their subscription during the period and (ii) have determined that such notice evidences the client’s final decision to terminate or not renew the applicable products or services, even though such termination or non-renewal may not be effective until a later date.

“Organic recurring subscription Run Rate growth” is defined as the period over period Run Rate growth, excluding the impact of changes in foreign currency and the first year impact of any acquisitions. It is also adjusted for divestitures. Changes in foreign currency are calculated by applying the currency exchange rate from the comparable prior period to current period foreign currency denominated Run Rate.

Sales represents the annualized value of products and services clients commit to purchase from MSCI and will result in additional operating revenues. Non-recurring sales represent the actual value of the customer agreements entered into during the period and are not a component of Run Rate. New recurring subscription sales represent additional selling activities, such as new customer agreements, additions to existing agreements or increases in price that occurred during the period and are additions to Run Rate. Subscription cancellations reflect client activities during the period, such as discontinuing products and services and/or reductions in price, resulting in reductions to Run Rate. Net new recurring subscription sales represent the amount of new recurring subscription sales net of subscription cancellations during the period, which reflects the net impact to Run Rate during the period.

Total gross sales represent the sum of new recurring subscription sales and non-recurring sales. Total net sales represent the total gross sales net of the impact from subscription cancellations.

Notes Regarding the Use of Non-GAAP Financial Measures

MSCI has presented supplemental non-GAAP financial measures as part of this earnings release. Reconciliations are provided in Tables 9 through 14 below that reconcile each non-GAAP financial measure with the most comparable GAAP measure. The non-GAAP financial measures presented in this earnings release should not be considered as alternative measures for the most directly comparable GAAP financial measures. The non-GAAP financial measures presented in this earnings release are used by management to monitor the financial performance of the business, inform business decision-making and forecast future results.

“Adjusted EBITDA” is defined as net income before (1) provision for income taxes, (2) other expense (income), net, (3) depreciation and amortization of property, equipment and leasehold improvements, (4) amortization of intangible assets and, at times, (5) certain other transactions or adjustments, including, when applicable, certain acquisition-related integration and transaction costs.

“Adjusted EBITDA expenses” is defined as operating expenses less depreciation and amortization of property, equipment and leasehold improvements and amortization of intangible assets and, at times, certain other transactions or adjustments, including, when applicable, certain acquisition-related integration and transaction costs.

“Adjusted EBITDA margin” is defined as adjusted EBITDA divided by operating revenues.

“Adjusted net income” and “adjusted EPS” are defined as net income and diluted EPS, respectively, before the after-tax impact of: the amortization of acquired intangible assets, including the amortization of the basis difference between the cost of the equity method investment and MSCI’s share of the net assets of the investee at historical carrying value and, at times, certain other transactions or adjustments, including, when applicable, the impact related to certain acquisition-related integration and transaction costs, the impact related to write-off of deferred fees on debt extinguishment and the impact related to gain from changes in ownership interest of investees.

“Capex” is defined as capital expenditures plus capitalized software development costs.

“Free cash flow” is defined as net cash provided by operating activities, less Capex.

“Organic operating revenue growth” is defined as operating revenue growth compared to the prior year period excluding the impact of acquired businesses, divested businesses and foreign currency exchange rate fluctuations.

Asset-based fees ex-FX does not adjust for the impact from foreign currency exchange rate fluctuations on the underlying assets under management (“AUM”).

We believe adjusted EBITDA, adjusted EBITDA margin and adjusted EBITDA expenses are meaningful measures of the operating performance of MSCI because they adjust for significant one-time, unusual or non-recurring items as well as eliminate the accounting effects of certain capital spending and acquisitions that do not directly affect what management considers to be our ongoing operating performance in the period.

We believe adjusted net income and adjusted EPS are meaningful measures of the performance of MSCI because they adjust for the after-tax impact of significant one-time, unusual or non-recurring items as well as eliminate the impact of any transactions that do not directly affect what management considers to be our ongoing operating performance in the period. We also exclude the after-tax impact of the amortization of acquired intangible assets and amortization of the basis difference between the cost of the equity method investment and MSCI’s share of the net assets of the investee at historical carrying value, as these non-cash amounts are significantly impacted by the timing and size of each acquisition and therefore not meaningful to the ongoing operating performance in the period.

We believe that free cash flow is useful to investors because it relates the operating cash flow of MSCI to the capital that is spent to continue and improve business operations, such as investment in MSCI’s existing products. Further, free cash flow indicates our ability to strengthen MSCI’s balance sheet, repay our debt obligations, pay cash dividends and repurchase shares of our common stock.

We believe organic operating revenue growth is a meaningful measure of the operating performance of MSCI because it adjusts for the impact of foreign currency exchange rate fluctuations and excludes the impact of operating revenues attributable to acquired and divested businesses for the comparable prior year period, providing insight into our ongoing operating performance for the period(s) presented.

We believe that the non-GAAP financial measures presented in this earnings release facilitate meaningful period-to-period comparisons and provide a baseline for the evaluation of future results.

