MCO - NYSE
Moody's Corporation
MCO·NYSE
$448.39
-1.1%Financial ServicesFinancial - Data & Stock Exchanges
Moody's Corporation operates as an integrated risk assessment firm worldwide. It operates in two segments, Moody's Investors Service and Moody's Analytics. The Moody's Investors Service segment publishes credit ratings and provides assessment services on various debt obligations, programs and facilities, and entities that issue such obligations, such as various corporate, financial institution, and governmental obligations, as well as and structured finance securities. This segment provides ratings in approximately 140 countries. Its ratings are disseminated through press releases to the public through electronic media, including the internet and real-time information systems used by securities traders and investors. This segment has rated approximately 5,000 non-financial corporates; 3,600 financial institutions; 16,000 public finance issuers; 145 sovereigns; 47 supranational institutions; 459 sub-sovereigns; and 1,000 infrastructure and project finance issuers, as well as 9,100 structured finance deals. The Moody's Analytics segment develops a range of products and services that support the risk management activities of institutional participants in financial markets; and offers subscription based research, data, and analytical products comprising credit ratings, credit research, quantitative credit scores and other analytical tools, economic research and forecasts, business intelligence and company information products, commercial real estate data and analytical tools, and on-line and classroom-based training services, as well as credentialing and certification services. It also offers offshore analytical and research services with learning solutions and certification programs; and software solutions, as well as related risk management services. The company was formerly known as Dun and Bradstreet Company and changed its name to Moody's Corporation in September 2000. Moody's Corporation was founded in 1900 and is headquartered in New York, New York.
At a Glance
Live SnapshotMarket Cap$78.33B
EPS13.7300
P/E Ratio32.66
Earnings Date07/22/2026
Earnings Call Transcript
MCO • 2026 • Q1
Operator
Good day everyone, and welcome to the Moody's Corporation First Quarter 2026 Earnings Call. At this time, I would like to inform you that this conference is being recorded and that all participants are in a listen-only mode. At the request of the company, we will open the conference up for questions and answers following the presentation. The call is scheduled to last approximately one hour. I will now turn the call over to Shivani Kak, Head of Investor Relations. Please go ahead.
Shivani Kak
Hello, and thank you for joining us today. I'm Shivani Kak, Head of Investor Relations at Moody's. This morning, we reported our first quarter 2026 results. The press release and today's presentation are posted at ir.moodys.com. We'll reference non-GAAP or adjusted measures. Please see the tables in our earnings release for reconciliations to U.S. GAAP. Today's remarks may include forward-looking statements under the Private Securities Litigation Reform Act of 1995. Please see the safe harbor language in our earnings release and the risk factors and MD&A in our most recent Form 10-K and other SEC filings available on our website and the SEC's website. These factors could cause actual results to differ materially from those expressed or implied. Members of the media may be listening in a listen-only mode. With that, I'll turn it over to Rob.
Rob Fauber
Hey everybody, thanks for joining us. Q1 was a strong start to the year despite a volatile geopolitical backdrop. Moody's again delivered sustained revenue growth across both businesses and powerful operating leverage as we continue to capitalize on the deep currents driving demand for our ratings and solutions. Now there are three takeaways for the first quarter. First, we delivered strong financial performance. Both MIS and MA grew revenues by 8%, and disciplined cost management drove 150 basis points of adjusted operating margin to 53.2%. Together, this contributed to adjusted diluted EPS of $4.33, and that was up 13%. We returned $1.7 billion through buybacks and dividends in the quarter, and we increased full year buyback guidance by $500 million to approximately $2.5 billion. Second, demand remains healthy across both businesses.
Rob Fauber
In ratings, issuance continues to reflect long-term funding needs tied to infrastructure, technology, private credit and energy transition, even as volatility may affect timing. In analytics, engagement is strongest in our largest, most strategic relationships, which continue to grow materially faster than the broader M&A base, and we have a growing pipeline of some of the world's largest financial institutions to consume our agent-ready intelligence, and that's supported by further expansion with our hyperscaler and AI partners. Third, we're executing on our strategic priorities, and when our intelligence is embedded directly into customer decision-making, we see tangible outcomes, higher retention, expanding relationships, and more durable recurring revenue. Like last quarter, we'll share some specific examples of meaningful customer wins. Now let me turn to what's driving performance.
