S&P Global Q1 2025 Earnings Report

S&P Global EPS Results

• Actual EPS: $4.37
• Consensus EPS: $4.23
• Beat/Miss: Beat by +$0.14
• One Year Ago EPS: $4.01

S&P Global Revenue Results

• Actual Revenue: $3.78 billion
• Expected Revenue: $3.72 billion
• Beat/Miss: Beat by +$53.81 million
• YoY Revenue Growth: +8.20%

S&P Global Announcement Details

• Quarter: Q1 2025
• Date: 4/29/2025
• Time: Before Market Opens
• Conference Call Date: Tuesday, April 29, 2025
• Conference Call Time: 8:30AM ET

S&P Global (NYSE:SPGI), Inc. engages in the provision of transparent and independent ratings, benchmarks, analytics, and data to the capital and commodity markets worldwide. It operates through the following segments: Market Intelligence, Ratings, Commodity Insights, Mobility, Indices, and Engineering Solutions. The Market Intelligence segment provides multi-asset-class data and analytics integrated with purpose-built workflow solutions. The Ratings segment is involved in credit ratings, research, and analytics, offering investors and other market participants information, ratings, and benchmarks. The Commodity Insights segment focuses on information and benchmark prices for the commodity and energy markets. The Mobility segment offers solutions serving the full automotive value chain including vehicle manufacturers, automotive suppliers, mobility service providers, retailers, consumers, and finance and insurance companies. The Engineering Solutions segment engages in advanced knowledge discovery technologies, research tools, and software-based engineering decision engines to advance innovation, maximize productivity, improve quality, and reduce risk. The company was founded by James H. McGraw and John A. Hill in 1917 and is headquartered in New York, NY.

S&P Global Q1 2025 Earnings Call Transcript

Key Takeaways

• S&P Global delivered 8% total revenue growth year-over-year in Q1 with 240 basis points of trailing-12-month margin expansion and 9% adjusted diluted EPS growth.
• The company announced a definitive agreement to divest the Ostrich joint venture to KKR and intends to spin off its Mobility division into a standalone, tax-free public company over the next 12–18 months.
• Platform engagement surged with a 23% year-over-year increase in active users across Capital IQ, Platts Connect and Automotive Mastermind, and record attendance at CERAWeek and TPM conferences drove strong commodity insights and trading services results.
• Full-year guidance was updated to reflect moderating build issuance and equity markets, with revenue growth now expected at 4–6%, adjusted operating margins of 48.5–49.5%, and adjusted EPS of $16.75–$17.25.
• Innovation milestones include integrating Visible Alpha into Capital IQ a quarter ahead of schedule and launching an AI-powered iLevel automated data ingestion tool, while revenue synergies from the IHS Markit merger are now at a $311 million run rate.

Presentation

[Operator]

Good morning, and welcome to S and P Global's First Quarter twenty twenty five Earnings Conference Call. I'd like to inform you that this call is being recorded for broadcast. All participants will be in a listen only mode. We will open the conference for questions and answers after the presentation and instructions will follow at that time. To access the webcast and slides, go to investor.spglobal.com.

[Operator]

I would now like to introduce Mr. Mark Grant, Senior Vice President of Investor Relations for S and P Global. Sir, you may begin.

[Mark Grant, Senior Vice President, Investor Relations at S&P Global]

Good morning, and thank you for joining today's S and P Global First Quarter twenty twenty five Earnings Call. Presenting on today's call are Martina Chung, President and Chief Executive Officer and Eric Abouaf, Chief Financial Officer. We issued a press release with our results earlier today. In addition, we have posted a supplemental slide deck with additional information on our results and guidance. If you need a copy of the release and financial schedules or the supplemental deck, they can be downloaded at investor.spglobal.com.

[Mark Grant, Senior Vice President, Investor Relations at S&P Global]

We also issued a release announcing the company's intent to separate its Mobility division into a stand alone public company. That release can also be found at investor.spglobal.com. The matters discussed in today's conference call may contain forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including projections, estimates and descriptions of future events. Any such statements are based on current expectations and current economic conditions and are subject to risks and uncertainties that may cause actual results to differ materially from results anticipated in these forward looking statements. Additional information concerning these risks and uncertainties can be found in our Forms 10 ks and 10 Q filed with the U.

[Mark Grant, Senior Vice President, Investor Relations at S&P Global]

S. Securities and Exchange Commission. In today's earnings release and during the conference call, we're providing non GAAP adjusted financial information. This information is provided to enable investors to make meaningful comparisons of the company's operating performance between periods and to view the company's business from the same perspective as management. The earnings release contains financial measures calculated in accordance with GAAP that correspond to the non GAAP measures we're providing.

[Mark Grant, Senior Vice President, Investor Relations at S&P Global]

And the press release and the supplemental deck contain reconciliations of such GAAP and non GAAP measures. The financial metrics we'll be discussing today refer to non GAAP adjusted metrics unless explicitly noted otherwise. I would also like to call your attention to certain European regulations. Any investor who has or expects to obtain ownership of 5% or more of S and P Global should contact Investor Relations to better understand the potential impact of this legislation on the investor and the company. We are aware that we have some media representatives with us on the call.

[Mark Grant, Senior Vice President, Investor Relations at S&P Global]

However, this call is intended for investors and we would ask that questions from the media be directed to our media relations team whose contact information can be found in the press release. At this time, I would like to turn the call over to Martina Chung. Martina?

[Martina Cheung, Director, President & CEO at S&P Global]

Thank you, Mark. S and P Global had a solid first quarter with strong growth in all five of our divisions. Total revenue increased 8% year over year and revenue from our subscription products increased 7%. We continue to demonstrate disciplined execution driving year over year margin expansion of two forty basis points on a trailing twelve month basis and 9% growth in adjusted diluted EPS. We also continued our strong track record of capital allocation returning over $900,000,000 to shareholders in the first quarter through dividends and repurchases.

[Martina Cheung, Director, President & CEO at S&P Global]

In addition to our strong financial results, we are acting decisively in our portfolio optimization efforts. As you saw us announce earlier this month, we have signed a definitive agreement to divest the Ostrich joint venture to KKR, which we expect to close in the second half of this year. As we'll discuss in more detail shortly, we have also announced the intent to separate the Mobility division of S and P Global into a standalone public company. We expect this separation to be tax free and to be completed in twelve to eighteen months. We continue to innovate not just in our products themselves, but in how we bring those products to market and how we engage with our customers.

[Martina Cheung, Director, President & CEO at S&P Global]

We're encouraged by the early indications from our Chief Client Office as well as the continued momentum of new products and services introduced in the first quarter. Lastly, we plan to host an Investor Day in November. By November, we expect to have made significant progress on the planned separation of Mobility and we look forward to providing a refreshed view of the multiyear strategy for F and P Global at that time. Now turning to what we're seeing in the markets and starting with build issuance. Build issuance increased 9% year over year in the first quarter.

[Martina Cheung, Director, President & CEO at S&P Global]

Strength in build issuance was driven by structured finance and bank loans. While we've continued to see spreads widen year to date, they are still below historical norms and issuers saw an attractive window to issue debt in the first quarter. We expect those issuance to moderate from Q1 levels for the remainder of 2025 and we have already seen declines in April. We believe some of the strength in Q1, particularly in investment grade was driven by the pull forward of some issuance to get ahead of April. We expect the tariff discussion and related market volatility is likely leading to some pushback of issuance as well both of which put pressure on issuance volumes in the near term.

[Martina Cheung, Director, President & CEO at S&P Global]

As we look at the broader macro and commercial conditions, it's clear that we are going through a phase of unpredictable market movement, geopolitical risk and fluidity in the regulatory landscape. It is also clear to us at S and P Global that our customers need us more in times like these, not less. In the first quarter, we saw a significant increase in engagement with our platforms. Active users across Capital IQ platforms, Platts Connect and Automotive Mastermind increased on average 23% year over year in the first quarter and we have continued to see strong engagement through April. Our customers are looking for insights, data and tools to help them navigate and S and P Global is a destination of choice for decision makers around the world.