Adjusted EBITDA expenses, adjusted EBITDA margin, adjusted EBITDA, adjusted net income, adjusted EPS, Capex, free cash flow and organic operating revenue growth are not defined in the same manner by all companies and may not be comparable to similarly-titled non-GAAP financial measures of other companies. These measures can differ significantly from company to company depending on, among other things, long-term strategic decisions regarding capital structure, the tax jurisdictions in which companies operate and capital investments. Accordingly, the Company’s computation of these measures may not be comparable to similarly-titled measures computed by other companies.

Notes Regarding Adjusting for the Impact of Foreign Currency Exchange Rate Fluctuations

Foreign currency exchange rate fluctuations reflect the difference between the current period results as reported compared to the current period results recalculated using the foreign currency exchange rates in effect for the comparable prior period. While operating revenues adjusted for the impact of foreign currency fluctuations includes asset-based fees that have been adjusted for the impact of foreign currency fluctuations, the underlying AUM, which is the primary component of asset-based fees, is not adjusted for foreign currency fluctuations. Approximately three-fifths of the AUM is invested in securities denominated in currencies other than the U.S. dollar, and accordingly, any such impact is excluded from the disclosed foreign currency-adjusted variances.

Table 2: Condensed Consolidated Statements of Income (unaudited)

	Three Months Ended								Nine Months Ended
In thousands, except per share data	Sep. 30, 2024			Sep. 30, 2023			% Change		Sep. 30, 2024			Sep. 30, 2023			% Change
In thousands, except per share data	Sep. 30, 2024			Sep. 30, 2023			% Change		Sep. 30, 2024			Sep. 30, 2023			% Change
Operating revenues	$	724,705		$	625,439		15.9	%	$	2,112,619		$	1,838,814		14.9	%
Operating expenses:
Cost of revenues (exclusive of depreciation and amortization)		126,192			105,311		19.8	%		382,815			324,024		18.1	%
Selling and marketing		70,763			66,581		6.3	%		214,385			201,044		6.6	%
Research and development		38,584			31,438		22.7	%		120,182			92,901		29.4	%
General and administrative		41,561			36,826		12.9	%		137,958			113,527		21.5	%
Amortization of intangible assets		41,939			26,722		56.9	%		121,316			77,543		56.4	%
Depreciation and amortization of property,
equipment and leasehold improvements		4,332			5,252		(17.5	)%		12,639			15,911		(20.6	)%
Total operating expenses(1)		323,371			272,130		18.8	%		989,295			824,950		19.9	%

Operating income		401,334			353,309		13.6	%		1,123,324			1,013,864		10.8	%

Interest income		(5,217	)		(10,314	)	(49.4	)%		(17,375	)		(31,079	)	(44.1	)%
Interest expense		46,688			46,902		(0.5	)%		139,995			139,725		0.2	%
Other expense (income)		2,927			(935	)	n/m			7,881			4,032		95.5	%
Other expense (income), net		44,398			35,653		24.5	%		130,501			112,678		15.8	%

Income before provision for income taxes		356,936			317,656		12.4	%		992,823			901,186		10.2	%

Provision for income taxes		76,035			57,997		31.1	%		189,210			155,974		21.3	%
Net income	$	280,901		$	259,659		8.2	%	$	803,613		$	745,212		7.8	%


Earnings per basic common share	$	3.58		$	3.28		9.1	%	$	10.18		$	9.36		8.8	%


Earnings per diluted common share	$	3.57		$	3.27		9.2	%	$	10.15		$	9.32		8.9	%

Weighted average shares outstanding used
in computing earnings per share:

Basic		78,499			79,116		(0.8	)%		78,925			79,580		(0.8	)%
Diluted		78,729			79,500		(1.0	)%		79,159			79,959		(1.0	)%

n/m: not meaningful.

(1) Includes stock-based compensation expense of $19.1 million and $18.4 million for the three months ended Sep. 30, 2024 and Sep. 30, 2023, respectively. Includes stock-based compensation expense of $73.1 million and $56.0 million for the nine months ended Sep. 30, 2024 and Sep. 30, 2023, respectively.

Table 3: Condensed Consolidated Balance Sheet (unaudited)

	As of
	Sep. 30,			Dec. 31,
In thousands	2024			2023
ASSETS
Current assets:
Cash and cash equivalents (includes restricted cash of $3,909 and $3,878 at September 30, 2024 and December 31, 2023, respectively)	$	500,979		$	461,693
Accounts receivable (net of allowances of $4,363 and $3,968 at September 30, 2024 and December 31, 2023, respectively)		643,807			839,555
Other current assets		141,010			116,905
Total current assets		1,285,796			1,418,153
Property, equipment and leasehold improvements, net		62,317			55,920
Right of use assets		121,726			115,243
Goodwill		2,916,102			2,887,692
Intangible assets, net		931,428			956,234
Other non-current assets		91,580			84,977
Total assets	$	5,408,949		$	5,518,219