Rob Fauber
In ratings, as I said, issuance remains anchored in long-term funding needs tied to AI-driven infrastructure, private credit, energy transition, and emerging markets. These are multi-year funding needs. They're not short-term cycles. As I said, volatility may affect timing, but the underlying demand is structural. That showed up clearly in Q1. In fact, in the first quarter, rated issuance surpassed $2 trillion for the first time, and that was led by near record investment-grade volumes, including several jumbo AI-related financings totaling more than $100 billion. Now, private credit activity remained durable this quarter despite increasing credit concerns. As private credit and private markets scale and come under greater scrutiny, demand for our independent credit assessment continues to increase, and that dynamic contributed to private credit-related revenue in ratings growing more than 80% year-over-year.
Rob Fauber
In Moody's Analytics, we're embedding our intelligence into mission-critical workflows, particularly lending, underwriting, and compliance, where accuracy and auditability and trust are essential. To support that shift, we're expanding how and where customers access Moody's intelligence. In fact, over the last several weeks, we announced a set of partnerships that significantly extend our distribution without compromising governance or independence. Through Model Context Protocol integrations, Moody's licensed intelligence can now be accessed directly within enterprise AI environments such as ChatGPT Enterprise and Claude. This allows customers to bring trusted Moody's content into their own AI workflows rather than relying on generic or unverified data. With Anthropic, for licensed users, our agentic credit and compliance workflows are now available natively inside the Claude interface through something called an MCP application.
Rob Fauber
That's the first of its kind as far as we're aware, and it enables users to access Moody's agents to perform analysis, generate outputs, and trace sources without leaving the Claude environment. By making our agentic solutions available through the AWS Marketplace, we're meeting customers inside their existing cloud and procurement ecosystems, reducing friction by allowing customers to burn down their AWS commit when consuming Moody's agents and intelligence. Moody's is scaling workflow-embedded distribution by launching a dedicated Moody's agent in Microsoft 365 Copilot and making Moody's intelligence available as a grounding data source across Copilot experiences. That's Copilot Chat, Researcher, Copilot and Excel. This brings trusted decision-grade context directly into everyday Microsoft tools, extending access beyond specialist teams and enabling faster, more consistent, explainable, and auditable decisions. Importantly, these are bring-your-own-license models. They expand reach and usage but preserve our direct relationship with our customer.
Rob Fauber
All of this sets up what I'm going to turn to next, which is how customers are using these capabilities today, and how that's translating into growth and differentiation across analytics and ratings. I'll start with lending and credit decisioning. Our AI-enabled lending suite continues to gain traction as banks modernize end-to-end credit workflows. ARR for our lending suite grew 18% year-over-year, and was driven by customers upgrading to an integrated platform that spans origination, decisioning, and monitoring. What's driving adoption is workflow integration and AI enablement. That's faster decisions, greater consistency, clear auditability. We're also seeing demand for credit assessment and workflow beyond banks with asset managers and even corporates. In the first quarter, we expanded relationships with two of the world's five largest asset managers, representing nearly $20 trillion of assets under management.
Rob Fauber
The first asset manager signed an approximately $6 million multi-year deal to bring our decision-grade intelligence to both public and private credit workflows, supporting risk and investment decision-making at a global scale. The second asset manager signed a multi-year contract of over $2.5 million and adopted multiple Moody's modules to support front, middle, and back-office credit and compliance workflows. It also represented our first structured finance software win with a trustee, which provides a strong reference for future opportunities. In the corporate space, a global athleisure brand tripled its relationship with us and signed a multi-year contract for an automated credit decisioning solution that accelerates decisions from days to minutes. These are all ways that customers are accessing what we believe are the best set of commercial credit scoring capabilities in the world. In insurance, growth was sustained from continued demand for digitization via our Intelligent Risk Platform.
