Moody’s Corporation (NYSE:MCO) Q1 2024 Earnings Call Transcript

It’s all of the people and PEP information. It’s the AI-curated news. That supports what you would think of as traditional KYC. And then people want to understand, okay, well, I need to have that information about my suppliers plus other information. And so, the demand for what you would think of as KYC solutions just continues to broaden out, and we’re selling into that. And that’s one of the areas of investment for us, Shlomo. We talked about really wanting to serve corporates because historically, this has been serving financial institutions. But this theme of know who you’re doing business with is a big theme with large corporations, and we have some fantastic customer wins that really validate our right to win in that space. The other thing, I may have mentioned this on some prior calls is, especially in the back half of last year, we had a lot of product innovation going on in that space.

You may have even seen like some articles about Moody’s and the number of shell companies that we had identified around the world that got a lot of press. Well, that shell company indicators is one of the products we created. We also have something called an entity verification API that pulls together a bunch of our different data sets and allows our customers to do real-time checks. So, product innovation, broadening of demand, all of that together, Shlomo, is continuing to drive some very strong growth, I think, for the foreseeable future.

Shlomo Rosenbaum: Should we see the ARR kind of ticking up a little bit? Where we’re seeing the revenue ticking up, should we see ARR ticking up as well? I know it’s pretty healthy as it is, but revenue is moving ahead.

Rob Fauber: Yes. I mean we don’t guide on that, but I think…

Noemie Heuland: I’d really look at the ARR as the best indicator of the underlying trends in that business, as with every other line, by the way. I think that’s the best way to look at it.

Rob Fauber: I’d say, Shlomo, we’ve gotten positive momentum there in the ARR, I believe.

Operator: And that does conclude the Q&A session. I’ll turn the conference back over to Rob for any closing remarks.

Rob Fauber: All right. Well, thank you, everybody, for your questions. And I appreciate you joining the call, and we’ll talk to you next quarter. Have a great day.

Noemie Heuland: Thank you.

Operator: And this concludes Moody’s Corporation first quarter 2024 earnings call. As a reminder, immediately following this call, the Company will post the MIS revenue breakdown under the Investor Resources section of the Moody’s IR homepage. Additionally, a replay will be made available after the call on the Moody’s IR website. Thank you.