LIABILITIES AND SHAREHOLDERS’ EQUITY (DEFICIT)
Current liabilities:
Current portion of long-term debt	$	—		$	10,902
Deferred revenue		942,840			1,083,864
Other current liabilities		435,075			422,259
Total current liabilities		1,377,915			1,517,025
Long-term debt		4,484,773			4,496,826
Long-term operating lease liabilities		123,939			120,134
Other non-current liabilities		173,320			123,998
Total liabilities		6,159,947			6,257,983

Total shareholders’ equity (deficit)		(750,998	)		(739,764	)
Total liabilities and shareholders’ equity (deficit)	$	5,408,949		$	5,518,219

Table 4: Condensed Consolidated Statement of Cash Flow (unaudited)

	Three Months Ended								Nine Months Ended
	Sep. 30,			Sep. 30,			%		Sep. 30,			Sep. 30,			%
In thousands	2024			2023			Change		2024			2023			Change
Cash flows from operating activities
Net income	$	280,901		$	259,659		8.2	%	$	803,613		$	745,212		7.8	%
Adjustments to reconcile net income to net cash provided by operating activities:
Amortization of intangible assets		41,939			26,722		56.9	%		121,316			77,543		56.4	%
Stock-based compensation expense		18,503			18,144		2.0	%		72,235			55,375		30.4	%
Depreciation and amortization of property, equipment and leasehold improvements		4,332			5,252		(17.5	)%		12,639			15,911		(20.6	)%
Amortization of right of use assets		7,745			5,898		31.3	%		19,582			17,484		12.0	%
Loss on extinguishment of debt		—			—		—	%		1,510			—		100.0	%
Other adjustment		1,819			(22,721	)	n/m			43,856			(25,983	)	n/m
Net changes in other operating assets and liabilities		66,370			(1,823	)	n/m			(3,757	)		(38,466	)	90.2	%
Net cash provided by operating activities		421,609			291,131		44.8	%		1,070,994			847,076		26.4	%

Cash flows from investing activities
Capitalized software development costs		(20,975	)		(17,417	)	(20.4	)%		(59,648	)		(50,080	)	(19.1	)%
Capital expenditures		(6,626	)		(3,564	)	(85.9	)%		(19,515	)		(18,942	)	(3.0	)%
Cash paid for acquisitions, net of cash acquired		—			—		—	%		(27,467	)		—		100.0	%
Other		(463	)		—		100.0	%		(892	)		(389	)	(129.3	)%
Net cash used in investing activities		(28,064	)		(20,981	)	(33.8	)%		(107,522	)		(69,411	)	(54.9	)%

Cash flows from financing activities
Repurchase of common stock held in treasury		(199,509	)		(18,744	)	n/m			(511,218	)		(504,161	)	(1.4	)%
Payment of dividends		(125,757	)		(109,380	)	(15.0	)%		(383,980	)		(331,640	)	(15.8	)%
Repayment of borrowings		(25,000	)		(2,188	)	n/m			(364,063	)		(6,563	)	n/m
Proceeds from borrowings		—			—		—	%		336,875			—		100.0	%
Payment of debt issuance costs		—			—		—	%		(3,739	)		—		100.0	%
Net cash used in financing activities		(350,266	)		(130,312	)	(168.8	)%		(926,125	)		(842,364	)	(9.9	)%

Effect of exchange rate changes		6,299			(3,615	)	n/m			1,939			(313	)	n/m

Net increase (decrease) in cash, cash equivalents and restricted cash		49,578			136,223		(63.6	)%		39,286			(65,012	)	n/m
Cash, cash equivalents and restricted cash, beginning of period		451,401			792,329		(43.0	)%		461,693			993,564		(53.5	)%
Cash, cash equivalents and restricted cash, end of period	$	500,979		$	928,552		(46.0	)%	$	500,979		$	928,552		(46.0	)%

n/m: not meaningful.

Table 5: Operating Results by Segment and Revenue Type (unaudited)

*Index*	Three Months Ended								Nine Months Ended
	Sep. 30,			Sep. 30,			%		Sep. 30,			Sep. 30,			%
In thousands	2024			2023			Change		2024			2023			Change
Operating revenues:
Recurring subscriptions	$	223,945		$	206,453		8.5	%	$	653,929		$	603,845		8.3	%
Asset-based fees		168,622			141,066		19.5	%		482,162			412,354		16.9	%
Non-recurring		12,315			14,603		(15.7	)%		39,855			47,621		(16.3	)%
Total operating revenues		404,882			362,122		11.8	%		1,175,946			1,063,820		10.5	%
Adjusted EBITDA expenses		90,734			84,450		7.4	%		277,048			255,396		8.5	%
Adjusted EBITDA	$	314,148		$	277,672		13.1	%	$	898,898		$	808,424		11.2	%
Adjusted EBITDA margin %		77.6	%		76.7	%				76.4	%		76.0	%