Rob Fauber
That included adoption by one of the top three reinsurers in the world in the first quarter, as well as adoption of our high-definition models. In fact, IRP cross-selling and upselling accounted for almost half of our insurance net growth in the first quarter. Net growth was also supported by our trailing 12-month retention rate of 97%, which reflects how embedded we are in customers' workflows as what they call their primary view of risk. In KYC and compliance, growth continues to be driven by scale, complexity, and regulatory expectations. I've talked before how these needs go beyond regulated financial institutions, and a good example is our first Moody's for Compliance customer. In the first quarter, a global real estate firm spanning approximately 275,000 sites operating in more than 80 countries, selected our enterprise-wide solution for counterparty screening and monitoring, covering millions of entities annually.
Rob Fauber
We replaced a fragmented region-specific approach with a single governed platform integrating ownership, sanctions, politically exposed people, and adverse media, representing both a competitive displacement and a meaningful expansion of our relationship. Finally, let me turn to ratings and digital finance. As capital markets evolve, we're extending the same rigor and governance and independence that define our ratings franchise into new asset classes and new forms of market infrastructure. In fact, during the first quarter, we were the first rating agency to publish a methodology for stablecoins, and that's an asset class that's expected to reach north of $2 trillion by 2030. I'm excited to share that we already have a number of deals in the pipeline. We were also the first rating agency with blockchain-agnostic capabilities to ingest data and publish ratings directly on-chain.
Rob Fauber
We're now live on the Canton Network, making Moody's the first rating agency operating a node in the privacy-enabled blockchain ecosystem. During the quarter, we were the first rating agency to rate an innovative inaugural Bitcoin-backed bond where repayment is secured by Bitcoin collateral. These are not pilots or proofs of concept. They represent and reflect real customer demand for trusted comparable risk assessment as finance evolves, whether assets are traditional or digital. Taken together, this is what differentiates Moody's. Across analytics and ratings, we're embedding decision-grade intelligence directly into the workflows and decisions that matter most, driving durable growth today and reinforcing the long-term strength of the franchise. Now finally, before I close, I want to highlight an important leadership milestone, and I am absolutely thrilled that Christina Kosmowski will become Moody's Analytics CEO in June. She brings a blue-chip Silicon Valley pedigree.
Operator
Thank you. If you would like to ask a question, please dial star one on your telephone keypad. If you are on a speakerphone, please pick up your handset and make sure your mute function is turned off so that your signal reaches our equipment. We ask that you please limit yourself to one question. The option to rejoin the queue will be unavailable. Again, that is star one to ask a question. Our first question will come from the line of George Tong with Goldman Sachs. Please go ahead.
George Tong
Hi. Thanks. Good morning. You talked about your MCP strategy allowing Moody's data to be accessed through LLMs. Can you discuss how many customers are accessing Moody's data through these channels and what your plans are to monetize MCP distribution?
Rob Fauber
Yeah. Hey, George. Good to have you on the call. Yeah, I talked a little bit about these different partnerships, and so that's enabling integration of our intelligence through MCPs through those surfaces. We have customers who are also looking to take the data directly into their own AI, internal AI workflow orchestration platforms at their institution. We have, I would say, a number of large financial institutions who are trialing. I'm going to call this our agent-ready data through either the MCPs directly into the institution or through one of these channels. What that does is it allows us the opportunity to kind of uplevel the commercial model that we have with these institutions, right?
Rob Fauber
Because if they want to bring our intelligence into the corporate investment bank, we need to make sure that, you know, there's an arrangement and a license that allows them to access that content across that entire division. As opposed to in the past, we may have had been serving different use cases in different parts of the bank. I would say it's in early days. Lots of really good engagement. A number now of trials, and we'll be looking to convert those to, you know, obviously to sales through the balance of the year. The one other thing I'd say is, you know, sometimes it'll also depend on the kind of institution or what the use case is for some of this. We may see some of this show up in different segments across M&A.