[Martina Cheung, Director, President & CEO at S&P Global]

We also saw record attendance at two of our marquee conferences in the first quarter. CERAWeek, widely considered the world's preeminent energy conference, had over 10,000 attendees including government officials and 1,600 C suite executives and board directors. For over forty years, the energy industry has gathered at CERoweek to confront some of the biggest challenges facing the world. This year was particularly impactful as we saw business leaders and government officials take advantage of our platform to make major product strategy and policy announcements from the CERAWeek stage. We also had record attendance at our premier shipping and logistics conference, TPM twenty five.

[Martina Cheung, Director, President & CEO at S&P Global]

More than ever, customers need insight into how to effectively manage logistics and supply chains, and it was encouraging to see so many industry leaders gather under the F and P Global banner to share ideas and insights on navigating the current environment. We know it's not enough to wait for our customers to come to us, so we have continued our proactive outreach to customers through our global commercial teams in conjunction with the Chief Client Office. Like many of the individuals on this call, our customers are facing variables that are increasingly difficult to predict week to week. We are seeing a slowing pace of decision making in the markets compared to our initial expectations. While we and many others expected some improvement in the M and A environment, many of our customers are less confident in both the timing and the magnitude of that recovery this year.

[Martina Cheung, Director, President & CEO at S&P Global]

We consistently hear about the pent up demand and we maintain strong optimism in the long term, but many customers are trying to stay flexible and preserve optionality in the very near term. We benefit however from the resilience of our business mix With recurring revenue accounting for approximately 75% of our total revenue, we aren't overly reliant on market driven factors for our results in any given year. Market volatility can also benefit areas of our business as you can see in the results of our ETD business and indices and the Global Trading Services business and commodity insights. These derivative products built on the IP of S and P Global's index and commodity divisions are crucial to procurement, hedging and other strategies that see heightened demand in periods of volatility. Many of our products are mission critical for our customers with annual and multi year contracts providing additional stability for our business through the cycle.

[Martina Cheung, Director, President & CEO at S&P Global]

Even within our Ratings business, nearly half of our revenue comes from non transaction revenue, which is more stable, predictable and consistent in its growth during volatile periods. Despite the near term headwinds facing issuance, we expect continued growth in our non transaction business in 2025. That said, there are a number of market factors that can have incremental impact on our business in the near term. And it's important to pay close attention to how these factors are evolving over the year. Even with a very strong portfolio of market leading products and services, we acknowledge the broad market factors like trade conflict and supply chain risk as well as the evolving geopolitical landscape.

[Martina Cheung, Director, President & CEO at S&P Global]

These things make it more challenging to foresee our plan for Central Bank actions or the level of capital markets activity that may take place in 2025. As we look to the global markets, we continue to see secular trends that would benefit S and P Global, like the continued shift from active to passive management and energy transition. For 2025 specifically, we expect asset prices in the equity markets as well as the mix of investment grade versus high yield in the near term maturity walls to be modest headwinds relative to our initial outlook. However, we continue to see other factors like the timing of issuance, market volatility and the fluidity of regulatory actions as having positive impacts on part of our business and modestly negative impacts on others. The base case assumptions underpinning our outlook for 2025 reflect the changes we've seen in the environment since February.

[Martina Cheung, Director, President & CEO at S&P Global]

We originally assumed 3% global GDP growth and 2.3% U. S. Inflation. Our current view is that GDP growth will be lower than that forecast, though we do not assume a recession. We also expect inflation to be a bit higher than originally assumed in our guidance.

[Martina Cheung, Director, President & CEO at S&P Global]

We expect crude oil prices to average in the low 70s for the year, slightly above the levels we're seeing now, though we do expect volatility in the coming quarters. We've had a strong start to the year for build issuance. But since the end of Q1, we have seen market volatility suppressing volumes, particularly in high yield, and we expect second quarter issuance to decline double digits year over year before returning to more or less flat growth in the second half. As such, we now expect build issuance to be approximately flat year over year compared to our initial outlook of low single digit growth. Maturity walls for the remainder of 2025 and 2026 are still 3% to 5% higher than corresponding walls were a year ago, but our build issuance assumptions now call for M and A volumes to be flat year over year compared to prior assumptions of modest improvements from 2024.

[Martina Cheung, Director, President & CEO at S&P Global]

We still see potential for one or more rate cuts from the U. S. Fed in 2025. As we highlighted last quarter, there is a range of potential outcomes beyond our base case assumptions, but we continue to reflect our current thinking and plan to update and refine as we move through the year. All these things are factored into the guidance as Eric will share with you in a moment.

[Martina Cheung, Director, President & CEO at S&P Global]

One of the reasons S and P Global is able to deliver strong financial results through the cycle is our commitment to continued innovation and customer value. The first quarter included some important innovations in data benchmarks and artificial intelligence. We integrated Visible Alpha data as an add on module in Capital IQ Pro and we were thrilled that the team was able to get this important integration completed and ready for customers a full quarter ahead of schedule. We are also very excited to discuss the launch of iLevel automated data ingestion. This joint innovation between our Market Intelligence and Kensho teams created an AI powered tool that can pull in data from structured and unstructured sources, tag that data appropriately and load us into iLevel.

[Martina Cheung, Director, President & CEO at S&P Global]

This makes it faster and easier for customers to manage increasingly complex portfolios across private equity and private credit. Just as importantly, this tool was developed in a way that lets us leverage its capabilities in other products and even in our own internal workflows like our CRM. It's a great example of our cross divisional teams creating scalable technology that's built once and deployed everywhere. We also introduced important benchmarks in our fixed income indices franchise, including a first of its kind fixed income index in Europe, utilizing rolling fixed maturity credits. In Platts, we introduced new commodity benchmarks in biofuels, fertilizers, chemicals and metals.

[Martina Cheung, Director, President & CEO at S&P Global]

We encourage you to look through the quarterly release notes to see the continued rapid pace of new products and content in commodity insights. Turning to our financial results. Eric will walk through the first quarter results in more detail in a moment, but we have had an impressive start to 2025. We saw strong growth in every division and 100 basis points of margin expansion in the quarter. Trailing twelve month margins improved two forty basis points to a record 49.3%.

[Martina Cheung, Director, President & CEO at S&P Global]

Now turning to the big announcement we made this morning. We're excited to announce today our intent to spin S and P Global's Mobility division into a stand alone public company. We believe this separation will maximize shareholder value by enhancing S and P Global's strategic focus while creating a scaled and independent mobility business. This decision is the result of a lengthy and very robust internal analysis and the Board and management team are unanimously aligned that this is the right course of action to create value for our shareholders. Looking at the financials of both S and P Global's core businesses and S and P Global Mobility, we see that both have very attractive profiles.

[Martina Cheung, Director, President & CEO at S&P Global]

S and P Global's four core businesses, Market Intelligence, Ratings, Commodity Insights and S and P Dow Jones Indices generated nearly $13,000,000,000 in revenue in 2024 at an adjusted operating margin of approximately 50%. Mobility generated $1,600,000,000 at an adjusted operating margin of nearly 40%. Both businesses have a history of innovation, growth, discipline and strong competitive positioning and we expect that to continue following the separation. We believe the separation will create some significant advantages for S and P logo going forward. Our four core divisions have similar characteristics, similar customer profiles and greater ability to share technological and data resources across them.

