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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
___________________________________
FORM 10-Q
___________________________________
xQUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2023
OR
oTRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from____________to____________
Commission file number 001-33812
________________________________________
msci-logo-resized.gif
MSCI INC.
(Exact Name of Registrant as Specified in its Charter)
________________________________________
Delaware13-4038723
(State or other jurisdiction of
Incorporation or Organization)
(I.R.S. Employer
Identification Number)
7 World Trade Center
250 Greenwich Street, 49th Floor
New York, New York
10007
(Address of Principal Executive Offices)(Zip Code)
Registrant’s telephone number, including area code: (212) 804-3900
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common stock, par value $0.01 per shareMSCINew York Stock Exchange
________________________________________
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes  x  No  o
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes  x  No  o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filerxAccelerated filero
Non-accelerated fileroSmaller reporting companyo
Emerging growth companyo
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes No x
As of April 18, 2023, there were 80,063,402 shares of the registrant’s common stock, par value $0.01, outstanding.


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FOR THE QUARTER ENDED MARCH 31, 2023
TABLE OF CONTENTS
Page
Item 6.
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Table of Contents
AVAILABLE INFORMATION
Our corporate headquarters is located at 7 World Trade Center, 250 Greenwich Street, 49th Floor, New York, New York, 10007, and our telephone number is (212) 804-3900. We maintain a website on the internet at www.msci.com. The contents of our website are not a part of or incorporated by reference in this Quarterly Report on Form 10-Q.
We file annual, quarterly and current reports, proxy statements and other information with the Securities and Exchange Commission (the “SEC”). The SEC maintains a website that contains reports, proxy and information statements and other information that we file electronically with the SEC at www.sec.gov. We also make available free of charge, on or through our website, these reports, proxy statements and other information as soon as reasonably practicable following the time they are electronically filed with or furnished to the SEC. To access these, click on the “SEC Filings” link under the “Financial Information” tab found on our Investor Relations homepage (http://ir.msci.com).
We also use our Investor Relations homepage, Corporate Responsibility homepage and corporate Twitter account (@MSCI_Inc) as channels of distribution of Company information. The information we post through these channels may be deemed material.
Accordingly, investors should monitor these channels, in addition to following our press releases, SEC filings and public conference calls and webcasts. In addition, you may automatically receive email alerts and other information about us when you enroll your email address by visiting the “Email Alerts” section of our Investor Relations homepage at https://ir.msci.com/email-alerts. The contents of our website, including our Investor Relations homepage and Corporate Responsibility homepage, and our social media channels are not, however, a part of or incorporated by reference in this Quarterly Report on Form 10-Q.
FORWARD-LOOKING STATEMENTS
We have included in this Quarterly Report on Form 10-Q, and from time to time may make in our public filings, press releases or other public statements, certain statements that constitute forward-looking statements. In addition, our management may make forward-looking statements to analysts, investors, representatives of the media and others. These forward-looking statements are not historical facts and represent only MSCI’s beliefs regarding future events, many of which, by their nature, are inherently uncertain and beyond our control. These forward-looking statements involve known and unknown risks, uncertainties and other factors that may
cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of
activity, performance or achievements expressed or implied by these statements.
In some cases, you can identify forward-looking statements by the use of words such as “may,” “could,” “expect,” “intend,” “plan,” “seek,” “anticipate,” “believe,” “estimate,” “predict,” “potential” or “continue,” or the negative of these terms or other comparable terminology. Statements concerning our financial position, business strategy and plans or objectives for future operations are forward-looking statements. You should not place undue reliance on forward-looking statements because they involve known and unknown risks, uncertainties and other factors that are, in some cases, beyond our control and that could materially affect our actual results, levels of activity, performance or achievements. Such risks and uncertainties include those set forth under “Risk Factors” in Part I, Item 1A of the 2022 Annual Report on Form 10-K filed with the SEC on February 10, 2023. If any of these risks or uncertainties materialize, or if MSCI’s underlying assumptions prove to be incorrect, actual results may vary significantly from what MSCI projected. Any forward-looking statement reflects our current views with respect to future events, levels of activity, performance or achievements and is subject to these and other risks, uncertainties and assumptions relating to our operations, results of operations, growth strategy and liquidity. The forward-looking statements in this report speak only as of the time they are made and do not necessarily reflect our outlook at any other point in time. MSCI assumes no obligation to publicly update or revise these forward-looking statements for any reason, whether as a result of new information, future events, or otherwise, except as required by law. Therefore, readers should carefully review the risk factors set forth in the Annual Report on Form 10-K and in other reports or documents we file from time to time with the SEC.
