Revenues (Tables)

6 Months Ended

Jun. 30, 2020

Revenue from Contract with Customer [Abstract]

Disaggregation of Revenue

The following table presents the Company’s revenues disaggregated by LOB:

	Three Months Ended June 30,				Six Months Ended June 30,
	2020		2019		2020		2019
MIS:
Corporate finance (CFG)
Investment-grade	$	291	$	96	$	435	$	193
High-yield	99		69		174		126
Bank loans	43		83		132		156
Other accounts (1)	139		140		284		268
Total CFG	572		388		1,025		743
Structured finance (SFG)
Asset-backed securities	23		26		45		49
RMBS	23		24		50		48
CMBS	13		20		30		38
Structured credit	21		41		50		76
Other accounts	1		1		2		2
Total SFG	81		112		177		213
Financial institutions (FIG)
Banking	88		84		174		164
Insurance	44		28		74		57
Managed investments	8		10		14		14
Other accounts	2		3		5		6
Total FIG	142		125		267		241
Public, project and infrastructure finance (PPIF)
Public finance / sovereign	64		53		121		99
Project and infrastructure	69		55		121		102
Total PPIF	133		108		242		201
Total ratings revenue	928		733		1,711		1,398
MIS Other	10		6		21		11
Total external revenue	938		739		1,732		1,409
Intersegment royalty	35		33		72		65
Total MIS	973		772		1,804		1,474
MA:
Research, data and analytics (RD&A)	366		315		724		623
Enterprise risk solutions (ERS)	131		117		269		239
Professional services (PS) (2)	—		43		—		85
Total external revenue	497		475		993		947
Intersegment revenue	2		3		4		5
Total MA	499		478		997		952
Eliminations	(37)		(36)		(76)		(70)
Total MCO	$	1,435	$	1,214	$	2,725	$	2,356

⁽¹⁾ Other includes: recurring monitoring fees of a rated debt obligation and/or entities that issue such obligations as well as fees from programs such as commercial paper, medium term notes, and ICRA corporate finance revenue.

⁽²⁾ Subsequent to the divestiture of MAKS in 2019, revenue from the MALS reporting unit, which previous to 2020 was reported in the PS LOB, is now reported as part of the RD&A LOB. Prior periods have not been reclassified as the amounts were not material.

The following table presents the Company’s revenues disaggregated by LOB and geographic area:

	Three Months Ended June 30, 2020						Three Months Ended June 30, 2019
	U.S.		Non-U.S		Total		U.S.		Non-U.S		Total
MIS:
Corporate finance (CFG)	$	413	$	159	$	572	$	242	$	146	$	388
Structured finance (SFG)	45		36		81		72		40		112
Financial institutions (FIG)	70		72		142		52		73		125
Public, project and infrastructure finance (PPIF)	87		46		133		69		39		108
Total ratings revenue	615		313		928		435		298		733
MIS Other	1		9		10		1		5		6
Total MIS	616		322		938		436		303		739
MA:
Research, data and analytics (RD&A)	167		199		366		138		177		315
Enterprise risk solutions (ERS)	54		77		131		46		71		117
Professional services (PS) (1)	—		—		—		18		25		43
Total MA	221		276		497		202		273		475
Total MCO	$	837	$	598	$	1,435	$	638	$	576	$	1,214

	Six Months Ended June 30, 2020						Six Months Ended June 30, 2019
	U.S.		Non-U.S		Total		U.S.		Non-U.S		Total
MIS:
Corporate finance (CFG)	$	727	$	298	$	1,025	$	485	$	258	$	743
Structured finance (SFG)	106		71		177		134		79		213
Financial institutions (FIG)	130		137		267		98		143		241
Public, project and infrastructure finance (PPIF)	155		87		242		129		72		201
Total ratings revenue	1,118		593		1,711		846		552		1,398
MIS Other	1		20		21		1		10		11
Total MIS	1,119		613		1,732		847		562		1,409
MA:
Research, data and analytics (RD&A)	325		399		724		273		350		623
Enterprise risk solutions (ERS)	107		162		269		94		145		239
Professional services (PS) (1)	—		—		—		36		49		85
Total MA	432		561		993		403		544		947
Total MCO	$	1,551	$	1,174	$	2,725	$	1,250	$	1,106	$	2,356

⁽¹⁾ Subsequent to the divestiture of MAKS in 2019, the RD&A LOB now includes revenue from MALS beginning in the first quarter of 2020. MALS revenue was previously reported as part of the PS LOB and prior year revenue by LOB has not been reclassified as the amounts were not material.