[Martina Cheung, Director, President & CEO at S&P Global]

Our leadership team will be better able to focus attention, energy and resources to accelerate product development and deepen customer relationships while executing against a more unified and cohesive strategy. We're excited to share more about that multiyear strategy at our Investor Day, which we plan to host in New York on November 13. As a standalone public company, we believe the Mobility business will also be better able to execute its long term growth strategy independent of the priorities of S and P Global. Mobility will be a well capitalized company with strong well known brands like CARFAX, Automotive Mastermind, MarketScan and Polk. As our analysts and shareholders know, Mobility has incredible data and technology assets, creating significant customer value for dealerships, automotive OEMs and parts suppliers as well as finance and insurance companies.

[Martina Cheung, Director, President & CEO at S&P Global]

We've seen significant growth in the users of Carfax Car Care, now serving over 46,000,000 consumers, leveraging more than 35,000,000,000 vehicle history records. The vehicle history, forecasting, pricing and incentive data of the mobility business serve 100% of the top automotive OEMs, 94% of the supplier markets and includes approximately 72,000,000 lines of monthly forecast. This data and technology is deeply entrenched in the workflows of mobility customers, creating a very strong competitive moat and positioning the business well for profitable long term growth. We are particularly encouraged by the resilience this business has demonstrated through the cycle. We acknowledge the additional attention to the automotive space during these times of trade conflict and supply chain disruption, but we remain very confident in the long term growth of the mobility business.

[Martina Cheung, Director, President & CEO at S&P Global]

The secular trends around EV transition, autonomous and software defined vehicles, shifts in the sales motion of new vehicles and continued growth in the used car market, all have the potential to increase the demand and addressable market of this business. With more than 70% of mobility revenue tied to the used car market and more than 80% of revenue coming from subscription products, we remain confident that despite some of the end market challenges among automotive manufacturers, the mobility business is largely insulated from direct impact. We expect both companies to be well capitalized and we will provide the details around capital structure and capital allocation as the transaction progresses. We expect the transaction to qualify as tax free to shareholders for U. S.

[Martina Cheung, Director, President & CEO at S&P Global]

Federal tax purposes. We anticipate the process taking between twelve and eighteen months and will be subject to market conditions and the satisfaction of customary regulatory approvals. We are committed to keeping investors up to date as we move through this process and investors can expect a number of milestones over the next twelve to eighteen months. With that, I'll turn the call over to Eric Abouaf, our new CFO, to review the financial results. Eric, welcome to the call.

[Martina Cheung, Director, President & CEO at S&P Global]

Over to you.

[Eric Aboaf, CFO & EVP at S&P Global]

Thank you, Martina, and good morning, everyone. I'm delighted to be joining for my very first earnings call here at S and P Global and especially pleased to be able to talk through such strong results this quarter. Starting with Slide 18, you'll see on the left panel that we delivered a very strong start to 2025 with solid growth in every division and 9% organic constant currency revenue growth for the company. Revenue growth of 8% and expense growth of 6% allowed us to deliver 100 basis points of margin expansion year over year and 9% in adjusted diluted EPS growth. As Martina mentioned earlier, we continue to engage proactively with customers across the board this quarter while maintaining strict discipline on expenses.

[Eric Aboaf, CFO & EVP at S&P Global]

That focus and execution helped us to deliver a strong first quarter and also positions us well to deliver strong results for the rest of 2025. Slide 19 illustrates the progress we continue to make in key strategic growth areas. Sustainability and Energy Transition revenue grew 20% to $93,000,000 in the quarter, driven by strong demand for Commodity Insights Energy Transition products and data and insights from Market Intelligence. We continue to see very strong demand for our sustainability offerings in all divisions and saw a number of competitive wins in the quarter, especially around our physical risk solutions. Moving to Private Markets.

[Eric Aboaf, CFO & EVP at S&P Global]

Revenue increased by 21% year over year to $140,000,000 Growth was driven by debt and bank loan ratings as well as continued strength in iLevel and other private market solutions within Market Intelligence. Private credit continues to be a significant driver of growth for us, and we continue to see strong demand for an S and P Global rating on debt, whether it is issued in the public or the private markets. We are also nearing the finish line on our revenue synergies. We exited the first quarter with run rate revenue synergies of $311,000,000 and remain ahead of pace to achieve our target of $350,000,000 by 2026. Finally, we are pleased that we continue to deliver the Vitality Index at or above our 10% target.

[Eric Aboaf, CFO & EVP at S&P Global]

In the first quarter, we saw contributions from new and enhanced products in every division and are pleased to see the financial impact of the product investments we've made in recent years. Turning to our divisions. Market Intelligence revenue increased 5% in the first quarter with the net impact of acquisitions and divestitures creating a roughly 30 basis point headwind to growth. Revenue from our data analytics and insights products accelerated on both the reported and an organic basis in the first quarter to 74% year over year respectively. First quarter revenue in the business line includes contribution from Vivobyl Alpha less the lost revenue from the PrimeOne divestiture.

[Eric Aboaf, CFO & EVP at S&P Global]

Enterprise Solutions benefited from an increase in issuance volumes in the debt and equity capital markets as well as strong growth in subscription products. Reported revenue growth of 1% includes the impact of $21,000,000 in FinCentric revenue in the year ago period. Excluding that impact, organic growth was 8% year over year. Credit and Risk Solutions grew 6%, supported by strong new sales and price realization, particularly for Ratings Express subscriptions. Consistent with the commentary we made during our last call, margins were below the full year guidance range in the first quarter, but actually came in slightly better than we initially expected based on some tight expense controls we put in place at the start of the year.

[Eric Aboaf, CFO & EVP at S&P Global]

Margins of 32.8% improved slightly year over year. We expect some modest improvement in the quarterly revenue growth rates in 2025 as we progress through the year. We see strong growth in the sales pipeline and stable renewal rates, and we expect both of those dynamics to continue as we lap more of the cancellations from 2024. We're also encouraged by the continued momentum we're seeing in our competitive win rates in Market Intelligence as our enterprise approach continues to resonate with more and more customers. Now turning to ratings on Slide 21.

[Eric Aboaf, CFO & EVP at S&P Global]

As Martina mentioned earlier, we saw issuers take advantage of favorable financing conditions and open market windows to drive growth in issuance volumes in the first quarter. Q1 was actually the fifth consecutive quarter of more than $1,000,000,000 in revenue for our Ratings division. Ratings revenue increased 8% year over year as we saw positive growth across all revenue categories. Transaction revenue grew by 7% in the first quarter as heightened refinancing activity increased bank loan and structured finance fees. Non transaction revenue increased 10%, primarily due to an increase in annual fee revenue and elevated issuer credit rating or ICR revenue.

[Eric Aboaf, CFO & EVP at S&P Global]

Importantly, much of our growth in ICR came from private market mandates as more and more participants in the private markets are looking to capture the value that comes from an S and P Global rating. Given the pullback we've seen in April issuance volumes, we do expect build issuance to be down low double digits in the second quarter and flattish in the second half. This will primarily impact the cadence of transaction revenue, while non transaction revenue continues to grow at a healthy pace each quarter. As Martino mentioned earlier, we benefit from the strong base of non transaction revenue in our Ratings business, and we expect non transaction revenue to grow faster than transaction revenue in a year like 2025. That provides some additional stability to our ratings business through the cycle.

[Eric Aboaf, CFO & EVP at S&P Global]

Adjusted expenses increased only 4% in the quarter. We continue to actively monitor the issuance environment and manage expense levers in our market driven businesses tightly to preserve margins and ensure we're positioned to deliver against the profitability targets we set out for 2025. Now turning to commodity insights. Revenue increased 9% following the sixth consecutive quarter of double digit growth in Energy and Resource Data and Insight. Price assessments and data and insights grew 810% respectively.

[Eric Aboaf, CFO & EVP at S&P Global]

We continue to see commercial momentum as we transition more customers to enterprise contract relationships. We are approximately one quarter of the way through the eligible customer base in that transition and expect to be nearly halfway through by year end. Advisory and transactional services revenue grew 19%. As Martina noted earlier, times of volatility and uncertainty drive increased demand for a number of our products, and we saw this positive impact in the first quarter. We had a record quarter in Global Trading Services and record attendance at CERAWeek, both of which contributed to the outsized growth we saw here too.

