SPGI Q2 Earnings Call Highlights AI Growth and Buybacks

SPGI Sharpens Post-Spin Strategy

SPGI reported adjusted EPS of $4.83, above the Zacks Consensus Estimate of $4.49, while revenue reached $3.68 billion on a pro forma basis versus the $3.65 billion estimate. Adjusted EPS increased 23% year over year, supported by stronger profitability.

CEO Martina Cheung said the company’s quarter after completing the Mobility spin-off demonstrated the strength of its benchmark businesses. She highlighted 11% revenue growth and 200 basis points of adjusted margin expansion during the second quarter.

Management emphasized that benchmark operations now represent nearly two-thirds of revenue and more than 80% of operating profits, reinforcing the company’s focus on scalable, high-margin businesses.

S&P Global Expands AI Monetization

S&P Global highlighted continued adoption of its AI offerings, including Kensho LLM-ready APIs and MCP-connected solutions. Management said the number of customers using these solutions surpassed 500, increasing more than 70% quarter over quarter.

Cheung said customers using AI solutions are growing faster than average within Market Intelligence and Energy. She noted API usage increased significantly, with second-quarter LLM-ready API call volume more than five times the prior quarter.

CFO Eric Aboaf said AI monetization efforts include consumption pricing and additional data set pricing as customer usage expands. Management also noted internal AI and productivity initiatives are targeting $100 million in annualized cost savings.

SPGI Sees Strength in Ratings and Indices

SPGI’s Ratings division delivered record quarterly revenue, with revenue rising 17% year over year. Management pointed to stronger issuance activity, including investment-grade issuance tied to technology infrastructure, data centers and mergers and acquisitions.

The company said billed issuance increased 25% year over year in the quarter, while updated expectations call for mid- to high-single-digit growth in billed issuance for the full year.

Indices also posted record results, with revenue increasing 20% year over year. Management cited strong asset-linked fees, exchange-traded derivatives activity and continued inflows tied to S&P Dow Jones Indices products.

S&P Global Addresses Energy Headwinds

S&P Global said Energy revenue growth faced near-term pressure from geopolitical volatility, including the Iran conflict, which affected contract renewals and customer activity. Management maintained that these pressures are cyclical while long-term demand drivers remain intact.

Energy revenue increased 2% in the quarter on a reported basis, with Platts benefiting from demand for price assessments while some trading-related activity remained challenged.

Cheung also highlighted investments in data center and energy transition opportunities, including the acquisition of datacenterHawk to expand capabilities tied to AI infrastructure demand.

SPGI Restructures Market Intelligence

SPGI is reorganizing Market Intelligence around Kensho Data & Platforms and Enterprise Solutions. Management said the changes are designed to simplify operations, improve profitability and better align products with customer needs.

Market Intelligence revenue grew 6% in the quarter, supported by AI solutions, data feeds and strategic products.

Management said some mature platforms will receive greater productivity focus while higher-growth offerings receive additional investment.

During Q&A, a Barclays analyst asked about the strategic changes in Market Intelligence and Energy. Cheung responded that the company was simplifying execution rather than changing strategy, with greater focus on customer alignment.

S&P Global Maintains Outlook Focus

S&P Global raised its 2026 share repurchase target to more than $7 billion, with management expecting buybacks to represent more than 5% of current market capitalization. The company plans to use proceeds from the Mobility spin-off and additional debt capacity to support returns.

Management expects 2026 organic constant currency revenue growth of 6% to 8% and adjusted EPS of $17.50 to $17.75. It also expects adjusted operating margin expansion excluding OSTTRA of 75 to 100 basis points.

Cheung’s overall message centered on executing the company’s simplified structure, expanding AI capabilities and investing in benchmark businesses while improving efficiency.

Zacks Signals

SPGI carries a Zacks Rank #5 (Strong Sell), indicating the stock currently has the weakest ranking in the Zacks Rank system based on earnings estimate revisions. The Zacks Rank can change after newly released results as analysts update their earnings expectations.You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The stock has a Value Score of F, Growth Score of C, Momentum Score of D and VGM Score of F. Zacks Style Scores range from A to F, with stronger scores reflecting more favorable characteristics for the related investment style.

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