George Tong
Very helpful. Thank you.
Operator
Our next question will come from the line of Scott Wurtzel with Wolfe Research. Please go ahead.
Rob Fauber
Yeah. Scott, just to double-click, I think that the AI enablement really picked up in the back half of last year. As Noémie said, there was a lot of foundational work that we had done that put us in a very good position. We also had to work through our risk teams and make sure that we're going to deploy that in the appropriate way across ratings. It's not only about efficiency, and I appreciate you acknowledging that, but it's also going to be about insight as well. As Noémie said, we're capturing more and more structured and unstructured information across our entire ecosystem, and we're already seeing that that's going to give us new insights for our analysts that are going to support ratings quality as well as new research insights.
Scott Wurtzel
Super helpful. Thank you.
Operator
Our next question will come from the line of Jeff Silber with BMO. Please go ahead.
Jeff Silber
Thank you so much. I wanted to shift back to MIS. Rob, I think you had mentioned that volatility may impact timing, and I was just curious, do you think there was any pull forward in the first quarter? Or conversely, have we seen any recent delays? And if so, when do you think that debt might be issued?
Rob Fauber
Hey, Jeff. Good to hear from you. We were looking at the pull forward, and I would say there was no more pull forward than what we would consider to be within typical ranges. We've talked about on prior calls that typically there's less pull forward with investment-grade issuers because they typically have market access all the time, and spec-grade issuers a little bit more pull forward. Nothing out of the ordinary, I would say, first of all. I would say, Jeff, that in general yes, things have been choppier, but spreads have come back in from the highs in late March, and so has the 10-year as well. I would say from an investment grade perspective, the market's open. In fact, last week was a big week for financials.
Rob Fauber
You had four of the six largest banks hitting the market, almost $40 billion in issuance. There is a backlog of Q1 deals that we have heard this from the banks. Some of these deals have been deferred into the second quarter, and I think there's some optimism that we're going to see some of that come back in May and June. Overall, the funding costs are pretty attractive. You think very tight spreads by historical standards. Looking at default rates, if anything, continuing to modestly decline based on depending on what plays out. In spec grade, I'd say there's a little bit more selectivity, as you'd expect with a preference towards credits at the higher end of the credit spectrum. Last week was pretty strong from a high yield issuance perspective. Pretty good from a loans perspective as well.
Rob Fauber
I'd say the market is open, constructive, and I think there are some risk windows, risk on and off windows that we're going to continue to see for some time as we've got some of the headlines playing out.
Jeff Silber
Thanks for the color.
Operator
Our next question comes from the line of Andrew Nicholas with William Blair. Please go ahead.
Andrew Nicholas
Hi. Good morning. Thanks for taking my question. I wanted to follow up on the AI efficiency gains topic and maybe ask a different way on the regulatory side. It seems like you guys have been a first mover on a lot of these items, a lot of progress already to date. Is there any gating factor on adoption internally tied to regulatory pushback or what the regulators are comfortable with you kind of leveraging for ratings or even within MA? Just trying to get a sense for the puts and takes on that side. Thank you.
Rob Fauber
Yeah, Andrew, good question. I'll take it in two parts here. One, with ratings, as you'd expect, we have a very active dialogue with our regulators, and they want to understand how we are thinking about deploying and using AI. They want to make sure that there are a very strong control environment around all of that. There's, I'd say, heightened sensitivity for sure around the use of AI to actually be making decisions. I think you see that across a number of industries, actually. A lot of what we're doing is around the rating process and tools to give our analysts more and new insights, like I talked about. We have a very good engagement with our regulators, and I would say they understand and expect that we will be deploying these AI tools and providing them transparency and having a strong control environment.