[Eric Aboaf, CFO & EVP at S&P Global]

Upstream data and insights revenue grew by 1% year over year, with growth tempered by somewhat elevated cancellations due to the customer consolidation we've seen in the energy space. We expect that consolidation to impact Upstream a bit more in the remaining quarters of 2025. Adjusted expenses increased 8% due to higher compensation costs and ongoing investment in growth initiatives. Operating profit for commodity insights increased 11% and operating margin improved by 90 basis points to 48.1%. Now turning to Mobility.

[Eric Aboaf, CFO & EVP at S&P Global]

Revenue increased 9% year over year, though this includes a roughly 70 basis point headwind from currency impacts largely due to exposure to the Canadian dollar. Dealer revenue increased 11% year over year driven by new business growth in products such as CARFAX and Automotive Mastermind. Dealer revenue benefits from its higher exposure to the used car market, which is generally more resilient for the cycle than the new car market. Manufacturing increased 1% with growth impacted by the decline in the transaction revenue related to the recall business. As a reminder, we began calling out the impact of the decline in recalls earlier last year and will lap that impact beginning in the second quarter.

[Eric Aboaf, CFO & EVP at S&P Global]

Financials and other increased 11% as the business line continues to benefit from strong underwriting volumes and commercial momentum. Adjusted expenses increased 8% due primarily to the increased advertising and promotional investment. That investment has helped drive significant growth in CARFAX Car Care, which now has approximately 46,000,000 users, a nearly 65% increase since our Investor Day in 2022. Margins for the segment improved 40 basis points year over year to 38.5. Now turning to S and P Dow Jones Indices.

[Eric Aboaf, CFO & EVP at S&P Global]

Revenue increased 15%, primarily due to strong growth in asset linked fees, which benefited from higher AUM and continued strength in exchange traded derivative revenue. Revenue associated with asset linked fees was up a strong 18% in the first quarter. This was driven by higher ETF and mutual fund AUMs, benefiting from both market appreciation and net inflows. As a reminder, there is a slight delay in revenue recognition in our asset linked fees, which allows us to continue benefiting from higher equity valuations we saw during the fourth quarter of last year. We do expect growth in asset linked fees to moderate in 2Q and beyond, given the declines we've seen in market valuations since we gave our initial guidance.

[Eric Aboaf, CFO & EVP at S&P Global]

Exchange traded derivatives revenue grew 11%, primarily driven by the strong volumes in SPX products and price realization. Data and custom subscriptions increased 7% year over year, driven by new business growth in end of day contracts, which saw mid teens growth in the quarter. Revenue from custom subscriptions, however, somewhat offset the very strong growth in end of day contracts. Adjusted expenses increased 15% year over year, primarily due to increased investments in strategic growth initiatives as well as an increase in compensation expense. Indices operating profit increased 15% and operating margin remained unchanged year over year at a very strong 72.9%.

[Eric Aboaf, CFO & EVP at S&P Global]

Now turning to guidance. Given our new debt issuance expectations and the current equity market levels, Slide 25 outlines our enterprise guidance on a GAAP and adjusted basis. We are now expecting total revenue growth in the range of 4% to 6%, with adjusted margins in the range of 48.5 to 49.5%. We remain confident in our ability to deliver solid revenue growth, strong margins and growth in adjusted EPS this year. As I'll discuss on the next slide, we do expect slightly lower growth in ratings and indices, our two market driven and highest margin businesses, but we plan to manage expenses so that we can preserve margin guidance in all five divisions this year.

[Eric Aboaf, CFO & EVP at S&P Global]

However, due to the planned closing of the Austro sale later this year, we will see slightly lower operating income with no corresponding revenue impact, which will directly impact margins for the year. The Austria impact and the mix shift in revenue are the primary drivers for the change to our enterprise margin guidance. We expect to use the proceeds from Alstro for additional share repurchases, which will offset much of the EPS impact. And our discipline on both expenses and strong capital returns allows us to keep the high end of our EPS guidance intact. Given the market volatility and variability in our market driven businesses, we think it's prudent to widen the range a bit and now expect adjusted diluted EPS in the range of 16.75 to $17.25 Moving to our division outlook.

[Eric Aboaf, CFO & EVP at S&P Global]

Our revenue guidance for Market Intelligence is unchanged. For ratings, based on the current expectation for flattish build issuance this year, we expect revenue growth to be flat to up 4%, slightly lower but also slightly broader range compared to our previous guidance. Revenue guidance for Commodity Insights and Mobility are also unchanged. For Indices, we've obviously seen the market pullback, particularly in U. S.

[Eric Aboaf, CFO & EVP at S&P Global]

Equities, since we gave our initial guidance. Given that pullback, we now expect revenue growth in the range of 5% to 7%. This guidance assumes the S and P 500 is flat from April 15 through the end of the year, modest growth in ETD volumes and subscription growth similar to what we saw in the first quarter. On the next slide, we are reiterating the margin outlook for all five of our divisions. While we do expect somewhat lower revenue and ratings and indices, we expect to offset that impact with expense discipline and modest adjustments to incentive compensation.

[Eric Aboaf, CFO & EVP at S&P Global]

We have multiple levers that we can pull as needed this year, and we've proactively identified and prioritized those. We want to make sure we are prudent and don't pull them too early or too aggressively though and preserve our ability to invest in the important revenue growth opportunities we see over the next few years. With that, I'll turn the call back over to Mark for your questions.

[Mark Grant, Senior Vice President, Investor Relations at S&P Global]

Thank you, Eric. Our

[Operator]

first question comes from Ms. Toni Kaplan of Morgan Stanley. Your line is open.

[Toni Kaplan, Executive Director, Senior Equity Research Analyst at Morgan Stanley]

Thanks so much. Congratulations on the mobility announcement. I was hoping you could just give some color on timing. So why now? And then maybe the implications for RemainCo, are there any data sets that you'll continue to try to license from the spun entity once that happens?

[Toni Kaplan, Executive Director, Senior Equity Research Analyst at Morgan Stanley]

And then I know it's early, but any initial thoughts on dis synergies? Thanks.

[Martina Cheung, Director, President & CEO at S&P Global]

Hi, Toni. It's Martina. Thanks for the question. Well, as I mentioned during the prepared remarks, this is something that we have been thinking about very deeply for some time. We've done an incredibly deep and rigorous assessment, including multiple rounds of dialogue around around this with our board of directors and consulting with external, advisers on this also.

[Martina Cheung, Director, President & CEO at S&P Global]

So, we've come to the conclusion that this is the best path to long term shareholder value and that the tax free spin here is the right path forward for us. I would say we certainly would have more details with respect to datasets that we would license. At this point, we're very much in the mode of business as usual and continuing to focus while the process is running in the background.

[Eric Aboaf, CFO & EVP at S&P Global]

And, Tony, it's it's Eric. We've obviously done an initial initial look at the at the financials. As you can expect, the carve out process has begun and is fairly intense. You know, high level view of dis synergies, stranded costs, so forth suggests that they're relatively material to our overall financials. But those are the kinds of topics we'll update you on as we move along later this summer, this fall and into next spring.

[Martina Cheung, Director, President & CEO at S&P Global]

Thanks, Tony.

[Operator]

The next question will come from Faiza Alwy of Deutsche Bank. Your line is open.

[Faiza Alwy, Managing Director, US Company Research at Deutsche Bank]

Yes. Hi. Thank you so much. I wanted to ask about Market Intelligence and your confidence and the ability to accelerate revenue as we go through the year. Maybe you can comment on what you're hearing from your customers, how bookings have trended and any other color around the end markets?

