What MSCI (MSCI) Said on Its Q3 Earnings Call

Key Points

• MSCI reported strong Q3 growth: Revenue rose 12.4% year over year, adjusted EPS increased 14%, and asset-based-fee revenue jumped 25% to a record, supported by $76 billion in equity ETF inflows.
• Private markets and analytics gained momentum: Private Capital Solutions subscription run-rate growth accelerated to 19%, while historic net new sales were reported across Index, Analytics and private-capital products. The UBS partnership and Vantager acquisition are expanding MSCI’s private-asset capabilities.
• AI is becoming a central growth and efficiency driver, powering customized indexes, portfolio tools and private-asset diligence products. However, sustainability and climate offerings faced elevated cancellations, while higher acquisition, severance and stock-compensation costs are expected to push 2026 expenses toward the top of guidance.

MSCI NYSE: MSCI reported third-quarter results marked by double-digit revenue growth, record asset-based fees and historic net new sales in several product lines, as the company highlighted expanding use cases for artificial intelligence across its data, analytics and private-markets offerings.

Chairman and Chief Executive Officer Henry Fernandez said total revenue increased 12.4% year over year, while asset-based-fee revenue rose 25%, subscription revenue increased 8%, adjusted EBITDA grew 12% and adjusted earnings per share increased 14%.

“In the third quarter, MSCI delivered strong financial and operating metrics, including historic net new sales in Index, Analytics, and Private Capital Solutions, plus another record quarter for asset-based fees,” Fernandez said.

Index and asset-based-fee growth

MSCI said total run-rate growth reached 12% during the quarter, supported by an asset-based-fee run rate of nearly $1 billion. The company said assets under management benchmarked to its indexes totaled nearly $23 trillion, including roughly $15 trillion actively managed and $8 trillion indexed.

Asset-based fees benefited from $76 billion in equity ETF cash inflows, concentrated in developed markets excluding the U.S. and emerging markets. Chief Financial Officer Andy Wiechmann said this represented the company’s second-highest quarter of ETF inflows, behind only the first quarter of 2026.

Index organic subscription run-rate growth accelerated to 11.7%, with retention above 97% across the segment and 98% among asset managers, according to Wiechmann. The company cited double-digit subscription growth across hedge funds, banks and brokers, wealth managers and asset owners.

MSCI also reported more than 26% growth in custom-index subscription run rate. Management said demand for customized and systematic portfolio products, as well as the expansion of trading and liquidity ecosystems around its indexes, supported results.

Fernandez said the company sees additional opportunity in serving traders, hedge funds, broker-dealers, exchanges and market makers with data sets related to the trading of assets linked to MSCI indexes.

Analytics and private-market momentum

Analytics organic subscription run-rate growth was 7.5%, driven by strategic client wins with asset owners and wealth managers that are modernizing investment platforms and integrating risk and portfolio-management workflows, Wiechmann said. He noted that Analytics results can be uneven on a quarterly basis, but said last-12-month recurring net new sales in the business increased 18% from the prior comparable period.

Private Capital Solutions subscription run-rate growth accelerated to 19%. Management cited demand for transparency, Private Capital Intel and total-plan offerings, as well as newer data and diligence platforms. MSCI said its acquisition of AI-native platform Vantager, now called the MSCI Private Assets Diligence Platform, helped it complete a major deal with a large U.S. bank.

Fernandez said MSCI also formalized its agreement with UBS during the quarter. The partnership is intended to extend the reach of the company’s private-asset solutions, strengthen connections between general partners and wealth managers, and support greater transparency in private markets.

At the client-segment level, the company said recurring net new sales with asset owners more than tripled from a year earlier. Its largest deal of the quarter made MSCI a strategic portfolio analytics partner for one of Asia’s largest sovereign wealth funds, Fernandez said.

AI investment and product development

Management repeatedly emphasized AI as a driver of product innovation, operational efficiency and future distribution. Fernandez described MSCI as an analytics and modeling company working to combine proprietary data, models and AI technology to help clients consume content more effectively.

Chief Product Officer and Head of Client Segments Alvise Munari said AI-enabled product development is supporting custom indexes, factor models, specialized data sets and portfolio-construction tools. He said agentic technology has shortened the process of creating and calibrating a new model from several weeks to a matter of hours, with the potential to reduce that further over time.

Munari also pointed to AI-powered diligence and document-management tools for private assets, geospatial offerings and specialized data sets related to the AI value chain. The company has developed connectors for major large-language-model providers, though Munari said clients currently tend to prefer MSCI’s directly trained and curated applications.

“It’s early stages,” Munari said, adding that MSCI is investing in connectivity to external platforms, direct agent-enabled access to its content and its own client-side agent capabilities.

Sustainability pressures and expense outlook

MSCI said its sustainability and climate reporting segment continued to face retention pressure. The company executed more than $5 million in new recurring sustainability sales and more than $2 million in climate sales during the quarter, but it also experienced elevated cancellations, including one sizable down-sale from a client reducing its sustainability spending.

Climate run-rate growth across MSCI product lines was 8%, excluding the effect of First Street. Management said integration of First Street, which provides physical-risk solutions, remained on track and client engagement was strong. MSCI expects sustainability and climate recurring net new sales to be roughly flat to slightly positive in the fourth quarter.

Wiechmann said the company expects to be at the top end of its 2026 expense-guidance ranges, citing approximately $20 million of acquisition-related expenses, $15 million to $20 million of incremental non-cash performance stock-option accruals, and $10 million to $15 million of higher-than-planned severance costs. He said severance reflects accelerated efficiency initiatives and the company’s AI transformation.

Management said headcount remained roughly flat from a year earlier despite four acquisitions. MSCI intends to use AI-driven productivity gains in its existing operations to fund further growth investments rather than target substantial margin expansion.

“We intend to reinvest those savings,” Wiechmann said, describing AI as an accelerant that could support more product investment, top-line growth and profitability over time.

Fernandez also said MSCI repurchased $627 million of shares from July 1 through Oct. 19 at an average price of $562 per share. Since the start of 2024, the company has repurchased nearly 8 million shares for $4.4 billion, he said.

About MSCI (NYSE:MSCI)

MSCI Inc NYSE: MSCI is a global provider of investment decision-support tools and services for institutional investors, asset managers, banks and other financial institutions. The company is best known for developing equity, fixed-income and multi-asset indexes used to benchmark portfolios and support the creation of investment products such as exchange-traded funds.

In addition to its indexes, MSCI provides portfolio analytics, risk-management and performance-attribution tools, as well as research and data covering environmental, social and governance factors, climate risk and sustainable investing.

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