Rob Fauber
Now, on the analytics side of the business, I would say that. If you think about who we serve, we have several thousand bank customers, something like a thousand insurance customers. They expect a strong control environment. They expect for us to have strong AI governance and other things as part of our products. In fact, some of our customers come in and actually audit our products and solutions and what we're doing. When we talk about decision-grade intelligence, we always say it's got to be decision-grade, and that means you have to have a strong control environment and auditability and all of those things that our regulated customers expect of us.
Rob Fauber
I think we've seen that it takes a little bit longer for adoption with these big regulated institutions because they've got to satisfy not only their internal environments, but make sure that the third parties that they're working with have the same kind of controls and governance that their regulators are going to expect of them.
Operator
Our next question will come from the line of Peter Christiansen with Citi. Please go ahead.
Peter Christiansen
Good morning. Thanks for taking my questions. Congrats, Rob. Best luck on next chapter here, and also great to see first-mover strategy on digital assets. I had a question about private credit. It seems like sentiment here has been kind of going back and forth the last couple of months, and you called out 80% year-over-year growth, which is pretty impressive. Should we think that there's been a bit of a build in the pipeline there? You did talk about some deals that potentially are creeping in from 1Q to 2Q, but specifically on private credit, whether you're seeing that dynamic occur, and if possible, is there any way you could size that portion of the growth for us? Thank you.
Rob Fauber
Hey, Peter. Thanks. There's a few kind of crosscurrents I'm going to try to address on private credit. I think fundamentally, though, when obviously we've been reading about increased credit stress in private credit throughout the quarter, we've been talking about this now for a couple of years, about the importance of transparency in the context of private markets and having benchmarks and data and other things that can support a consistent understanding of credit risk across that market. That is very important for that market to be able to continue to grow and scale. I think one of the things that you're seeing, and this happens in the public markets as well, when there's more credit stress in the market, there is more interest and demand in our ratings and in our solutions. That is exactly what we are seeing right now.
Rob Fauber
It's exactly what you'd expect, that we are seeing aspects of what I call investor demand pull, where the investors in private credit are starting to say, "We'd like to have a third party independent credit assessment on these loans that are in the fund that I'm invested in." You're starting to see alternative asset managers make disclosures about how much of their portfolio is rated or the insurers are doing that and by whom. That's because the underlying investors are asking questions and wanting to have a third party assessment of credit risk. Now, I'll say this, though, that we've seen a number of deals shift from private into public market this past quarter. That's not surprising. The public markets are typically a cheaper source of funding, so we've seen a lot of that. There are massive funding needs. We've talked about these deep currents.
Rob Fauber
They're not going away. We've talked about sovereign balance sheets being really stretched. That means you've got both the public and private markets are going to have to be very important sources of funding going forward. All of that is playing into what you're seeing, I think, with our growth in private credit. Obviously, we've got very strong growth in ratings. A couple of the things that I mentioned in my prepared remarks were actually us supporting credit assessment out of our MA business with our credit scoring tools and other things. I mentioned we believe we have the world's best commercial credit franchise, so we're very well positioned to serve these needs across the entire company and across the entire ecosystem.
Peter Christiansen
Thank you. Super helpful.
Operator
Our next question will come from the line of Jason Haas with Wells Fargo. Please go ahead.
Jason Haas
Hey, good morning, and thanks for taking my question. I'm curious what caused ARR to come in a little better than expected, since I think a few weeks ago you were talking about it maybe coming in towards the lower end of high single digits. I think the expectation then was that we would see an improvement through the year, maybe due to some timing of new products getting pushed out. I'm curious if that timing cadence still holds. Thanks.
Operator
Our next question will come from the line of Sean Kennedy with Mizuho. Please go ahead.
Sean Kennedy
Hi. Good morning. Thanks for taking my question. I wanted to see if you could discuss a bit more about KYC and some of the trends that you're seeing there and the longer term opportunity. If some of the slowdown was due to macro later in the quarter. Thank you.