[Faiza Alwy, Managing Director, US Company Research at Deutsche Bank]

Thank you. Thank you.

[Martina Cheung, Director, President & CEO at S&P Global]

Hi, Faiza. Thanks for the question. We have had a a very good start to the year with market intelligence and, been quite encouraged with, several of the core metrics there, including some of the ones that Eric mentioned.

[Martina Cheung, Director, President & CEO at S&P Global]

We've seen stable retention rates, good sales pipelines, and ACV faster than revenue, which, of course, is a great indicator for the strength of the business going forward. Remember that Eric also mentioned we will be lapping 2024 early year cancels as we go throughout the year. That gives us a lot of confidence in acceleration as we had indicated in our last call for a stronger second half compared to first half of the year. So good indications there. From a customer standpoint, we have made several, I would say, improvements to how the sales teams are aligned to customers, particularly from an account management standpoint.

[Martina Cheung, Director, President & CEO at S&P Global]

That has really helped teams to to have more direct connections and engagement with the customers, and we've been hearing very positive feedback, on that realignment. Also hearing very positive feedback on joint go to market between the market intelligence sales teams and our chief commercial office. And we're starting to see some some great deals there. So we, for example, closed a large counterparty manager deal with a large investment bank. In the quarter, we also closed a large primary markets issue book deal with a commercial bank in the first quarter.

[Martina Cheung, Director, President & CEO at S&P Global]

So all in good momentum, good first quarter and we'll continue moving ahead. Thanks for the question.

[Operator]

The next question will come from Surinder Thind of Jefferies. Your line is open.

[Surinder Thind, Equity Research Analyst at Jefferies Financial Group]

Thank you. Eric, could you maybe talk about the levers as you guys talk about managing expenses and where some of the puts and takes might be in the range of expectations?

[Eric Aboaf, CFO & EVP at S&P Global]

Sure. The the levers here are as you'd expect and then the ones that we've actually, I think, pulled and addressed over the last couple of years during the ups and downs of of the environment, but also the same ones that you'd expect at any well well run company. You know, clearly, headcount and hiring for backfills is a lever that we monitor closely, especially in this environment where there's uncertainty.

[Eric Aboaf, CFO & EVP at S&P Global]

There's incentive compensation, which will float up and down with with revenue and performance. There's third party spend, professional services, obviously, which has a a degree of flexibility. And then finally, is investments. So I think those are the ones that we typically wanna protect except in very extreme circumstances. So, you know, part of what I've done is I've settled in over the last two months is literally spend time division by division, circling those, making sure we're ready, selectively making some some tactical adjustments.

[Eric Aboaf, CFO & EVP at S&P Global]

But that's the those are the areas where we're vigilant. We'll continue to to stay vigilant and disciplined during this environment.

[Martina Cheung, Director, President & CEO at S&P Global]

Thanks, Surinder.

[Operator]

The next question will come from Ashish Sabadra of RBC Capital Markets.

[Ashish Sabadra, Information & Business Services Analyst at RBC Capital Markets]

Thanks for taking my question. On the issuance guidance, thanks for providing that incremental color on M and A assumptions. My question was the flat issuance assumptions for the back half of the year. Does that include any kind of pull forward or what are your assumptions around high yield spreads as well as rate volatility? Thanks.

[Ashish Sabadra, Information & Business Services Analyst at RBC Capital Markets]

Thanks.

[Martina Cheung, Director, President & CEO at S&P Global]

Hi, Ashish. Thanks for the question. Well, as we mentioned, we would expect, our build issuance to be roughly flat for, for the full year. So modestly more cautious than, what we had during our last call. Maybe I can break it down a little bit for you.

[Martina Cheung, Director, President & CEO at S&P Global]

So from a refi standpoint, we still expect the 25 refis to go ahead. We saw a little bit, we think, in in pull forward in investment grades ahead of April. But broadly speaking, we're seeing the 25 refis, you know, come to market as we considered. What we have less expectation of this year is pull forward from 2026 and beyond, especially for high yields who would have less of an incentive to come to market in a volatile environment. On the m and a piece, we did say flat year over year.

[Martina Cheung, Director, President & CEO at S&P Global]

I think it's worth mentioning, we still see potential for some opportunistic issuance, although we've moderated that a little bit in in the full year guide that we've we've provided for build issuance. And I think maybe the the last point I would make on this is, you know, as we know, this is incredibly difficult to to predict at this point. There are risks to the downside and the upside on this. I mean, look, contemplated in our range is, you know, there's a possibility of negative year over year growth, for example, in in transaction revenues. However, there's also risk to the upside.

[Martina Cheung, Director, President & CEO at S&P Global]

We know that there's a lot of pent up demand in m and a. And so we think from a timing standpoint, it's more likely at this point to hit in 2026. But we know issuers are are good at coming to market when they see an opportunity. And so it's possible we could see some of that this year in the second half as well. Thanks for your question, Ashish.

[Operator]

The next question will come from Andrew Steinerman of JPMorgan. Your line is open.

[Andrew Steinerman, Equity Research Analyst - Business & Info Services at JP Morgan]

Two quick ones. One, what's the share count implied in the '25 guide? And did change since February? And secondly, you talk a lot about the strong balance sheet and the share buyback activity. What's the view on S and P's M and A ambitions at this point?

[Eric Aboaf, CFO & EVP at S&P Global]

Andrew, let me take the first part of that question. I think for share count, you just start with the share count as it's disclosed, you know, factor in the buybacks at, you know, reasonable price expectations, and then just calculate that going forward for the quarters and the the rest of the year. And I think you should be able to to get to what you need.

[Martina Cheung, Director, President & CEO at S&P Global]

Great. Hi, Andrew. Regarding your question on m and a ambitions going forward, I'd I'd reiterate a point that I made on the last call, which is we certainly have no intention of any type of transformative m and a as we go forward. We're really focused on what we think are very high quality organic growth opportunities within each of the divisions and across the divisions, and that's that's where we're executing as we go throughout the year. I would say consistent with how we have, you know, how we have taken advantage of certain opportunities in the past.

[Martina Cheung, Director, President & CEO at S&P Global]

If if we see a tuck in that is very attractive for either a core business or very attractive for one of our strategic growth teams, of course, we would consider that. And of course, we always do that through the lens of shareholder value as well as the value we create for our customers. Thanks for the question, Andrew.

[Operator]

The next question will come from Scott Wirtzl of Wolfe Research. Your line is open.

[Scott Wurtzel, SVP - Equity Research at Wolfe Research, LLC]

Hey, good morning guys and thank you for taking my question. I just wanted to touch on the topic of private credit and wondering if you can share how that performed on the rating side relative to expectations during the quarter and maybe talk about what you're assuming in terms of growth contribution from private credit for the balance of the year? Thanks.

[Martina Cheung, Director, President & CEO at S&P Global]

Hi, Scott. It's Martina. Thanks for the question. Well, we continue execute at the highest levels we can and are happy with performance that we've seen in private credit overall across the organization through the really strong products we have in ratings in market intelligence as well as opportunities for our benchmarks in index. Specifically in ratings, we've always said that we would rate the business or the deals wherever they come.

[Martina Cheung, Director, President & CEO at S&P Global]

And we've made very good strides with the majority of the sponsors that we've engaged with. There are a lot of there's a lot of demand, as Eric said in his remarks, for an S and P rating, whether it's public or private. And so that's been, I think, a strong contribution. We've cited the mix there in the past. We've certainly seen some great results in middle market CLOs, for example, in NAVs and and other private credit opportunities.

[Martina Cheung, Director, President & CEO at S&P Global]

I would say for the remainder of the year, given some of the really tough year over year comps as well as a little bit of moderation in the environment around issuance generally, I wouldn't say we have heroic assumptions for growth specifically in private credit for the remainder of this year. Thanks for your question, Scott.

[Operator]

The next question will come from Alex Kramm of UBS. Your line is open.