*Analytics*	Three Months Ended								Nine Months Ended
	Sep. 30,			Sep. 30,			%		Sep. 30,			Sep. 30,			%
In thousands		2024			2023		Change			2024			2023		Change
Operating revenues:
Recurring subscriptions	$	168,150		$	151,269		11.2	%	$	490,829		$	443,276		10.7	%
Non-recurring		4,226			2,999		40.9	%		11,508			7,943		44.9	%
Total operating revenues		172,376			154,268		11.7	%		502,337			451,219		11.3	%
Adjusted EBITDA expenses		82,089			82,487		(0.5	)%		258,166			253,509		1.8	%
Adjusted EBITDA	$	90,287		$	71,781		25.8	%	$	244,171		$	197,710		23.5	%
Adjusted EBITDA margin %		52.4	%		46.5	%				48.6	%		43.8	%

*ESG and Climate*	Three Months Ended								Nine Months Ended
	Sep. 30,			Sep. 30,			%		Sep. 30,			Sep. 30,			%
In thousands		2024			2023		Change			2024			2023		Change
Operating revenues:
Recurring subscriptions	$	81,536		$	71,744		13.6	%	$	235,954		$	207,523		13.7	%
Non-recurring		2,107			1,294		62.8	%		5,428			3,792		43.1	%
Total operating revenues		83,643			73,038		14.5	%		241,382			211,315		14.2	%
Adjusted EBITDA expenses		53,654			47,598		12.7	%		166,372			145,201		14.6	%
Adjusted EBITDA	$	29,989		$	25,440		17.9	%	$	75,010		$	66,114		13.5	%
Adjusted EBITDA margin %		35.9	%		34.8	%				31.1	%		31.3	%

*All Other – Private Assets*	Three Months Ended								Nine Months Ended
	Sep. 30,			Sep. 30,			%		Sep. 30,			Sep. 30,			%
In thousands		2024			2023		Change			2024			2023		Change
Operating revenues:
Recurring subscriptions	$	62,991		$	35,531		77.3	%	$	190,434		$	111,292		71.1	%
Non-recurring		813			480		69.4	%		2,520			1,168		115.8	%
Total operating revenues		63,804			36,011		77.2	%		192,954			112,460		71.6	%
Adjusted EBITDA expenses		47,526			24,615		93.1	%		146,803			76,384		92.2	%
Adjusted EBITDA	$	16,278		$	11,396		42.8	%	$	46,151		$	36,076		27.9	%
Adjusted EBITDA margin %		25.5	%		31.6	%				23.9	%		32.1	%

*Consolidated*	Three Months Ended								Nine Months Ended
	Sep. 30,			Sep. 30,			%		Sep. 30,			Sep. 30,			%
In thousands		2024			2023		Change			2024			2023		Change
Operating revenues:
Recurring subscriptions	$	536,622		$	464,997		15.4	%	$	1,571,146		$	1,365,936		15.0	%
Asset-based fees		168,622			141,066		19.5	%		482,162			412,354		16.9	%
Non-recurring		19,461			19,376		0.4	%		59,311			60,524		(2.0	)%
Operating revenues total		724,705			625,439		15.9	%		2,112,619			1,838,814		14.9	%
Adjusted EBITDA expenses		274,003			239,150		14.6	%		848,389			730,490		16.1	%
Adjusted EBITDA	$	450,702		$	386,289		16.7	%	$	1,264,230		$	1,108,324		14.1	%
Operating margin %		55.4	%		56.5	%				53.2	%		55.1	%
Adjusted EBITDA margin %		62.2	%		61.8	%				59.8	%		60.3	%

Table 6: Sales and Retention Rate by Segment (unaudited)(1)

	Three Months Ended								Nine Months Ended
	Sep. 30,			Sep. 30,			%		Sep. 30,			Sep. 30,			%
In thousands		2024			2023		Change			2024			2023		Change
Index
New recurring subscription sales	$	25,271		$	23,978		5.4	%	$	80,081		$	80,156		(0.1	)%
Subscription cancellations		(9,862	)		(7,402	)	33.2	%		(34,876	)		(22,617	)	54.2	%
Net new recurring subscription sales	$	15,409		$	16,576		(7.0	)%	$	45,205		$	57,539		(21.4	)%
Non-recurring sales	$	13,883		$	14,679		(5.4	)%	$	44,687		$	54,365		(17.8	)%
Total gross sales	$	39,154		$	38,657		1.3	%	$	124,768		$	134,521		(7.3	)%
Total Index net sales	$	29,292		$	31,255		(6.3	)%	$	89,892		$	111,904		(19.7	)%

Index Retention Rate(2)		95.4	%		96.2	%				94.6	%		96.1	%

Analytics
New recurring subscription sales	$	20,780		$	18,787		10.6	%	$	56,137		$	50,751		10.6	%
Subscription cancellations		(10,307	)		(7,543	)	36.6	%		(28,001	)		(24,094	)	16.2	%
Net new recurring subscription sales	$	10,473		$	11,244		(6.9	)%	$	28,136		$	26,657		5.5	%
Non-recurring sales	$	7,293		$	3,206		127.5	%	$	13,812		$	8,734		58.1	%
Total gross sales	$	28,073		$	21,993		27.6	%	$	69,949		$	59,485		17.6	%
Total Analytics net sales	$	17,766		$	14,450		22.9	%	$	41,948		$	35,391		18.5	%