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PART I – FINANCIAL INFORMATION
Item 1.    Financial Statements
MSCI INC.
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(in thousands, except per share and share data)
As of
March 31,December 31,
(unaudited) 20232022
ASSETS
Current assets:
Cash and cash equivalents (includes restricted cash of $3,871 and $368 at March 31, 2023
   and December 31, 2022, respectively)
$1,080,608 $993,564 
Accounts receivable, net of allowances641,584 663,236 
Prepaid income taxes33,487 36,654 
Prepaid and other assets54,888 54,520 
Total current assets1,810,567 1,747,974 
Property, equipment and leasehold improvements, net 58,839 53,853 
Right of use assets 125,596 126,584 
Goodwill2,231,037 2,229,670 
Intangible assets, net 551,012 558,517 
Equity method investment211,924 214,389 
Deferred tax assets28,857 29,207 
Other non-current assets40,868 37,341 
Total assets$5,058,700 $4,997,535 
LIABILITIES AND SHAREHOLDERS’ EQUITY (DEFICIT)
Current liabilities:
Accounts payable$10,746 $15,039 
Income taxes payable27,481 8,058 
Accrued compensation and related benefits75,553 182,370 
Current portion of long-term debt8,715 8,713 
Other accrued liabilities165,840 153,461 
Deferred revenue920,255 882,886 
Total current liabilities1,208,590 1,250,527 
Long-term debt4,502,176 4,503,233 
Long-term operating lease liabilities130,571 131,575 
Deferred tax liabilities27,433 29,098 
Other non-current liabilities91,294 91,027 
Total liabilities5,960,064 6,005,460 
Commitments and Contingencies (see Note 7)
Shareholders’ equity (deficit):
Preferred stock (par value $0.01, 100,000,000 shares authorized; no shares issued)
  
Common stock (par value $0.01; 750,000,000 common shares authorized; 133,804,962
   and 133,623,005 common shares issued and 80,063,044 and 79,959,989 common
   shares outstanding at March 31, 2023 and December 31, 2022, respectively)
1,338 1,336 
Treasury shares, at cost (53,741,918 and 53,663,016 common shares held at March 31, 2023 and December 31, 2022, respectively)
(5,982,106)(5,938,116)
Additional paid in capital1,536,906 1,515,874 
Retained earnings3,599,934 3,473,192 
Accumulated other comprehensive loss(57,436)(60,211)
Total shareholders’ equity (deficit)(901,364)(1,007,925)
Total liabilities and shareholders’ equity (deficit)$5,058,700 $4,997,535 
See Notes to Condensed Consolidated Financial Statements (Unaudited)
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Table of Contents
MSCI INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share data)
Three Months Ended
March 31,
(unaudited) 20232022
Operating revenues$592,218 $559,945 
Operating expenses:
Cost of revenues (exclusive of depreciation and amortization)108,647 102,771 
Selling and marketing66,475 66,053 
Research and development31,323 28,322 
General and administrative41,044 45,567 
Amortization of intangible assets24,667 21,720 
Depreciation and amortization of property, equipment and
   leasehold improvements
5,460 6,534 
Total operating expenses277,616 270,967 
Operating income314,602 288,978 
Interest income(10,362)(298)
Interest expense46,206 40,714 
Other expense (income)2,386 (381)
Other expense (income), net38,230 40,035 
Income before provision for income taxes276,372 248,943 
Provision for income taxes37,644 20,520 
Net income$238,728 $228,423 
Earnings per share:
Basic$2.98 $2.80 
Diluted$2.97 $2.78 
Weighted average shares outstanding:
Basic80,04181,591
Diluted80,48282,286
See Notes to Condensed Consolidated Financial Statements (Unaudited)
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Table of Contents
MSCI INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(in thousands)
Three Months Ended
March 31,
(unaudited) 20232022
Net income$238,728 $228,423 
Other comprehensive income (loss):
Foreign currency translation adjustments4,362 (2,950)
Income tax effect(1,108)862 
Foreign currency translation adjustments, net3,254 (2,088)
Pension and other post-retirement adjustments(513)110 
Income tax effect34 (44)
Pension and other post-retirement adjustments, net(479)66 
Other comprehensive (loss) income, net of tax2,775 (2,022)
Comprehensive income$241,503 $226,401 
See Notes to Condensed Consolidated Financial Statements (Unaudited)
6

Table of Contents
MSCI INC.
CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY (DEFICIT)
(in thousands)
(unaudited) Common
Stock
Treasury
Stock
Additional
Paid in
Capital
Retained
Earnings
Accumulated
Other
Comprehensive
Income (Loss)
Total
Balance at December 31, 2022
$1,336 $(5,938,116)$1,515,874 $3,473,192 $(60,211)$(1,007,925)
Net income238,728 238,728 
Dividends declared ($1.38 per common share)
(111,986)(111,986)
Dividends paid in shares44 44 
Other comprehensive income (loss), net of tax2,775 2,775 
Common stock issued2 2 
Shares withheld for tax withholding(43,960)(43,960)
Compensation payable in common stock20,988 20,988 
Common stock repurchased and held in treasury 
Common stock issued to Directors and
   (held in)/released from treasury
(30)(30)
Balance at March 31, 2023
$1,338 $(5,982,106)$1,536,906 $3,599,934 $(57,436)$(901,364)
Balance at December 31, 2021
$1,332 $(4,540,144)$1,457,623 $2,976,517 $(58,795)$(163,467)
Net income228,423 228,423 
Dividends declared ($1.04 per common share)
(87,280)(87,280)
Dividends paid in shares77 77 
Other comprehensive income (loss), net of tax(2,022)(2,022)
Common stock issued4 4 
Shares withheld for tax withholding(105,000)(105,000)
Compensation payable in common stock22,754 22,754 
Common stock repurchased and held in treasury(772,657)(772,657)
Common stock issued to Directors and
   (held in)/released from treasury
(21)(21)
Balance at March 31, 2022
$1,336 $(5,417,822)$1,480,454 $3,117,660 $(60,817)$(879,189)



See Notes to Condensed Consolidated Financial Statements (Unaudited)
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MSCI INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
Three Months Ended
March 31,
(unaudited) 20232022
Cash flows from operating activities
Net income$238,728 $228,423 
Adjustments to reconcile net income to net cash provided by operating activities:
Amortization of intangible assets24,667 21,720 
Stock-based compensation expense21,088 22,857 
Depreciation and amortization of property, equipment and leasehold improvements5,460 6,534 
Amortization of right of use assets5,782 6,292 
Amortization of debt origination fees1,264 1,403 
Deferred taxes(2,254)(12,961)
Other adjustments3,906 933 
Changes in assets and liabilities:
Accounts receivable22,489 70,417 
Prepaid income taxes3,396 (7,170)
Prepaid and other assets(1,194)3,062 
Other non-current assets(2,333)(5,005)
Accounts payable(6,327)(2,060)
Income taxes payable19,179 24,257 
Accrued compensation and related benefits(108,252)(135,148)
Other accrued liabilities8,305 15,161 
Deferred revenue34,427 10,932 
Long-term operating lease liabilities(5,047)(5,542)
Other non-current liabilities941 1,695 
Other(84)(1,616)
Net cash provided by operating activities264,141 244,184 
Cash flows from investing activities  
Capitalized software development costs(15,351)(14,084)
Capital expenditures(6,225)(1,254)
Other(186)28 
Net cash used in investing activities(21,762)(15,310)
Cash flows from financing activities
Payment of dividends(112,145)(87,769)
Repurchase of common stock held in treasury(43,960)(877,657)
Repayment of borrowings(2,188)(5,000)
Proceeds from borrowings, inclusive of premium 5,000 
Payment of debt issuance costs in connection with debt (559)
Payment of contingent consideration (132)
Net cash (used in) provided by financing activities(158,293)(966,117)
Effect of exchange rate changes2,958 (4,891)
Net (decrease) increase in cash, cash equivalents and restricted cash87,044 (742,134)
Cash, cash equivalents and restricted cash, beginning of period993,564 1,421,449 
Cash, cash equivalents and restricted cash, end of period$1,080,608 $679,315 
Supplemental disclosure of cash flow information:
Cash paid for interest$33,803 $27,776 
Cash paid for income taxes, net of refunds received$18,965 $17,645 
Supplemental disclosure of non-cash investing activities
Property, equipment and leasehold improvements in other accrued liabilities$5,156 $6,118 
Supplemental disclosure of non-cash financing activities
Cash dividends declared, but not yet paid$511 $2,361 
See Notes to Condensed Consolidated Financial Statements (Unaudited)
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MSCI INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
1. INTRODUCTION AND BASIS OF PRESENTATION
MSCI Inc., together with its wholly owned subsidiaries (the “Company” or “MSCI”) is a leading provider of critical decision support tools and solutions for the global investment community. Our mission-critical offerings help investors address the challenges of a transforming investment landscape and power better investment decisions. Leveraging our knowledge of the global investment process and our expertise in research, data and technology, we enable our clients to understand and analyze key drivers of risk and return and confidently and efficiently build more effective portfolios. Our products and services include indexes; portfolio construction and risk management tools; environmental, social and governance (“ESG”) and climate solutions; and real estate market and transaction data and analysis.