[Alex Kramm, Managing Director - Equity Research at UBS Group]

Yes. Hey, good morning, everyone. I'm going to have another boring cost question, but it is Eric's first call, so I think it's okay. But it sounds like you mentioned that all the work on the cost base so far has been more as a do we need to pull any sort of levers to show margin expansion, etcetera, if the environment is a little bit tougher. Just wondering how you think about the cost base holistically.

[Alex Kramm, Managing Director - Equity Research at UBS Group]

I know it's only been a couple of months for you, but obviously you come from a lower margin company. And look, I think over if you compare some of the peers, in particular Market Intelligence, the margins don't compare as well anymore for S and P Global. So given that you have a history of cost programs in a couple of years, you did a big transaction a few years ago, just wondering if there's room for maybe a more holistic rebasing of the cost program and where that will come from? Thank you.

[Eric Aboaf, CFO & EVP at S&P Global]

Alex, it's Eric. Thank you for the question. As you say, in every company and this one included, there's typically and I've seen it here already, a recent history, you know, over the last few years, but certainly embedded in our budgets for this year and our guidance for this year to do more than just, you know, ration, you know, headcount up or down. That's that's not what, you know, what we're focused on. That that that we do for you know, to make tactical adjustments during the year.

[Eric Aboaf, CFO & EVP at S&P Global]

I think what I've started to appreciate is that there's a range of initiatives that we've launched over the last year across our various businesses. Some of those, as you know, for example, in MI, we've been removing silos, simplifying operations, consolidating areas of activities. In other areas like commodities insights, we've had a real push on using GenAI for productivity and some of the analytical and research functions. So there's some systemic, efforts underway that I think are, part of what, will help us deliver our, our, expectations and guidance for this year. You know, to the question of, is there more?

[Eric Aboaf, CFO & EVP at S&P Global]

Well, there's there's always more to do and, you know, that's the kind of work that, you know, we start planning on now for next year, and we'll start planning on next year for the year after because it's a, it's a muscle that's, think, developed here, but we can continue to refine it and that's what the, the management team will do together.

[Martina Cheung, Director, President & CEO at S&P Global]

Thanks, Alex.

[Operator]

The next question will come from Manav Patnaik of Barclays. Your line is open.

[Manav Patnaik, Managing Director, Equity Research Analyst at Barclays Investment Bank]

Good morning. Martina, I just wanted to confirm, I mean, it sounds like from everything you're saying, you're not yet seeing any major changes in your customer behavior. So I was just hoping you could just help elaborate on that, maybe focusing more on the MI and subscription businesses really?

[Martina Cheung, Director, President & CEO at S&P Global]

Yes. Thanks, Manav. And that is true when it comes to the subscription businesses. Clearly, in this kind of environment, we've signaled that we see some behavioral changes in ratings, for example, as I mentioned, with some issuers on the sidelines. So we certainly see that downside in the market sensitive areas like ratings and a little bit in index as well.

[Martina Cheung, Director, President & CEO at S&P Global]

I would say that we're really close attention to the subscription businesses and looking very closely at this obviously by sector. The fact that, you know, we have, for the most part, multiyear deals really serves as a ballast in times like this. But, of course, we have to be very strongly engaged with our customers to, get a sense for when there may be more pressures. One of the other things that we've been extremely disciplined about, since, last year is making sure that we're positioned, increasingly to benefit from vendor consolidation opportunities. And we have heard in a couple of, recent, discussions, with large clients that they may be accelerating vendor consolidation.

[Martina Cheung, Director, President & CEO at S&P Global]

And, of course, we're there, through the work that we've been doing as well with the chief client office. And so those are some examples. I would also say that, you know, there there were upside opportunities. We have, as you know, some of the strongest supply chain data around, you know, multiple sectors, regions. We also just simply by virtue of what we do are being used to our data is being used by our clients even more.

[Martina Cheung, Director, President & CEO at S&P Global]

We saw that in the very significant uptick year over year in platform usage, for example, across MI and CI as well as mobility in the first quarter. So overall, we're watching very closely. We don't see massive changes in behavior. We're certainly not hearing that from our customers and engaging very, very strongly to make sure we're positioned for growth opportunities as they arise. Thanks Manav.

[Operator]

The next question will come from George Tong of Goldman Sachs. Your line is open.

[George Tong, Sr. Research Analyst - Equity Research at Goldman Sachs]

Hi, thanks. Good morning. You mentioned you're not seeing any major changes in customer behaviors. Can you talk a little bit more about what you're seeing with pipeline performance and sales cycles?

[Martina Cheung, Director, President & CEO at S&P Global]

Hi, George. It's Martina. We are right now seeing our sales pipelines as expected. And that is one of the things that gives us very good confidence as we think about our subscription businesses throughout the rest of the year. Again, I think the behaviors, as we've engaged more closely with our customers across the divisions, all the way from our division presidents down through the sales teams, to the extent that we're hearing places where customers, you know, maybe feeling, more or less pressure, a lot of times, we are positioned to benefit from better consolidation efforts, for example.

[Martina Cheung, Director, President & CEO at S&P Global]

Definitely something that we're paying very close, very close attention to. And I think what comes in line with this, and I've mentioned it in particular, for example, for MI, but also the other divisions is that we're seeing quite stable renewal performance, particularly in market intelligence where, you know, that is something that we had highlighted as a core objective for this year. And between that and the fact that we'll be lapping some councils for for early twenty four, we see that as good indicators for a strong second half in MI in particular. Thanks for the question, George.

[Operator]

The next question will come from Andrew Nicholas of William Blair. Your line is open.

[Thomas Roesch, Equity Research Associate at William Blair]

Hi, good morning. This is Tom Rush on for Andrew Nicholas. Thanks for taking my question. I was wondering if you could touch on the commodity insights end markets and kind of what you're seeing there. And then also, are you expecting any pressure from tariffs or just trade war in general within that segment on the end markets?

[Thomas Roesch, Equity Research Associate at William Blair]

Thank you.

[Martina Cheung, Director, President & CEO at S&P Global]

Hi, Thomas. It's Martina. Thank you for the question. I think we've seen really strong growth in commodity insights so far this year. We've benefited across businesses as a result of some of unique data that we have.

[Martina Cheung, Director, President & CEO at S&P Global]

We've been able to launch new price assessments in a number of areas like biofuels, ag, etcetera. And we highlighted the particular strength also of the energy transition and sustainability parts of

[Martina Cheung, Director, President & CEO at S&P Global]

that

[Martina Cheung, Director, President & CEO at S&P Global]

business where our growth in CI with the combination of the commodity insights, data, etcetera, with the sustainability data is now beginning to give the team opportunities to launch new innovative products also. One example there is we recently launched a product that integrates our climate risk analytics onto our ag data so that our users can actually understand the impact of extreme weather events on crops, for example. So really unique and differentiated insights, not only in the products that we offer today, but also in what we're rolling out, as we go forward. So, strong performance there, strong engagement with our clients. Clearly, Eric mentioned that there's a little bit of consolidation in upstream.

[Martina Cheung, Director, President & CEO at S&P Global]

That's something that we've contemplated as part of the full year guidance that we're giving. And then I think pressures from tariffs, if I were to take a little bit of a step back on this, I think generally speaking, we certainly would be watching very closely, working closely with our customers. These are the types of these are the types of areas where our customers will actually use the data more. We saw really strong uptick, for example, in usage of PathConnect in Q1. And obviously, we see that upside as well through the GTS revenues, which had very strong results in the first quarter.

[Martina Cheung, Director, President & CEO at S&P Global]

So largely insulated, would say, Thomas, specifically from the direct impacts of the tariffs. But clearly, we're very strongly engaged with our customers to make sure that we don't see anything else that we would need to address going forward. Thanks for the question.