Analytics Retention Rate(3)		93.8	%		95.1	%				94.4	%		94.8	%

ESG and Climate
New recurring subscription sales	$	9,333		$	12,124		(23.0	)%	$	39,361		$	38,497		2.2	%
Subscription cancellations		(5,575	)		(2,639	)	111.3	%		(17,496	)		(7,331	)	138.7	%
Net new recurring subscription sales	$	3,758		$	9,485		(60.4	)%	$	21,865		$	31,166		(29.8	)%
Non-recurring sales	$	2,345		$	1,532		53.1	%	$	6,852		$	4,066		68.5	%
Total gross sales	$	11,678		$	13,656		(14.5	)%	$	46,213		$	42,563		8.6	%
Total ESG and Climate net sales	$	6,103		$	11,017		(44.6	)%	$	28,717		$	35,232		(18.5	)%

ESG and Climate Retention Rate(4)		93.0	%		96.0	%				92.7	%		96.3	%

All Other – Private Assets
New recurring subscription sales	$	9,959		$	4,788		108.0	%	$	29,877		$	14,746		102.6	%
Subscription cancellations		(4,610	)		(3,153	)	46.2	%		(15,112	)		(8,634	)	75.0	%
Net new recurring subscription sales	$	5,349		$	1,635		227.2	%	$	14,765		$	6,112		141.6	%
Non-recurring sales	$	520		$	262		98.5	%	$	2,361		$	1,069		120.9	%
Total gross sales	$	10,479		$	5,050		107.5	%	$	32,238		$	15,815		103.8	%
Total All Other – Private Assets net sales	$	5,869		$	1,897		209.4	%	$	17,126		$	7,181		138.5	%

All Other – Private Assets Retention Rate(5)		92.7	%		91.3	%				92.0	%		92.1	%

Consolidated
New recurring subscription sales	$	65,343		$	59,677		9.5	%	$	205,456		$	184,150		11.6	%
Subscription cancellations		(30,354	)		(20,737	)	46.4	%		(95,485	)		(62,676	)	52.3	%
Net new recurring subscription sales	$	34,989		$	38,940		(10.1	)%	$	109,971		$	121,474		(9.5	)%
Non-recurring sales	$	24,041		$	19,679		22.2	%	$	67,712		$	68,234		(0.8	)%
Total gross sales	$	89,384		$	79,356		12.6	%	$	273,168		$	252,384		8.2	%
Total net sales	$	59,030		$	58,619		0.7	%	$	177,683		$	189,708		(6.3	)%

Total Retention Rate(6)		94.2	%		95.4	%				93.9	%		95.4	%

(1) See “Notes Regarding the Use of Operating Metrics” for details regarding the definition of new recurring subscription sales, subscription cancellations, net new recurring subscription sales, non-recurring sales, total gross sales, total net sales and Retention Rate.
(2) Retention rate for Index excluding the impact of the acquisition of Foxberry was 95.5% and 94.6% for the three and nine months ended Sep. 30, 2024, respectively.
(3) Retention rate for Analytics excluding the impact of the acquisition of Fabric was 93.8% and 94.4% for the three and nine months ended Sep. 30, 2024, respectively.
(4) Retention rate for ESG and Climate excluding the impact of the acquisition of Trove was 93.4% and 92.9% for the three and nine months ended Sep. 30, 2024, respectively.
(5) Retention rate for All Other – Private Assets excluding the impact of the acquisition of Burgiss was 92.2% and 90.7% for the three and nine months ended Sep. 30, 2024, respectively.
(6) Total retention rate excluding the impact of the acquisitions of Foxberry, Fabric, Trove and Burgiss was 94.4% and 94.0% for the three and nine months ended Sep. 30, 2024, respectively.

Table 7: AUM in ETFs Linked to MSCI Equity Indexes (unaudited)(1)(2)

	Three Months Ended												Nine Months Ended
		Sep. 30,			Dec. 31,		Mar. 31,		June 30,		Sep. 30,		Sep. 30,		Sep. 30,
In billions			2023			2023		2024		2024		2024		2023		2024
Beginning Period AUM in ETFs linked to
MSCI equity indexes		$	1,372.5		$	1,322.8	$	1,468.9	$	1,582.6	$	1,631.9	$	1,222.9	$	1,468.9
Market Appreciation/(Depreciation)			(56.1	)		130.5		92.8		21.2		111.3		67.4		225.3
Cash Inflows			6.4			15.6		20.9		28.1		18.6		32.5		67.6
Period-End AUM in ETFs linked to
MSCI equity indexes		$	1,322.8		$	1,468.9	$	1,582.6	$	1,631.9	$	1,761.8	$	1,322.8	$	1,761.8

Period Average AUM in ETFs linked to
MSCI equity indexes		$	1,376.5		$	1,364.9	$	1,508.8	$	1,590.6	$	1,677.0	$	1,332.6	$	1,592.1