Basis of Presentation and Use of Estimates
The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they should be read in conjunction with the audited consolidated financial statements and notes included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022. If not materially different, certain note disclosures included therein have been omitted from these interim condensed consolidated financial statements.
In the opinion of management, all adjustments, which consist of normal recurring adjustments necessary for a fair statement of the interim consolidated financial statements, have been included. The results of operations for interim periods are not necessarily indicative of results for the entire year.
The Company’s unaudited condensed consolidated financial statements are prepared in accordance with GAAP. The Company makes certain estimates and judgments that can affect the reported amounts of assets and liabilities as of the date of the unaudited condensed consolidated financial statements, as well as the reported amounts of operating revenues and expenses during the periods presented. Significant estimates and judgments made by management include such examples as assessment of impairment of goodwill and intangible assets and income taxes. The Company believes that estimates used in the preparation of these unaudited condensed consolidated financial statements are reasonable; however, actual results could differ materially from these estimates. Inter-company balances and transactions are eliminated in consolidation.
Concentrations
For the three months ended March 31, 2023 and 2022, BlackRock, Inc. (“BlackRock”) accounted for 10.2% and 10.9% of the Company’s consolidated operating revenues, respectively. For the three months ended March 31, 2023 and 2022, BlackRock accounted for 17.4% and 18.0% of the Index segment’s operating revenues, respectively. No single customer represented 10.0% or more of operating revenues within the Analytics, ESG and Climate or All Other – Private Assets segments for the three months ended March 31, 2023 and 2022.
Restricted Cash
Restricted cash primarily relates to security deposits for certain operating leases that are legally restricted and unavailable for our general operations.
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Allowance for Credit Losses
Changes in the allowance for credit losses from December 31, 2021 to March 31, 2023 were as follows:
(in thousands) Amount
Balance as of December 31, 2021$2,337 
Addition (reduction) to credit loss expense910 
Write-offs, net of recoveries(595)
Balance as of December 31, 2022$2,652 
Addition (reduction) to credit loss expense320 
Write-offs, net of recoveries(191)
Balance as of March 31, 2023$2,781 
2. RECENT ACCOUNTING PRONOUNCEMENTS
There are no recently issued accounting standards updates that are currently expected to have a material impact on the Company.
3. REVENUE RECOGNITION
MSCI’s operating revenues are reported by product type, which generally reflects the timing of recognition. The Company’s operating revenue types are recurring subscriptions, asset-based fees and non-recurring revenues. The Company also disaggregates operating revenues by segment.
The tables that follow present the disaggregated operating revenues for the periods indicated:
For the Three Months Ended March 31, 2023
Segments
(in thousands)IndexAnalyticsESG and ClimateAll Other - Private AssetsTotal
Operating Revenue Types
Recurring subscriptions$196,678 $144,503 $65,732 $38,334 $445,247 
Asset-based fees133,126    133,126 
Non-recurring9,578 2,567 1,326 374 13,845 
Total$339,382 $147,070 $67,058 $38,708 $592,218 

For the Three Months Ended March 31, 2022
Segments
(in thousands)IndexAnalyticsESG and ClimateAll Other - Private AssetsTotal
Operating Revenue Types
Recurring subscriptions$174,498 $137,799 $50,572 $36,891 $399,760 
Asset-based fees145,053    145,053 
Non-recurring11,208 1,998 1,457 469 15,132 
Total$330,759 $139,797 $52,029 $37,360 $559,945 

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The tables that follow present the change in accounts receivable, net of allowances, and current deferred revenue between the dates indicated:
(in thousands) Accounts receivable, net of allowancesDeferred revenue
Opening (December 31, 2022)
$663,236 $882,886 
Closing (March 31, 2023)
641,584 920,255 
Increase/(decrease)$(21,652)$37,369 
(in thousands) Accounts receivable, net of allowancesDeferred revenue
Opening (December 31, 2021)
$664,511 $824,912 
Closing (March 31, 2022)
592,326 832,203 
Increase/(decrease)$(72,185)$7,291 
The amounts of revenues recognized in the periods that were included in the opening current deferred revenue, which reflects contract liability amounts, were $356.6 million and $339.7 million for the three months ended March 31, 2023 and 2022 respectively. The difference between the opening and closing balances of the Company’s deferred revenue was primarily driven by an increase in billings, partially offset by an increase in amortization of deferred revenue to operating revenues. As of March 31, 2023 and December 31, 2022, the Company carried a long-term deferred revenue balance of $30.0 million and $29.4 million, respectively, in “Other non-current liabilities” on the Unaudited Condensed Consolidated Statement of Financial Condition.