The following tables summarize the split between transaction and relationship revenue. In the MIS segment, excluding MIS Other, transaction revenue represents the initial rating of a new debt issuance as well as other one-time fees while relationship revenue represents the recurring monitoring fees of a rated debt obligation and/or entities that issue such obligations, as well as revenue from programs such as commercial paper, medium-term notes and shelf registrations. In MIS Other, transaction revenue represents revenue from professional services and outsourcing engagements and relationship revenue represents subscription-based revenues. In the MA segment, relationship revenue represents subscription-based revenues and software maintenance revenue. Transaction revenue in MA represents perpetual software license fees and revenue from software implementation services, risk management advisory projects, training and certification services, and outsourced research and analytical engagements.

	Three Months Ended June 30,
	2020									2019
	Transaction			Relationship			Total			Transaction			Relationship			Total
Corporate Finance	$	457		$	115		$	572		$	277		$	111		$	388
	80		%	20		%	100		%	71		%	29		%	100		%
Structured Finance	$	35		$	46		$	81		$	69		$	43		$	112
	43		%	57		%	100		%	62		%	38		%	100		%
Financial Institutions	$	76		$	66		$	142		$	61		$	64		$	125
	54		%	46		%	100		%	49		%	51		%	100		%
Public, Project and Infrastructure Finance	$	96		$	37		$	133		$	71		$	37		$	108
	72		%	28		%	100		%	66		%	34		%	100		%
MIS Other	$	—		$	10		$	10		$	—		$	6		$	6
	—		%	100		%	100		%	—		%	100		%	100		%
Total MIS	$	664		$	274		$	938		$	478		$	261		$	739
	71		%	29		%	100		%	65		%	35		%	100		%
Research, data and analytics	$	16		$	350		$	366		$	4		$	311		$	315
	4		%	96		%	100		%	1		%	99		%	100		%
Enterprise risk solutions	$	26		$	105		$	131		$	23		$	94		$	117
	20		%	80		%	100		%	20		%	80		%	100		%
Professional services	$	—		$	—		$	—		$	43		$	—		$	43
	—		%	—		%	—		%	100		%	—		%	100		%
Total MA	$	42		$	455		$	497		$	70		$	405		$	475
	8		%	92		%	100		%	15		%	85		%	100		%
Total Moody's Corporation	$	706		$	729		$	1,435		$	548		$	666		$	1,214
	49		%	51		%	100		%	45		%	55		%	100		%

	Six Months Ended June 30,
	2020										2019
	Transaction				Relationship			Total			Transaction				Relationship			Total
Corporate Finance	$	795			$	230		$	1,025		$	526			$	217		$	743
	78		%		22		%	100		%	71		%		29		%	100		%
Structured Finance	$	85			$	92		$	177		$	126			$	87		$	213
	48		%		52		%	100		%	59		%		41		%	100		%
Financial Institutions	$	136			$	131		$	267		$	109			$	132		$	241
	51		%		49		%	100		%	45		%		55		%	100		%
Public, Project and Infrastructure Finance	$	165			$	77		$	242		$	126			$	75		$	201
	68		%		32		%	100		%	63		%		37		%	100		%
MIS Other	$	2			$	19		$	21		$	1			$	10		$	11
	10		%		90		%	100		%	9		%		91		%	100		%
Total MIS	$	1,183			$	549		$	1,732		$	888			$	521		$	1,409
	68		%		32		%	100		%	63		%		37		%	100		%
Research, data and analytics	$	34			$	690		$	724		$	9			$	614		$	623
	5		%		95		%	100		%	1		%		99		%	100		%
Enterprise risk solutions	$	58			$	211		$	269		47				$	192		$	239
	22		%		78		%	100		%	20		%		80		%	100		%
Professional services	$	—			$	—		$	—		$	85			$	—		$	85
	—		%		—		%	—		%	100		%		—		%	100		%
Total MA	$	92		(1)	$	901		$	993		$	141		(1)	$	806		$	947
	9		%		91		%	100		%	15		%		85		%	100		%
Total Moody's Corporation	$	1,275			$	1,450		$	2,725		$	1,029			$	1,327		$	2,356
	47		%		53		%	100		%	44		%		56		%	100		%

⁽¹⁾ Revenue from software implementation services and risk management advisory projects, while classified by management as transactional revenue, is recognized over time under the Revenue Accounting Standard (please also refer to the following table).