[Operator]

The next question will come from Craig Huber of Huber Research Partners. Please go ahead, sir.

[Craig Huber, Equity Research Analyst at Huber Research Partners]

Thank you. Just want to get back, if I could, on mobility question and the whole why now and stuff. I mean, obviously, the past, you guys have talked about it being a core part of operations. It's done really well underneath S and P. I'm just wondering, again, just if you could just elaborate a little bit further, what's changed here?

[Craig Huber, Equity Research Analyst at Huber Research Partners]

Why you want to spin it off now and I mean, in the past, said it was core, now it's not core. I'm just trying to understand better. Obviously, your stock has moved in line, right in line with the S and P 500 here over the last twenty four months. I mean, a lot of stocks would love to have that sort of performance. I mean, just what's changed?

[Craig Huber, Equity Research Analyst at Huber Research Partners]

Just a little bit more there.

[Martina Cheung, Director, President & CEO at S&P Global]

Craig, I'm going to take your question and respond to it from the top again. I think we lost audio there momentarily. So you're asking why now and what's changed. I would say this is something we've been thinking about for quite some time. We've done very rigorous and deep analysis around this.

[Martina Cheung, Director, President & CEO at S&P Global]

To be clear, the Mobility business is a phenomenal business. It has a very long history of innovation, of strong growth, and it's got incredibly talented leaders across the business. We believe that the plan to do a tax free spin is really the best opportunity for long term shareholder value here. It allows Mobility to pursue its profitable growth trajectory. And for S and P Global, excluding Mobility, allows our four core divisions to grow and be very closely aligned with our strategy.

[Martina Cheung, Director, President & CEO at S&P Global]

So that's really the thinking here Craig. Thanks for the question.

[Operator]

The next question will come from Owen Lau of Oppenheimer. Your line is open.

[Owen Lau, Executive Director & Senior Analyst at Oppenheimer & Co. Inc.]

Hi, good morning. Thank you for taking my questions. I actually have two quick questions here. The first one is, could you please talk about how do you bridge the flat build business, the 0% to 4% ratings revenue growth? Is it mainly driven by pricing or there's another like some mix shift going on that we should be aware of?

[Owen Lau, Executive Director & Senior Analyst at Oppenheimer & Co. Inc.]

And then the second part is about the sale of Astra. Could you please talk about how do you plan to use the proceeds? And if there's any if there's additional buyback, have you baked that into your guidance? Thanks.

[Martina Cheung, Director, President & CEO at S&P Global]

Owen. Thanks for the question. I'll take the first one and then hand over to Eric. So the revenue guidance at 0% to 4% for ratings, obviously, we've widened the range there. And that really contemplates the possible variety of ways in which business issuance could shape up.

[Martina Cheung, Director, President & CEO at S&P Global]

So we wanted to be prudent in how we were guiding for the full year around revenues. To be clear, the path back to the 0% to 4% is informed by our expectations for the rest of the year in the non transaction side, which we expect to grow around the mid single digit range. And then there are a variety of potential scenarios on the build issuance side with risk to both the upside and downside as I had mentioned earlier in the call. So that's the path back to that wider range of 0% to 4%.

[Eric Aboaf, CFO & EVP at S&P Global]

Owen, just to follow-up on Austria. We're very pleased to have announced the sale. It will bring in proceeds of about $1,000,000,000 on an after tax net basis. And we expect to close sometime this fall and expect to use those proceeds for additional buybacks in the latter part of the year. And it is included in our overall guidance.

[Martina Cheung, Director, President & CEO at S&P Global]

Thanks, Owen.

[Operator]

The next question will come from Jeff Silber of BMO Capital Markets. Your line is open.

[Jeffrey Silber, Senior Analyst at BMO Capital Markets]

Thank you so much. I had a question on your guidance specifically looking at the free cash flow. I realize you reduced guidance slightly for revenue growth and operating profit margin, but it looks like the reduction in guidance for free cash flow is in excess of that despite the fact that you're also expecting about $10,000,000 less in CapEx.

[Jeffrey Silber, Senior Analyst at BMO Capital Markets]

Is there something going on in the free cash flow line that's different from three months ago that we should be aware of? Thanks.

[Eric Aboaf, CFO & EVP at S&P Global]

Hi, Jeff. It's Eric. There are just some puts and takes in there, in particular, some timing on taxes, working capital and so forth that are just realigning that a little bit. Obviously, if those change those tend to change now and then and we just thought it'd be appropriate to update given what given the highlights we now have.

[Martina Cheung, Director, President & CEO at S&P Global]

Thanks, Jeff.

[Operator]

The next question will come from Shlomo Rosenbaum of Stifel Nicolaus. Your line is open.

[Shlomo Rosenbaum, Managing Director at Stifel Institutional]

Hi. Thank you for taking my question. Martina, maybe you could give us a little bit of inside baseball on how you kind of set the guidance. It seems like the changes are in ratings and indices, which you're already seeing some impact from the environment, but the other ones you're leaving at the same. Is leaving at the same just because you have not seen an impact yet?

[Shlomo Rosenbaum, Managing Director at Stifel Institutional]

Or is leaving the guidance in the other divisions because you are looking at the range of outcomes and the kind of net back to neutral? I'm just trying to understand your thinking over there.

[Martina Cheung, Director, President & CEO at S&P Global]

Hi, Shlomo. Thanks for the question. I would say we spent quite a lot of time bottom up with all of the divisions, understanding what we're seeing in key metrics, whether it's renewals, retention, cancels, new sales pipelines, etcetera, and really being quite rigorous in thinking about any potential impacts. And this is contemplated essentially in the full year, including in the changes to ratings and maintaining the other divisions. But we don't net out at the aggregate level.

[Martina Cheung, Director, President & CEO at S&P Global]

We go bottom up division by division to get to the answer. So hopefully that helps. Thanks so much for the question.

[Operator]

The next question will come from Russell Quelch of Redburn Atlantic. Your line is open.

[Russell Quelch, Managing Director at Redburn Atlantic]

Hi, good morning. I appreciate the impact the lower equity markets have on indices revenue outlook. But I wanted to pick up on the 9% growth in data and custom subscription revenues in Q1 within the index business. That looks like the highest print you've ever reported in that line in terms of growth. So are you managing to drive competitive displacement in benchmark index subscriptions?

[Russell Quelch, Managing Director at Redburn Atlantic]

If so, maybe what areas? Or is that more pricing? And maybe could that help offset some of the pressure on asset linked fees as we look out for the rest of the year?

[Eric Aboaf, CFO & EVP at S&P Global]

Russell, it's Eric. We're quite pleased with the performance of indices this quarter in aggregate and across its various product lines. Part of what boosted the data and customer subscriptions line was end of day data, which is quite rich in terms of what we provide and quite valuable for our clients and saw some real uptick there. It was marginally offset by some custom data feeds that came in a little lower. But overall, we're pleased with the performance.

[Martina Cheung, Director, President & CEO at S&P Global]

Thanks, Russell.

[Operator]

The next question will come from Jason Haas of Wells Fargo. Your line is open.

[Jason Haas, Director & Senior Equity research Analyst at Wells Fargo]

Hey, good morning and thanks for taking my question. I'm curious if you could talk about the sensitivity of the mobility business to auto tariffs. Have you seen any impact from that so far? The conversations with your customers changing at all? How do you expect that to

[Jason Haas, Director & Senior Equity research Analyst at Wells Fargo]

trend going forward? Thank you.

[Martina Cheung, Director, President & CEO at S&P Global]

Hi, Jason. Thanks for the question. This is obviously something we're paying very close attention to. Maybe just to give some color around firstly, what we think is happening and likely to happen in the automotive sector. So we certainly see pressures in reduced imports, potential for lower actual manufacturing in some cases for a variety of different reasons, including imported components, etcetera.