Rob Fauber
Yeah. Hey. Thanks, Sean. For KYC, 13% ARR growth. We had a little bit of a tough comp for new business versus the first quarter of last year. We had a couple outsized deals last quarter. Retention improved pretty notably as we lapsed those cancellations that we had last year. Most of that was related to DOGE. I would say, Sean, that we think growth is going to pick back up into the mid-teens through the balance of the year. We've got some new use cases and new product launches. Probably the most important of those is the one that I just mentioned briefly in my prepared remarks, which is what we call Moody's for Compliance. Think of that as a kind of a platform solution that serves non-regulated institutions, corporates and so on. We've been building pipeline on that.
Rob Fauber
We expect that to continue through the balance of the year. Most of our growth so far has been from cross-selling to existing banking customers, and we're starting to see that corporate growth pick up. I think the key message here is that we expect the ARR growth to pick up through the balance of the year into that kind of mid-teens number.
Sean Kennedy
Great. Thank you. Appreciate the color.
Operator
Our next question comes from the line of Toni Kaplan with Morgan Stanley. Please go ahead.
Toni Kaplan
Thanks so much. Rob, I was hoping you could just give us an update on how you're thinking about the hyperscalers and if you've seen a number of them move to the frequent issuer program and whether the economics there are sort of similar to other IG issues. I guess, has that created sort of a price dilution or a mix dilution between sort of when we look at the issuance numbers and ratings revenue? is that one of the factors that would drive sort of a delta there? Should we expect that to continue as we see this sort of massive hyperscaler issuance over the next few years? Thanks.
Rob Fauber
Hey, Toni. Good question. I'm glad you asked it because I mentioned kind of $100 billion-ish hyperscaler issuance through the first quarter. That's a big number, and that's getting close to what we were thinking of for the full year for 2026. It is possible there's some upside to that through the balance of the year. I'm glad you asked the question because I would say hyperscalers are in many ways no different than any other, what you would think of as frequent investment-grade issuer. We always talk about some of our serial investment-grade issuers are on frequent issuer pricing programs, which is why there's a little bit different revenue mix on investment-grade versus spec grade. That's true here. When you see these big numbers around hyperscaler issuance, just think of that as frequent investment-grade issuer kind of issuance.
Toni Kaplan
Thank you.
Operator
Our next question comes from the line of Andrew Steinerman with J.P. Morgan. Please go ahead.
Andrew Steinerman
Thank you.
Operator
Our next question comes from the line of Alex Kramm with UBS. Please go ahead.
Alex Kramm
Very good.
Operator
Our next question will come from the line of Owen Lau with Clear Street. Please go ahead.
Operator
Our next question comes from the line of Curtis Nagle with Bank of America. Please go ahead.
Curtis Nagle
Great. Thanks very much for taking the question. Just a quick question on ratings issuance, just assuming we stay at that current guide of single-digit rate for revenue. Rob, last time you had spoken to at least the relative mix of the weighting to be about mid-50s for the first half of the year. Is that still roughly right, or just anything we should think about or any changes that's baked into the current forecast?
Rob Fauber
Yeah. Curtis, good question, because obviously we held the guidance, but the issuance has been a little softer than we had expected. I can give you kind of an update on how we're thinking about the calendarization of both issuance, and then maybe I'm sure it'll be helpful, I'll translate that quickly into ratings revenue. We're expecting issuance to grow in the, call it, high single-digit percent range for the first half of 2026 versus the first half of last year. Then we're expecting it to decline mid-single-digit percent in the second half of 2026 versus 2025. Remember, we have bank loan repricings in those numbers. From a sequential standpoint, we think that issuance is going to decline from the first quarter to the second quarter in kind of call it the mid-teens range.
Rob Fauber
Flat issuance from the second quarter to the third quarter, and then kind of mid-20s decline from third quarter to the fourth quarter. From a revenue perspective, we're expecting, first of all, a year-over-year revenue growth in every quarter in 2026, stronger in the first half versus the second half. In the first half, something like low double-digit percent revenue growth in the first half. For the second half, we're expecting something like mid-single-digit percent revenue growth. Again, the delta is just because of bank loan repricings being in there. Hopefully that gives you a sense.