For contracts that have a duration of one year or less, the Company has not disclosed either the remaining performance obligation as of the end of the reporting period or when the Company expects to recognize the revenue. The remaining performance obligations for contracts that have a duration of greater than one year and the periods in which they are expected to be recognized are as follows:
As of
March 31,
(in thousands)2023
First 12-month period$673,206 
Second 12-month period408,154 
Third 12-month period188,184 
Periods thereafter126,279 
Total$1,395,823 
4. EARNINGS PER COMMON SHARE
Basic earnings per share (“EPS”) is computed by dividing net income by the weighted average number of common shares outstanding during the period. Diluted EPS reflects the assumed conversion of all dilutive securities, including, when applicable, restricted stock units (“RSUs”), performance stock units (“PSUs”) and performance stock options (“PSOs”).
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The following table presents the computation of basic and diluted EPS:
Three Months Ended
March 31,
(in thousands, except per share data)20232022
Net income$238,728 $228,423 
Basic weighted average common shares outstanding80,041 81,591 
Effect of dilutive securities:
PSUs, RSUs and PSOs441 695 
Diluted weighted average common shares outstanding80,482 82,286 
Earnings per common share:
Basic$2.98 $2.80 
Diluted$2.97 $2.78 
5. PROPERTY, EQUIPMENT AND LEASEHOLD IMPROVEMENTS, NET
Property, equipment and leasehold improvements, net consisted of the following as of the dates indicated:
As of
March 31,December 31,
(in thousands)20232022
Computer & related equipment$183,739 $181,710 
Furniture & fixtures14,429 14,078 
Leasehold improvements54,662 54,040 
Work-in-process9,409 2,373 
Subtotal262,239 252,201 
Accumulated depreciation and amortization(203,400)(198,348)
Property, equipment and leasehold improvements, net$58,839 $53,853 
Depreciation and amortization expense of property, equipment and leasehold improvements was $5.5 million and $6.5 million for the three months ended March 31, 2023 and 2022, respectively.
6. GOODWILL AND INTANGIBLE ASSETS, NET
Goodwill
The following table presents goodwill by reportable segment:
(in thousands)IndexAnalyticsESG and ClimateAll Other - Private AssetsTotal
Goodwill at December 31, 2022$1,201,622 $290,976 $48,047 $689,025 $2,229,670 
Foreign exchange translation adjustment846   521 1,367 
Goodwill at March 31, 2023$1,202,468 $290,976 $48,047 $689,546 $2,231,037 
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Intangible Assets, Net
The following table presents the amount of amortization expense related to intangible assets by category for the periods indicated:
Three Months Ended
March 31,
(in thousands)20232022
Amortization expense of acquired intangible assets$15,831 $15,898 
Amortization expense of internally developed capitalized software8,836 5,822 
Total amortization of intangible assets expense$24,667 $21,720 
The gross carrying and accumulated amortization amounts related to the Company’s intangible assets were as follows:
As of
March 31,December 31,
(in thousands)20232022
Gross intangible assets:
Customer relationships$532,500 $532,500 
Proprietary data220,778 220,778 
Acquired technology and software209,220 209,220 
Trademarks208,190 208,190 
Internally developed capitalized software182,400 165,928 
Subtotal1,353,088 1,336,616 
Foreign exchange translation adjustment(11,550)(13,214)
Total gross intangible assets$1,341,538 $1,323,402 
Accumulated amortization:
Customer relationships$(316,078)$(308,437)
Proprietary data(46,550)(41,783)
Acquired technology and software(180,862)(179,833)
Trademarks(164,438)(162,044)
Internally developed capitalized software(86,095)(77,259)
Subtotal(794,023)(769,356)
Foreign exchange translation adjustment3,497 4,471 
Total accumulated amortization$(790,526)$(764,885)
Net intangible assets:
Customer relationships$216,422 $224,063 
Proprietary data174,228 178,995 
Acquired technology and software28,358 29,387 
Trademarks43,752 46,146 
Internally developed capitalized software96,305 88,670 
Subtotal559,065 567,260 
Foreign exchange translation adjustment(8,053)(8,743)
Total net intangible assets$551,012 $558,517 