Period-End Basis Point Fee(3)			2.51			2.50		2.48		2.47		2.44		2.51		2.44

(1) The historical values of the AUM in ETFs linked to our equity indexes as of the last day of the month and the monthly average balance can be found under the link “AUM in ETFs Linked to MSCI Equity Indexes” on our Investor Relations homepage at http://ir.msci.com. Information contained on our website is not incorporated by reference into this Press Release or any other report filed with the SEC. The AUM in ETFs also includes AUM in Exchange Traded Notes, the value of which is less than 1% of the AUM amounts presented.
(2) The value of AUM in ETFs linked to MSCI equity indexes is calculated by multiplying the equity ETFs net asset value by the number of shares outstanding.
(3) Based on period-end Run Rate for ETFs linked to MSCI equity indexes using period-end AUM.

Table 8: Run Rate by Segment and Type (unaudited)(1)

	As of
	Sep. 30,		Sep. 30,		%
In thousands	2024		2023		Change
Index
Recurring subscriptions	$	906,803	$	835,334	8.6	%
Asset-based fees		683,462		545,548	25.3	%
Index Run Rate		1,590,265		1,380,882	15.2	%

Analytics Run Rate		691,333		639,462	8.1	%

ESG and Climate Run Rate		344,015		297,297	15.7	%

All Other – Private Assets Run Rate		268,577		150,749	78.2	%

Total Run Rate	$	2,894,190	$	2,468,390	17.3	%

Total recurring subscriptions	$	2,210,728	$	1,922,842	15.0	%
Total asset-based fees		683,462		545,548	25.3	%
Total Run Rate	$	2,894,190	$	2,468,390	17.3	%

(1) See “Notes Regarding the Use of Operating Metrics” for details regarding the definition of Run Rate.

Table 9: Reconciliation of Net Income to Adjusted EBITDA (unaudited)

	Three Months Ended				Nine Months Ended
	Sep. 30,		Sep. 30,		Sep. 30,		Sep. 30,
In thousands	2024		2023		2024		2023
Net income	$	280,901	$	259,659	$	803,613	$	745,212
Provision for income taxes		76,035		57,997		189,210		155,974
Other expense (income), net		44,398		35,653		130,501		112,678
Operating income		401,334		353,309		1,123,324		1,013,864
Amortization of intangible assets		41,939		26,722		121,316		77,543
Depreciation and amortization of property,
equipment and leasehold improvements		4,332		5,252		12,639		15,911
Acquisition-related integration and transaction costs(1)		3,097		1,006		6,951		1,006
Consolidated adjusted EBITDA	$	450,702	$	386,289	$	1,264,230	$	1,108,324

Index adjusted EBITDA	$	314,148	$	277,672	$	898,898	$	808,424
Analytics adjusted EBITDA		90,287		71,781		244,171		197,710
ESG and Climate adjusted EBITDA		29,989		25,440		75,010		66,114
All Other – Private Assets adjusted EBITDA		16,278		11,396		46,151		36,076
Consolidated adjusted EBITDA	$	450,702	$	386,289	$	1,264,230	$	1,108,324

(1) Represents transaction expenses and other costs directly related to the acquisition and integration of acquired businesses, including professional fees, severance expenses, regulatory filing fees and other costs, in each case that are incurred no later than 12 months after the close of the relevant acquisition.

Table 10: Reconciliation of Net Income and Diluted EPS to Adjusted Net Income and Adjusted EPS (unaudited)

	Three Months Ended						Nine Months Ended
	Sep. 30,			Sep. 30,			Sep. 30,			Sep. 30,
In thousands, except per share data	2024			2023			2024			2023
Net income	$	280,901		$	259,659		$	803,613		$	745,212
Plus: Amortization of acquired intangible assets and
equity method investment basis difference		26,066			16,722			77,226			50,356
Plus: Acquisition-related integration and transaction costs(1)		3,140			1,006			6,994			1,006
Plus: Write-off of deferred fees on debt extinguishment		—			—			1,510			—
Less: Gain from changes in ownership interest of investees		—			—			—			(447	)
Less: Income tax effect(2)		(6,260	)		(3,327	)		(16,432	)		(8,880	)
Adjusted net income	$	303,847		$	274,060		$	872,911		$	787,247

Diluted EPS	$	3.57		$	3.27		$	10.15		$	9.32
Plus: Amortization of acquired intangible assets and
equity method investment basis difference		0.33			0.21			0.98			0.63
Plus: Acquisition-related integration and transaction costs(1)		0.04			0.01			0.09			0.01
Plus: Write-off of deferred fees on debt extinguishment		—			—			0.02			—
Less: Gain from changes in ownership interest of investees		—			—			—			(0.01	)
Less: Income tax effect(2)		(0.08	)		(0.04	)		(0.21	)		(0.10	)
Adjusted EPS	$	3.86		$	3.45		$	11.03		$	9.85

Diluted weighted average common shares outstanding		78,729			79,500			79,159			79,959

(1) Represents transaction expenses and other costs directly related to the acquisition and integration of acquired businesses, including professional fees, severance expenses, regulatory filing fees and other costs, in each case that are incurred no later than 12 months after the close of the relevant acquisition.
(2) Adjustments relate to the tax effect of non-GAAP adjustments, which were determined based on the nature of the underlying non-GAAP adjustments and their relevant jurisdictional tax rates.

