Strong quarterly results overshadowed by higher cost outlook
MSCI Inc. (NYSE:MSCI) reported better-than-expected second-quarter results on Tuesday, although shares fell 5.8% in pre-market trading as investors reacted to higher expense guidance for the remainder of the year.
For the quarter ended 30 June 2026, the financial data and index provider posted adjusted earnings per share of $4.94, ahead of the $4.90 consensus forecast. Revenue increased 12.2% year over year to $867.0 million, exceeding analyst expectations of $864.08 million.
Expense guidance raised following acquisitions
MSCI increased its full-year adjusted EBITDA expense guidance to between $1.34 billion and $1.37 billion, up from its previous range of $1.305 billion to $1.335 billion.
The company said the higher outlook reflects the impact of recent acquisitions, including First Street, as well as increased incentive compensation linked to stronger operating performance.
“In the second quarter MSCI delivered strong financial results along with a record asset-based-fee run rate and accelerated run-rate growth in Index and Private Capital Solutions,” said Henry A. Fernandez, Chairman and CEO.
Operating income rose 14.6% to $487.5 million, while adjusted EBITDA increased 13.5% to $538.5 million. The adjusted EBITDA margin improved to 62.1%, compared with 61.4% in the same period last year.
Index business continues to fuel growth
The company’s Index segment remained its strongest performer during the quarter.
Revenue from the division climbed 17.5% to $511.0 million, supported by a 26.6% increase in asset-based fees to $233.1 million and an 11.6% rise in recurring subscription revenue.
Assets under management in exchange-traded funds linked to MSCI equity indexes reached $2.82 trillion at the end of the quarter, up from $2.03 trillion a year earlier.
Meanwhile, Analytics revenue increased 6.6% to $189.4 million, although adjusted EBITDA for the segment declined 5.0% as operating expenses increased.
Retention improves as shareholder returns continue
MSCI reported a client retention rate of 95.3%, improving from 94.4% in the prior-year quarter.
The company also repurchased $145.0 million of its shares during the period and declared a third-quarter dividend of $2.05 per share.
MSCI stock price