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The following table presents the estimated amortization expense for the remainder of the year ending December 31, 2023 and succeeding years:    
Years Ending December 31,
(in thousands)
Amortization
Expense
Remainder of 2023$78,701 
202497,591 
202572,243 
202639,846 
202736,275 
Thereafter226,356 
Total$551,012 
7. COMMITMENTS AND CONTINGENCIES
As of March 31, 2023, the Company had outstanding an aggregate of $4,200.0 million in senior unsecured notes (collectively, the “Senior Notes”) and an aggregate of $345.6 million in senior unsecured tranche A term loans (the “Tranche A Term Loans”) under the term loan A facility (the “TLA Facility”), as presented in the table below:
Principal
Amount
Outstanding at
Carrying
Value at
Carrying
Value at
Fair
Value at
Fair
Value at
(in thousands)Maturity DateMarch 31, 2023March 31, 2023December 31, 2022March 31, 2023December 31, 2022
Debt
4.000% senior unsecured notes due 2029
November 15, 2029
$1,000,000 $992,818 $992,546 $913,500 $876,240 
3.625% senior unsecured notes due 2030
September 1, 2030
900,000 895,091 894,925 783,216 751,113 
3.875% senior unsecured notes due 2031
February 15, 2031
1,000,000 991,340 991,067 891,050 833,130 
3.625% senior unsecured notes due 2031
November 1, 2031
600,000 594,359 594,195 514,356 500,880 
3.250% senior unsecured notes due 2033
August 15, 2033
700,000 693,030 692,862 576,072 542,696 
Variable rate Tranche A Term Loans due 2027
February 16, 2027
345,625 344,253 346,352 343,897 346,073 
Total debt(1)
$4,545,625 $4,510,891 $4,511,947 $4,022,091 $3,850,132 
___________________________
(1)    Includes $8.7 million of current-portion of long-term debt.
Maturities of the Company’s principal debt payments as of March 31, 2023 are as follows:
Maturity of Principal Debt Payments
(in thousands)
Amounts
Remainder of 2023$6,562 
202410,938 
202519,687 
202626,250 
2027282,188 
Thereafter4,200,000 
Total debt$4,545,625 
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Interest payments attributable to the Company’s outstanding indebtedness are due as presented in the following table:
Interest payment frequencyFirst interest
payment date
Senior Notes and Tranche A Term Loans
4.000% senior unsecured notes due 2029
Semi-AnnualMay 15
3.625% senior unsecured notes due 2030
Semi-AnnualMarch 1
3.875% senior unsecured notes due 2031
Semi-AnnualJune 1
3.625% senior unsecured notes due 2031
Semi-AnnualMay 1
3.250% senior unsecured notes due 2033
Semi-AnnualFebruary 15
Variable rate Tranche A Term Loans due 2027
VariableJuly 11
The fair market value of the Company’s debt obligations represent Level 2 valuations. The Company utilized the market approach and obtained security pricing from a vendor who used broker quotes and third-party pricing services to determine fair values.
Credit Agreement. Since November 20, 2014, the Company has maintained a revolving credit agreement with a syndicate of banks. On June 9, 2022, the Company, the guarantors party thereto and the lenders and agents party thereto, entered into an Amended and Restated Credit Agreement (the “Credit Agreement”), amending and restating in its entirety the Company’s prior revolving credit agreement (the “Prior Revolving Credit Agreement”). The Credit Agreement makes available to the Company an aggregate of $500.0 million of revolving loan commitments, which may be drawn until February 16, 2027, and the TLA Facility. At March 31, 2023, the revolving loan commitments were undrawn. As noted above, at March 31, 2023, the commitments under the TLA Facility were drawn in full, and the resulting Tranche A Term Loans mature on February 16, 2027. The obligations under the Credit Agreement are general unsecured obligations of the Company and the guarantors.
Interest on the Tranche A Term Loans under the TLA Facility accrues, at a variable rate, based on the secured overnight funding rate (“SOFR”) or the alternate base rate (“Base Rate”), plus, in each case, an applicable margin and will be due on each Interest Payment Date (as defined in the Credit Agreement). The applicable margin is calculated by reference to the Company’s Consolidated Leverage Ratio (as defined in the Credit Agreement) and ranges between 1.50% to 2.00% for SOFR loans, and 0.50% to 1.00% for Base Rate loans. At March 31, 2023, the interest rate on the TLA Facility was 6.84%.