Table 11: Reconciliation of Operating Expenses to Adjusted EBITDA Expenses (unaudited)

	Three Months Ended				Nine Months Ended				Full-Year
	Sep. 30,		Sep. 30,		Sep. 30,		Sep. 30,		2024
In thousands	2024		2023		2024		2023		Guidance (1)
Total operating expenses	$	323,371	$	272,130	$	989,295	$	824,950	$1,305,000 – $1,345,000
Amortization of intangible assets		41,939		26,722		121,316		77,543
Depreciation and amortization of property,
equipment and leasehold improvements		4,332		5,252		12,639		15,911	$175,000 – $185,000
Acquisition-related integration and transaction costs(2)		3,097		1,006		6,951		1,006
Consolidated adjusted EBITDA expenses	$	274,003	$	239,150	$	848,389	$	730,490	$1,130,000 – $1,160,000

Index adjusted EBITDA expenses	$	90,734	$	84,450	$	277,048	$	255,396
Analytics adjusted EBITDA expenses		82,089		82,487		258,166		253,509
ESG and Climate adjusted EBITDA expenses		53,654		47,598		166,372		145,201
All Other – Private Assets adjusted EBITDA expenses		47,526		24,615		146,803		76,384
Consolidated adjusted EBITDA expenses	$	274,003	$	239,150	$	848,389	$	730,490	$1,130,000 – $1,160,000

(1) We have not provided a full line-item reconciliation for total operating expenses to adjusted EBITDA expenses for this future period because we believe such a reconciliation would imply a degree of precision and certainty that could be confusing to investors and we are unable to reasonably predict certain items contained in the GAAP measure without unreasonable efforts. This is due to the inherent difficulty of forecasting the timing or amount of various items that have not yet occurred and are out of the Company’s control or cannot be reasonably predicted. For the same reasons, the Company is unable to address the probable significance of the unavailable information. Forward-looking non-GAAP financial measures provided without the most directly comparable GAAP financial measures may vary materially from the corresponding GAAP financial measures. See “Forward-Looking Statements” above.
(2) Represents transaction expenses and other costs directly related to the acquisition and integration of acquired businesses, including professional fees, severance expenses, regulatory filing fees and other costs, in each case that are incurred no later than 12 months after the close of the relevant acquisition.

Table 12: Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow (unaudited)

	Three Months Ended						Nine Months Ended						Full-Year
	Sep. 30,			Sep. 30,			Sep. 30,			Sep. 30,			2024
In thousands	2024			2023			2024			2023			Guidance (1)
Net cash provided by operating activities	$	421,609		$	291,131		$	1,070,994		$	847,076		$1,420,000 – $1,470,000
Capital expenditures		(6,626	)		(3,564	)		(19,515	)		(18,942	)
Capitalized software development costs		(20,975	)		(17,417	)		(59,648	)		(50,080	)
Capex		(27,601	)		(20,981	)		(79,163	)		(69,022	)	($105,000 – $115,000)
Free cash flow	$	394,008		$	270,150		$	991,831		$	778,054		$1,305,000 – $1,365,000

(1) We have not provided a line-item reconciliation for free cash flow to net cash provided by operating activities for this future period because we believe such a reconciliation would imply a degree of precision and certainty that could be confusing to investors and we are unable to reasonably predict certain items contained in the GAAP measure without unreasonable efforts. This is due to the inherent difficulty of forecasting the timing or amount of various items that have not yet occurred and are out of the Company’s control or cannot be reasonably predicted. For the same reasons, the Company is unable to address the probable significance of the unavailable information. Forward-looking non-GAAP financial measures provided without the most directly comparable GAAP financial measures may vary materially from the corresponding GAAP financial measures. See “Forward-Looking Statements” above.

Table 13: Third Quarter 2024 Reconciliation of Operating Revenue Growth to Organic Operating Revenue Growth (unaudited)

	Comparison of the Three Months Ended September 30, 2024 and 2023
	Total		Recurring Subscription		Asset-Based Fees		Non-Recurring Revenues
Index	Change Percentage		Change Percentage		Change Percentage		Change Percentage
Operating revenue growth	11.8	%	8.5	%	19.5	%	(15.7	)%
Impact of acquisitions and divestitures	—	%	(0.1	)%	—	%	—	%
Impact of foreign currency exchange rate fluctuations	—	%	0.1	%	—	%	—	%
Organic operating revenue growth	11.8	%	8.5	%	19.5	%	(15.7	)%

