MSCI Q3 Earnings Beat Estimates, Revenues Rise Y/Y, Shares Up

MSCI’s MSCI third-quarter 2025 adjusted earnings of $4.47 per share beat the Zacks Consensus Estimate by 2.29% and increased 15.8% year over year.

MSCI's revenues rose 9.5% year over year to $793.4 million, missing the consensus estimate by 0.72%. The year-over-year improvement was driven by strong growth in recurring subscription revenues and asset-based fees. Organic operating revenues grew 9% year over year.

Recurring subscriptions of $579.1 million increased 7.9% year over year and contributed 73% to revenues. Asset-based fees of $197.5 million jumped 17.1% year over year and contributed 24.9% to revenues. Non-recurring revenues of $16.9 million decreased 13.4% year over year and contributed 2.1% to revenues.

At the end of the reported quarter, average assets under management were $2.211 trillion in ETFs linked to MSCI equity indexes. The total retention rate was 94.7% in the reported quarter.

MSCI Inc Price, Consensus and EPS Surprise

MSCI Inc price-consensus-eps-surprise-chart | MSCI Inc Quote

MSCI reported solid growth in the third quarter of 2025, with notable increases in revenues and earnings. MSCI shares jumped more than 4.19% at the time of writing this article.

MSCI’s Top-Line Details

In third-quarter 2025, Index revenues of $451.2 million increased 11.4% year over year. Recurring subscriptions and asset-based fees rose 8.3% and 17.1% on a year-over-year basis, respectively. Non-recurring revenues declined 10.1% year over year. Organically, Index operating revenue growth was 11.4%.

The uptick in recurring subscription revenues was driven by strong growth from market-cap-weighted Index products and ETFs linked to MSCI equity indexes.

Analytics’ operating revenues of $182.2 million increased 5.7% year over year. Recurring subscription revenues jumped 6% and non-recurring revenues decreased 8.2% on a year-over-year basis. Organically, Analytics’ operating revenue growth was 5.6%.

The Sustainability and Climate segment’s (previously titled "ESG and Climate") operating revenues were $90.1 million, rising 7.7% year over year. While recurring subscriptions increased 8.8% year over year, non-recurring revenues declined 31.2% on a year-over-year basis. Organically, Sustainability and Climate operating revenue growth was 5.1%. 

All Other – Private Assets operating revenues, which primarily comprise the Real Assets operating segment and the Private Capital Solutions (formerly known as Burgiss), were $70 million, up 9.7% year over year. Organic operating revenue growth for All Other – Private Assets was 8.3%.

MSCI’s Q3 Operating Details

Adjusted EBITDA increased 9.7% year over year to $494.4 million in the reported quarter. The adjusted EBITDA margin in the third quarter of 2025 was 62.3% compared with 62.2% in the third quarter of 2024.

Adjusted EBITDA expenses were $298.9 million, up 9.1% year over year, reflecting higher compensation and benefits costs due to higher headcount, as well as elevated severance costs.

Total operating expenses increased 6.9% on a year-over-year basis to $345.7 million due to higher compensation costs from a 2.2% increase in headcount.

Operating income improved 11.6% year over year to $447.7 million. The operating margin expanded 100 bps on a year-over-year basis to 56.4%.

MSCI’s Balance Sheet & Cash Flow

Total cash and cash equivalents, as of Sept. 30, 2025, were $400.1 million compared with $347.3 million as of June 30, 2025.

Total debt was $5.6 billion as of Sept. 30, 2025, compared with $4.5 billion as of June 30, 2025. The total debt-to-adjusted EBITDA ratio (based on trailing 12-month-adjusted EBITDA) was 3 times. Management targets total debt to adjusted EBITDA of 3-3.5 times.

As of Sept. 30, 2025, the free cash flow was $423.3 million, up 7.4% year over year from $301.6 million as of June 30, 2025.

As of Oct. 25, 2025, the MSCI board of directors authorized a new $3.0 billion share repurchase program.

The company paid out dividends worth $137.4 million in the third quarter of 2025.

MSCI Maintains 2025 Guidance

For 2025, MSCI expects total operating expenses of $1.415-$1.445 billion. 

Adjusted EBITDA expenses are anticipated to be between $1.230 billion and $1.250 billion.

Interest expenses are expected to be between $205 million and $209 million.

Net cash provided by operating activities and the free cash flow are expected to be $1.54-$1.59 billion and $1.41-$1.47 billion, respectively.

Zacks Rank & Stocks to Consider

MSCI currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the broader Zacks Computer and Technology sector are Alkami Technology ALKT, AMETEK AME, and Advanced Energy AEIS. While Alkami Technology sports a Zacks Rank #1 (Strong Buy), AMETEK and Advanced Energy carry a Zacks Rank #2 (Buy) each at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

Alkami Technology is set to report third-quarter 2025 results on Oct. 30. Alkami Technology shares have lost 35.2% year to date.

AMETEK is slated to report third-quarter 2025 results on Oct. 30. AMETEK shares have gained 2.5% year to date.

Advanced Energy is set to report third-quarter 2025 results on Nov. 4. Advanced Energy shares have surged 75.2% year to date.

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