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MSCI Inc. (NYSE: MSCI) reported financial results for the three months ended March 31, 2026, its first quarter of 2026.
Henry A. Fernandez, Chairman and CEO of MSCI, said the company delivered “strong financial and operating metrics,” including a record asset-based-fee run rate and its best Q1 of recurring net-new subscription sales since 2022. He also cited record levels of Q1 recurring sales in both Index and Analytics, along with the best-ever Q1 recurring net-new sales with hedge funds and with banks and broker-dealers.
Fernandez added that sales momentum is occurring across regions, product lines, client segments and asset classes, and that MSCI is building on this through “AI-fueled product innovation.”
Operating revenues were $850.8 million, up 14.1%, with organic operating revenue growth of 13.3%. The company said the $105.0 million increase reflected a $47.6 million rise in recurring subscription revenues and a $47.1 million increase in asset-based fees, along with a $10.3 million increase in non-recurring revenues.
Operating income was $456.9 million, up 21.2%. The operating income margin was 53.7% in the first quarter 2026, compared with 50.6% in the first quarter 2025.
Adjusted EBITDA was $504.7 million, up 18.6%. Adjusted EBITDA margin was 59.3%, compared with 57.1% in the first quarter 2025.
Total run rate at March 31, 2026 was $3,357.3 million, up 12.7%. Recurring subscription run rate increased by $203.3 million and asset-based fees run rate increased by $174.8 million. Organic recurring subscription run rate growth was 8.2%. Retention rate was 95.4% in the first quarter 2026, compared with 95.3% in the first quarter 2025.
Total operating expenses were $393.9 million, up 6.8%. Adjusted EBITDA expenses were $346.1 million, up 8.1%, primarily reflecting higher compensation and benefits costs due to increased headcount, as well as higher professional fees, market data costs and information technology costs.
Other expense (income), net was $67.7 million, up 47.5%, primarily driven by higher interest expense resulting from higher debt levels.
The effective tax rate decreased to (4.3)% in the first quarter 2026 from 12.8% in the first quarter 2025. MSCI said a multi-phase internal legal entity restructuring began in the fourth quarter 2025, and that completion of a subsequent phase in the first quarter 2026 led to an $88 million discrete tax benefit.
Net income was $406.0 million, up 40.7%.
As of March 31, 2026, MSCI had 6,319 employees, up 2.2% year over year, with 29% located in developed market locations and 71% in emerging market locations.
Cash and cash equivalents were $385.3 million as of March 31, 2026. Total debt outstanding was $6.5 billion. MSCI reported a trailing twelve months debt to net income ratio of 4.9x and a trailing twelve months debt to adjusted EBITDA ratio of 3.2x. The company targets a debt to adjusted EBITDA range of 3.0x to 3.5x.
Capex was $28.8 million. Net cash provided by operating activities increased by 1.7% to $306.8 million. Free cash flow for the first quarter 2026 was $278.0 million, up 3.4% year over year.
Weighted average diluted shares outstanding were 73.4 million in the first quarter 2026, down 5.7% year over year. Total shares outstanding as of March 31, 2026 were 72.9 million. As of April 20, 2026, approximately $1.7 billion remained available under the outstanding share repurchase authorization.
MSCI paid approximately $150.1 million in dividends in the first quarter 2026. On April 20, 2026, the company declared a cash dividend of $2.05 per share for second quarter 2026, payable on May 29, 2026 to shareholders of record as of May 15, 2026.
MSCI’s guidance for the year ending December 31, 2026 is based on macroeconomic factors and capital markets assumptions, which the company said are subject to uncertainty.
MSCI’s senior management will review the first quarter 2026 results on Tuesday, April 21, 2026 at 11:00 AM Eastern Time.
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