[Martina Cheung, Director, President & CEO at S&P Global]

And so that could put downward pressure on existing inventories, upward pressure on prices. And so we would expect and we are anticipating that there could be some budget pressures, for example, in dialogue with our OEM manufacturing clients. However, recall that this is largely on a subscription basis and there we are reasonably insulated from those impacts. But we're also very much engaged with helping our manufacturer clients to actually navigate this journey. The other point that I would make is the business overall is about 70% used car related.

[Martina Cheung, Director, President & CEO at S&P Global]

And there we actually see that the used car market could actually benefit from some of this anticipated change in higher prices for new cars, lower inventory for new cars. So that's another piece of this. And of course, the vehicle history, the vehicle pricing, the incentive sales and marketing data, these are all really critical data sets for dealers, particularly in this kind of environment. All in all, we're paying close attention. We certainly see some pressure on our end customers, but we are not directly impacted by that at this point.

[Martina Cheung, Director, President & CEO at S&P Global]

And that's one of the reasons why you see us maintain and have confidence in our guide for the full year. Thanks for the question, Jason.

[Operator]

The next question will come from Jeff Moeller of Baird. Your line is open.

[Jeffrey Meuler, Analyst at Robert W. Baird]

Yes, thank you. Maybe just taking a step back as the portfolio gets to steadier state, just given the number of divestitures, including some of the smaller businesses within the segments and the forced divestitures. I guess what are the how would you summarize the most important capabilities acquired at this point from the IHS Markit acquisition? And where do they show up the most in financials? I'm guessing private markets and energy transition growth are in part enabled by that, but just how would you summarize that overall?

[Jeffrey Meuler, Analyst at Robert W. Baird]

Thank you.

[Martina Cheung, Director, President & CEO at S&P Global]

Hi, Jeff. Thanks for the question. Well, IHS Markit from an acquisition standpoint benefited us tremendously across three of our four divisions ex mobility. The areas where we've seen incredible positive momentum first if we start with S and P Dow Jones and the iBox franchise that has positioned very strong in Fixed Income, for example, and we've been able to launch really new innovative products there, including the ability to enhance our multi asset class offering within Market Intelligence, products across Peace, including our Enterprise Solution products. We also have incredibly strong maritime data that came in, which of course is so critical now.

[Martina Cheung, Director, President & CEO at S&P Global]

And the private credit capabilities, as you mentioned, be it Wall Street office or eye level and evaluations business. So these are I mean, there's really just a huge number of very high value, high growth products there in Market Intelligence that came through the acquisition. And of course, in commodity insights, this is a business that is really suit to nuts three sixty commodities. We were able to round out our capabilities in several areas including petrochemicals, including in the renewables area as part of the merger between the Energy Resources business and Platts. And we're so well positioned.

[Martina Cheung, Director, President & CEO at S&P Global]

And last but not least, of course, CERAWeek, which has given us just such an incredible stage from which to host these amazing dialogues every year. So this has been, I think, very, very important for us and incredibly important for our growth going forward. And of course, you see that with Eric's comment earlier that we're about 90% of the revenue synergies that we had anticipated from the deal, which continues to perform very well. Thanks for the question, Jeff.

[Operator]

The next question comes from Sean Kennedy of Mizuho. Your line is open.

[Sean Kennedy, Payments & IT Services Equity Research Analyst at Mizuho Financial Group]

Good morning. Congrats on the results. So I was wondering how a sustained period of lower oil and other energy prices might affect commodity insights growth and how it may be different versus the last period of lower energy prices in 2020?

[Sean Kennedy, Payments & IT Services Equity Research Analyst at Mizuho Financial Group]

Thank you.

[Martina Cheung, Director, President & CEO at S&P Global]

Hi, Sean. It's Martina here. What I would say is our business doesn't move directly in line with the price of commodities. So we charge a license or subscription for the use of the price assessments, whether it's oil or natural gas or any of the other many, many dozens of commodity prices that we price on a daily basis. So I would say at its most extreme to the extent that the price got so low and impacted actual providers or resulted in bankruptcies or shutdowns, I mean that certainly you would see maybe some impact there.

[Martina Cheung, Director, President & CEO at S&P Global]

Remember though our view for this year is that we expect prices to be in the low 70s, which is actually a little bit higher than where they are right now. All of that is contemplated in the guide that we provided and we don't see at this point of the year massive downside or upside from that expected price range. Thanks, Sean.

[Operator]

And the final question for today will come from Joshua Dennerlein of Bank of America. Your line is open.

[Joshua Dennerlein, Head of Business & Information Services equity research at Bank of America]

Yes. Hey, everyone. Martina, you briefly touched on it, but it would be great to hear a bigger update on the Chief Client Officer role and how those conversations are progressing with clients. And then any kind of early wins you can share from that office?

[Martina Cheung, Director, President & CEO at S&P Global]

Yes. Josh, well, we're progressing, I would say, very nicely with the Chief Client Office. We are across the board, including all of our division presidents, out engaging with our senior clients senior executives at our largest strategic clients in partnership with the Chief Client Office. And I would say that it's positioned us, as I mentioned a little bit earlier in the call, really strongly for certainly for opportunities around vendor consolidation. But we've also seen strong renewals, in some cases, for very large deals and also new business, which is really exciting.

[Martina Cheung, Director, President & CEO at S&P Global]

Several to mention, one example is a large deal with an investment bank for counterparty manager, another four primary markets issue book for a large commercial bank, multiyear, multimillion dollar new deal that we've won for corporate actions for another bank. And so really interesting, we're continuing to build pipelines across all sectors. We've certainly seen some really nice early wins in the in financial clients, but we'll continue to build out across all sectors as we go throughout the year. So it's encouraging, and I think we're off to a good start there with that effort. And that is that's where I'll wrap up with that one.

[Martina Cheung, Director, President & CEO at S&P Global]

Thank you so much for your question, Josh. So I will just say thanks so much to everybody who joined the call today for your questions. We've had a very impressive start to the year and we're excited to continue executing throughout the course of the year. I do want to welcome Eric and thank him for a phenomenal first call. We're very excited to have him on board.

[Martina Cheung, Director, President & CEO at S&P Global]

And mostly also thank you so much to our customers and to our employees. And with that, we will close the call. Thank you.

Participants

Executives

• Mark Grant, Senior Vice President, Investor Relations
• Martina Cheung, Director, President & CEO
• Eric Aboaf, CFO & EVP

Analysts

• Toni Kaplan, Executive Director, Senior Equity Research Analyst at Morgan Stanley
• Faiza Alwy, Managing Director, US Company Research at Deutsche Bank
• Surinder Thind, Equity Research Analyst at Jefferies Financial Group
• Ashish Sabadra, Information & Business Services Analyst at RBC Capital Markets
• Andrew Steinerman, Equity Research Analyst - Business & Info Services at JP Morgan
• Scott Wurtzel, SVP - Equity Research at Wolfe Research, LLC
• Alex Kramm, Managing Director - Equity Research at UBS Group
• Manav Patnaik, Managing Director, Equity Research Analyst at Barclays Investment Bank
• George Tong, Sr. Research Analyst - Equity Research at Goldman Sachs
• Thomas Roesch, Equity Research Associate at William Blair
• Craig Huber, Equity Research Analyst at Huber Research Partners
• Owen Lau, Executive Director & Senior Analyst at Oppenheimer & Co. Inc.
• Jeffrey Silber, Senior Analyst at BMO Capital Markets
• Shlomo Rosenbaum, Managing Director at Stifel Institutional
• Russell Quelch, Managing Director at Redburn Atlantic
• Jason Haas, Director & Senior Equity research Analyst at Wells Fargo
• Jeffrey Meuler, Analyst at Robert W. Baird
• Sean Kennedy, Payments & IT Services Equity Research Analyst at Mizuho Financial Group
• Joshua Dennerlein, Head of Business & Information Services equity research at Bank of America