Moody's (MCO) Risk Factor Changes

If any of these attacks on Moody’s or its vendors are successful, or if any of these risks materialize, they could have a material adverse effect on the Company’s business, financial condition or results of operations.

In the ordinary course, third-parties, including the Company’s vendors, are subject to various forms of cyber-attacks or security incidents.

Moody’s relies on Third-Party Technology in connection with its product development and offerings and operations.

To conduct its operations, the Company regularly moves data across national borders, and consequently is subject to a variety of continuously evolving and developing laws and regulations in the U.S.

Additionally, Gen AI has contributed to an increase in the prevalence and sophistication of cyber threats, expanding the Company's exposure to potential breaches and systems disruptions.

Our business could be negatively impacted by physical and transitional climate risks.

and financial projections in any of these reporting units could result in a significant asset impairment charge, which would result in a non-cash charge to operating expenses.

Moody’s success depends upon its ability to recruit, retain and motivate highly skilled, experienced professionals, including financial analysts, data scientists and software engineers.

Over the past several years, both in the United States and internationally, regulators, certain investors and other stakeholders have focused on various sustainability matters, including environmental impact, human ca…

Our Reputation or Business Could Be Negatively Impacted by Sustainability Matters and Our Reporting of Such Matters

Moody’s reputation and the strength of its brand are key competitive strengths.

others may develop alternative, proprietary systems for assessing risk, including credit and climate risk.

The markets for credit ratings, research, credit risk management services, business intelligence and analytical services are highly competitive and characterized by rapid technological change, including change based o…

Current market, economic and government factors could negatively impact the volume of debt securities issued in global capital markets and the demand for credit ratings, which could materially and adversely affect the…

Moody’s ability to conduct business may be materially and adversely impacted by a disruption in the infrastructure that supports its businesses and the communities in which Moody’s has large employee populations, incl…

–potentially adverse tax consequences.

–uncertain, evolving and new laws and regulations, including employment laws, various proposed and enacted data laws including those relating to data sharing, portability of data services, cybersecurity rules, and law…

–U.S.

–economic and geopolitical events and market conditions in countries where we have large employee populations, such as the ongoing tensions between India and Pakistan, and conflicts such as the Russia-Ukraine military…

Moody’s conducts operations in various countries outside the U.S.

During 2023, multiple foreign jurisdictions in which the Company operates have enacted legislation to adopt a minimum tax rate described in the GloBE or Pillar II, tax model rules issued by the OECD.

We also incorporate third-party software, including open-source software components, in certain of our products and services.

Moody’s Faces Risks Related to Intellectual Property Rights.

market, where there has been increased regulatory attention relating to the rapid growth of private credit, new financing structures, and CRA ratings for private credit-related instruments, issuers, and credit facilit…

The Company Faces Exposure to Litigation and Government Regulatory Proceedings, Investigations and Inquiries (Including Competition Market Studies) Related to Rating Opinions, Analytics Services and Other Business Pra…

–Regulators in Europe and other foreign markets in which MA is active have issued guidance similar to that issued in the U.S.

New laws and regulations are likely to be enacted and existing laws and regulations may change or be interpreted and applied differently over time and from jurisdiction to jurisdiction, and it is possible they will be…

In turn, such developments may affect MIS’s communications with issuers as part of the rating assignment process, alter the manner in which MIS’s credit ratings are developed, assigned and communicated, affect the man…

–In the EU and the U.K., applicable rules include procedural requirements with respect to credit ratings of sovereign issuers, liability for intentional or grossly negligent failure to abide by applicable regulations,…

The events and consequences discussed in these risk factors could, in circumstances the Company may not be able to accurately predict, recognize, or control, have a material adverse effect on Moody’s business, financi…

confidential data, could cause reputational harm, loss of customers and revenue, fines, regulatory actions and scrutiny, sanctions or other statutory penalties, litigation, liability for failure to safeguard the Compa…

sabotage, intentional acts of vandalism, acts of terrorism, political unrest, pandemic, war or otherwise, may impair the Company’s ability to deliver its products and services.

–complexities of compliance with employment laws, various proposed and enacted data privacy laws, and cybersecurity rules in numerous jurisdictions.

–reduced protection for intellectual property rights;

–the possibility of nationalization, expropriation, price controls and other restrictive governmental actions;

laws in multiple jurisdictions may need to determine a means to comply with such laws.

The EU AI Act has introduced a risk-based framework for regulating AI systems which applies different obligations to various actors in the AI supply chain.

In turn, such developments may affect MIS’s communications with issuers as part of the rating assignment process, alter the manner in which MIS’s credit ratings are developed, assigned and communicated, affect the man…

Company’s products, fail to be comprehensive or accurate, unavailable or fail to operate effectively, and Moody’s business could be adversely affected when the Company is unable to timely or effectively replace such T…

We are also subject to changes in policies, technologies, or market preferences that are intended to address the effects of climate related risks, as well as ongoing legislative and regulatory uncertainties and change…

At December 31, 2025, Moody’s had $6,368 million of goodwill and $1,866 million of intangible assets on its balance sheet.

In addition, there has been a recent increase in “anti-ESG” sentiment in the United States by certain activists, institutions and governmental entities criticizing ESG or climate-focused products and services.

–restrictive actions of governmental authorities in the jurisdictions in which we operate which may affect trade, cross-border data transfer, and foreign investment, especially during periods of heightened tension bet…

property and proprietary rights against theft, misappropriation or infringement could be materially and adversely affected by insufficient and/or changing proprietary rights and intellectual property legal protections…

Moody’s faces exposure to litigation and government and regulatory proceedings, investigations and inquiries (including market studies) related to MIS’s ratings actions, as well as other business practices and product…

The EU AI Act has introduced a risk-based framework for regulating AI systems which applies different obligations to various participants in the AI supply chain.