3Q 2022 Investor Presentation
Annualized Recurring Revenue (ARR)
The Company presents Annualized Recurring Revenue ("ARR") on a constant currency organic basis for its MA business as a supplemental performance metric to provide additional
insight on the estimated value of MA's recurring revenue contracts at a given point in time. The Company uses ARR to manage and monitor performance of its MA operating segment and
believes that this metric is a key indicator of the trajectory of MA's recurring revenue base.
The Company calculates ARR by taking the total recurring contract value for each active renewable contract as of the reporting date, divided by the number of days in the contract and
multiplied by 365 days to create an annualized value. The Company defines renewable contracts as subscriptions, term licenses, maintenance and renewable services. ARR excludes
transaction sales, including training, one-time services and perpetual licenses. In order to compare period-over-period ARR excluding the effects of foreign currency translation, the
Company bases the calculation on currency rates utilized in its current year operating budget and holds these FX rates constant for the duration of all current and prior periods being
reported. Additionally, ARR excludes contracts related to acquisitions to provide additional perspective in assessing growth excluding the impacts from certain acquisition activity.
The Company's definition of ARR may differ from definitions utilized by other companies reporting similarly named measures, and this metric should be viewed in addition to, and not as a
substitute for, financial measures presented in accordance with U.S. GAAP.
Amounts in millions
ARR
September 30, 2022
September 30, 2021
Change
Decision Solutions
1,177
$
1,071
$
Research and Insights
740
688
Data and Information
745
683
Total MA ARR
$
2,662
$
2,442
MOODY'S | DECODE RISK. UNLOCK OPPORTUNITY.
Growth
106
10%
52
8%
62
9%
220
9%
Third Quarter 2022 - Earnings Call
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