In connection with the closings of the Senior Notes offerings, entry into the Prior Revolving Credit Agreement and the subsequent amendments thereto and entry into the Credit Agreement, the Company paid certain financing fees which, together with the existing fees related to prior credit facilities, are being amortized over their related lives. At March 31, 2023, $36.8 million of the deferred financing fees and premium remain unamortized, $0.5 million of which is included in “Prepaid and other assets,” $1.5 million of which is included in “Other non-current assets” and $34.8 million of which is included in “Long-term debt” on the Unaudited Condensed Consolidated Statement of Financial Condition.
8. LEASES
The Company recognized $7.1 million and $7.7 million of operating lease expenses for the three months ended March 31, 2023 and 2022, respectively. The amounts associated with variable lease costs, short-term lease costs and sublease income were not material for any of the three months ended March 31, 2023 and 2022.
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Maturities of the Company’s operating lease liabilities as of March 31, 2023 are as follows:
Maturity of Lease LiabilitiesOperating
(in thousands)Leases
Remainder of 2023$21,258 
202425,085 
202523,817 
202622,133 
202717,288 
Thereafter66,535 
Total lease payments$176,116 
Less: Interest(22,725)
Present value of lease liabilities$153,391 
Other accrued liabilities$22,820 
Long-term operating lease liabilities$130,571 
Weighted-average remaining lease term and discount rate for the Company’s operating leases are as follows:
As of
March 31,December 31,
Lease Term and Discount Rate20232022
Weighted-average remaining lease term (years)7.667.86
Weighted-average discount rate3.45 %3.40 %
Other information related to the Company’s operating leases are as follows:
Other InformationThree Months Ended
March 31,
(in thousands)20232022
Operating cash flows used for operating leases$7,408 $7,152 
Right of use assets obtained in exchange for new
    operating lease liabilities
$3,432 $ 
9. SHAREHOLDERS’ EQUITY (DEFICIT)
Return of capital
On July 28, 2022, the Board of Directors authorized a stock repurchase program (the “2022 Repurchase Program”) for the purchase of up to $1,000.0 million worth of shares of MSCI’s common stock in addition to the $539.1 million of authorization then remaining under a previously existing share repurchase program that was replaced by, and incorporated into, the 2022 Repurchase Program for a total of $1,539.1 million of stock repurchase authorization available under the 2022 Repurchase Program.
Share repurchases made pursuant to the 2022 Repurchase Program may take place in the open market or in privately negotiated transactions from time to time based on market and other conditions. This authorization may be modified, suspended or terminated by the Board of Directors at any time without prior notice. As of March 31, 2023, there was $1,304.4 million of available authorization remaining under the 2022 Repurchase Program.
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The following table provides information with respect to repurchases of the Company’s common stock made on the open market:
Three Months Ended
(in thousands, except per share data)
Average
Price
Paid Per
Share
Total
Number of
Shares
Repurchased
Dollar
Value of
Shares
Repurchased
March 31, 2023$  $ 
March 31, 2022$515.74 1,498 $772,657 
The following table presents dividends declared per common share as well as total amounts declared, distributed and deferred for the periods indicated:
Dividends

(in thousands, except per share data)
Per ShareDeclaredDistributed(Released)/Deferred
Three Months Ended March 31, 2023$1.38 $111,986 $112,189 $(203)
Three Months Ended March 31, 2022$1.04 $87,280 $87,846 $(566)
Common Stock.
The following table presents activity related to shares of common stock issued and repurchased during the three months ended March 31, 2023:
Common StockTreasury Common Stock
IssuedStockOutstanding
Balance at December 31, 2022
133,623,005(53,663,016)79,959,989
Dividend payable/paid2424
Common stock issued181,875181,875
Shares withheld for tax withholding (78,844)(78,844)
Shares repurchased under stock repurchase programs
Shares issued to directors58(58)
Balance at March 31, 2023
133,804,962(53,741,918)80,063,044
10. INCOME TAXES
The Company’s provision for income taxes was $37.6 million and $20.5 million for the three months ended March 31, 2023 and 2022, respectively.
The effective tax rate of 13.6% for the three months ended March 31, 2023 reflects the Company’s estimate of the effective tax rate for the period and was impacted by certain favorable discrete items totaling $16.5 million, primarily related to $11.1 million of excess tax benefits recognized on share-based compensation vested during the period and $4.6 million of tax benefits related to the resolution of prior year items.
The effective tax rate of 8.2% for the three months ended March 31, 2022 reflects the Company’s estimate of the effective tax rate for the period and was impacted by certain favorable discrete items totaling $28.1 million, primarily related to $28.3 million of excess tax benefits recognized on share-based compensation vested during the period.
