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RESTRUCTURING
 12 Months Ended
Dec. 31, 2025
Restructuring and Related Activities [Abstract]  
RESTRUCTURING RESTRUCTURING
On December 19, 2024, the CEO of Moody’s approved the Strategic and Operational Efficiency Restructuring Program. The Company estimates that upon completion, the program will result in annualized savings of $250 million to $300 million. This program relates to the Company's strategy to realign its operations toward high priority growth areas and to consolidate certain functions to simplify the organization to enable improved operating efficiency and leverage. This program will primarily include a reduction in staff, the rationalization and exit of certain leased office spaces and the retirement of certain legacy software applications. The program includes $210 million to $230 million of expected pre-tax personnel-related restructuring charges, an amount that includes severance costs (primarily determined under the Company’s existing severance plans), expense related to the modification of equity awards and other related costs. In addition, the program is expected to result in approximately $5 million of non-cash charges from the exit from certain leased office spaces and $10 million to $15 million of non-cash charges related to incremental amortization of internally developed software due to a reduction in the useful life of the software assets. The savings generated from the Strategic and Operational Efficiency Restructuring Program are expected to strengthen the Company's operating margin, with a portion being deployed to support strategic investments. The Strategic and Operational Efficiency Restructuring Program is expected to be substantially complete by the end of 2026. Cash outlays associated with this program are expected to be $210 million to $230 million, which are expected to be paid through 2027.
On June 30, 2022, the CEO of Moody’s approved the 2022 - 2023 Geolocation Restructuring Program. This program related to the Company's post-COVID-19 geolocation strategy and other strategic initiatives and included the rationalization and exit of certain leased office spaces and a reduction in staff, including the relocation of certain job functions. Cumulative charges related to this program are shown in the table below. The savings generated from the 2022 - 2023 Geolocation Restructuring Program strengthened the Company's operating margin, with a portion being deployed to support strategic investments, including the Company's workplace of the future program and employee retention initiatives. The 2022 - 2023 Geolocation Restructuring Program was substantially complete at the end of 2023.
Total expenses included in the accompanying consolidated statements of operations related to the aforementioned restructuring programs are outlined below:
Year ended December 31,
Cumulative expense incurred
202520242023
2022 - 2023 Geolocation Restructuring Program
Employee Termination Costs (1)
$— $14 $51 $151 
Real Estate Related Costs (2)
— — 36 63 
Total 2022-2023 Geolocation Restructuring Program Costs
$— $14 $87 $214 
Strategic and Operational Efficiency Restructuring Program
Employee Termination Costs (1)
$101 $45 $— $146 
Real Estate Related Costs (3)
4 — — 4 
Internally developed software-related charges (4)
3 — — 3 
Total Strategic and Operational Efficiency Restructuring Program Costs
$108 $45 $— $153 
Total Restructuring$108 $59 $87 
(1)Primarily includes severance costs, expense related to the modification of equity awards and professional service fees related to execution of the restructuring program.
(2)For the year ended December 31, 2023, primarily includes ROU Asset impairment charges. The fair value of the impaired assets was determined by utilizing the present value of the estimated future cash flows attributable to the assets. The fair value of those assets subsequent to the impairment for the year ended December 31, 2023 was $4 million and was categorized as Level 3 within the ASC Topic 820 fair value hierarchy.
(3)Includes the incremental amortization in the period of ROU Assets that have been abandoned or for which abandonment is planned in future periods.
(4)Includes the incremental amortization in the period relating to a change in estimated useful lives for certain internally developed software that has been abandoned or for which abandonment is planned in future periods.
Changes to the restructuring liability for the aforementioned restructuring programs were as follows:
202520242023
Balance as of January 1$47 $36 $64 
2022 - 2023 Geolocation Restructuring Program:
Cost incurred and adjustments(1)14 51 
Cash payments
(7)(42)(79)
Strategic and Operational Efficiency Restructuring Program:
Cost incurred and adjustments99 44 — 
Cash payments
(97)(5)— 
Balance as of December 31 (1)
$41 $47 $36 
(1)Restructuring liability is primarily comprised of employee termination costs and other severance-related charges.
As of December 31, 2025, substantially all of the remaining $41 million restructuring liability is expected to be paid out in 2026.