Curtis Nagle
Very helpful. Thank you.
Operator
Our next question comes from the line of Craig Huber with Huber Research Partners. Please go ahead.
Craig Huber
Great. Thank you. Rob, I thought one of the most important things you said earlier was in partial response to a question concerning that the regulators are very apprehensive, have an issue with AI making decisions out there. We're talking about parts of your portfolio. Can you elaborate on that? It's obviously a major, major issue, AI concerns, that somebody with AI tools can come in and duplicate some of the services that information service companies have in general. Just talk about that a little bit further, please. It's a big point. Thank you.
Rob Fauber
Yeah. Craig, just take this for what it is from my seat. Obviously, I'm not an expert, for instance, in insurance and all of that. I would say just, in general, you can imagine, and this is true with our regulators as well. Thinking about the opportunity to accelerate your process and the time to get to a decision and all of those things, those are pretty straightforward conversations with regulators. When it comes to, hey, I've got an AI model that's actually going to make a decision about who's going to get a loan, who's going to get an insurance policy, at what price, what a credit rating might be, there's a lot more sensitivity around that, as you'd expect, because there's questions about the model. Does the model have bias? How is the model being governed? What kind of data is going into the model?
Rob Fauber
Is there a human in the loop? All of those things, right? That's true with us, and that's true with a number of our customers. Obviously there are decisions across financial services that do get made by models. I get that. There's quantitative trading platforms, there's credit score, things that go on for consumers, all of that. I would just say that's generally where there's more scrutiny from the regulators and wanting to understand if a decision is being made by a model, well, there's a lot of questions about that. Hopefully, that gives you a sense.
Operator
Our final question will come from the line of Shlomo Rosenbaum with Stifel. Please go ahead.
Shlomo Rosenbaum
Hi. Thank you very much. This is a little bit more of a broader question in terms of the guidance, and I know it's a fluid situation geopolitically, but I'm just wondering how did you incorporate the war in Iran and what's going on and the potential impact to inflation and anything else in terms of spreads going up and down into the guidance? I know you maintained the guidance, talked a little bit about volatility, but when you think about it through the year and your decision to keep the guidance there, how are you thinking about it as it goes through both MIS and MA?
Rob Fauber
I'll focus probably mostly on ratings just because I think that's where there's more variability given the geopolitical backdrop. Obviously the Iran war is the most important variable. It's interesting actually because we were thinking back to the first quarter call this time last year, and if you remember, there were the Liberation Day tariffs, and it created a lot of volatility and uncertainty in the market. What we saw through the balance of the year was that that volatility resulted in considerably lower issuance levels in April last year. Then we saw that get made up through the back half of the year, right? We ultimately ended up essentially right in line with our original full year guidance. I think we feel like we're in a little bit of the same situation. It's April 22nd.
Rob Fauber
There's still a long way to go in the year. There's actually an interesting stat, Shlomo, that in March, 80% of investment grade issuance was in six days. That's pretty remarkable. That tells you a couple things. I mean, one, it just shows you kind of the risk on, risk off windows that were going on in March. Two, it also shows you how much demand there is that was just waiting until there's a risk on window and that demand hits the market. It goes back to all these things about the underlying funding drivers, the demand drivers for raising capital. Those are still there.
Rob Fauber
Noémie talked a little bit about, in her prepared remarks, that if we see heightened volatility that goes on into May, and we see real softness in the month of May, I think at that point, Noémie gave you a sense of what that would mean for our guidance. Right from where we sit right now, given the conditions that I talked about, given the underlying drivers, and given the fact we're still in April, we think it's most prudent to hold to our current guidance. When we talk to the banks, that's the same thing we hear from them as well.
Operator
This concludes our question-and-answer session, and I will hand the call back over to Rob for any closing comments.
Rob Fauber
Okay. With that, thank you very much for joining, and we look forward to talking with you on our next earnings call. Goodbye.
Transcript from April 22, 2026
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