The following table presents the timing of revenue recognition:

	Three Months Ended June 30, 2020						Six Months Ended June 30, 2020
	MIS		MA		Total		MIS		MA		Total
Revenue recognized at a point in time	$	664	$	20	$	684	$	1,183	$	59	$	1,242
Revenue recognized over time	274		477		751		549		934		1,483
Total	$	938	$	497	$	1,435	$	1,732	$	993	$	2,725

	Three Months Ended June 30, 2019						Six Months Ended June 30, 2019
	MIS		MA		Total		MIS		MA		Total
Revenue recognized at a point in time	$	478	$	22	$	500	$	888	$	52	$	940
Revenue recognized over time	261		453		714		521		895		1,416
Total	$	739	$	475	$	1,214	$	1,409	$	947	$	2,356

Company's Reportable Segment Revenues Disaggregated by Segment and Geographic Region

The following table presents the Company’s reportable segment revenues disaggregated by segment and geographic region:

	Three Months Ended June 30,				Six Months Ended June 30,
	2020		2019		2020		2019
MIS:
U.S.	$	616	$	436	$	1,119	$	847
Non-U.S.:
EMEA	183		178		354		327
Asia-Pacific	90		84		171		163
Americas	49		41		88		72
Total Non-U.S.	322		303		613		562
Total MIS	938		739		1,732		1,409
MA:
U.S.	221		202		432		403
Non-U.S.:
EMEA	190		184		382		368
Asia-Pacific	54		57		109		110
Americas	32		32		70		66
Total Non-U.S.	276		273		561		544
Total MA	497		475		993		947
Total MCO	$	1,435	$	1,214	$	2,725	$	2,356

Schedule of Changes in the Deferred Revenue Balances

Significant changes in the deferred revenue balances during the three and six months ended June 30, 2020 are as follows:

	Three Months Ended June 30, 2020
	MIS		MA		Total
Balance at March 31, 2020	$	379	$	843	$	1,222
Changes in deferred revenue
Revenue recognized that was included in the deferred revenue balance at the beginning of the period	(115)		(341)		(456)
Increases due to amounts billable excluding amounts recognized as revenue during the period	100		234		334
Effect of exchange rate changes	1		4		5
Total changes in deferred revenue	(14)		(103)		(117)
Balance at June 30, 2020	$	365	$	740	$	1,105

	Six Months Ended June 30, 2020
	MIS		MA		Total
Balance at January 1, 2020	$	322	$	840	$	1,162
Changes in deferred revenue
Revenue recognized that was included in the deferred revenue balance at the beginning of the period	(167)		(677)		(844)
Increases due to amounts billable excluding amounts recognized as revenue during the period	213		577		790
Increases due to RDC acquisition during the period	—		20		20
Effect of exchange rate changes	(3)		(20)		(23)
Total changes in deferred revenue	43		(100)		(57)
Balance at June 30, 2020	$	365	$	740	$	1,105
Deferred revenue - current	$	265	$	736	$	1,001
Deferred revenue - noncurrent	$	100	$	4	$	104

	Three Months Ended June 30, 2019
	MIS		MA		Total
Balance at March 31, 2019	$	388	$	795	$	1,183
Changes in deferred revenue
Revenue recognized that was included in the deferred revenue balance at the beginning of the period	(114)		(340)		(454)
Increases due to amounts billable excluding amounts recognized as revenue during the period	101		246		347
Amount included in liabilities reclassified as held for sale	—		(3)		(3)
Effect of exchange rate changes	1		(3)		(2)
Total changes in deferred revenue	(12)		(100)		(112)
Balance at June 30, 2019	$	376	$	695	$	1,071

	Six Months Ended June 30, 2019
	MIS		MA		Total
Balance at January 1, 2019	$	326	$	750	$	1,076
Changes in deferred revenue
Revenue recognized that was included in the deferred revenue balance at the beginning of the period	(161)		(533)		(694)
Increases due to amounts billable excluding amounts recognized as revenue during the period	210		479		689
Amount included in liabilities reclassified as held for sale	—		(3)		(3)
Effect of exchange rate changes	1		2		3
Total changes in deferred revenue	50		(55)		(5)
Balance at June 30, 2019	$	376	$	695	$	1,071
Deferred revenue - current	$	262	$	691	953
Deferred revenue - noncurrent	$	114	$	4	118