The Company is under or open to examination by the IRS and other tax authorities in certain jurisdictions, including foreign jurisdictions, such as the United Kingdom, Switzerland and India, and states in the United States in which the Company has significant operations, such as New York and California. The tax years currently under or open to examination vary by jurisdiction but include years from 2008 onwards.
The Company regularly assesses the likelihood of additional assessments in each of the taxing jurisdictions in which it files income tax returns. The Company has established unrecognized tax benefits that the Company believes are adequate in relation to the potential for additional assessments. Once established, the Company adjusts unrecognized tax benefits only when more information is
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available or when an event occurs necessitating a change. Based on the current status of income tax audits, the Company believes it is reasonably possible that the total amount of unrecognized benefits may decrease by approximately $24.0 million in the next twelve months as a result of the resolution of prior year items.
During the three months ended March 31, 2023, the Company's unrecognized tax benefits decreased by $3.8 million principally due to the resolution of prior year items.
11. SEGMENT INFORMATION
The Company has five operating segments: Index, Analytics, ESG and Climate, Real Assets and The Burgiss Group, LLC (“Burgiss”), which are presented as the following four reportable segments: Index, Analytics, ESG and Climate and All Other – Private Assets.
The Index operating segment offers equity and fixed income indexes. The indexes are used in many areas of the investment process, including for developing indexed financial products (e.g., Exchange Traded Funds (“ETFs”), mutual funds, annuities, futures, options, structured products and over-the-counter derivatives), performance benchmarking, portfolio construction and rebalancing, and asset allocation.
The Analytics operating segment offers risk management, performance attribution and portfolio management content, applications and services that provide clients with an integrated view of risk and return and tools for analyzing market, credit, liquidity, counterparty and climate risk across all major asset classes, spanning short-, medium- and long-term time horizons. Clients access Analytics tools and content through MSCI’s proprietary applications and application programming interfaces, third-party applications or directly through their own platforms. Additionally, the Analytics operating segment also provides various managed services to help clients operate more efficiently, including consolidation of client portfolio data from various sources, review and reconciliation of input data and results, and customized reporting.
The ESG and Climate operating segment offers products and services that help institutional investors understand how ESG and climate considerations can impact the long-term risk and return of their portfolio and individual security-level investments. In addition, the ESG and Climate operating segment provides data, ratings, research and tools to help investors navigate increasing regulation, meet new client demands and better integrate ESG and climate elements into their investment processes.
The Real Assets operating segment offers data, benchmarks, return-analytics, climate assessments and market insights for tangible assets such as real estate and infrastructure. In addition, Real Assets performance and risk analytics range from enterprise-wide to property-specific analysis. The Real Assets operating segment also provides business intelligence products to real estate owners, managers, developers and brokers worldwide.
The Burgiss operating segment represents the Company’s equity method investment in Burgiss, a global provider of investment decision support tools for private capital.
The Chief Operating Decision Maker (“CODM”) measures and evaluates reportable segments based on segment operating revenues as well as Adjusted EBITDA and other measures. The Company excludes the following items from segment Adjusted EBITDA: provision for income taxes, other expense (income), net, depreciation and amortization of property, equipment and leasehold improvements, amortization of intangible assets and, at times, certain other transactions or adjustments, including certain non-recurring acquisition-related integration and transaction costs, that the CODM does not consider for the purposes of making decisions to allocate resources among segments or to assess segment performance. Although these amounts are excluded from segment Adjusted EBITDA, they are included in reported consolidated net income and are included in the reconciliation that follows.
The following table presents operating revenues by reportable segment for the periods indicated:
Three Months Ended
March 31,
(in thousands)20232022
Operating revenues
Index$339,382 $330,759 
Analytics147,070 139,797 
ESG and Climate67,058 52,029 
All Other - Private Assets38,708 37,360 
Total$592,218 $559,945 
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The following table presents segment profitability and a reconciliation to net income for the periods indicated:
Three Months Ended
March 31,
(in thousands)20232022
Index Adjusted EBITDA$253,682 $245,875 
Analytics Adjusted EBITDA60,780 50,889 
ESG and Climate Adjusted EBITDA17,876 12,092 
All Other - Private Assets Adjusted EBITDA12,391 9,688 
Total operating segment profitability344,729 318,544 
Amortization of intangible assets24,667 21,720 
Depreciation and amortization of property, equipment and leasehold improvements5,460 6,534 
Acquisition-related integration and transaction costs(1)
 1,312 
Operating income314,602 288,978 
Other expense (income), net38,230 40,035 
Provision for income taxes