- Quarterly revenue achieved a new record of $3.575 billion, increasing 16% year over year.
- GAAP operating margin increased 530 basis points and adjusted operating margin increased 180 basis points, driving 33% growth in GAAP EPS and 21% growth in adjusted EPS, respectively, year over year.
- The Company expects to execute additional accelerated share repurchases (ASR) totaling $1.3 billion in the coming weeks.
- The Company is raising full-year 2024 guidance. Guidance now calls for revenue growth of 11.5% – 12.5%, GAAP diluted EPS in the range of $11.95 – $12.15, and adjusted diluted EPS in the range of $15.10 – $15.30.
S&P Global (NYSE: SPGI) today reported third quarter results. This earnings release and supplemental materials are available at http://investor.spglobal.com/Quarterly Earnings.
The Company reported third quarter 2024 revenue of $3.575 billion, an increase of 16% compared to the third quarter of 2023. Third quarter GAAP net income increased 31% to $971 million and GAAP diluted earnings per share increased 33% to $3.11 as higher net income was driven primarily by strong growth in Ratings and Indices.
Adjusted net income for the third quarter increased 18% to $1.210 billion and adjusted diluted earnings per share increased 21% to $3.89.
As previously announced, Eric Aboaf has been appointed EVP and Chief Financial Officer, effective February 2025. The Company also announced the members of its new Executive Leadership Team, which will be effective November 1, 2024. For details on these appointments, please see press releases dated October 15 and October 17, 2024.
The previously announced divestiture of Fincentric closed on August 15, 2024. The Company is announcing today the planned divestiture of PrimeOne, which is expected to close in the coming weeks. The financial impact of these transactions is fully contemplated in the Company’s updated guidance, issued today.
“S&P Global delivered exceptional financial results in the third quarter.
The Company continues to serve its customers with world-class benchmarks, data and insights, and workflow tools, while we invest in innovation that will generate growth and create long-term value for our shareholders.
The Company is as strong as it has ever been. I am excited to see such a talented team of executives preparing to lead this incredible Company into the future, with the experience, track record, and passion to deliver strong results for years to come.”
Douglas Peterson
President and CEO
Note: All presentations of revenue above refer to GAAP revenue. Adjusted financials refer to non GAAP adjusted metrics in all periods.
The Company’s third quarter reported operating profit margin increased by 530 basis points to 40.1%, and adjusted operating
Third quarter GAAP diluted earnings per share increased 33% to $3.11 primarily due to a 31% increase in net income, and a 2% reduction in diluted shares outstanding.
Adjusted diluted earnings per share increased 21% to $3.89 due to an 18% increase in adjusted net income and a 2% decrease in diluted shares outstanding. Currency negatively impacted adjusted diluted EPS by $0.02. The largest non-core adjustments to earnings in the third quarter of 2024 were for deal-related amortization and merger-related costs.
In addition to the above, the Company expects 2024 cash provided by operating activities, less capital expenditures and distributions to noncontrolling interest holders, of ~$4.7 billion, compared to prior expectation of ~$4.4 billion, as a result of higher net income expectations. The Company expects adjusted free cash flow, excluding certain items, of ~$5.2 billion, compared to prior guidance of ~$4.7 billion, also as a result of higher expected net income.
The Company’s updated guidance for revenue growth is 250 to 350 bps higher than the previous guidance range, given the strong performance in the third quarter and an improved outlook for the fourth quarter. Corporate unallocated expense is expected to be approximately $25 million higher on a GAAP basis and $10 million higher on an adjusted basis, compared to prior guidance, due primarily to increased incentive compensation. The Company is raising GAAP operating margin expansion guidance from prior guidance in the range of 500 to 550 bps, while adjusted operating margin is expected to expand 200 – 250 bps compared to prior guidance of approximately 125 – 175 bps, both as a result of higher expected revenue growth. GAAP and adjusted interest expense, net are each expected to be approximately $15 million lower than prior guidance. As a result of the higher expected revenue and operating margin, GAAP diluted EPS is expected to be approximately $0.75 to $0.80 higher than previous guidance range, and adjusted diluted EPS is expected to be $0.70 to $0.75 higher than previous guidance range. The Company now expects $160 – $170 million GAAP and adjusted capital expenditures compared to prior guidance of approximately $180 – $190 million. GAAP tax rate is now expected in the range of 21.0% – 21.5% and non-GAAP tax rate is now expected in the range of 21.5% – 22.0%, both 50 bps points lower on the high end versus previous guidance ranges based on year-to-date results. GAAP and adjusted deal-related amortization are also unchanged from prior guidance.
GAAP and non-GAAP adjusted guidance include the impact of the Visible Alpha acquisition in the second quarter, the divestiture of Fincentric in the third quarter, and the expected divestiture of PrimeOne in the coming weeks. Non-GAAP adjusted guidance excludes merger-related costs and amortization of intangibles related to acquisitions.
Capital Return: For the full year 2024, the Company expects to return approximately 85% of adjusted free cash flow to shareholders through dividends and share repurchases. The Board of Directors has authorized a quarterly cash dividend of $0.91. The Company expects to execute additional accelerated share repurchases (ASR) totaling $1.3 billion in the coming weeks.
Supplemental Information/Conference Call/Webcast Details: The Company’s senior management will review the third quarter 2024 earnings results on a conference call scheduled for today, October 24, at 8:30 a.m. EDT. Additional information presented on the conference call, as well as the Company’s Supplemental slide content may be found on the Company’s Investor Relations Website at http://investor.spglobal.com/Quarterly-Earnings.
The Webcast will be available live and in replay at http://investor.spglobal.com/Quarterly-Earnings. Telephone access is available. U.S. participants may call (888) 603-9623; international participants may call +1 (630) 395-0220 (long-distance charges will apply). The passcode is “S&P Global” and the conference leader is Douglas Peterson. A recorded telephone replay will be available approximately two hours after the meeting concludes and will remain available until November 24, 2024. U.S. participants may call (866) 405-7296; international participants may call +1 (203) 369-0607 (long distance charges will apply). No passcode is required.
Source: S&P Global Earnings Release