	Total		Recurring Subscription		Asset-Based Fees		Non-Recurring Revenues
Analytics	Change Percentage		Change Percentage		Change Percentage		Change Percentage
Operating revenue growth	11.7	%	11.2	%	—	%	40.9	%
Impact of acquisitions and divestitures	(0.1	)%	(0.2	)%	—	%	—	%
Impact of foreign currency exchange rate fluctuations	0.1	%	0.1	%	—	%	0.1	%
Organic operating revenue growth	11.7	%	11.1	%	—	%	41.0	%

	Total		Recurring Subscription		Asset-Based Fees		Non-Recurring Revenues
ESG and Climate	Change Percentage		Change Percentage		Change Percentage		Change Percentage
Operating revenue growth	14.5	%	13.6	%	—	%	62.8	%
Impact of acquisitions and divestitures	(1.4	)%	(1.4	)%	—	%	(2.3	)%
Impact of foreign currency exchange rate fluctuations	(2.1	)%	(2.0	)%	—	%	(0.9	)%
Organic operating revenue growth	11.0	%	10.2	%	—	%	59.6	%

	Total		Recurring Subscription		Asset-Based Fees		Non-Recurring Revenues
All Other – Private Assets	Change Percentage		Change Percentage		Change Percentage		Change Percentage
Operating revenue growth	77.2	%	77.3	%	—	%	69.4	%
Impact of acquisitions and divestitures	(75.1	)%	(75.2	)%	—	%	(72.9	)%
Impact of foreign currency exchange rate fluctuations	(1.1	)%	(1.0	)%	—	%	(0.7	)%
Organic operating revenue growth	1.0	%	1.1	%	—	%	(4.2	)%

	Total		Recurring Subscription		Asset-Based Fees		Non-Recurring Revenues
Consolidated	Change Percentage		Change Percentage		Change Percentage		Change Percentage
Operating revenue growth	15.9	%	15.4	%	19.5	%	0.4	%
Impact of acquisitions and divestitures	(4.6	)%	(6.0	)%	—	%	(1.9	)%
Impact of foreign currency exchange rate fluctuations	(0.2	)%	(0.4	)%	—	%	(0.1	)%
Organic operating revenue growth	11.1	%	9.0	%	19.5	%	(1.6	)%

Table 14: Nine Months 2024 Reconciliation of Operating Revenue Growth to Organic Operating Revenue Growth (unaudited)

	Comparison of the Nine Months Ended September 30, 2024 and 2023
	Total		Recurring Subscription		Asset-Based Fees		Non-Recurring Revenues
Index	Change Percentage		Change Percentage		Change Percentage		Change Percentage
Operating revenue growth	10.5	%	8.3	%	16.9	%	(16.3	)%
Impact of acquisitions and divestitures	—	%	(0.1	)%	—	%	—	%
Impact of foreign currency exchange rate fluctuations	0.2	%	0.3	%	0.1	%	—	%
Organic operating revenue growth	10.7	%	8.5	%	17.0	%	(16.3	)%

	Total		Recurring Subscription		Asset-Based Fees		Non-Recurring Revenues
Analytics	Change Percentage		Change Percentage		Change Percentage		Change Percentage
Operating revenue growth	11.3	%	10.7	%	—	%	44.9	%
Impact of acquisitions and divestitures	(0.1	)%	(0.1	)%	—	%	—	%
Impact of foreign currency exchange rate fluctuations	0.4	%	0.4	%	—	%	1.2	%
Organic operating revenue growth	11.6	%	11.0	%	—	%	46.1	%

	Total		Recurring Subscription		Asset-Based Fees		Non-Recurring Revenues
ESG and Climate	Change Percentage		Change Percentage		Change Percentage		Change Percentage
Operating revenue growth	14.2	%	13.7	%	—	%	43.1	%
Impact of acquisitions and divestitures	(1.6	)%	(1.6	)%	—	%	(2.5	)%
Impact of foreign currency exchange rate fluctuations	(1.9	)%	(2.0	)%	—	%	—	%
Organic operating revenue growth	10.7	%	10.1	%	—	%	40.6	%

	Total		Recurring Subscription		Asset-Based Fees		Non-Recurring Revenues
All Other – Private Assets	Change Percentage		Change Percentage		Change Percentage		Change Percentage
Operating revenue growth	71.6	%	71.1	%	—	%	115.8	%
Impact of acquisitions and divestitures	(69.4	)%	(69.3	)%	—	%	(80.0	)%
Impact of foreign currency exchange rate fluctuations	(0.5	)%	(0.5	)%	—	%	(0.3	)%
Organic operating revenue growth	1.7	%	1.3	%	—	%	35.5	%

	Total		Recurring Subscription		Asset-Based Fees		Non-Recurring Revenues
Consolidated	Change Percentage		Change Percentage		Change Percentage		Change Percentage
Operating revenue growth	14.9	%	15.0	%	16.9	%	(2.0	)%
Impact of acquisitions and divestitures	(4.5	)%	(5.9	)%	—	%	(1.7	)%
Impact of foreign currency exchange rate fluctuations	—	%	(0.1	)%	0.1	%	0.1	%
Organic operating revenue growth	10.4	%	9.0	%	17.0	%	(3.6	)%

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